Which court can hear applications to extend time for arbitration? Bombay High Court refers issue to larger bench

A single-judge of the Bombay High Court at Goa on Monday referred to a larger bench the question of which is the appropriate court to deal with applications filed under Section 29A of the Arbitration Act, 1996. .Justice Bharat P Deshpande made the reference after noting that there were two conflicting Bombay High Court decisions on the issue. "Since, the view taken by the learned Single Judges in the case of Mormugao Port Trust (supra) and subsequently in K.I.P.L. Vistacore Infrastructure J.V. (supra), appears to be divergent/different views and the fact that the decision in the case of Mormugao Port Trust (supra) was not brought to the notice while deciding the matter incase of K.I.P.L. Vistacore Infrastructure J.V. (supra), the judicial propriety demand that reference be made to the Larger Bench," the April 15 judgment stated. .The Court was dealing with a writ petition challenging a district commercial court's January 2024 decision to extend the time to complete certain arbitral proceedings..The petitioner (a party to the arbitration) challenged the district court's order before the High Court. It was contended that the power to extend the time to complete arbitral proceedings under Section 29A of the Arbitration Act lay with the High Court and not the commercial court (district court).This stance was contested by the respondents (other parties to the arbitration) who pointed out that the word "court" as found in Section 29A (4) means a court of original civil jurisdiction which includes district judges or courts empowered under the Commercial Courts Act.Therefore, the district court in this case was empowered to extend the time to complete arbitration, the respondents argued..While analysing the rival contentions, Justice Deshpande's attention was drawn to two Bombay High Court decisions, namely:1. The 2020 judgment in the case of Mormugao Port v. Ganesh Benzoplast Ltd, wherein a single-judge held that the term "court” in Section 29A refers to a court having ordinary original jurisdiction, including the High Court having the original jurisdiction in the area. In other words, district courts having such jurisdiction could also deal with Section 29A applications.2. The 2024 judgment in the case of KIPL Vistacore InfraProjects JV v. Municipal Corporation of the City of Ichalkarnji, in which a single-judge held that "court" under Section 29A, read with Section 2(1)(e) (definition clause) of the Arbitration Act, means the High Court. In this judgment, it was held that it is the jurisdictional High Court that can extend the mandate of the arbitrator and/or substitute the arbitrator or arbitral tribunal..Justice Deshpande expressed that he found himself unable to agree with the ruling in the Mormugao Port Trust case.However, he decided to refer the matter to a larger bench of the Court for an authoritative pronouncement on the issue. The question framed on this aspect for the larger bench to dwell on was:"In the event an Arbitral Tribunal constituted by the High Court under Section 11(6), fails to complete the proceedings within the stipulated period/extended period, where an application under Section 29-A(4) would lie i.e. the High Court or the Civil Court having original jurisdiction in case of a domestic arbitration?".Additionally, Justice Deshpande also took note of another related question which arose in the present case.In this case, the parties had initially consented to the constitution of a three-member arbitral tribunal. However, one of the members of the tribunal withdrew from the arbitration.Another arbitrator appointed in his place also recused himself from the post, eventually leading the parties to approach the High Court with an application under Section 11(6) to appoint an arbitrator.This plea was allowed by the High Court in 2023 and former Chief Justice of India UU Lalit was eventually appointed as the third (and presiding) arbitrator.All of these events preceded the filing of the plea to extend the arbitral tribunal's mandate.Bearing these facts in mind, Justice Deshpande posed an additional question of how and where Section 29A applications ought to be entertained in cases where arbitral tribunals are constituted not on court orders, but based on consent by the parties.The question framed in this respect reads:"In the event an Arbitral Tribunal consisting of three Arbitrators is constituted as per Section 11(2) i.e. with agreement and consent of the parties, fails to complete the proceedings within the stipulated period/extended period, where an application under Section 29-A(4) would lie i.e. before the High Court or the Civil Court having original jurisdiction in the case of domestic arbitration?".Advocates Pawan Jhabakh, Gajendra Kanekar, Aniket S Kunde and Varun Salai appeared for the petitioner.Advocates Parag Rao, Ajay Menon, S Drago, Pulkit Bandodkar, and Shailesh Redkar represented various respondents..A related question concerning the interpretation of Section 29A recently arose before the Allahabad High Court as well. There, the question was whether High Courts that do not have "ordinary original civil jurisdiction" (such as the Allahabad High Court) could entertain such applications. Justice Shekhar B Saraf has referred the question to a larger bench of the Allahabad High Court.It may be noted that only five High Courts in India have ordinary original civil jurisdiction - the High Courts of Bombay, Madras, Calcutta, Delhi and Himachal Pradesh..[Read Judgment]