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2024 Supreme(Pat) 478

IN THE HIGH COURT OF JUDICATURE AT PATNA
ARUN KUMAR JHA, J.
Civil Misc. Jur. No.123 of 2024
(1.8.2024)
Chandeshwar Kumar ... Petitioner
vs.
State of Bihar & Anr. ... Respondents

Advocates:
For the Petitioner: Mr. Ajay Kumar Singh.
For the Resp. No.3 : M/s P.K. Shahi, A.G., Manish Dhari Singh.

Headnote:

Arbitration and Conciliation Act, 1996 – Section 34 read with Limitation Act, 1963 – Sections 3 & 5 – Whether a miscellaneous case challenging an arbitral award can be filed beyond the period of limitation – The Hon'ble Supreme Court has settled that the time period prescribed to challenge the award u/s 34 of the Arbiration Act is absolute and could not be extended in any case and Section 5 of the Limitation Act is not applicable for condonation of delay in such cases – In view of the specific bar created by Section 3 of the Limitation Act, the appeal/application preferred after expiry of the period of limitation is liable to be dismissed – Section 3 of the Limitation Act is peremptory in nature and has to be given effect to even though no objection is taken – Impugned order is thus set aside – Civil Misc. application allowed. (Paras 7 & 9)

Arun Kumar Jha, J.—Heard Mr. Ajay Kumar Singh learned counsel for the petitioner as well as Mr. P.K. Shahi, learned Advocate General for respondent 2nd set/respondent no.3.

2. The instant petition has been filed by the defendant/petitioner under Article 227 of the Constitution of India for quashing the order dated 21.12.2023 passed by the learned District Judge, Gaya in Civil Miscellaneous (Arbitration) Case No. 139 of 2023 whereby and whereunder the learned District Judge, Gaya admitted the said miscellaneous case.

3. Learned counsel for the petitioner submits that in Civil Misc. (Arbitration) Case No. 139 of 2023, the arbitral award, passed by the Arbitrator-cum-Commissioner, Magadh Division, Gaya on 16.07.2022 in Arbitration Case No. 216 of 2021, directing the competent authority to amend the compensation award, is under challenge. Learned counsel further submits that the award was sent to the petitioner as well as the respondent 2nd set/respondent no.3 vide Letter No. 3165/legal dated 03.08.2022 through registered post. The petitioner received the copy of award within a week and it is presumed that by that time the respondent 2nd set/respondent no.3 must also have received the award. Learned counsel further submits that it is the clear mandate of the law that the miscellaneous case under Section 34 (3) of the Arbitration and Conciliation Act, 1996 (in short ‘the Arbitration Act’) challenging the award can be filed within three months from the date on which party making the application had received the award. Further proviso to Section 34 of the Arbitration Act makes it clear that if the court is satisfied that the applicant was prevented by sufficient cause from making the application within said period of three months, the court may entertain the application within a further period of 30 days but not thereafter. Learned counsel further submits that from the composite reading of the provision, it is clear that an arbitral award can be challenged within a maximum period of 120 days from the date of receipt of the award. Learned counsel further submits that even by its own admission, the respondent 2nd set/respondent no.3 received the award on 10.05.2023. So the award could have been challenged till 10.09.2023. However, miscellaneous case has been filed on 30.10.2023, i.e., beyond the limitation period. The petitioner, coming to know about filing of the miscellaneous case, entered appearance and took objection about the miscellaneous case being not maintainable as barred by limitation. The Hon’ble Supreme Court in the case of Mahendra and Mahendra Financial Services Limited vs. Maheshbhai Tinabhai Rathod & Ors., reported in (2022) 4 SCC 162 has held that in a petition filed under Section 34 of the Arbitration and Conciliation Act, 1996, Section 5 of the Limitation Act has got no application. Learned District Judge, vide the impugned order dated 21.12.2023, admitted the miscellaneous case without considering the issue of limitation and surprisingly when it has been reported by Saristedar that the said miscellaneous case was barred by limitation. Learned counsel further submits that the learned District Judge, Gaya has committed patent illegality as the law mandates that even though a party might not raise the issue of limitation, the court is bound to consider the same. In the light of specific provision of Section 34(3) and proviso to Section 34 of the Arbitration and Conciliation Act, 1996, the learned District Judge could not have proceeded with the matter ignoring the fact that the filing of the miscellaneous case was barred by law of limitation and thus he has committed patent illegality.

4. Mr. P.K. Shahi, learned Advocate General appearing on behalf of respondent 2nd set/respondent no.3 very fairly submits that he would not dispute the proposition of law in this regard as the provision of Section 34(3) read with proviso of the Arbitration Act is very much clear. However, a similar issue came before the Hon’ble Supreme Cou

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