The Supreme Court has definitively resolved a long-standing circuit split on the jurisdictional forum for extending the time limit for arbitral awards under Section 29A of the Arbitration and Conciliation Act, 1996. The judgment clarifies that the identity of the appointing authority - whether the High Court under Section 11(6) or the parties under Section 11(2) - has no bearing on which court may grant an extension. The statutory definition of 'Court' in Section 2(1)(e) governs exclusively.
Background & Facts
The Dispute
The dispute arose from a family settlement agreement between members of the Chowgule family, which contained an arbitration clause. After disagreements surfaced, arbitration was invoked in May 2021. The presiding arbitrator resigned, prompting one party to seek appointment of a new arbitrator under Section 11 before the High Court of Bombay at Goa. The High Court appointed the arbitrator in October 2023. Subsequently, the same party applied to the Commercial Court under Section 29A(4) for an extension of time to complete the award. The Commercial Court granted the extension in January 2024.
Procedural History
- May 2021: Arbitration invoked under Clause 24 of the Memorandum of Family Settlement.
- August 2023: Application filed under Section 11 before the High Court due to resignation of presiding arbitrator.
- October 2023: High Court appointed new arbitrator under Section 11(6).
- January 2024: Commercial Court granted extension of time under Section 29A(4).
- January 2024: Opposing party filed writ petition challenging jurisdiction of Commercial Court.
- April 2024: Single Judge referred questions to Division Bench.
- August 2024: Division Bench held that only the High Court could entertain Section 29A applications where arbitrator was appointed by it.
- August 2024: Single Judge quashed Commercial Court’s order, directing parties to approach the High Court.
Relief Sought
The appellant sought restoration of the Commercial Court’s order granting the extension, arguing that Section 29A(4) applies uniformly to all domestic arbitrations, irrespective of the appointing authority. The respondent contended that the High Court, as appointing authority, retained exclusive supervisory jurisdiction.
The Legal Issue
The central question was whether the expression "Court" in Section 29A(4) of the Arbitration and Conciliation Act, 1996 refers exclusively to the court defined under Section 2(1)(e), or whether it shifts to the High Court or Supreme Court that appointed the arbitrator under Section 11(6).
Arguments Presented
For the Appellant
The appellant relied on State of West Bengal v. Associated Contractors and Nimet Resources Inc. v. Essar Steels Ltd. to argue that Section 2(1)(e) provides an exhaustive definition of "Court" for Part I of the Act. The appellant emphasized that Section 29A is located in Chapter VI, which governs the conduct of arbitral proceedings and award-making, not appointment. The legislature deliberately excluded the High Court from being the default forum for extensions, and no contextual indication in Section 29A overrides the statutory definition. The appellant further cited Chief Engineer (NH) PWD v. BSC&C and C JV to affirm that the Principal Civil Court is the proper forum.
For the Respondent
The respondents relied on judgments from the Gujarat, Delhi, and Calcutta High Courts, arguing that permitting a Civil Court to extend the mandate of an arbitrator appointed by the High Court creates a "jurisdictional anomaly" and a "conflict of power." They contended that the phrase "unless the context otherwise requires" in Section 2(1) permits contextual interpretation, and that the High Court’s role as appointing authority implies residual supervisory control. They feared that allowing subordinate courts to substitute arbitrators appointed by superior courts would undermine judicial hierarchy and procedural coherence.
The Court's Analysis
The Supreme Court undertook a rigorous textual, contextual, and structural analysis of the Arbitration and Conciliation Act, 1996. It rejected the notion that judicial hierarchy or perceived power conflicts could override a statutory definition. The Court held that the principle of rule of law, as articulated in A.R. Antulay v. R.S. Nayak, mandates that jurisdiction flows only from law, not from the status of the court.
"Interpretation based on a perception of status or hierarchy of Courts is opposed to the fundamental conception of rule of law. It is apt to refer to the famous statement of Dicey that, ‘however high you may be, the law is above you.’ Law, and law alone is the source of power."
The Court emphasized that Section 11 confers a limited, special jurisdiction for appointment only. Once the arbitral tribunal is constituted, the appointing court becomes functus officio. This principle was reaffirmed in SBP & Co. v. Patel Engineering and State of Jharkhand v. Hindustan Construction Co. The Court distinguished Section 29A from Section 11: while the latter concerns appointment, the former concerns supervision of proceedings and award timelines - matters squarely within the domain of the court defined in Section 2(1)(e).
The Court also dismissed the applicability of Section 42, noting that applications under Section 11 are not made before the "Court" as defined, and therefore cannot trigger exclusive jurisdiction under Section 42. The judgment in Associated Contractors was reaffirmed: the Chief Justice’s role under Section 11 is administrative and distinct from judicial supervision under Section 29A.
The Court concluded that Section 29A(4), (6), and (7) - which empower the Court to extend time, substitute arbitrators, and continue proceedings - must be read consistently with Section 2(1)(e). No contextual indicator in Section 29A justifies deviating from the statutory definition.
The Verdict
The appellant won. The Supreme Court held that the "Court" under Section 29A(4) is exclusively the court defined under Section 2(1)(e) - the Principal Civil Court of original jurisdiction or the High Court in exercise of its ordinary original civil jurisdiction - regardless of whether the arbitrator was appointed by the High Court under Section 11(6) or by the parties under Section 11(2). The orders of the Division Bench and Single Judge were set aside, and the Commercial Court’s extension order was restored.
What This Means For Similar Cases
The Court Defined in Section 2(1)(e) Is the Only Forum for Section 29A Applications
- Practitioners must file applications for extension of arbitral timelines under Section 29A(4) before the Principal Civil Court or the High Court with ordinary original civil jurisdiction.
- Filing such applications before the appointing High Court under Section 11(6) will be procedurally defective and subject to dismissal.
- The mere fact that the arbitrator was appointed by the High Court does not confer jurisdiction on it for subsequent supervisory applications.
Appointment and Supervision Are Legally Distinct Functions
- Section 11 is a one-time appointment mechanism; Section 29A is an ongoing supervisory mechanism.
- Once appointed, the arbitrator operates independently; the appointing court has no residual authority over timelines, substitutions, or fee reductions.
- Lawyers must avoid conflating appointment jurisdiction with supervisory jurisdiction in pleadings and applications.
Substitution of Arbitrators Must Be Sought in the Correct Forum
- Applications under Section 29A(6) for substitution of arbitrators must be filed before the court defined in Section 2(1)(e), not the appointing court.
- The Supreme Court’s clarification eliminates forum shopping and ensures uniformity in arbitral supervision across India.
- Practitioners should verify the jurisdictional competence of the forum before filing any application under Section 29A.
