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SUPREME COURT OF INDIA
Pamidighantam Sri Narasimha, Alok Aradhe, JJ.
National Highway Authority Of India – Appellant
Versus
T. Younis & Anr. – Respondents
Civil Appeal No. 8388 of 2026 (@ SLP (C) No. 7570 of 2024)
Decided On : 02-06-2026
Arbitration and Conciliation Act, 1996 – Sections 33 and 34 – National Highways Act, 1956 – Section 3A(1) – Setting aside arbitral award – Limitation prescribed under Section 34(3) can start only from the date on which proceedings under Section 33 are disposed of – Once proceedings under Section 33 are initiated and entertained by Arbitral Tribunal, award remains subject to limited jurisdiction of Tribunal for correction, interpretation, or supplementation – So long as such proceedings remain pending, parties cannot be compelled to institute proceedings under Section 34 merely as a matter of abundant caution – Parties can effectively pursue their remedy under Section 34 only upon conclusion of proceedings under Section 33 – Whether application under Section 33 ultimately succeeds or fails, or whether Arbitral Tribunal eventually finds that no correction or modification of award is warranted, is not determinative for the purpose of Section 34(3) – What is relevant is whether jurisdiction of Arbitral Tribunal under Section 33 had been formally invoked and that such proceedings remained pending consideration before Tribunal – Impugned judgment and order passed by High Court set aside – Orders passed by Principal District and Sessions Judge, condoning delay in filing applications under Section 34 of Act, restored. (Paras 14, 15, 18 and 20)
Facts of the case:
Present appeal arises from judgment and order dated 22.01.2024, passed by the High Court of Karnataka, Dharwad Bench, by which writ petition preferred by Respondents was allowed. By said order, High Court, set aside the order dated 05.08.2023 passed by Principal District and Sessions Judge, Bellary, whereby delay in filing applications under Section 34 of Arbitration and Conciliation Act, 1996 was condoned.
The issue that arises is whether limitation under Section 34(3) would commence from date of original award or from date on which application under Section 33 came to be disposed of.
Findings of Court:
Where applications under Section 33 are found to be sham, frivolous, or mala fide or solely filed for the purpose of defeating limitation under Section 34(3) of the Act, courts would be justified in imposing exemplary and punitive costs, as maintaining balance between preserving legitimate remedies and preventing abuse of process is fundamental to effective administration of justice.
Result : Appeal allowed.
Key Points: - The limitation under Section 34(3) can start only from the date on which proceedings under Section 33 are disposed of (!) . - Once Section 33 proceedings are initiated and entertained, the arbitral award remains subject to the limited jurisdiction of the Arbitral Tribunal for correction, interpretation, or supplementation (!) . - Parties cannot be compelled to file Section 34 applications merely while Section 33 proceedings are pending; remedies under Section 34 are effectively available only after Section 33 conclusions (!) . - Whether Section 33 application ultimately succeeds or fails is not determinative; the crucial factor is that Section 33 proceedings were formally invoked and pending (!) . - The High Court’s view to exclude time spent in Section 33 proceedings while computing Section 34(3) limitation is overturned; the guiding principle aligns with previous Supreme Court rulings (Geojit, etc.) that disposal date of Section 33 governs the start of Section 34(3) limitation (!) . - In the present case, Section 33 applications were disposed of by a common order on 04.07.2022, and Section 34 applications were filed on 07.11.2022, which falls within the permissible period when calculated from the disposal date (!) . - The Supreme Court sets aside the High Court judgment and restores the delay-condoning orders, allowing Section 34 applications to be decided on their merits (!) . - Exemplary costs may be imposed if Section 33 applications are found sham, frivolous, or mala fide or filed solely to defeat Section 34(3) limitation (!) .
JUDGMENT :
1. Leave granted.
2. The present appeal arises from the judgment and order dated 22.01.2024, passed by the High Court of Karnataka, Dharwad Bench, (“High Court”) by which the writ petition1[Writ Petition No. 105176 of 2023 (GM-RES).] preferred by the Respondents was allowed. By the said order, the High Court, set aside the order dated 05.08.2023 passed by the Principal District and Sessions Judge, Bellary, whereby delay in filing the applications under Section 34 of the Arbitration and Conciliation Act, 1996 (“the Act”) was condoned.
3. Facts leading to filing of this appeal are that on 15.12.2009, the Ministry of Shipping, Road Transport and Highways issued a preliminary notification under Section 3A(1) of the National Highways Act, 1956, (‘1956 Act’) for acquisition of land in Bellary District. The said notification included the land belonging to Respondent No.1 as well. By a declaration dated 14.12.2010 issued under Section 3D(2), the land vested in the Central Government free from all encumbrances. The competent authority by an Award dated 05.12.2011, determined the compensation under Section 3G(1) of the 1956 Act.
4. The Appellant invoked the remedy of Arbitration under Section 3G(5) of the 1956 Act. The Deputy Commissioner-Cum-Arbitrator, Bellary (Arbitrator) vide Award dated 16.02.2013, redetermined the market value of agricultural land at the rate of Rs.362/- per sq. metre, whereas the market value of the non-agricultural land was assessed at Rs.741/- per sq. metre. The High Court by an order dated 16.03.2019 set aside the Arbitral Award dated 16.02.2013 and remitted the matter to the Arbitrator for de novo consideration.
5. Pursuant to the remand, the Arbitrator conducted fresh proceedings and passed an Award on 03.2.2022 by granting the benefit of Section 23(1-A), 23(2), 28 and Section 34 of the Land Acquisition Act, 1894 (1894 Act). On 08.03.2022, the Appellant filed application under Section 33(1)(a) of the Act before Arbitrator seeking correction of Arbitral Award, inter alia on the ground that grant of additional market value under Section 23 and interest under Section 34 of the 1894 Act is not legally sustainable. On 10.03.2022, the Respondent No.1 filed an application under Section 33(4) of the Act seeking an additional award of 50% over and above the market value on the ground that such a claim had been raised during the Arbitral Proceeding, but the same was omitted in the final Award. The Arbitrator by a common order dated 04.07.2022, dismissed the applications filed under Section 33 of the Act by the Appellant as well as Respondent No.1. The certified copy of the said order was received by the Appellant on 15.09.2022.
6. On 29.10.2022, the Appellant filed applications under Section 34 of the Act along with applications seeking condonation of delay2[Arbitration Application Nos. 3/2022 and 4/2022]. The Respondent No. 1 raised an objection contending that the applications under Section 34 of the Act were filed with delay which was beyond the condonable period of delay of 120 days, as provided, in proviso to Section 34(3) of the Act. The Principal District & Sessions Judge, Bellary by an order dated 05.08.2023 condoned the delay in filing the applications under Section 34 of the Act and allowed the same. The Respondent No.1 challenged the aforesaid order dated 05.08.2023 in a Writ Petition3[W.P. No. 105176/2023].
7. The High Court by a judgment and order dated 22.01.2024, held that Section 33(1) (a) of the Act permits correction of computation, clerical or typographical errors or errors of similar nature. It was further held that the prayer made in the application filed by the Appellant seeking modification of the Arbitral Award did not fall within the purview of Section 33(1)(a) of the Act and hence the same was not maintainable. The High Court concluded that the benefit of limitation under Section 34(3) of the Act was not available and, therefore, the limitation could not be computed from the date of dispo
Setting aside arbitral award – Limitation prescribed under Section 34(3) of Arbitration and Conciliation Act, 1996 can start only from the date on which proceedings under Section 33 are disposed of.
The limitation period for filing an application under Section 34 of the Arbitration and Conciliation Act, 1996, commences from the date of disposal of an application filed under Section 33, provided ....
The limitation period for challenging an arbitral award under Section 34(3) of the Arbitration and Conciliation Act, 1996 is strict and non-extendable, emphasizing the need for timely recourse to mai....
The limitation period for setting aside an arbitral award starts from the disposal of a request under Section 33, excluding the time taken for communication of that decision.
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