In Lancor Holdings Limited v. Prem Kumar Menon & Ors., the Hon’ble Supreme Court has set aside an arbitral award that was rendered nearly four years after the conclusion of proceedings , holding that such inordinate delay and failure to adjudicate core disputes amounts to a violation of the public policy of India under Section 34 of the Arbitration and Conciliation Act, 1996.
Judgment Summary:
The Court expressed “utter shock” at the manner in which the arbitrator conducted the proceedings and described the award as “rudderless.” It was observed that:
- The essence of arbitration lies in expeditious and reasoned adjudication ; unexplained delay defeats the object of the statute.
- An award lacking findings on essential issues and bereft of analytical reasoning cannot be sustained in law.
Such an award not only undermines procedural fairness but also offends the fundamental policy of Indian law , thereby rendering it liable to be set aside.
Key Takeaway: The ruling reinforces that arbitral tribunals are bound by duties of diligence, reasoned decision-making, and timeliness . Delay and indecisiveness strike at the root of arbitral integrity and erode confidence in the alternative dispute resolution mechanism.
