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2023 Supreme(Guj) 236

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
Bhargav D. Karia, J.
M/s Magirsha Industries – Petitioner
Versus
M/S Gujarat State Fertilizer and Chemicals Limited – Respondent
R/Petn. Under Arbitration Act No. 13 of 2023
Decided On : 10-02-2023

Advocates:
Advocate Appeared:
For the Petitioner: Rushabh H Shah
For the Respondent: Mr Nisarg Desai With Mr Devarsh Trivedi For Gandhi Law Associates

The main legal point established in the judgment is that the application for extension of time under Section 29A(4) of the Arbitration Act is to be heard by the Court having jurisdiction to hear Arbitration petitions under the roster.

Headnote:

Arbitration Act - Extension of Arbitral Proceedings - Section 29A (4) - Section 29A(5) - Section 11(6)

Fact of the Case:

The applicant sought an extension of the arbitral proceedings under Section 29A(4) of the Arbitration Act due to the inability to attend the arbitration proceedings. The Court granted an extension of 12 months from the date of expiry, excluding the period during which the Court and the Apex Court had extended the period of limitation due to the COVID-19 pandemic.

Finding of the Court:

The Court found that the application for extension of time under Section 29A(4) of the Arbitration Act is to be heard by the Court, and in this case, it was required to be heard by the Court having jurisdiction to hear Arbitration petitions under the roster.

Issues: The main issue was whether the application for extension of time under Section 29A(4) of the Arbitration Act should be heard by the Court or by the nominee of the Chief Justice under Section 11(6) of the Arbitration Act.

Ratio Decidendi: The Court held that the application for extension of time under Section 29A(4) of the Arbitration Act is to be heard by the Court having jurisdiction to hear Arbitration petitions under the roster, and granted an extension of two months to complete the arbitral proceedings.

Final Decision: The Court allowed the application and granted an extension of two months to complete the arbitral proceedings.

ORDER :

1. Heard learned advocate Mr.Rushabh H. Shah for the applicant and learned advocate Mr.Nisarg Desai with Mr.Devarsh Trivedi for Gandhi Law Associates for the respondent no.1, who appears on advance copy.

2. This is an application under Section 29A (4) read with Sub-section (5) read with Section 29A of the Arbitration and Conciliation (Amendment) Act, 2019 (for short “the Arbitration Act”). It is stated in the application that a reference was made by the Micro Small and Medium Enterprise Facilitation Council to the Gujarat Chamber of Commerce Alternative Dispute Resolution Center under Section 18(3) of the Micro Small and Medium Enterprise Act, 2006. Pursuant to the reference made by the Council, Mr.Amal Dhru was appointed as a Sole Arbitrator in the year 2018.

3. The Arbitral proceedings are conducted as under:-

    “i. Submission of statement of claim: on or before 01st January, 2019;

ii. Reply to statement of claim & Counter claim, if any: on or before 9th February, 2019;

iii. Rejoinder/reply to counter claim, if any: on or before 23rd February, 2019;

iv. Rejoinder to reply in case if there is any counter claim: on or before 9th March, 2019;

v. Suggested issues along with admission and denial of documents to be submitted by the Claimant & Respondent on 16th March, 2019;

vi. Hearing for framing of issues and admission and denial of documents: 23rd March, 2019.”

4. The claim statement along with the documents was submitted on 1st January, 2019 by the applicant and the statement of defence was filed by the respondent on 9th February, 2019 and rejoinder was filed on 25th February, 2019.

5. Learned advocate Mr.Rushabh Shah referred to Section 29A(1) of the Arbitration Act which stipulates that the Arbitral Tribunal is required to pass an award within a period of 12 months from the date of completion of the pleadings under Sub-section (4) of Section 23 of the Arbitration Act. It was submitted that the 12 months period for passing the award by the Tribunal would start from 26.02.2019 and would end on 26.02.2020 and 12 months would be completed on 26.02.2020. It was submitted that the parties could not attend the arbitration proceedings and therefore an application was filed being IAAP No.68 of 2020 before this Court under Section 29A(4) of the Arbitration Act for extension of the arbiral proceedings.

6. Learned advocate Mr.Shah invited the attention of this Court to the order dated 04.03.2022 passed by the Hon’ble the Chief Justice of this Court granting extension of 12 months, which reads as under:-

    “(ii) Tribunal is granted extension of time namely 12 months from the date of expiry and it is made clear that the period during which this Court and the Hon’ble Apex Court had extended the period of limitation would also stand excluded for the purposes of computation of 12 months period.”

7. Therefore, the period from 20.03.2020 to 26.02.2021 is required to be excluded as per the order dated 10.01.2022 passed by the Hon’ble Apex Court in Miscellaneous Application NO.21 of 2022 in Miscellaneous Application NO.665 of 2021 in SUO Motu Writ Petition (C) No.3 of 2020 IN RE: Congnizance For Extension of Limitation With Miscellaneous Application NO.29 of 2022 in Miscellaneous Application NO.665 of 2021 in SUO Motu Writ Petition (C) No.3 of 2020, which reads as under:-

    “1. In March, 2020, this Court took Suo Motu cognizance of the difficulties that might be faced by the litigants in filing petitions/ applications/ suits/ appeals/ all other quasi proceedings within the period of limitation prescribed under the general law of limitation or under any special laws (both Central and/or State) due to the outbreak of the COVID-19 pandemic.

2. On 23.03.2020, this Court directed extension of the period of limitation in all proceedings before Courts/Tribunals including this Court w.e.f. 15.03.2020 till further orders. On 08.03.2021, the order dated 23.03.2020 was brought to an end, permitting the relaxation of period of limitation between 15.03.2020 and 14.03.20

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