Section 29A Applications Must Be Filed Before Court Under Section 2(1)(e), Not Before Appointing High Court: Supreme Court

Case Overview

Jagdeep Chowgule Vs Sheela Chowgule & Ors. (Supreme Court of India)

The Supreme Court of India delivered a significant ruling addressing a long-standing jurisdictional controversy under the Arbitration and Conciliation Act, 1996. The central issue before the Court was whether an application for extension of an arbitral tribunal's mandate under Section 29A(4) must be preferred before the High Court that had originally appointed the arbitrator under Section 11, or whether it must be filed before the "Court" as defined under Section 2(1)(e) of the Act.

The Supreme Court settled this controversy decisively, holding that the expression "Court" in Section 29A bears the meaning assigned to it under Section 2(1)(e), regardless of whether the arbitral tribunal was constituted by the parties themselves or by the High Court or Supreme Court under Section 11.

Background Facts

The dispute in the present case originated from a Memorandum of Family Settlement (MFS) dated 11.01.2021, executed among members of the Chowgule family. Arbitration was invoked under Clause 24 of the MFS on 18.05.2021. On 05.08.2023, Respondent No. 2 moved an application for extension of time before the Commercial Court under Section 29A.

In the intervening period, the presiding arbitrator resigned, prompting Respondent No. 2 to approach the High Court of Bombay at Goa under Section 11 for appointment of a substitute arbitrator. The High Court allowed that application on 31.10.2023. Subsequently, the Commercial Court allowed the extension application under Section 29A vide its order dated 02.01.2024.

Respondent No. 1 challenged the Commercial Court's order by filing a writ petition on 08.01.2024, contending that since the arbitrator had been appointed by the High Court under Section 11, the Commercial Court lacked jurisdiction to extend the mandate under Section 29A.

The Single Judge of the High Court of Bombay at Goa referred two questions to the Division Bench, which answered them by holding:

• Where the arbitral tribunal is constituted by the High Court under Section 11(6), the application under Section 29A(4) must be filed before the High Court.
• Where the arbitral tribunal is constituted by consent of parties under Section 11(2), the application must be filed before the Principal Civil Court of original jurisdiction.

Following this, the Single Judge allowed the writ petition, set aside the Commercial Court's order, and permitted the parties to approach the High Court for extension. The appellant challenged both orders before the Supreme Court.

The Core Question Reframed

The Supreme Court observed that the questions as framed by the High Court were unnecessarily bifurcated and that such bifurcation had itself contributed to conflicting judicial outcomes. The Court reframed the question as follows:

If an arbitral tribunal — appointed either by the High Court or by the parties — fails to complete proceedings within the prescribed or extended time limit, can an application under Section 29A for extension be filed before the Civil Court or must it be filed before the High Court?

Divergent Views of High Courts

View 1 — "Court" in Section 29A Means Court as Defined in Section 2(1)(e)

Several High Courts, including in Mormugao Port Trust v. Ganesh Benzoplast Ltd., M/s A'Xykno Capital Services Private Ltd. v. State of UP, and Dr. VV Subbarao v. Dr. Appa Rao Mukkamala & Ors., consistently held that: