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TMI Blog2025 (1) TMI 623X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 5 of the Limitation Act ................................................... 18 ii. Section 12 of the Limitation Act ................................................. 20 iii. Section 14 of the Limitation Act ................................................. 20 iv. Section 17 of the Limitation Act ................................................. 22 v. Section 4 of the Limitation Act ................................................... 24 8. Applicability of Section 10 of the GCA .......................................... 31 9. Summarising the Current Position of Law ..................................... 32 10. Highlighting Certain Concerns with the Current Legal Position ...... 33 11. Conclusion ................................................................................. 37 1. Introduction: Leave granted. Facts, to the extent that they are relevant for determining the issue of limitation for filing an application challenging an arbitral award under Section 34 of the Arbitration and Conciliation Act, 19961 are as follows. The appellants received the arbitral award on 14.02.2022. The 3- month limitation period for filing the application under Section 34(3) o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... signed hard copy of the award on 14.02.2022, from which day limitation must be calculated. The 3-month limitation period under Section 34(3), after considering the extension of limitation by operation of this Court's order dated 10.01.2022 on account of the COVID-19 pandemic,4 expired on 29.05.2022. The further 30-day condonable period expired on 28.06.2022. This fell during the High Court's summer vacation between 04.06.2022 and 03.07.2022. The appellants filed the Section 34 petition along with an application for condonation of delay on the date when the court reopened, i.e., 04.07.2022. It would also be relevant to note the notification dated 20.05.2022 of the Registrar General of the Delhi High Court as per which 04.07.2022 would be considered the date of reopening for calculating limitation. In the meanwhile, the respondent filed for execution of the award. 3. Decision of the High Court under Section 34 and Section 37 of the ACA: The Section 34 application was dismissed by the single judge by order dated 07.02.2023 as being barred by limitation. The appellants preferred an appeal under Section 37, which was dismissed by the division bench by order dated 03.04.2024 that is imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sions: We have heard Mr. Neeraj Kishan Kaul, learned senior counsel for the appellants, and Mr. Syed Ahmed Naqvi, learned counsel for the respondent. Mr. Kaul's submissions proceed as follows: 5.1 First, referring to Union of India v. Popular Construction8 and its reliance in Assam Urban (supra), he submitted that the Limitation Act, including Section 4, does not apply to Section 34(3). Hence, he submitted that there was no occasion for the Court in Assam Urban (supra) to interpret Section 4 of the Limitation Act and delve into the difference between the ''prescribed period'' and the condonable period under Section 34(3). 5.2 Second, since the Limitation Act is excluded, Section 10 of the GCA applies to Section 34(3), including when the condonable period expires on a holiday. He relied on Sridevi Datla v. Union of India9, where the benefit of Section 10 of the GCA was extended to the party when the condonable period under Section 16 of the NGT Act expired on a holiday and the appeal was filed on the next working day. Additionally, he submitted that the term ''certain day'' in Section 10 of the GCA gives it wider import than Section 4 of the Limitation Act, and extends its applica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Engineering Enterprises v. Principal Secretary, Irrigation Department13, which is a 3-judge bench decision, to submit that Popular Construction (supra) only deals with the exclusion of Section 5 of the Limitation Act. In this case, Section 14 of the Limitation Act was held to be applicable. Similarly, he submitted that other decisions also apply Section 12 of the Limitation Act to Section 34(3). In the same vein, Section 4 of the Limitation Act also applies. 6.2 Third, regarding the manner in which Section 4 of the Limitation Act applies to Section 34(3), he submitted that Sagufa Ahmed (supra) clearly distinguishes the prescribed period and condonable period. The wording of Section 4 only makes it applicable to the 3-month period and not the 30-day condonable period, which cannot be extended any further. He also submitted that Sridevi Datla (supra) did not notice the distinction drawn in Sagufa Ahmed (supra) when applying Section 10 of the GCA. 6.3 Fourth, he submitted that Section 10 of the GCA does not apply to Section 34(3) as the Limitation Act applies. He also responded to Mr. Kaul's reliance on the words ''certain day'' in Section 10 of the GCA by submitting that they app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not expressly excluded by such special or local law. Therefore, Section 29(2) imports the provisions of the Limitation Act to special and local laws that prescribe a different period of limitation, unless there is an express exclusion contained in such law. Section 29(2) reads: "29. Savings.- (2) Where any special or local law prescribes for any suit, appeal or application a period of limitation different from the period prescribed by the Schedule, the provisions of section 3 shall apply as if such period were the period prescribed by the Schedule and for the purpose of determining any period of limitation prescribed for any suit, appeal or application by any special or local law, the provisions contained in sections 4 to 24 (inclusive) shall apply only in so far as, and to the extent to which, they are not expressly excluded by such special or local law." 9. The effect of Section 29(2) has been summarised by this Court in Mukri Gopalan v. Cheppilat Puthanpurayil15 as follows: "8. ...A mere look at the aforesaid provision shows for its applicability to the facts of a given case and for importing the machinery of the provisions containing Sections 4 to 24 of the Limitation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d court proceedings under the ACA, it is necessary to consider its applicability to Section 34 proceedings. Section 34(3) provides the limitation period and condonable period to file a Section 34 application, and it reads: "34. Application for setting aside arbitral award.- (3) An application for setting aside may not be made after three months have elapsed from the date on which the party making that application had received the arbitral award or, if a request had been made under section 33, from the date on which that request had been disposed of by the arbitral tribunal: Provided that if the Court is satisfied that the applicant was prevented by sufficient cause from making the application within the said period of three months it may entertain the application within a further period of thirty days, but not thereafter." 13. From reading the provision, it is clear that an application to set aside an arbitral award under Section 34 must be within 3 months from the receipt of the award or the date of disposal of a request under Section 33. This is the period of limitation.18 Further, the court may exercise discretion to entertain the application, within a further period o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation Act.23 18.1 The Court further considered the scheme and object of the ACA and held that Section 34(1) provides for recourse against the arbitral award "in accordance with" sub-sections (2) and (3), which set out the grounds and the time period for challenging the arbitral award. Reading the provision as a whole, the Court held that an application beyond 3 months and 30 days would not be "in accordance with" Section 34(3), and hence the recourse under Section 34(1) cannot be availed.24 18.2 Further, the Court also considered the enforceability of the award under Section 36 of the ACA once the time to make an application under Section 34 expires.25 Thus, it held that the scheme of the ACA would result in an exclusion of Section 5 of the Limitation Act, and therefore, a delay beyond 30 days cannot be condoned by recourse to Section 5. 19. Section 12 of the Limitation Act26: This Court in State of Himachal Pradesh v. Himachal Techno Engineers27 held that Section 12 of the Limitation Act applies for the purpose of calculating limitation under Section 34(3), and the same is not excluded by the provisions of the ACA. It held that the day from which the 3-month limitation period i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot enable condonation of delay in a Section 34 application beyond the 30-day period when such delay is caused due to fraud played on the applicant party. The Court took note of the applicability of Sections 12 and 14 of the Limitation Act (discussed above). It held that Section 17 only defers the commencement of the limitation period, but does not extend or break the limitation period.38 However, it held Section 17 to be inapplicable for the following reasons. 22.1 Under Section 34(3) of the ACA, the limitation period commences on the date of receipt of award or the date of disposal of request under Section 33 for correction or an additional award. However, if Section 17 of the Limitation Act were to apply, the limitation would commence on the date of discovery of the alleged fraud or mistake, and the outer limit to challenge the award would go beyond the mandatory 3 months plus 30 days period.39 Based on these inconsistencies between Section 17 of the Limitation Act and the language of Section 34(3), the Court held that there is an "express exclusion". 22.2 It also considered the object of the ACA to ensure speedy dispute resolution and finality to the award; enforceability of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ply to any act or proceeding to which the Indian Limitation Act, 1877 (15 of 1877), applies. (2) This section applies also to all Central Acts and Regulations made on or after the fourteenth day of January, 1887." (emphasis supplied) 25. As per Section 4, if the ''prescribed period'', which is defined in Section 2(j) of the Limitation Act as the period of limitation computed in accordance with its provisions41, expires on a day when the court is closed, the application may be made on the day when the court reopens. 26. This Court in Assam Urban (supra) considered the applicability of Section 4 of the Limitation Act in a situation when the condonable period of 30 days expired on a court holiday. The brief facts are that the appellants received the arbitral awards on 26.08.2003, the 3-month limitation period expired on 26.11.2003, on which date the court was open. The further condonable period of 30 days expired during court vacation between 25.12.2003 to 01.01.2004. The application under Section 34 was filed on 02.01.2004, on the date of court reopening. This Court upheld the dismissal of the Section 34 application on the ground of delay, as the same could not be condoned. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... during the court's winter/Christmas vacation. The Court here considered the applicability of Section 4 of the Limitation Act and Section 10 of the GCA. 29.1 On the issue of Section 4 of the Limitation, it held that the issue is covered by Assam Urban (supra), where it was held that the benefit of exclusion of the period when the court is closed is only available with respect to the "prescribed period of limitation" and not the period extendable by the court in exercise of its discretion.44 29.2 To determine the applicability of Section 10 of the GCA, it considered whether the Limitation Act applies to the ACA. It specifically rejected the submission that the Limitation Act does not apply. It further referred to Assam Urban (supra) on the extent of exclusion and held as follows in para 54: "54. Now, so far as the submission on behalf of the appellant that the Limitation Act shall not be applicable to the proceedings under the Arbitration Act is concerned, the aforesaid has no substance. Section 43(1) of the Arbitration Act specifically provides that the Limitation Act, 1963 shall apply to arbitrations as it applies to proceeding in Court. However, as observed and held by this Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his legal position, the final issue for our consideration is whether the appellant can claim the benefit of Section 10 of the GCA. This issue is also answered against the appellant by virtue of the clear and express language of the proviso to Section 10 of the GCA. 33. This Court in Bhimashankar (supra) has already considered this issue and has clearly held that since the Limitation Act applies to Section 34(3), Section 10 of the GCA is not applicable.46 The argument put forth by the appellant in its written submissions that Section 10 of the GCA must apply to the 30-day period stipulated in the proviso to Section 34(3) also warrants rejection due to the statutory language of the proviso to Section 10 of the GCA, which states that it does not apply to "any act or proceeding" to which the Limitation Act applies. Considering that Section 4 of the Limitation Act applies to a Section 34 proceeding, the appellant cannot simultaneously claim benefit of Section 10 of the GCA. 34. Since the applicability of Section 10 of the GCA is rejected at the very threshold, it is no longer necessary to consider the interpretation of "prescribed period'' under Section 10 of the GCA as including the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions 4 to 24 of the Limitation Act in special statutes, including the ACA, to the extent that its provisions are not expressly excluded. 36.2 The language of Section 34(3) read with its proviso does not expressly or impliedly exclude Section 4 of the Limitation Act and this interpretation is in consonance with the important principle contemplated under Section 29(2) to protect rights and remedies. This Court has already recognised the applicability of Section 4 of the Limitation Act. 36.3 The substantive remedies available under Sections 34 and 37 of the ACA are, by their very nature, limited in their scope due to statutory prescription. It is therefore necessary to interpret the limitation provisions liberally, or else even the limited window available to parties to challenge an arbitral award will be lost. The remedy under Section 34 is precious, and courts will keep in mind the need to secure and protect such remedy while applying limitation provisions.47 If this limited remedy is denied on stringent principles of limitation, it will cause great prejudice and has the effect of (a) denying the remedy, and (b) in the long run, it will have the effect of dissuading contracting pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Limitation Act and the manner in which they apply are at the doorstep of the court, rather than being determined by a clear and categorical statutory prescription. This is perhaps the reason why the Parliament has used the expression "express exclusion" in Section 29(2) of the Limitation Act. We are conscious of the fact that it is too late in the day to hold that "express exclusion" will not include implied exclusion. It is for the legislature to take note of this position and bring about clarity and certainty. We say no more, for the overbearing intellectualisation of the Act by courts has become the bane of Indian arbitration. 37. Conclusion: For the reasons set forth above, the application preferred by the appellant under Section 34 of the ACA stands dismissed as it was filed beyond the condonable period of 30 days, which conclusively and absolutely expired on 28.06.2022. 38. For the reasons stated above, we affirm the judgment and order passed by the High Court in FAO (OS) (COMM) No. 67/2023 dated 03.04.2024 and dismiss the appeal. 39. There shall be no order as to costs. 40. Pending applications, if any, stand disposed of. JUDGMENT PANKAJ MITHAL, J. 1. The sole issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... working day. However, the appellants filed the petition under Section 34 of the A & C Act, not on the last day of limitation i.e. 29.05.2022 but on 04.07.2022 when the Courts re-opened after the summer vacation which were notified between 04.06.2022 and 03.07.2022. The petition filed by the appellants under Section 34 of the A & C Act was accompanied by an application for condonation of delay. 6. The High Court rejected the delay condonation application and accordingly dismissed the petition filed by the appellants under Section 34 of the A & C Act vide order dated 07.02.2023 as barred by limitation. The appeal preferred by the appellants under Section 37 of the A & C Act before the Division Bench also met the same fate. 7. The submission is that, though, the period of limitation for filing a petition under Section 34 of the A & C Act is 3 months but the court, on being satisfied that the appellants were prevented by sufficient cause from filing the petition within the aforesaid 3 months, could have entertained it within a further period of 30 days. Therefore, the maximum period in which the petition under Section 34 of the A & C Act, after condoning the delay, could be entertai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en the courts were working. Therefore, the appellants were not entitled to the benefit of Section 4 of the Limitation Act to permit them to prefer the petition on the re-opening of the court as the period of limitation prescribed had not expired on the day when the court was closed. 14. The appellants are not entitled even to any benefit as per Section 10 of the General Clauses Act Hereinafter referred to as 'the GC Act', 1897 which also permits the filing of a petition on the re-opening of the court where the last day of prescribed period for filing it falls or expires on the day on which the court is closed. The proviso to Section 10 in no uncertain terms states that the provisions of Section 10 of the GC Act shall not apply to any Act or proceedings to which the Limitation Act applies. In the case at hand, admittedly in proceedings of arbitration as also to court proceedings under the A & C Act, the Limitation Act squarely applies. Therefore, by proviso to Section 10 of GC Act, Section 10 of the GC Act stands excluded and would not be attracted to accord any benefit to the appellants. 15. The period of limitation prescribed for instituting a suit or filing an appeal or making ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tute. Moreover, there may be genuine cases where the litigant may not be able to approach the court in time for cogent reasons beyond his control. For example, in arbitration matters where an award is passed on a particular date and a copy of it is also served upon the litigating party but that party happens to be seriously ill and hospitalised for months together and as such is unable to prefer a petition under Section 34 within the period of limitation prescribed. If the delay in challenging the award is not condoned beyond the period of 30 days, he would suffer great prejudice and may lose the remedy on a technical ground even though he may be having a good case on merit. There may also be a situation where a litigant is facing proceedings by the law enforcement agencies like the Enforcement Directorate, Central Bureau of Investigation, etc., and is taken into custody and as such is unable to take the legal remedy within the period of limitation prescribed. He avails the remedy only after he is out of custody; months after the service of the order. In such circumstances, in my opinion, the legislature ought not to confine condoning the delay only for a prescribed period and not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CC 692, paras 13 and 14. 16 Consolidated Engineering (supra), para 42. 17 ibid, para 45. 18 State of Goa v. Western Builders, (2006) 6 SCC 239, para 10; Consolidated Engineering Enterprises (supra), para 19. 19 See State of Maharashtra v. Hindustan Construction Co. Ltd., (2010) 4 SCC 518, para 29. 20 Mangu Ram v. Municipal Corporation of Delhi, (1976) 1 SCC 392, para 7. 21 Hukumdev Narain Yadav v. Lalit Narain Mishra, (1974) 2 SCC 133, para 17; Popular Construction (supra), paras 8-11; Commissioner of Customs and Central Excise v. Hongo India Pvt Ltd, (2009) 5 SCC 791, para 35. 22 Section 5 of the Limitation Act reads: "5. Extension of prescribed period in certain cases.-Any appeal or any application, other than an application under any of the provisions of Order XXI of the Code of Civil Procedure, 1908 (5 of 1908), may be admitted after the prescribed period, if the appellant or the applicant satisfies the court that he had sufficient cause for not preferring the appeal or making the application within such period. Explanation.-The fact that the appellant or the applicant was misled by any order, practice or judgment of the High Court in ascertaining or computing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or (c) the suit or application is for relief from the consequences of a mistake; or (d) where any document necessary to establish the right of the plaintiff or applicant has been fraudulently concealed from him, the period of limitation shall not begin to run until plaintiff or applicant has discovered the fraud or the mistake or could, with reasonable diligence, have discovered it; or in the case of a concealed document, until the plaintiff or the applicant first had the means of producing the concealed document or compelling its production..." 37 (2019) 13 SCC 445. 38 ibid, para 30. 39 ibid, paras 31.1-31.2. 40 ibid, paras 36-37. 41 Section 2(j) of the Limitation Act reads: "2. Definitions.-In this Act, unless the context otherwise requires,- (j) "period of limitation" means the period of limitation prescribed for any suit, appeal or application by the Schedule, and "prescribed period" means the period of limitation computed in accordance with the provisions of this Act;" (emphasis supplied) 42 Assam Urban (supra), para 9. 43 ibid, paras 11-14. 44 Bhimashankar (supra), paras 50-53. 45 Rajpath Contractors (supra), paras 10-12. 46 Bhimashankar (supra), ..... X X X X Extracts X X X X X X X X Extracts X X X X
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