The award is the destination of every arbitration. Sections 28 to 33 of the Arbitration and Conciliation Act, 1996 form the heart of Chapter VI, governing the rules a tribunal must apply to the substance of a dispute, how a multi-member panel decides, the strict timelines within which the award must be delivered, the formal requirements that make a writing an enforceable award, the tribunal's power to award interest and costs, and the limited post-award powers of correction, interpretation and additional award. Mastering this cluster is essential because Section 34 challenges almost always trace back to a defect in how the award was made. This note walks through each provision with the controlling case law and connects it to the rest of the Arbitration and Conciliation Act notes.
The Scheme of Chapter VI: From Reference to Award
Chapter VI of the 1996 Act, captioned "Making of arbitral award and termination of proceedings", spans Sections 28 to 33 and is the legislative engine room of the arbitral process. By the time a tribunal reaches this stage, the threshold questions of a valid arbitration agreement, the constitution of the tribunal and its jurisdiction have already been settled. What remains is the decision itself and the instrument that records it.
The architecture is deliberate. Section 28 tells the tribunal which body of law to apply to the merits; Section 29 tells a panel how to reach a collective decision; Section 29A imposes a statutory clock; Section 29B offers an accelerated route; Section 30 channels settlement into an award; Section 31 prescribes the form, contents, interest and costs; Section 32 governs termination; and Section 33 confers narrow post-award powers. Read together, they balance two competing values the Act constantly negotiates: party autonomy on the one hand and finality with minimal court interference on the other. The award produced under these sections is what a party will ultimately seek to enforce, or to set aside under Section 34, making the integrity of the award-making process the fulcrum of the entire statute.
Section 28: Rules Applicable to the Substance of the Dispute
Section 28 separates domestic arbitration from international commercial arbitration. In a purely domestic arbitration, where the place of arbitration is in India and the dispute is not international commercial in character, Section 28(1)(a) commands the tribunal to decide "in accordance with the substantive law for the time being in force in India". The tribunal has no freedom to apply a foreign law to the merits; the parties cannot contract out of Indian substantive law in a domestic reference.
For international commercial arbitration seated in India, Section 28(1)(b) embraces party autonomy. The tribunal decides according to the rules of law designated by the parties as applicable to the substance of the dispute. A designation of the law of a country is taken to refer to that country's substantive law and not to its conflict-of-laws rules, ruling out renvoi. Where the parties make no designation, the tribunal applies the rules of law it considers appropriate given all the circumstances, determined through the conflict-of-laws rules it considers applicable.
Two universal mandates apply across both categories. Under Section 28(3), the tribunal must decide in accordance with the terms of the contract and must take into account the usages of the trade applicable to the transaction. The Supreme Court in Associate Builders v. Delhi Development Authority, (2015) 3 SCC 49, underscored that a construction of the contract which no fair-minded or reasonable person could take is impermissible, but mere reinterpretation of contractual terms by a court is not. Finally, only where the parties have expressly authorised it may the tribunal decide ex aequo et bono or as amiable compositeur, that is, according to what it considers fair and equitable rather than strict law.
Section 29: Decision-Making by a Panel of Arbitrators
Where a tribunal comprises more than one arbitrator, Section 29(1) provides that, unless otherwise agreed by the parties, any decision is made by a majority of all the members. The majority principle is the default rule and reflects the collegiate nature of a three-member tribunal: the award rests on the collective vote rather than the view of any single arbitrator, which guards against domination by one member.
Section 29(2) creates a narrow exception. If the parties or all the members of the tribunal so authorise, questions of procedure may be decided by the presiding arbitrator alone. This carve-out is confined to procedural questions and does not extend to the substantive decision or the final award, which must still command a majority. The provision dovetails with the definition of the arbitral tribunal as a sole arbitrator or a panel, and with the requirement under Section 31(1) that the award be signed by the members of the tribunal. Where the signatures of a majority are present and the reason for any omitted signature is stated, the award remains valid under Section 31(2).
Section 29A: The Statutory Clock on the Award
Section 29A, inserted by the Arbitration and Conciliation (Amendment) Act, 2015 and later refined by the 2019 amendment, is the Act's principal answer to dilatory arbitrations. For arbitrations other than international commercial arbitration, the award must be made within twelve months from the date the tribunal completes pleadings under Section 23(4), the point at which it "enters upon the reference". For international commercial arbitration, the 2019 amendment replaced the rigid limit with an endeavour to conclude within twelve months.
The parties may, by consent, extend the twelve-month period by a further period not exceeding six months under Section 29A(3). If the award is still not made within this aggregate of eighteen months, the mandate of the arbitrator or arbitrators terminates unless the court extends the period under Section 29A(4), either before or after the expiry of the period. The court may grant an extension only for sufficient cause and on such terms as it imposes. While extending, the court may order a reduction of the arbitrator's fees by up to five per cent for each month of delay where the delay is attributable to the tribunal, and may substitute one or all of the arbitrators, in which event the proceedings continue from the stage already reached on the existing record.
On the temporal reach of the 2015 amendments, the Supreme Court in Board of Control for Cricket in India v. Kochi Cricket Pvt. Ltd., (2018) 6 SCC 287, held that the amendments apply prospectively to arbitral proceedings commenced on or after 23 October 2015, while the amendment to Section 36 dealing with the enforcement of awards applies even to court proceedings filed before that date. The decision is the leading authority on the prospective operation of Section 29A and the related timeline provisions.
Section 29B: The Fast-Track Procedure
Section 29B, also a 2015 introduction, offers parties an expedited path. It is an opt-in mechanism: the parties may agree, before or at the time of appointing the tribunal, that the dispute be resolved by a fast-track procedure. The hallmark of the procedure is that the tribunal decides on the basis of written pleadings, documents and submissions, with no oral hearing unless all the parties request one or the tribunal considers it necessary for clarifying certain issues. The tribunal may call for further information or clarification from the parties beyond the pleadings.
The defining advantage is speed. Under Section 29B(4), the award in a fast-track arbitration must be made within six months from the date the tribunal enters upon the reference. Where the dispute is decided within this shorter window, the twelve-month and extension framework of Section 29A is correspondingly compressed. The fast-track route is particularly suited to documentary disputes of modest complexity, complementing the broader efficiency objectives that run through the scheme of the Act.
Section 30: Settlement and the Award on Agreed Terms
Section 30 reflects the conciliatory ethos of the Act by permitting the tribunal, with the agreement of the parties, to use mediation, conciliation or other procedures to encourage settlement at any stage of the proceedings. Importantly, the use of such procedures by the tribunal does not by itself disqualify it from continuing as the arbitral tribunal if settlement fails.
Where the parties do settle, the tribunal terminates the proceedings and, if the parties so request and the tribunal does not object, records the settlement in the form of an arbitral award on agreed terms. Section 30(3) provides that such an award is made in accordance with Section 31 and is to be stated to be an arbitral award. Crucially, Section 30(4) gives it the same status and effect as any other arbitral award on the substance of the dispute. The consent award is therefore enforceable as a decree and may be the basis of execution, distinguishing it from a private compromise. Because it embodies the parties' agreement, the requirement to state reasons under Section 31(3) is dispensed with for an award on agreed terms.
Section 31: Form and Contents of the Arbitral Award
Section 31 is the formal charter of the award and a frequent battleground in Section 34 challenges. Four requirements stand out. First, under Section 31(1) the award must be in writing and signed by the members of the tribunal; Section 31(2) permits a multi-member award to bear the signatures of a majority provided the reason for any omitted signature is stated. Second, Section 31(3) requires the award to state the reasons upon which it is based, unless the parties have agreed that no reasons are to be given or the award is one on agreed terms under Section 30. The reasoned-award requirement is mandatory and a wholly unreasoned award invites challenge.
Third, Section 31(4) requires the award to state its date and the place of arbitration as determined under Section 20, and the award is deemed to have been made at that place; this anchors the seat for the purposes of supervisory jurisdiction. Fourth, after the award is made, Section 31(5) requires a signed copy to be delivered to each party, and the period of limitation for a Section 34 application runs from the date of receipt of that signed copy. The tribunal may also make an interim arbitral award under Section 31(6) on any matter on which it can make a final award. In Indian Farmers Fertiliser Cooperative Ltd. (IFFCO) v. Bhadra Products, (2018) 2 SCC 534, the Supreme Court held that an award deciding the issue of limitation is an interim award liable to be challenged independently under Section 34, and confirmed that the power to make an interim award under Section 31(6) is advisedly wide and left to the good sense of the tribunal.
Interest on the Award under Section 31(7)
Section 31(7) confers a broad discretionary power to award interest on monetary claims. Under Section 31(7)(a), unless otherwise agreed by the parties, the tribunal may include in the sum for which the award is made interest, at such rate as it deems reasonable, on the whole or any part of the money, for the whole or any part of the period between the date on which the cause of action arose and the date of the award. This captures pre-reference and pendente lite interest.
The foundational authority is the Constitution Bench decision in Secretary, Irrigation Department, Government of Orissa v. G.C. Roy, (1992) 1 SCC 508, which held that an arbitrator to whom a dispute is referred has the power to award interest pendente lite where the contract is silent on the point, overruling the contrary view in Executive Engineer (Irrigation), Galimala v. Abaaduta Jena. The award of pendente lite interest is a matter of the arbitrator's discretion to be exercised on the facts and circumstances of the case. On post-award interest, Section 31(7)(b), as amended in 2015, provides that unless the award otherwise directs, the awarded sum carries interest at a rate two per cent higher than the prevailing rate of interest on the date of the award, from the date of the award to the date of payment. Section 31A, also inserted in 2015, separately codifies the regime for costs.
Section 32: Termination of Proceedings
Section 32 governs how an arbitration ends. Under Section 32(1), the proceedings are terminated by the final arbitral award. Section 32(2) lists three situations in which the tribunal issues an order for termination short of a final award: where the claimant withdraws the claim, unless the respondent objects and the tribunal recognises a legitimate interest on its part in obtaining a final settlement of the dispute; where the parties agree on termination; and where the tribunal finds that the continuation of the proceedings has for any other reason become unnecessary or impossible. Under Section 32(3), the mandate of the tribunal terminates with the termination of the proceedings, subject to the limited survival of powers under Sections 33 and 34(4).
The finality of a termination order was settled in SREI Infrastructure Finance Ltd. v. Tuff Drilling Pvt. Ltd., (2018) 11 SCC 470, and reinforced in M/s Sai Babu v. M/s Clariya Steels Pvt. Ltd., (2019) 4 SCC 657, where the Supreme Court observed that an order terminating the proceedings under Section 32(2)(c) cannot be recalled, because the mandate of the tribunal stands terminated under Section 32(3) once such an order is passed. The decision draws a firm line between a default-based termination, which the tribunal may revive in appropriate circumstances, and a Section 32(2)(c) termination, which it cannot. This connects to the broader question of when a party is deemed to have abandoned its claim, a theme that also informs waiver of the right to object under Section 4.
Section 33: Correction, Interpretation and Additional Award
Section 33 confers the only powers a tribunal retains over its award after delivery, and they are deliberately narrow so as not to disturb finality. Under Section 33(1)(a), within thirty days of receipt of the award, a party may, with notice to the other party, request the tribunal to correct any computation errors, clerical or typographical errors, or any other errors of a similar nature. Under Section 33(1)(b), where the parties agree, a party may request the tribunal to give an interpretation of a specific point or part of the award; such an interpretation, once given, forms part of the award. The tribunal may also correct any error of the kind in clause (a) on its own initiative within thirty days of the date of the award under Section 33(3).
Section 33(4) deals with the additional award. Unless otherwise agreed, a party may, within thirty days of receipt of the award and with notice to the other, request the tribunal to make an additional award on claims that were presented during the proceedings but were omitted from the award. If the tribunal considers the request justified, it must make the additional award within sixty days under Section 33(5), a period it may extend under Section 33(6). The distinction between a correction, which fixes an accidental slip, and an additional award, which addresses a substantive omission, is examination-critical. None of these powers permits the tribunal to review the merits of its decision; that function belongs only to a court under Section 34.
Section 34, Public Policy and the Made Award
The award made under Sections 28 to 33 is final, but Section 34 allows a narrow recourse to set it aside. The grounds include incapacity of a party, invalidity of the arbitration agreement, lack of proper notice of the appointment of an arbitrator or of the proceedings, the award dealing with matters beyond the scope of the submission, improper composition of the tribunal, and conflict with the public policy of India. The defects that most often ground a challenge are failures in the award-making process itself: an unreasoned award offending Section 31(3), or a decision in disregard of the contract contrary to Section 28(3).
The meaning of public policy has been judicially contested. In Renusagar Power Co. Ltd. v. General Electric Co., 1994 Supp (1) SCC 644, the Supreme Court, in the context of enforcing a foreign award, confined public policy to the fundamental policy of Indian law, the interests of India, and justice or morality. In Oil & Natural Gas Corporation Ltd. v. Saw Pipes Ltd., (2003) 5 SCC 705, the Court expanded the domestic standard to include "patent illegality", so that an award contrary to the substantive law, the provisions of the Act, or the terms of the contract could be set aside. The expansion was criticised for inviting excessive judicial intervention. Associate Builders v. Delhi Development Authority, (2015) 3 SCC 49, systematised these heads, and the 2015 amendment then codified the narrowed test, expressly excluding a mere erroneous application of law or reappreciation of evidence and confining patent illegality to domestic awards under Section 34(2A).
Public Policy and Foreign Awards: The Narrowing Trend
For foreign awards, the trajectory has been towards a pro-enforcement bias. In Shri Lal Mahal Ltd. v. Progetto Grano Spa, (2014) 2 SCC 433, the Supreme Court overruled the wide reading of public policy that had crept in under Phulchand Exports Ltd. v. O.O.O. Patriot, holding that the ground of patent illegality has no application to the enforcement of a foreign award under Section 48 and that public policy there bears the narrower Renusagar meaning. The decision restored the distinction between the standard for setting aside a domestic award and the more deferential standard for refusing enforcement of a foreign award.
This narrowing matters for the award made under Sections 28 to 33 because it signals that a properly reasoned award, decided in accordance with the contract and the applicable law, enjoys strong protection from judicial second-guessing. The tribunal's compliance with Section 28(3) and Section 31(3) is therefore not a mere formality; it is the surest insulation against a later challenge. The interplay between the award-making provisions and the recourse provisions confirms that finality is the rule and intervention the exception, a theme introduced at the very start of these arbitration notes.
Exam Strategy: Mapping Sections 28 to 33
For judiciary and CLAT-PG candidates, the cluster rewards precise section memory. Anchor Section 28 to the domestic-versus-international distinction and the bar on ex aequo et bono without express authority; Section 29 to majority decision-making and the procedural carve-out for the presiding arbitrator; Section 29A to the twelve-plus-six month framework and BCCI v. Kochi Cricket on prospectivity; and Section 29B to the six-month fast-track and the no-oral-hearing default. Tie Section 30 to the consent award's decree-like status, Section 31 to the writing-signature-reasons-date-place quartet and IFFCO v. Bhadra Products on interim awards, Section 31(7) to G.C. Roy on pendente lite interest, Section 32 to Sai Babu v. Clariya Steels on the non-recallable termination, and Section 33 to the thirty-sixty day correction and additional-award timeline.
A common trap is confusing the powers under Section 33 with a power of review; the tribunal cannot reconsider the merits. Another is forgetting that limitation for a Section 34 challenge runs from receipt of the signed copy under Section 31(5), not from the date the award is signed. Candidates should also be able to state the public-policy trilogy of Renusagar, Saw Pipes and Shri Lal Mahal in chronological sequence, noting how the 2015 amendment codified the narrowed standard. For the foundational vocabulary underpinning all of this, revisit the definitions of arbitration, arbitral tribunal and court.
Frequently asked questions
What is the time limit for making an arbitral award under Section 29A?
For arbitrations other than international commercial arbitration, the award must be made within twelve months from the date the tribunal completes pleadings and enters upon the reference. The parties may extend this by mutual consent by up to a further six months, making eighteen months in all. Beyond that the arbitrator's mandate terminates unless the court extends the period for sufficient cause under Section 29A(4). In BCCI v. Kochi Cricket Pvt. Ltd., (2018) 6 SCC 287, the Supreme Court held that Section 29A applies prospectively to arbitrations commenced on or after 23 October 2015.
Must an arbitral award always state reasons?
Yes, as a default. Section 31(3) requires the award to state the reasons upon which it is based. There are two exceptions: where the parties have agreed that no reasons need be given, and where the award is one on agreed terms recorded under Section 30. An unreasoned award made outside these exceptions is vulnerable to being set aside under Section 34.
Can a tribunal award interest on the sum it awards?
Yes. Under Section 31(7)(a), unless the parties agree otherwise, the tribunal may award interest at a reasonable rate for the period between the cause of action arising and the date of the award, covering pre-reference and pendente lite interest. The Constitution Bench in Secretary, Irrigation Department, Government of Orissa v. G.C. Roy, (1992) 1 SCC 508, confirmed that an arbitrator may award pendente lite interest where the contract is silent, as a matter of discretion. Section 31(7)(b) governs post-award interest, set by default at two per cent above the current rate.
Can an arbitral tribunal recall an order terminating the proceedings?
Not where the termination is under Section 32(2)(c). In M/s Sai Babu v. M/s Clariya Steels Pvt. Ltd., (2019) 4 SCC 657, the Supreme Court held that once proceedings are terminated under Section 32(2)(c) on the ground that continuation has become unnecessary or impossible, the order cannot be recalled, because the tribunal's mandate terminates under Section 32(3). This is distinct from a default-based termination, which may be revived in appropriate circumstances as recognised in SREI Infrastructure Finance Ltd. v. Tuff Drilling Pvt. Ltd.
What is the difference between correction and an additional award under Section 33?
A correction under Section 33(1)(a) fixes accidental slips such as computation, clerical or typographical errors, and may be made on a party's request within thirty days or by the tribunal on its own initiative. An additional award under Section 33(4) addresses claims that were actually presented during the proceedings but omitted from the award; the request must be made within thirty days and, if justified, the additional award must be made within sixty days. Neither power permits the tribunal to review the merits of its decision.
How did the meaning of public policy in challenging an award evolve?
In Renusagar Power Co. Ltd. v. General Electric Co., 1994 Supp (1) SCC 644, public policy was confined to the fundamental policy of Indian law, the interests of India, and justice or morality. ONGC v. Saw Pipes Ltd., (2003) 5 SCC 705, expanded the domestic standard to include patent illegality. Shri Lal Mahal Ltd. v. Progetto Grano Spa, (2014) 2 SCC 433, held that patent illegality does not apply to foreign awards. The 2015 amendment then codified a narrowed test, excluding mere errors of law and confining patent illegality to domestic awards under Section 34(2A).