In Brief
This case addresses whether Section 34(5) of the Arbitration and Conciliation Act, 1996—which requires applicants to issue prior notice before challenging an arbitral award—is a mandatory or directory provision. The Patna High Court's Division Bench had held it mandatory, dismissing the challenge for non-compliance. The Supreme Court reversed this, holding Section 34(5) directory since no legal consequence is prescribed for breach. The Court reasoned that procedural provisions designed to expedite proceedings should be construed as directory if doing so advances justice. However, the Court directed all courts to endeavour to dispose of Section 34 applications within one year to fulfill the legislative intent of speedy arbitration dispute resolution.
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