The Delhi High Court presided over by Justice Sachin Datta, clarified the scope of Section 29A of the Arbitration and Conciliation Act. The court emphasized that Section 29A solely focuses on determining whether the arbitrator has acted expeditiously and does not entertain matters regarding the conduct of arbitration proceedings or arbitral fees.
Justice Datta further highlighted that the respondent's contentions concerning the conduct of arbitration proceedings, apart from the issue of expeditious disposal, should be raised before the arbitrator or in an application under Section 34 of the Act when challenging the award passed by the arbitrator.
Brief Facts:
The Court considered a petition filed under Section 29A of the Arbitration and Conciliation Act, 1996, seeking an extension of time for the completion of arbitral proceedings and the issuance of an arbitral award. The arbitration proceedings began in response to an application filed under Section 8 of the Act. The court appointed an arbitrator to adjudicate the dispute between the parties. Various directions were issued during the proceedings, including the payment of fees by the parties. However, there were disputes regarding the fees charged by the arbitrator.
Contentions by the Appellant:
The petitioner, the claimant in the arbitration, sought an extension of time for completing the arbitral proceedings and obtaining the award. The appellant argued that the proceedings were at an advanced stage, with final arguments already concluded.
Contentions of the Respondent:
The Respondent raised objections regarding the fees fixed by the arbitrator. The respondent requested the appointment of a new arbitrator and argued for the fixation of fees as per Schedule IV of the Act. They also sought admission of their counterclaim.
Observations by the Delhi High Court:
The court observed that the issue of fees had already been dealt with extensively in a previous judgment of the court. It stated that once the fees are fixed with the consent of the parties, they are binding on them. The court noted that issues related to the conduct of arbitration and arbitral fees are not relevant under Section 29A of the Act.
The court referred to previous judgments emphasizing that the purpose of Section 29A is to ensure expeditious completion of arbitration proceedings. In the case of Oil and Natural Gas Corporation Ltd. v. Afcons Gunanusa JV, the court noted that it was emphasised that once the fee has been fixed with the consent of the parties, it becomes binding on them. The court highlighted the need for parties to pay the agreed-upon fees, as stated in the judgment. Further, the court also referred to Orissa Concrete & Allied Industries Ltd. v. Union of India to note that such proceedings are concerned only with whether the arbitrator has proceeded expeditiously, and issues related to the conduct of arbitration or arbitral fees are not relevant. It stated that issues regarding the conduct of the proceedings and arbitral fees should be raised before the arbitrator or in an application under Section 34 of the Act, rather than in Section 29A proceedings.
Considering that the proceedings were at an advanced stage and the arbitrator had acted expeditiously, the court granted the appellant's request for an extension of time. The court extended the time for completion of arbitral proceedings and issuance of the award by six months from the date of the judgment.
The decision of the Court:
The court allowed the petition, granting an extension of time for completing the arbitral proceedings and making the arbitral award, while emphasizing that issues related to the conduct of the proceedings and arbitral fees should be raised in appropriate forums as per the Act.
Case Name: Mr. Anay Kumar Gupta Vs Mr. Jagmeet Singh Bhatia
Coram: Hon'ble Mr. Justice Sachin Datta
Case No.: O.M.P.(MISC.)(COMM.) 147/2023
Advocates for the Petitioners: Mr. Shailen Bhatia, Mr. Amit Jain, Mr. Arnav Chatterjee and Mr. Raghav Bhalla, Advs.
Advocates for the Respondent: Mr. Manish Kaushik, Mr. Ajit Singh Johar, Mr. Plarsh Vashishth, Ms. Snigdha Sharma and Mr. Mishal Johri, Advs.
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