On Monday (15th April), Bombay High Court in Goa faces jurisdictional challenge under the Arbitration Act, 1996, prompting a significant inquiry. Justice Bharat P Deshpande addresses divergent opinions, referring the matter to a larger bench for consistency and clarity in proceedings
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GOA: On Monday (15th April), The Bombay High Court in Goa confronted a challenging jurisdictional issue under the Arbitration Act, 1996, initiating a significant judicial inquiry with potential implications for future arbitration cases in India. Justice Bharat P Deshpande addressed this crucial matter on a notable day, acknowledging divergent opinions within the Bombay High Court and consequently referring the issue to a larger bench to ensure clarity and consistency in proceedings.
The topic revolves around the interpretation of Section 29A of the Arbitration Act, 1996, which delineates the procedural timeline for arbitration proceedings.Justice Deshpande recently referred to two divergent decisions of the Bombay High Court regarding the appropriate court for applications under this section.
In the judgment dated April 15, Justice Deshpande expressed his perspective, noting-
“Considering the divergent views presented by the learned Single Judges in the cases of Mormugao Port Trust (supra) and subsequently in K.I.P.L. Vistacore Infrastructure J.V. (supra), and the oversight of not bringing the Mormugao Port Trust (supra) decision to light during the K.I.P.L. Vistacore Infrastructure J.V. (supra) proceedings, it is judicially appropriate to refer the matter to a Larger Bench.”
The referral originated from a writ petition that challenged a decision by a district commercial court in January 2024. The petition questioned the court’s jurisdiction to prolong the timeline for specific arbitral proceedings, contending that such authority resides exclusively with the High Court, rather than the district (or commercial) court.
The respondents opposed this stance, asserting that the term “court” in Section 29A(4) encompasses courts with original civil jurisdiction, including district courts empowered by the Commercial Courts Act. Thus, they argued that the district court in question rightfully possessed the authority to extend the arbitration timeframe.
Justice Deshpande’s inquiry into this jurisdictional maze was guided by two key Bombay High Court rulings:
- In the 2020 case of Mormugao Port v. Ganesh Benzoplast Ltd, district courts with ordinary original jurisdiction were acknowledged as competent to address Section 29A applications.
- However, the contradictory ruling in the 2024 case of KIPL Vistacore InfraProjects JV v. Municipal Corporation of the City of Ichalkarnji affirmed the High Court’s exclusive jurisdiction over such issues.
Justice Deshpande‘s concerns about the interpretation in the Mormugao Port Trust case led him to question the need for a definitive ruling. Consequently, he opted to refer the matter to a larger bench. The larger bench will weigh in on whether Section 29A applications should be handled by the High Court or a civil court with original jurisdiction, particularly in situations where an Arbitral Tribunal constituted by the High Court exceeds the prescribed timeframe for concluding proceedings.
Furthermore, Justice Deshpande introduced an additional layer of complexity regarding arbitral tribunals constituted through mutual agreement by the parties, posing a vital question on the appropriate forum for Section 29A applications in such instances.
This judicial inquiry is not isolated, as a related issue has also emerged before the Allahabad High Court, highlighting a deliberation on the jurisdictional scope of High Courts in arbitration matters, particularly those lacking “ordinary original civil jurisdiction.”
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Advocates Pawan Jhabakh, Gajendra Kanekar, Aniket S Kunde, and Varun Salai represent the petitioner, while advocates Parag Rao, Ajay Menon, S Drago, Pulkit Bandodkar, and Shailesh Redkar represent the respondents.
