Andhra Pradesh High Court Upholds Extension of Arbitrator's Mandate in Commercial Dispute

Court Validates Extension of Arbitration Period Citing Procedural Delays and Sufficient Cause

The Andhra Pradesh High Court, in a recent decision, upheld the extension of the mandate of a sole arbitrator in the commercial dispute case of Chidepudi Bhanu Srivastava and others versus Sri Kancharla Subrahmanyam. The appeal, filed under Section 13 of the Commercial Courts Act, 2015, challenged the order of the Special Court for Trial and Disposal of Commercial Disputes in Vijayawada, which extended the arbitrator's mandate until December 31, 2025.

The case, initially filed under Section 29A(5) of the Arbitration and Conciliation Act, 1996, sought an extension for the arbitral proceedings which were due to conclude. The appellants opposed this extension, arguing that the application for extension was not filed within the statutory period and lacked sufficient cause. However, the Special Court justified the extension due to procedural delays and adjournments, such as an impleadment petition and an application under Order VII Rule 11 CPC, which significantly hindered the proceedings.

The High Court bench, comprising Justices Sri Ravi Nath Tilhari and Sri Maheswara Rao Kuncheam, reiterated the legal position established in previous Supreme Court judgments, including Rohan Builders (India) Private Limited v. Berger Paints India Limited and Ajay Protech Private Limited v. General Manager. These judgments clarified that an application for extension under Section 29A(4) could be entertained even after the expiry of the arbitral mandate, provided there is sufficient cause.

The bench concluded that the Special Court had rightly exercised its discretion in extending the mandate, noting that the arbitration proceedings had substantially progressed and that the cause for delay was well-documented. The appeal was dismissed at the admission stage, with no costs imposed, affirming that the period of extension was within the discretion of the Special Court.

Bottom Line:

Arbitration Law - Section 29A of the Arbitration and Conciliation Act, 1996 empowers courts to extend the mandate of arbitrators for making arbitral awards even after the expiry of the stipulated period, provided sufficient cause is established.

Statutory provision(s): Arbitration and Conciliation Act, 1996 Section 29A, Commercial Courts Act, 2015 Section 13

Chidepudi Bhanu Srivastava v. Sri Kancharla Subrahmanyam, (Andhra Pradesh)(DB) : Law Finder Doc Id # 2804549