No Bar On Court To Entertain More Than One Application U/S 29A Of Arbitration Act: Madras High Court

Brief Facts:

The present application has been filed under section 29A of the Arbitration Act seeking extension of the mandate of the Arbitral Tribunal.

The learned arbitrator directed the applicant to file an application seeking an extension of the mandate under section 29A(4). Consequently, an application was filed which came to be allowed and the mandate was extended by one year. A notice and order of the court allowing the extension were emailed to the respondent and his counsel on January 29, 2024.

However, the respondent's counsel informed the arbitrator that he would not be able to participate. Thereafter, the respondent requested the arbitrator to halt its proceedings until an application seeking recall of the order of the extension is decided.

On 17.06.2024, the respondent had marked his presence before the Arbitrator, but, stated that their participation in the matter would be without prejudice to their rights and contentions in the pending adjudication to recall the order dated 04.01.2024 passed under Section 29A(4) of the Act.

Subsequently, the court dismissed the 'recall application' filed by the respondent but granted liberty to the respondent to seek reopening of evidence before the Arbitrator. Later, the matter was adjourned and the respondent was directed to file a proof of affidavit by January 1, 2025.

Since the time limit under Section 29A of the Act will expire on 05.01.2025, the Arbitrator directed the applicant to file an application under “Section 29A” of the Arbitration Act seeking further extension of the Arbitrator's mandate by a period of six months.

In the above backdrop, the present application has been filed in which extension of the mandate of the Arbitral Tribunal is sought.The respondent contended that the present application is not 'maintainable' as the applicant is legally permitted to file only one application seeking extension of time for the arbitral tribunal.

Observations:

The court noted that 'section 29A' of the Arbitration Act does not prohibit multiple applications for extending the mandate of the Arbitrator. The only requirement is that sufficient cause must be demonstrated for seeking extension of the mandate of the tribunal.

It further added that when there are no restrictions as to the number of times an application seeking extension of the mandate of the Arbitral Tribunal can be filed, the court cannot prohibit parties from filing such applications provided sufficient cause is demonstrated.

It held that “prescribing a prohibition by the Court restricting the number of times a party can approach seeking for extension of the Arbitrator's mandate, though the statute does not contain such a prohibition, will lead to penal and fatal consequences resulting in grave injustice.”

The court further observed that a narrow interpretation of Section 29A should not be given by Courts, which may result in injustice to one of the parties to the dispute. If the intention of the legislature was to restrict the filing of Section 29A application under the Act, the legislature would have thought it fit to do so.

It said that as seen from the proceedings recorded by the Arbitrator, which have been highlighted by the applicant in this application, it is clear that only due to the conduct of the respondent in delaying the proceedings, the Arbitrator was unable to pronounce arbitral award within the prescribed time.

The court concluded that “since this Court is having the power to entertain more than one application filed under Section 29A(5) of the Act, if the applicant is able to show sufficient cause for seeking extension. Since sufficient cause has been shown by the applicant, this Court will have to necessarily allow the application as prayed for.”

Appearance: Adv.K.Gowtham Kumar, Adv.A.P.Balaji & Adv.Sushant Sanjay for the petitioners.

Case Title: M/s.Powergear Limited, Chennai. Vs. M/s.Anu Consultants, Hyderabad

Citation: 2025 LiveLaw (Mad) 48

Case Number: Application No.101 of 2025

Date of Judgment: 05/02/2025

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