Service of Arbitral Award in the Indian Legal System

One of the most crucial stages in arbitration proceedings is the service of the arbitral award. While much attention is often paid to the conduct of arbitration hearings and the making of the award itself, the legal consequences truly begin when the award is delivered and duly served upon the parties. In Indian arbitration law, the concept of service holds significant importance because it is directly linked to the limitation period for challenging the award, as well as for initiating enforcement proceedings.

Statutory Basis under the Arbitration and Conciliation Act, 1996

The governing law is the Arbitration and Conciliation Act, 1996 (the “Act”), particularly Section 31 which deals with the form and contents of the arbitral award, and Section 34(3) which prescribes limitation for setting aside the award.

• Section 31(5): It specifically provides that after the arbitral award is made, a signed copy shall be delivered to each party. The word used is "delivered" rather than "pronounced" or "communicated", which indicates a more formal act of service rather than mere knowledge of the award’s existence.

• Section 34(3): It sets the limitation period for filing an application to set aside the arbitral award at three months from the date on which the party making the application had received the arbitral award. A further grace period of thirty days may be allowed by court if sufficient cause is shown, but not beyond that.

Thus, the statutory framework makes delivery of the award to the parties the benchmark for computing limitation.

What Does “Service of Award” Mean?

The term “service” in this context does not mean service akin to court summons or pleadings. Instead, it refers to ensuring that each party to the arbitration has actually received a signed copy of the award from the arbitral tribunal.

Key features include:

• The copy must be signed by the arbitrator or the arbitral tribunal as per Section 31(1). Unsigned photocopies or emails without digital authentication are not sufficient in the eyes of law.

• Delivery is generally through hand delivery, registered post, speed post, or any other reliable means that ensures acknowledgment. In recent times, courts have also recognized service through electronic means (such as email) if authenticity and receipt can be established.

• The date of service is legally significant, because the time for challenge under Section 34 begins to run from that date.

Judicial Approach to Service of Award

The Supreme Court and High Courts have consistently emphasized that the limitation period under Section 34 runs only from the date when a signed copy is delivered to the party. Mere knowledge of the award or inspection of it is not enough.

Some leading pronouncements have clarified that:

• Service on the advocate of the party may not always be considered valid delivery unless expressly authorized, as the Act uses the word “delivered to each party”.

• If there is a dispute regarding date of delivery, the arbitral record and postal acknowledgments become critical pieces of evidence.

• Courts have leaned towards a strict interpretation, ensuring that parties have the full statutory period available to them, but once the limitation period lapses, courts have no power to extend it further.

Practical Significance

For practitioners and parties, ensuring proper service of the arbitral award is not a mere formality but a safeguard of rights.

• For the winning party, prompt service ensures that limitation for challenge starts running, paving the way for quicker enforcement.

• For the losing party, noting the exact date of service is essential, since any delay in filing an application under Section 34 could prove fatal.

Conclusion

In the Indian arbitration system, the service of an arbitral award operates as the critical trigger for post-award remedies. Both arbitrators and litigants must treat this procedural act with utmost care. Arbitrators must ensure that signed copies are duly delivered, and parties must remain vigilant of the date of receipt. Ultimately, the principle is simple—service of the award is not a technicality but the foundation for finality and certainty in arbitral proceedings.