[Arbitration Act] Section 29A Allows Extension Requests Even After Arbitrator's Mandate Expires: Delhi High Court
The Delhi High Court bench of Justice Dinesh Kumar Sharma held that Section 29A of the Arbitration and Conciliation Act, 1996 does not preclude the consideration of applications for extension of the arbitrator's mandate filed after the expiration of the mandate. Brief Facts: The Petitioner approached the Delhi High Court (“High Court”) and filed a petition under Section 29A of...
The Delhi High Court bench of Justice Dinesh Kumar Sharma held that Section 29A of the Arbitration and Conciliation Act, 1996 does not preclude the consideration of applications for extension of the arbitrator's mandate filed after the expiration of the mandate.
Brief Facts:
The Petitioner approached the Delhi High Court (“High Court”) and filed a petition under Section 29A of the Arbitration and Conciliation Act, 1996 (“Arbitration Act”) for a one-year extension of the Arbitral Tribunal's mandate. The Petitioner argued that the mandate expired on 29.02.2024. On the other hand, the Respondent opposed the extension and contended that the mandate cannot be prolonged after its expiration, especially when the request for extension comes after the expiration.
The Respondent contended that the Petitioner's conduct throughout the arbitration process, which began on 23.11.2021, significantly hindered the progress of the proceedings. Despite 27 months having passed, the arbitration process remains pending. The Respondent highlighted that the pleadings were completed on 22.06.2022, and according to Section 29A of the Arbitration Act, the initial 12-month period expired on 21.06.2023. It argued that due to the delay caused by the Petitioner, it was impractical to conclude the arbitration process by 29.02.2024.
Observations by the High Court:
The High Court referred to its decision in KMP Expressways Limited vs IDBI Bank Limited, where it held that Section 29A does not preclude the consideration of applications filed after the expiration of the mandate. Referring to Section 29A, the High Court highlighted the legislative intent to allow for extensions even after the specified period has lapsed. The High Court differentiated its position from the ruling of the Calcutta High Court in Rohan Builders (India) Pvt. Ltd. vs. Berger Paints India Limited and held that Section 29A does not impose explicit outer limits, and the discretion of the court to grant extensions remains intact.
The High Court noted that the arbitration proceedings were ongoing for approximately two and a half years and the delay was attributed to the Petitioner. The High Court stated the importance of not causing further delays and urged the arbitrator to expedite the proceedings.
Therefore, the High Court extended the mandate of the Arbitral Tribunal until 31.12.2024.
Case Title: Glowsun Powergen Private Limited Vs Hammond Power Solutions Private Limited
Citation: 2024 LiveLaw (Del) 704
Case Number: O.M.P.(MISC.)(COMM.) 120/2024
Advocate for the Petitioner: Ms. Chandreyee Maitra and Ms. Asmita Srivastav.
Advocate for the Respondent: Mr.Moazzam Khan, Mr Aniruddha Chaudhary, Ms Anvita Goel, Mr Amrit Bhatia, Mr Rohit and Mr Prince Kumar.
Date of Judgment: 28.05.2024