Recently, the Calcutta High Court held that the legislature did not restrict the prayer for extension of mandate under section 29(4) of the Arbitration and Conciliation Act, 1996 only once. While the parties have been enabled to extend the mandate by consent, for a further period of six months, no such period has been prescribed under section 29A(4) for the court to extend the mandate. Even at a belated stage, if sufficient cause is shown for extension of the time within which the Arbitrator should make and publish the award, such application can be entertained.
Brief facts:
The factual matrix of the case is that the first application for the extension of the mandate of the learned arbitrator was filed before a learned predecessor judge, and the said application was rejected on the ground that the applications for extension were filed after the mandate had, admittedly, terminated. Thereafter, the Petitioner challenged the said order before the Hon’ble Apex Court, and the question that arose before the court was whether the Court lacked jurisdiction to extend the mandate under Section 29A(4) if such an application for extension of mandate was filed after the mandate had terminated by operation of law. Then, the court concluded that the word ‘terminate’ under Section 29A in its contextual form did not reflect termination of the proceedings in the sense that the proceedings had come to an end and could not be continued even after filing of an application for extension and allowed the appeal filed by the petitioner and extended the mandate upto May 31, 2025. The present application has been filed seeking extension of the mandate of the learned Arbitrator, which expired on May 31, 2025.
Contentions of the Petitioner:
The counsel for the Petitioner contended that multiple applications for extension of mandate of the Arbitrator may be filed and the Court should not give a restricted meaning to the provision of Section 29A(4), by holding that the power of the Court to extend the mandate can be only exercised only once and further relied upon the judgments titled M/s. Powergear Limited Chennai vs. M/s. Anu Consultants, Hyderabad, and HMT Limited, Pinjore vs. S.K.V. Agro Distributors and Ors.
Contentions of the Respondent:
The counsel for the Respondent contended that the Apex Court fixed May 31, 2025 for publication of the award, however, the petitioner was lackadaisical in its approach and did not file the affidavit of evidence upto 150 days from the date of the decision of the Apex Court. It was furthermore contended that the petitioner was not a vigilant litigant but a rogue litigant.
Observations of the Court:
The Court observed that the Top Court, while allowing the civil appeal, concludes that “a prayer for extension of the mandate could be filed even after the mandate had terminated and even after expiry of 12 months or the extended six months, as the case would be. The principle for extension of a mandate would be guided by the principle of showing sufficient cause for such extension and not by fixing a period of limitation in exercise of powers under Section 29A(4). When the legislature was conscious not to import any kind of period of limitation for filing an application for extension of the mandate, the court should desist from prescribing a period within which the application for extension should be filed.”
The Court furthermore observed that the legislature did not restrict the prayer for extension of mandate under section 29(4) only once. While the parties have been enabled to extend the mandate by consent for a further period of six months, no such period has been prescribed under section 29A(4) for the court to extend the mandate. Even at a belated stage, if sufficient cause is shown for extension of the time within which the Arbitrator should make and publish the award, such application can be entertained.
The Court noted that the grounds given by the petitioner as to why the affidavit of evidence was submitted by the second witness for the petitioner after 150 days are reasonable grounds for extension of the mandate. Furthermore, the second witness had to correlate each of the invoices with the payment advices and the bank statements in order to file a detailed chart before the Arbitrator. Such exercise took time. Moreover, the claimant resides at Pune, but had to come down to Kolkata to instruct his learned advocates.
Based on these considerations, the Court was of the view that sufficient cause has been shown as to why the proceeding could not be completed within May 31, 2025 and that the delay in disposal of the proceeding was not solely attributable to petitioner, the mandate of the learned Arbitrator is extended by a period of one year from date of communication of this order.
The decision of the Court:
With the above direction, the court disposed of the application.
Case Title: Rohan Builders (India) Pvt Ltd vs. Berger Paints India Limited
Coram: Justice Shampa Sarkar
Case No: AP-COM/428/2025
Advocates for the Petitioner: Mr. Amitesh Banerjee (Sr. Adv.), Soumya Roy Chowdhury, Chayan Gupta, Sarosij Dasgupta, Ritesh Ganguly, Susrea Mitra, Ramanuj Ray Chowdhuri
Advocates for the Respondent: Mr. Anirban Ray, (Sr. Adv.), Snehashis Sen
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