The Supreme Court has clarified that applications seeking extension of time for making arbitral awards under Section 29A of the Arbitration and Conciliation Act, 1996 must be filed before the “Court” as defined under Section 2(1)(e) of the Act, and not before the High Court merely because the arbitrator was appointed by it under Section 11.
A Bench comprising Justice Pamidighantam Sri Narasimha and Justice R. Mahadevan set aside the judgment of the Bombay High Court at Goa, which had held that where an arbitral tribunal is constituted by the High Court under Section 11, only the High Court would have jurisdiction to entertain an application under Section 29A(4) for extension of time.
The dispute arose out of a family settlement, pursuant to which arbitration was invoked. While an application for extension of time under Section 29A was allowed by the Commercial Court, the order was challenged on the ground that the presiding arbitrator had been appointed by the High Court, and therefore the Commercial Court lacked jurisdiction. Accepting this contention, the High Court quashed the Commercial Court’s order and held that the parties must approach the High Court for the extension of time.
Reversing this view, the Supreme Court held that the power exercised by the High Court under Section 11 is limited to the appointment of arbitrators and stands exhausted once the tribunal is constituted. The Court observed that the appointing court does not retain any supervisory or continuing jurisdiction over arbitral proceedings and becomes functus officio thereafter. Reference was made to Nimet Resources Inc. & Anr. v. Essar Steels Ltd., (2009) 17 SCC 313.
The Bench rejected the reasoning adopted by the High Court that allowing civil courts to extend arbitral timelines would create a “hierarchical anomaly” or conflict of powers. Emphasising that jurisdiction flows solely from statute, the Court held that perceived status or hierarchy of courts cannot override the clear legislative definition of “Court” under Section 2(1)(e).
Accordingly, the appeals were allowed, and the Commercial Court’s order extending time was restored.
Appearances
Appellant- Mr. Abhay Anil Anturkar, Adv. Mr. Dhruv Tank, Adv. Mr. Sarthak Mehrotra, Adv. Mr. Bhagwant Deshpande, Adv. Ms. Surbhi Kapoor, Adv. Ms. Surbhi Kapoor, AOR
Respondents- Mr. Amit Pai, Adv. Mr. Omkar Jayant Deshpande, AOR Mr. Ashok Paulo Poul, Adv. Ms. Shaneen Parikh, Adv. Ms. Sanskriti Sidana, Adv. Mr. Rahul Mantri, Adv. M/S. Cyril Amarchand Mangaldas, AOR Mr. Parag Rao, Adv. Mrs. Shambhavi Rao, Adv. Mr. Salvador Santosh Rebello, AOR Mr. Raghav Sharma, Adv. Ms. Kritika, Adv. Mr. Jaskirat Pal Singh, Adv. Ms. Moulishree Pathak, Adv. Mr. Shiven Desai, Adv. Mr. Vivek Jain, AOR Ms. Suchitra Kumbhat, Adv. Mr. Sadiq Noor, Adv. Mr. Varun Bhandanker, Adv. Ms. Riya Amonker, Adv.
