Dentons Link Legal Secures Supreme Court Ruling on Extension of Arbitration Agreements by Conduct

Dentons Link Legal is pleased to share a significant ruling of the Bombay High Court, affirmed by the Supreme Court of India, in the case of Raymond Limited v. Miltex Apparels & Ors., settling the law on the extension of arbitration agreements by conduct of parties under Section 7 of the Arbitration and Conciliation Act, 1996.

The Bombay High Court, in a Section 37(2)(a) appeal filed by our firm on behalf of Raymond Limited, set aside an arbitral tribunal's order terminating the arbitral proceedings under Section 16 of the Act. The Court held that where parties extend an agreement - whether expressly in writing or impliedly through their conduct and continued performance — all terms of that agreement, including the arbitration clause, stand extended sub silentio and by necessary implication, without any requirement for a specific reiteration of the arbitration clause. The Court further held that the question of whether an agreement has been extended by conduct is a mixed question of fact and law, and that a tribunal cannot rule on jurisdiction without first permitting parties to lead evidence on the point.

This judgment, which was challenged by way of a Special Leave Petition before the Supreme Court of India [Diary No. 9453 of 2026], was affirmed by the Supreme Court by its order dated 12 March 2026, dismissing the SLP and confirming the Bombay High Court's ruling in its entirety.

The decision is expected to serve as an important precedent for businesses operating under distribution, supply, and commercial arrangements that continue beyond their stated contractual term, and is likely to have significant implications for arbitration jurisdiction disputes, the interpretation of Section 7 of the Act, and the evidentiary standards applicable to questions of contract extension by conduct in India.

Dentons Link Legal represented Raymond Limited before the Hon'ble Bombay High Court and the Hon'ble Supreme Court of India. The matter was led by Partner Mr. Saahil Memon, supported by a team comprising Ms. Oindrila Mukherjee, Ms. Jahnvi Pandey, and Mr. Ishan Jha.