Application For Extension Of Time For Passing The Award Lies Only Before The High Court Which Appointed The Arbitrator: Allahabad High Court

The Single Bench of Justice Rohit Ranjan Agarwal held that the Principal Civil Court does not have the jurisdiction to entertain an application for an extension of time. The Court held that Sub-section 6 of Section 29A allows the Court to substitute the arbitrator(s) and conferring this power on the Principal Civil Court would lead to an inconceivable situation where the mandate of an arbitrator appointed by the High Court could be substituted by an inferior Court.

The Court held that S. 29A cannot be read in isolation with S. 11 of the Act, therefore, the power to grant an extension of time and to substitute the arbitrator shall lie only with the Court which had appointed the arbitrator and since the Principal Civil Court does not have the power to appoint the arbitrator, the definition of Court occurring in S.2(1)(e) cannot be imported into S. 29A of the Act.

Facts

The Parties entered into an agreement for the execution of some work. There was a delay in the completion of the work, Accordingly, the Respondent invoked the arbitration clause and filed an application for the appointment of the arbitrator before the High Court of Allahabad.

The Court appointed the arbitrator but he recused due to poor health. Thereafter, the Court appointed another arbitrator who passed away in between and the Court appointed another arbitrator who also recused for some reasons. Thereafter, the parties appointed another arbitrator who failed to complete the proceedings within the timeframe. Therefore, the applicant filed an application for extension of time for completing the arbitration proceedings.

The issue before the Court

Whether the application moved under Section 29A of the Act for extending the time for arbitral award is maintainable before the High Court or the principal Civil Court as defined under Section 2(1)(e) of the Act.

Contention of the Parties

The applicant filed the application before the High Court on the following grounds:

• The pleadings are completed only the final arguments are to be done, therefore, the arbitration proceedings would come to a conclusion in the extended period.
• The word "Court" appearing under S.29A is not the same as appearing under S.2(1)(e) of the A&C Act.
• Only the Court which has the power to appoint the arbitrator can entertain an application for extending the period of limitation, therefore, the application must be filed before the High Court and not before the Principal Civil Court as it has no power to appoint an arbitrator.
• The Court as contemplated in S.29 is not only empowered to extend the time period but can also substitute the arbitrator(s) which involves appointing another arbitrator to complete the proceedings and since the power to appoint an arbitrator is not conferred on the Principal Civil Court, therefore, it cannot entertain an application under S.29A of the Act.

The Respondent raised a preliminary issue relating to the maintainability of the application on the following grounds:

• The word Court as appearing at different places must be given the same meaning as defined under S. 2(1)(e) of the A&C Act.
• The jurisdiction of the High Court is confined to the application under S.11 of the Act and for all other purposes, the jurisdiction is conferred on the Principal Civil Court.

Analysis by the Court

The Court held that S. 29A cannot be read in isolation with S. 11 of the A&C Act and once the appointment has been made by the High Court or the Supreme Court, it is only that Court that shall have the jurisdiction to entertain an application under S. 29A of the Act.

The Court held that the Principal Civil Court does not have the jurisdiction to entertain an application for an extension of time. The Court held that Sub-section 6 of Section 29A allows the Court to substitute the arbitrator(s) and conferring this power on the Principal Civil Court would lead to an inconceivable situation where the mandate of an arbitrator appointed by the High Court could be substituted by an inferior Court.

The Court further held that the absence of an appeal provision against the order of the Court in a S. 29A application is also indicative of the fact that the jurisdiction is not conferred on the Principal Civil Court.

The Court also held that S. 42 of the Act does not apply to S. 11 applications. Accordingly, the Court allowed the application.

Case Title: Indian Farmers Fertilizers Cooperative Ltd. v. Manish Engineering Enterprises, A&C Application U/S 11(4) No. 5 of 2022.

Citation:

Date: 11.03.2022

Counsel for the Applicant: Mr. Manish Goyal, Senior Advocate with Ms. Sushmita Mukerjee

Counsel for the Respondent: Mr. Anil Tiwari, Senior Advocate with MR. Dharmendra Shukla.

Click Here To Read/Download Order