Supreme Court overturns Calcutta HC ruling on arbitration mandate extension; orders fresh petition review

Supreme Court sets aside Calcutta HC judgment denying extension of arbitration mandate beyond deadline for making an award; Directs fresh adjudication of petition

In the Judgment dated 12-09-2024, Supreme Court had held that an application for extension of time for passing an arbitral award under Section 29A (4) read with Section 29A (5) is maintainable even after the expiry of the twelve-month or the extended six-month period. The court, while adjudicating such extension applications will be guided by the principle of sufficient cause.

Supreme Court: In civil appeals filed against the judgment and order passed by the Calcutta High Court, wherein the Court dismissed the application filed by the appellants under Section 29A(4) of the Arbitration and Conciliation Act, 1996 on the ground that the Court has no power to grant any extension of the period for making and publishing the award or to extend the arbitrator’s mandate, after the mandate has expired as no application was filed for extension of mandate before the expiry of the period envisaged for making the award under section 29A(1) of the Act, the three Judge bench of Sanjiv Khanna, Sanjay Kumar an R. Mahadevan, JJ. in view of the judgment dated 12-09-2024, set aside the impugned judgment, and revived the arbitration petition praying to extend the mandate of arbitration before the Calcutta High Court.

The Court noted that in one of the appeals, the Arbitrator appointed, has expired. Further, the Bench took note of its judgment dated 12-09-2024, wherein it held that an application for extension of time for passing an arbitral award under Section 29A (4) read with Section 29A (5) is maintainable even after the expiry of the twelve-month or the extended six-month period, subject to the principle of sufficient cause.

The appellant had prayed to the High Court to appoint a new arbitrator under Section 29A (6). However, the High Court disallowed the appellant’s prayer to extend the mandate of arbitration and refused to exercise its powers as laid down under Section 29 A (4) and 29 A (5) of the Act. The High Court has remarked that as the mandate was terminated on 11-03-2023 and the present application was made four months thereafter, the scheme of the 1996 Act does not permit the Court to extend the mandate any further. Thus, it was held that the application for extension of time under Sections 29A (4) and 29A (5) of the Act can only be entertained if filed before the expiry of the mandate of the arbitral tribunal.

In view of the above said judgment dated 12-09-2024, the Court said that the Arbitration petition titled Vrindavan Advisory Services LLP vs. Deep Shambhulal Bhanushali¹, will stand revived and will be decided by the Calcutta High Court in accordance with law.

The Court further noted that the appellant has filed an application under Section 9 of the Arbitration and Conciliation Act, 1996, which has been disposed of, granting certain reliefs. Thus, the Court permitted the appellant to seek extension of interim relief before the High Court.

In the connected appeals currently undergoing arbitration, the Court extended the time for making and passing/publishing of the award till 31-05-2025.

In other appeals, the Court opined that there is hardly any sufficient and good justification for extension of time for the Arbitral Tribunal to make and pass/publish its Award. Thus, partly allowing the appeals by setting aside the impugned judgment, the Court remitted the matter to the High Court for appointment of a new Arbitrator.

Read here:

Application for extension of time for passing arbitral award under Section 29A of Arbitration Act is maintainable even after 18-month deadline for making of award: SC

Supreme Court stays Calcutta HC order which restricted application filed under S.29A(4) of Arbitration Act after expiry of term of the Tribunal

CASE DETAILS

Citation:
2024 SCC OnLine SC 3108

Appellants :
Rohan Builders (India) Private Limited

Respondents :
Berger Paints India Limited

Advocates who appeared in this case

For Petitioner(s):
Mr. Swarnendu Chatterjee, AOR Mr. Nilay Sengupta, Adv. Ms. Deepakshi Garg, Adv. Ms. Harshita Rawat, Adv. 8 Mr. Nakul Dewan, Sr. Adv. Ms. Udita Singh, AOR Ms. Sowmya Saikumar, Adv. Mr. Nirav Shah, Adv. Mr. Soumya Ray Chowdhury, Adv. Mr. Bhushan Panse, Adv. Mr. Satyender Saharan, Adv. Mr. Sathvik Chandrashekar, Adv. Mr. Gopal Jain, Sr. Adv. Mr. Raunak Dhillon, Adv. Ms. Isha Malik, Adv. Ms. Niharika Shukla, Adv. M/s. Cyril Amarchand Mangaldas, AOR Mr. Udayaditya Banerjee, Adv. Mr. Samrat Sengupta, Adv. Mr. Siddhant Jaiswal, Adv. Mr. Soumya Dutta, AOR Ms. Pratika Agarwal, Adv. Mr. Siddhant Upmanyu, Adv. Mr. Abhijeet Pandey, Adv. Mr. Rajat Joseph, AOR Mr. Hrishikesh S. Chitaley, Adv. Mr. Vijay Kari Singh, Adv. Mr. Kaustubh D. Kadasne, Adv. Ms. Deeplaxmi Subhash Matwankar, AOR Ms. Rohini Wagh, Adv. Dr. Ravindra Chingale, Adv. Mr. Ravi Kotian, Adv. Ms. Preetika Dwivedi, AOR Mr. Sanjay Baid, Adv. Mr. Arindam Ghosh, AOR

For Respondent(s):
Mr. Siddharth Bhatnagar, Sr. Adv. Mr. Udayaditya Banerjee, Adv. Mr. Samrat Sengupta, Adv. Mr. Siddhant Jaiswal, Adv. Mr. Soumya Dutta, AOR Ms. Pratika Agarwal, Adv. Mr. Siddhant Upmanyu, Adv. Mr. Nakul Dewan, Sr. Adv. Mr. Umesh Kumar Khaitan, AOR Mr. Deepak Khurana, Adv. Mr. Vineet Tayal, Adv. 9 Ms. Nishtha Wadhwa, Adv. Mr. Harin P. Raval, Sr. Adv. Mr. Milind Kumar, AOR Mr. Vikas Mehta, AOR Mr. Apoorv Khator, Adv. Ms. Nitika Grover, Adv. Ms. Madhumita Bhattacharjee, AOR Ms. Debarati Sadhu, Adv. Ms. Srija Choudhury, Adv. Mr. Ashish Batra, AOR Ms. Aanchal Basur, Adv. Mr. Ivan, AOR

CORAM :