Court Deciding Plea To Extend Arbitral Tribunal Mandate Concerned Only With Extension, Not Merits: Calcutta High Court
The Calcutta High Court has held that while exercising jurisdiction to extend the mandate of an arbitral tribunal under Section 29A of the Arbitration Act, the court is concerned only with whether extension of time is warranted and cannot examine the merits of issues pending before the tribunal.
While deciding a petition filed by UGRO Capital Ltd seeking extension of the mandate of a sole arbitrator in a dispute with Vallabh Metal Industries, Justice Gaurang Kanth observed:
“In any event, while exercising jurisdiction under Section 29A of the Arbitration and Conciliation Act, 1996, this Court is concerned only with the question whether extension of the mandate is warranted and not with the merits of issues pending before the Tribunal.”
The dispute arises out of a Facility Agreement executed between the parties on May 2, 2019. After disputes emerged, UGRO Capital invoked the arbitration clause through a notice dated March 22, 2022. When the respondent failed to appoint an arbitrator in terms of the agreement, the petitioner approached the Calcutta High Court under the Arbitration Act.
On December 22, 2022, the court appointed a sole arbitrator to adjudicate the dispute.
With the consent of the parties, the arbitrator's mandate was extended until August 8, 2024. During the proceedings, the tribunal also decided applications under Section 17 of the Arbitration Act and considered a plea for impleadment of additional parties. The matter had progressed to the evidence stage and cross-examination of the claimant's witness had commenced.
In the meantime, the respondent raised objections regarding stamp duty on the Facility Agreement and the document was forwarded to the Collector for adjudication on June 17, 2024.
Addressing the objection, the court clarified that questions relating to stamping and admissibility of documents fall within the domain of the arbitral tribunal and do not prevent the Court from considering a request to extend the tribunal's mandate.
Finding that the arbitration proceedings were at an advanced stage and that there was no undue delay attributable to the arbitrator, the court extended the mandate of the sole arbitrator for a period of six months to enable completion of the proceedings and publication of the award.
For Petitioner: Advocates Rohit Banerjee, K.K. Pandey, Sonia Nandy, Mallika Bothra
For Respondent: Advocates Aniruddha Bhattacharya, Arnab Roy