Delhi High Court allowed petitions seeking extension of time for arbitration under Section 29A(5) despite mandate expiry, holding parties participated actively post-mandate and sufficient cause shown.
Period of 3 months granted to Arbitral Tribunal to conclude proceedings.
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$~24 to 26
versus
FOOD CORPORATION OF INDIA ..... Respondent Through: Mr. Manoj, SC with Ms. Aparna Sinha, Mr. MT Reddy, Advs.
25
versus
FOOD CORPORATION OF INDIA ..... Respondent Through: Mr. Manoj, SC with Ms. Aparna Sinha, Mr. MT Reddy, Advs.
26
..... Petitioner
Through: Ms. Ruchi Jain, Mr. Amogh Bansal, Advs.
versus FOOD CORPORATION OF INDIA ..... Respondent Through: Mr. Manoj, SC with Ms. Aparna Sinha, Mr. MT Reddy, Advs.
CORAM: HON'BLE MR. JUSTICE JASMEET SINGH O R D E R % 21.02.2024
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“ 29A. Time limit for arbitral award-
(5) The extension of period referred to in sub-section (4) may be on the application of any of the parties and may be granted only for sufficient cause and on such terms and conditions as may be imposed by the Court.
…”
This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 29/02/2024 at 11:19:26
This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 29/02/2024 at 11:19:26
from the view taken by “ Rohan Builders (India) (P) Ltd. vs. Berger Paints India Limited ” [(2023) SCC OnLine Cal 2645] to hold that the application under Section 29A of the Arbitration and Conciliation Act can be allowed even after the expiry of the mandate of the Arbitral Tribunal. The operative paras are reproduced below:
“ 6. The Court has considered the aforenoted submissions, and it is not inclined to accept that Section 29A bars applications submitted after the expiry of the mandate from being entertained. The language of the provision is clear; “…the mandate of the arbitrator(s) shall terminate unless the Court has, either prior to or after the expiry of the period so specified, extended the period…,” which plainly provides that an application under Section 29A may be allowed even after the expiry of the mandate. Relevant portions of Section 29A is reproduced below to aid the reading of our analysis:
“29A.Time limit for arbitral award.--(1) The award in matters other than international commercial arbitration shall be made by the arbitral tribunal within a period of twelve months from the date of completion of pleadings under sub-section (4) of section 23: Provided that the award in the matter of international commercial arbitration may be made as expeditiously as possible and endeavor may be made to dispose of the matter within a period of twelve months from the date of completion of pleadings under sub-section (4) of section 23.
(3) The parties may, by consent, extend the period specified in sub-section (1) for making award for a further period not exceeding six months.
(4) If the award is not made within the period specified in subsection (1) or the extended period specified under sub-section (3), the mandate of the arbitrator(s) shall terminate unless the Court has, either prior to or after the expiry of the period so specified, extended the period: Provided that while extending
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the period under this sub-section, if the Court finds that the proceedings have been delayed for the reasons attributable to the arbitral tribunal, then, it may order reduction of fees of arbitrator(s) by not exceeding five per cent. for each month of such delay. Provided further that where an application under sub-section (5) is pending, the mandate of the arbitrator shall continue till the disposal of the said application: Provided also that the arbitrator shall be given an opportunity of being heard before the fees is reduced.
(5) The extension of period referred to in sub-section (4) may be on the application of any of the parties and may be granted only for sufficient cause and on such terms and conditions as may be imposed by the Court.
(6) While extending the period referred to in sub-section (4), it shall be open to the Court to substitute one or all of the arbitrators and if one or all of the arbitrators are substituted, the arbitral proceedings shall continue from the stage already reached and on the basis of the evidence and material already on record, and the arbitrator(s) appointed under this section shall be deemed to have received the said evidence and material.
(7) In the event of arbitrator(s) being appointed under this section, the arbitral tribunal thus reconstituted shall be deemed to be in continuation of the previously appointed arbitral tribunal.
…” (emphasis supplied)
7. Our observations are supported by ATC Telecom Infrastructure Private Limited v. Bharat Sanchar Nigam Limited , whereby this Court has categorically held that grant of extension of time is permissible even if the petition under Section 29A has been filed after the expiry of the time period. The judgment in ATC Telecom (supra) categorically disagreed with the findings in Rohan Builders (supra) relied upon by the ATS Group. The Calcutta High Court in Rohan Builders (supra) held that petitions seeking extension of time cannot be entertained after the expiry of the mandate, on grounds
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that the legislature has explicitly introduced the word ‘terminate’ in Section 29A(5), as opposed to ‘revival’ or ‘renewal’ of arbitral proceedings upon filing of the extension application. The Court also drew attention to the proposed provisions in 176th Law Commission Report, the language of ‘suspension’ of mandate was deliberately not chosen in favour of ‘termination’.
8. This Court, in ATC Telecom, disagreed with the view taken in Rohan Builders, observing that no explicit outer limits have been prescribed in Section 29A, and that it clearly provides for extension in appropriate cases. Indeed, the intention is evidently not to prescribe inflexible timelines and eliminate the discretion of the Court; if it were so, specifying that explicitly would have been simple. The recommendations of the Law Commission could not be relied upon and interpreted against the plain words of the statute.
9. The judgment of Datar Switchgears (supra) advanced by ATS Group is also wholly inapplicable to the present case. The dispute before the Supreme Court was based on an arbitration clause whereby unilateral right to nominate the arbitrator was given to one party, and the legal issue was whether such a right is forfeited when 30 days have elapsed, the party has not appointed an arbitrator before the other party has filed an application under Section 11. The provisions of Section 11 and Section 29A are not pari materia and the words of Section 29A(4) clearly provides for extension after the expiry of the period.
10. In light of the above, O.M.P.(MISC.)(COMM.) 462/2023 and O.M.P.(MISC.)(COMM.) 493/2023 are allowed and O.M.P. (T) (COMM.) 91/2023 and O.M.P. (T) (COMM.) 92/2023 petitions are dismissed and the mandate of Sole Arbitrator is extended by a period of one year from today in the following matters:
(i) Arbitration Case No. 1/2021: Almond Infrabuild Private Limited & Anr v. Dalmia Family Office Trust;
(ii) Arbitration Case No. 2/2021: Domus Greens Private Limited & Ors v. Dalmia Family Office Trust;
(iii) Arbitration Case No. 3/2021: ATS Infrastructure Limited & Anr v. Dalmia Family Holdings LLP;
(iv) Arbitration Case No. 4/2021: Almond Infrabuild Private
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Limited & Anr v. Dalmia Family Office Trust;
(v) Arbitration Case No. 5/2021: Anand Divine Developers Private Limited & Anr v. Dalmia Family Office Trust;
(vi) Arbitration Case No. 6/2021: ATS Housing Private Limited & Anr v. Dalmia Family Office Trust;
(vii) Arbitration Case No. 7/2021: Almond Infrabuild Private Limited & Anr v. Dalmia Family Office Trust;
(viii) Arbitration Case No. 8/2021: Anand Divine Developers Private Limited & Anr v. Dalmia Family Office Trust;
(ix) Arbitration Case No. 9/2021: ATS Housing Private Limited & Anr v. Dalmia Family Office Trust;
(x) Arbitration Case No. 10/2021: Geetamber Anand vs. Rasbehari Traders; and
(xi) Arbitration Case No. 11/2021: ATS Infrastructure Pvt. Ltd. vs. Rasbehari Traders. ”
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applications to be submitted after expiry of the mandate of the Arbitral Tribunal. [(Reliance on ATS Infrastructure Ltd. and Anr. (supra)]
JASMEET SINGH, J
FEBRUARY 21, 2024/DM
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3 issues framed by the court
Whether an application for extension of time under Section 29A(5) of the Arbitration and Conciliation Act can be entertained after the expiry of the arbitral tribunal's mandate.
Whether the failure to show sufficient cause due to participation in proceedings post-mandate expiry bars the grant of extension.
Whether the petitions seeking extension of time for completion of arbitration proceedings should be allowed.
Colour shows how this judgement treated each authority
Skylark Cagers India Pvt. Ltd. vs. Institute of Liver and Biliary SciencesDistinguished¶13
Skylark Cagers India Pvt. Ltd. vs. Institute of Liver and Biliary Sciences [(2023) SSC OnLine Del 1276]
ATS Infrastructure Ltd. and Anr. vs. Rasbehari TradersRelied on¶32
ATS Infrastructure Ltd. and Anr. vs. Rasbehari Traders [O.M.P. (T) (COMM.) 91/2023]
Rohan Builders (India) (P) Ltd. vs. Berger Paints India LimitedDistinguished¶35
Rohan Builders (India) (P) Ltd. vs. Berger Paints India Limited [(2023) SCC OnLine Cal 2645] · Who else cites this
ATC Telecom Infrastructure Private Limited v. Bharat Sanchar Nigam LimitedDistinguished¶46
ATC Telecom Infrastructure Private Limited v. Bharat Sanchar Nigam Limited
Datar Switchgears (supra)Distinguished¶51
1 provisions across 1 enactments
PSA Protech and Infralogistics Pvt. Ltd.
Macheda Logistics India Pvt. Ltd.
Alopm pcm Infrastructural and Logistics Pvt. Ltd
Food Corporation of India
Jasmeet Singh
As recorded by the court registry
A miscellaneous application in an arbitration matter, commonly seeking extension of the arbitral tribunal's mandate under Section 29A.
Judgements on the same questions, provisions and authorities, from every court
