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2025 Supreme(Online)(Mad) 67486
IN THE HIGH COURT OF JUDICATURE AT MADRAS
N. ANAND VENKATESH, J
S.V.Saranya Partner M/s.Supreme Foundation Partnership Firm – Appellant
Versus
Supreme Foundation Partnership Firm – Respondent
A.No.4409 of 2025
For the Appellants/Petitioners: Mr.A.Ramesh Manikandan
For RR6 & 7: Mrs.Vedavalli Kumar
The court emphasizes that under Section 29A of the Arbitration and Conciliation Act, extensions should facilitate effective dispute resolution, even when one party withdraws a claim.
Headnote:(A) Arbitration and Conciliation Act, 1996 - Section 29A - Extension of time for completion of arbitration proceedings - Applicant sought extension citing counterclaim, while claimant expressed disinterest - Court must ensure that extension facilitates effective dispute resolution, reiterating the need for cooperation - Second request for extension considered based on parties' claims. (Paras 5, 6, 7)
(B) Dispute Resolution - Court's role in adjudicating extensions is limited to facilitating resolutions - Rejection of claimant’s withdrawal does not preclude consideration of counterclaims. (Paras 4, 5)
Facts of the case:
The applicant, a partner in a partnership firm, applied to extend arbitration time despite the claimant's withdrawal request, asserting that counterclaims must still be addressed.
Findings of Court:
Noting that this is the second extension request, the Court granted a six-month extension for arbitration proceedings while clarifying no further extensions would be allowed.
Issues: The main issue concerns whether an extension of time is warranted when one party withdraws a claim but counterclaims remain.
Ratio Decidendi: The Court held that the adjudication scope under Section 29A is limited, emphasizing the need for effective dispute resolution while accommodating both claims and counterclaims.
Result: Extension of six months granted for arbitration proceedings.
| Table of Content |
|---|
| 1. court considers request for arbitration extension despite withdrawal of the claim. (Para 1 , 2) |
| 2. arguments presented regarding claims and counterclaims in arbitration proceedings. (Para 3 , 4) |
| 3. court's role is to facilitate effective dispute resolution under section 29a. (Para 5 , 6 , 7) |
O R D E R
This application has been filed under Section 29A of the Arbitration and Conciliation Act, 1996 , seeking for extension of time for the completion of the arbitration proceedings between the applicant and the respondents.
2. The 6th respondent has filed a detailed counter affidavit and has brought to the notice of this Court that the 6th respondent, who was the claimant, sought withdrawal of the claim and in spite of the same, the said request was rejected and that the 6th respondent is not interested in prosecuting the claim any more.
3. Learned counsel appearing for the 6th respondent submitted that if the claimant is not interested in prosecuting the claim, no useful purpose will be served in extending the period for the completion of the arbitration proceedings.
4. Per contra, learned counsel for the applicant submitted that the applicant has made counterclaim and therefore, even if the claimant does not want to prosecute the claim, that will not result in the automatic closure of the proceedings and the counterclaim has to be considered by the learned Arbitrator.
5. In the considered view of this Court, the scope of an application under Section 29A of the Act is very limited. The Apex Court, in the case ofM/s.Ajay Protech Pvt. Ltd. Vs. General Manager & Another reported in(2024) SCC OnLine SC 3381, has held that the Court must only facilitate an effective dispute resolution and should not obstruct it.
6. The liberal interpretation given to Section 29A application was further reiterated in the case ofRohan Builders (India) Pvt. Ltd. Vs. Berger Paints India Ltd. reported in(2024) SCC OnLine SC 2494 , wherein, the Apex Court went to the extent of saying that such an application is maintainable, even after the prescribed period is over. Therefore, the consistent view of the Apex Court is that only in rare cases, such extension of time should not be granted and normally, the Court must ensure that the time is extended for facilitating the effective dispute resolution.
7. In the considered view of this Court, the scope of adjudication in an application under Section 29A is very limited. The Court must only see if the extension of time will facilitate in the effective dispute resolution between the parties. Considering the claim and counterclaim made by both the parties and also considering the fact that this is the second instance, where the parties have approached this Court seeking extension of time, this Court is inclined to extend the time for a period of six months. This Court expects both the parties to co-operate for the completion of the proceedings within the extended time. It is made clear that no further extension of time will be granted by this Court. The above direction issued by this Court will not stand in the way of both the parties raising all their grounds to workout their remedy in the manner known to law.
This application is disposed of in the above terms.
