The Supreme Court on Tuesday permitted arbitration proceedings under the Maharashtra Highways Act, 1955 to continue while leaving open the larger question of law on whether courts can substitute arbitrators appointed under a special statute by invoking Section 29A(6) of the Arbitration and Conciliation Act, 1996.

A Bench comprising Chief Justice Surya Kant, Justice Joymalya Bagchi and Justice V. Mohana directed the arbitrator to proceed with the arbitration, leaving the larger legal issue open for consideration in an appropriate case.

During the hearing, Solicitor General Tushar Mehta, appearing for the petitioners, remarked, “I wish someday the question of law is argued,” expressing the need for an authoritative pronouncement on the interplay between Section 29A of the Arbitration Act and statutory arbitrations under special enactments.

Opposing any further delay, Senior Advocate Mukul Rohatgi, appearing for the respondents along with Ranjeeta Rohatgi, submitted that “this is not that case as the facts are gross—there is already a five-year delay.” He added that another matter squarely raising the larger question of law is likely to come up next month, saying, “I’m waiting for that case. Another case raising the question of law is coming next month. I’ll send it to you in advance.”

Accepting the submission that the present dispute should not be held up, the Bench allowed the arbitration to proceed, while keeping the larger legal issue open.

The Maharashtra State Road Development Corporation has challenged the Bombay High Court’s ruling permitting substitution of a State-appointed arbitrator under Section 29A(6) after expiry of the arbitral mandate. The petitioner contends that under the Maharashtra Highways Act, only the State Government is empowered to appoint or substitute the arbitrator and that the special statute prevails over the Arbitration Act.