1. Challenge to arbitral award under Section 34, Arbitration and Conciliation Act — Limitation period expiry during court vacation — Application filed upon reopening. (Para 1 , 2 , 4 )
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2025 Supreme(SC) 84
SUPREME COURT OF INDIA
PAMIDIGHANTAM SRI NARASIMHA, PANKAJ MITHAL, JJ.
My Preferred Transformation & Hospitality Pvt. Ltd. & Anr. - Appellants
Versus
M/s Faridabad Implements Pvt. Ltd. - Respondent
Civil Appeal No. 336 of 2025 (ARISING OUT OF SLP (C) NO. 9996 OF 2024)
Decided on : 10-01-2025.
Advocates appeared:
For the Petitioner(s): Mr. Harsh Kaushik, AOR Ms. Adrija Mishra, Adv.
For the Respondent(s): Mr. Simran Mehta, Adv. Ms. Aruna Gupta, AOR Mr. Ramesh Allanki, Adv. Mr. Amit Kumar, Adv. Mr. Syed Ahmad Naqvi, Adv.
For the Petitioner(s): Mr. Harsh Kaushik, AOR Ms. Adrija Mishra, Adv.
For the Respondent(s): Mr. Simran Mehta, Adv. Ms. Aruna Gupta, AOR Mr. Ramesh Allanki, Adv. Mr. Amit Kumar, Adv. Mr. Syed Ahmad Naqvi, Adv.
The Limitation Act applies to arbitration proceedings under Section 34 of the ACA, but the condonable period does not extend beyond 30 days when it expires during a court holiday.
Headnote:(A) Arbitration and Conciliation Act, 1996 - Sections 34 and 37 - Limitation Act, 1963 - Sections 4, 10, 12, 14, and 17 - Applicability of Limitation Act to Section 34 proceedings - Court held that the application under Section 34 was barred by limitation as it was filed beyond the condonable period of 30 days, which expired on 28.06.2022, during court vacation - The court clarified that Section 4 applies only to the 3-month limitation period, not the 30-day condonable period. (Paras 1, 35, 36, and 37)
(B) Limitation - The court emphasized the need for a liberal interpretation of limitation statutes to avoid unduly restricting remedies available to parties in arbitration, while noting the stringent nature of the current legal position. (Paras 36.1-36.6)
Legal Category Hierarchy
Table of Contents
2. Analysis of Section 29(2) Limitation Act and Section 43(1) ACA — Distinction between prescribed period and condonable period — Inapplicability of Section 10, GCA. (Para 8 , 9 , 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17 , 18 , 19 , 20 , 21 , 22 , 23 , 24 , 25 , 26 , 27 , 29 , 30 , 31 , 32 , 34 , 36 )
3. Section 4, Limitation Act applies only to the prescribed 3-month period, not the condonable 30-day period; Section 10, GCA is excluded where the Limitation Act applies. (Para 28 , 33 )
4. Appeal dismissed — Application under Section 34, Arbitration and Conciliation Act held barred by limitation. (Para 37 , 38 )
5. Does the Limitation Act apply to Section 34 proceedings of the Arbitration and Conciliation Act?
Yes. The Limitation Act applies to ACA proceedings via Section 43(1) of the ACA and Section 29(2) of the Limitation Act, except where its provisions are expressly or impliedly excluded by the ACA's specific statutory scheme. (Para 8 , 10 , 11 , 14 , 23 )
6. Does Section 4 of the Limitation Act apply to the 30-day condonable period under Section 34(3) ACA?
No. Section 4 applies only to the prescribed period of limitation (3 months). It does not extend to the discretionary condonable period of 30 days if that period expires on a court holiday. (Para 26 , 28 , 31 )
7. Is Section 10 of the General Clauses Act applicable to the condonable period under Section 34(3) ACA?
No. Section 10 of the GCA is inapplicable to Section 34(3) ACA because the Limitation Act applies to these proceedings, triggering the GCA's exclusion proviso which states it does not apply to any act or proceeding to which the Limitation Act applies. (Para 32 , 33 )
8. Can Section 5 of the Limitation Act be used to condone delay beyond the 30-day period in Section 34(3) ACA?
No. Section 5 of the Limitation Act is excluded from Section 34(3) ACA because the phrase but not thereafter in the proviso constitutes an express exclusion, meaning delay beyond 30 days cannot be condoned via Section 5. (Para 18 )
JUDGMENT :
PAMIDIGHANTAM SRI NARASIMHA, J.
| Table of Contents | |
| 1. | Introduction |
| 2. | Facts |
| 3. | Decision of the High Court under Section 34 and Section 37 of the ACA |
| 4. | Submissions |
| 5. | Issues |
| 6. | Applicability of the Limitation Act to ACA |
| 7. | Applicability of the Limitation Act to Section 34(3) |
| i. Section 5 of the Limitation Act | |
| ii. Section 12 of the Limitation Act | |
| iii. Section 14 of the Limitation Act | |
| iv. Section 17 of the Limitation Act | |
| v. Section 4 of the Limitation Act | |
| 8. | Applicability of Section 10 of the GCA |
| 9. | Summarising the Current Position of Law |
| 10. | Highlighting Certain Concerns with the Current Legal Position |
| 11. | Conclusion |
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[Hereinafter “ACA”.] 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) of the ACA expired on 29.05.2022, on which date the court was functioning, but closed after five days for vacation commencing from 04.06.2022 to 03.07.2022. The application under Section 34 was filed immediately on the court’s reopening, i.e. 04.07.2022. The High Court single judge under Section 34 and the High Court division bench under Section 37 dismissed the petition as barred by limitation. Under these circumstances, the issue before us is whether the benefit of the additional 30 days under the proviso to Section 34(3), which expired during the vacation, can be given when the petition is filed immediately after reopening in exercise of power under Section 4 of the Limitation Act, 19632[Hereinafter “Limitation Act”.].
1.1 After considering Sections 34(3) and 43(1) of the ACA, Sections 4 and 29(2) of the Limitation Act and Section 10 of the General Clauses Act, 18973[Hereinafter “GCA”.], as well as precedents of this Court, we have answered the question in the negative and have dismissed the present appeal. While we have expressed certain concerns regarding the curtailment of a precious remedy to challenge an arbitral award due to a stringent construction of Section 4 of the Limitation Act vis-à-vis Section 34(3), we have held that in light of the current position of law, the Section 34 application preferred by the appellant is barred by limitation based on the following conclusions:
(i) There is no wholesale exclusion of Sections 4 to 24 of the Limitation Act when calculating the limitation period under Section 34(3) of the ACA.
(ii) Section 4 of the Limitation Act applies to Section 34(3) of the ACA only to the extent when the 3-month period expires on a court holiday. It does not aid the applicant when the 30-day condonable period expires on a court holiday.
(iii) In view of the applicability of Section 4 of the Limitation Act to Section 34 proceedings, Section 10 of the GCA does not apply and will not benefit the applicant when the 30- day condonable period expires on a court holiday.
2. Facts: The detailed facts leading up to the present appeal are as follows. The appellants entered into lease agreements with the respondent, who is the owner of the property. Pursuant to certain disputes, the respondent invoked arbitration and an arbitral award dated 04.02.2022 was made in its favour. The appellants received a scanned copy of the award by email on 04.02.2022 itself, and later received a 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[In Re: Cognizance of Extension of Limitation, Suo Motu Writ Petition (C) No 3 of 2020.] expir
