Substitute Arbitrator preserves prior hearings and rulings, restoring validity of earlier arbitral proceedings despite an intervening moratorium.

Section 15 of the Arbitration and Conciliation Act requires appointment of a substitute arbitrator according to the original appointment rules and, subject to party agreement or tribunal discretion, preserves prior hearings and rulings; the Arbitration Act functions as a self-contained code limiting judicial intervention. The High Court's declaration that arbitral hearings between 17.03.2022 and 25.08.2022 were a nullity exceeded jurisdiction under arbitration law. Consequently that part of the High Court order is set aside, the appeal is partly allowed, and transactions arising from those hearings are declared lawfully valid.

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Issues: Whether the High Court was justified in declaring as a nullity the arbitral proceedings held between 17.03.2022 and 25.08.2022 on the ground that those proceedings took place during a moratorium under Section 14 of the Insolvency and Bankruptcy Code, 2016.

Analysis: The Court examined Section 15 of the Arbitration and Conciliation Act, 1996, read with sub-sections (2), (3) and (4), which mandates appointment of a substitute arbitrator according to the rules applicable to the original appointment and preserves, subject to parties' agreement or the arbitral tribunal's discretion, the validity of prior hearings and rulings. The Arbitration Act is a self-contained code governing appointment, conduct and challenge of arbitral proceedings; courts acting under provisions of the Act must not assume powers excluded by the Act. Precedents establish that substitution ordinarily preserves continuity and prior proceedings remain valid unless set aside under procedures provided by the Act. The High Court's declaration that the seven dates' proceedings were a nullity amounted to exercising powers not conferred under Section 15 and related arbitration provisions and thereby went beyond its jurisdiction in a manner inconsistent with the Act's limited judicial intervention.

Conclusion: The part of the High Court's order declaring the arbitral proceedings held between 17.03.2022 and 25.08.2022 to be a nullity is set aside. The appeal is partly allowed in favour of the appellants and the transactions arising from those proceedings are declared lawfully valid.

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