Extension under Section 29A: Which Court is "The Court”?

Which Court is the competent court to grant extension under Section 29A of the Arbitration and Conciliation Act, 1996 (“the Act”)? Is it the High Court or is it the Principal Civil Court? The answer lies in the meaning, or the definition of the term 'Court' as defined in Section 2(1)(e) of the Act.

The Bombay High Court was posed with the above question in the case of KIPL Vistacore Infra Projects JV Municipal Corporation of the city of Ichalkarnji-2024 SCC Online Bom 327 and Mormugao Port Vs. Ganesh Benzoplast Ltd. in Writ Petition No.3/2020 decided on January 15, 2020.

In KIPL Vistacore Infra Projects (supra), a dispute arose between the parties and the High Court appointed an arbitrator under Section 11 of the Act. Thereafter, an application for extension of the mandate of an arbitral tribunal under Section 29A was filed before the High Court wherein the respondent raised objection on the maintainability of the petition. The High Court while discussing the provisions of Section 29A in respect of domestic arbitration, observed that the Court as defined in Section 2(1)(e) is the High Court which may extend the mandate of the arbitrator and substitute the arbitrator.

In Mormugao Port (supra), an application for extension was filed before the Principal District Judge for the extension of the mandate of the arbitral tribunal which was appointed jointly by the parties. The Principal District Judge rejected the extension application and held that the jurisdiction under Section 29A of the Act to extend the arbitral period lies with the High Court. Aggrieved by such a decision, the parties approached the High Court under writ jurisdiction. The High Court remanded the matter to the District Judge and observed that for the purpose of exercising power under Section 29A (4) of the said Act, the District Judge having jurisdiction is the Court to exercise the power of extending the mandate of the arbitrator. The term “Court” will have to be interpreted as the Court having ordinary original civil jurisdiction including the High Court having the original jurisdiction in the area.

Two different Benches of the same Hon’ble High Court, while interpreting the Section 2(1)(e) and Section 29A of the Act, in one case granted the extension itself while in the other case remanded back the issue at hand to the District Court.

Recently, in Sheela Chowgule v. Vijay V. Chowgule, 2024 SCC OnLine Bom 1069, the High Court while dealing with a similar issue observed that KIPL Vistacore Infra Projects (supra) and Mormugao Port (supra) have conflicting views.

The Court observed that while various provisions of the Act and decisions of the apex court held that the word ‘Court’ found in Section 29-A would have to be interpreted in the textual meaning and in the contextual meaning as a whole. Further, the meaning of each Section, each clause, each phrase and each word is to be analysed to fit into the scheme of the entire Act. Section 29-A does not solely decide on the extension of the arbitral mandate, but it also deals with various other aspects including the termination of the mandate, substitution of one of the arbitrators or all of the arbitrators, and the reduction of fees of the arbitrator. Thus, the power to substitute or re-constitute the Arbitral Tribunal as provided under sub-section 6 of Section 29-A will have to be read with Section 11 which deals with appointment of arbitrators. There cannot be any difference with regard to the appointment of an arbitrator with that of substitution of one of the arbitrators or reconstitution the arbitral tribunal. The words used in sub-section 7 of the Section 29-A specifically provides the word “appointed under this section.” Thus, substitution is in fact a fresh appointment as contemplated under Section 11 of the said Act. Thus, while extending the period of arbitration, the Court is also empowered either to substitute one or all the arbitrators and reconstitute the arbitral tribunal. It practically deals with appointment of fresh arbitrators, which is the power given to the High Court in case of domestic arbitration as found in Section 11.

Since there are two divergent views of two coordinate Benches of the High Court on the issue of the definition of “Court” as found mentioned in Section 29A(4), the High Court has now in Sheela Chowgule (supra) referred the matter to a larger Bench.

About the authors: Sonal Kumar Singh is the Managing Partner of AKS Partners. Obhirup Ghosh is a Senior Associate at the Firm.