The Supreme Court will hear if arbitral tribunals in India can go beyond institutional arbitration rules agreed by parties, citing equity and “interest of justice.” The case comes from a dispute between Aneja Constructions and Doosan Power Systems.
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NEW DELHI: The Supreme Court of India is soon going to decide on a very important question in arbitration law—whether an arbitral tribunal sitting in India can ignore the institutional arbitration rules chosen by the parties themselves, only on the ground of equity and “interest of justice.”
This matter has reached the country’s top court after a petition by Aneja Constructions India, which has challenged an order of the Delhi High Court.
The High Court had supported a tribunal’s decision to excuse an 84-day delay made by Doosan Power Systems India in filing its statement of defence and counterclaim, even though the Indian Council of Arbitration (ICA) Rules have clear time limits.
At the heart of this case lies the principle of party autonomy—the basic idea that when two parties agree on rules for arbitration, those rules must be followed strictly. Aneja Constructions has argued that this principle has been ignored both by the arbitral tribunal and the Delhi High Court.
The background of the dispute is as follows: On December 27, 2017, Aneja Constructions signed a sub-contract agreement with Doosan Power Systems. Both parties agreed that any disputes would be resolved through arbitration under the Indian Council of Arbitration (ICA) Rules.
Problems started when Doosan failed to file its statement of defence within the mandatory 60-day period mentioned under Rule 18(a) of the ICA Rules. Instead, Doosan submitted its defence 84 days late, far beyond the allowed time limit.
On July 11, 2025, a three-member arbitral tribunal chaired by Justice (retd) Vikramajit Sen decided to forgive the 84-day delay and accept the late filing. The tribunal stated that it “retains the power to extend the timelines in the interest of justice” even though Rule 18(a) clearly says “not exceeding thirty days.”
Interestingly, the tribunal itself admitted that words like “not exceeding thirty days” are “peremptorily limiting words” but at the same time strangely concluded that the ICA Rules “do not use these peremptorily limiting words.” This reasoning appears to directly go against the plain language of Rule 18(a).
Aneja Constructions then challenged the arbitral tribunal’s order before the Delhi High Court under Article 227 of the Constitution.
However, on August 6, 2025, Justice Manoj Jain dismissed the petition and observed that “the Rules are meant to guide and not bind” and that arbitral tribunals have enough powers to excuse delays “in interest of justice,” no matter what the rules say.
Now, in its appeal before the Supreme Court, Aneja Constructions has argued that both the tribunal and the High Court failed to follow Section 2(8) of the Arbitration and Conciliation Act, 1996. This section makes it clear that when parties agree to use institutional rules, those rules automatically become part of the arbitration agreement.
The company has argued that by allowing a delay much beyond the 60-day limit, the tribunal has effectively “re-wrote the contract” agreed between the parties and weakened the main reason for choosing institutional arbitration.
The petition also emphasizes that party autonomy is the foundation of arbitration and that no tribunal has the right to go beyond procedures agreed by both parties.
Aneja has further cited the Constitution Bench ruling in New India Assurance Co. v. Hilli Multipurpose Cold Storage, where the Supreme Court had ruled that the words “not exceeding” in a statute act as a strict limit and cannot be crossed. According to Aneja, the same interpretation should apply to Rule 18(a).
The company has warned that if the Delhi High Court ruling is not overturned, arbitral tribunals all over India may start ignoring institutional arbitration rules in the name of equity, which would seriously damage trust in institutional arbitration.
- The Special Leave Petition (SLP) before the Supreme Court has been filed through Advocate-on-Record Garima Bajaj.
- Aneja Constructions is being represented by Advocates Sidhant Goel, Mohit Goel, Aditya Maheshwari and Ishaan Pratap Singh from the law firm Sim & San.
Table explaining all the laws, rules, and sections mentioned in the case
| Law / Rule / Section | Provision / Meaning | Relevance in This Case |
|---|---|---|
| Arbitration and Conciliation Act, 1996 (ACA) | This is India’s main law governing arbitration, conciliation, and related matters. It is largely based on the UNCITRAL Model Law on Arbitration. | The Act provides the framework for both ad-hoc and institutional arbitration in India. The case involves whether tribunals can bypass rules agreed under this Act. |
| Section 2(8) of the Arbitration and Conciliation Act, 1996 | States that if parties agree to use rules of any arbitral institution (like ICA), those rules automatically become part of the arbitration agreement. | Aneja Constructions argued that ICA Rules became binding once both parties agreed, so the tribunal and High Court could not ignore them. |
| Indian Council of Arbitration (ICA) Rules | Institutional rules framed by ICA to govern arbitration conducted under its umbrella. They set timelines, procedures, and responsibilities of parties and tribunal. | The parties had agreed to ICA Rules. Rule 18(a) fixed a strict time limit for filing defence. |
| Rule 18(a) of ICA Rules | Requires respondent to file statement of defence within 60 days, with extension possible but “not exceeding thirty days.” | Doosan filed its defence 84 days late. Tribunal still allowed it, which Aneja claims violated this strict rule. |
| Article 227 of the Constitution of India | Gives High Courts power of superintendence over all lower courts and tribunals in their jurisdiction. | Aneja approached the Delhi High Court under this Article to challenge the tribunal’s order, but the High Court dismissed the plea. |
| New India Assurance Co. v. Hilli Multipurpose Cold Storage (Supreme Court, Constitution Bench) | In this case, SC interpreted the words “not exceeding” in a statute as a hard limit that cannot be extended beyond. | Aneja cited this precedent to argue that Rule 18(a)’s words “not exceeding thirty days” should also be treated as an absolute cap. |
CASE TITLE:
Aneja Constructions vs Doosan Power
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