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2018 Supreme(Del) 161

IN THE HIGH COURT OF DELHI AT NEW DELHI
GITA MITTAL, C.HARI SHANKAR, JJ.
TELECOMMUNICATION CONSULTANTS INDIA LTD. - Appellant
Versus
IDEB PROJECTS (P) LTD. - Respondent
FAO(OS) 321 of 2017 & CM Nos.46205 of 2017, 46207 of 2017
Decided On : 16-02-2018

Advocates Appeared:
For the Appellant : Mr. Ratan K. Singh with Mr. Nikhilesh Krishnan, Mr. Milind Sharma, Ms. Somya Priyadarshini, Mr. Gaurav and Ms. Sushila, Advs.
For the Respondent: Mr. V. Seshagiri, Mr. Adhish Rajvanshi and Mr. Dakshyani Saxena, Adv.

Headnote:

Arbitration Act, 1996 - Extension of Limitation - Section 34(3)

Fact of the Case:

The appellant sought condonation of delay in filing objections under Section 34 of the Arbitration Act, 1996 challenging the arbitral award. The appellant contended that the period of 90 days for filing the objections expired during court closure for summer vacations and thus, was entitled to a further period of 30 days. The single judge rejected the contention, leading to the present appeal.

Finding of the Court:

The court found that there can be no extension of limitation for filing objections to an arbitral award beyond the specific prescription of Section 34(3) and the proviso thereto. Section 5 of the Limitation Act has no applicability, and there can be no condonation of delay in filing objections thereunder.

Issues: The main issue was whether the appellant was entitled to an extension of the limitation period for filing objections under Section 34 of the Arbitration Act, 1996 due to court closure for summer vacations.

Ratio Decidendi: The court held that the period of limitation for filing objections to an arbitral award under Section 34 is absolute and unextendable by the court under Section 5 of the Limitation Act. The proviso to sub-section 3 of Section 34 places a limit on the period of extension of the period of limitation, and Section 4 of the Limitation Act has no application to further extend the period of extension granted under the proviso.

Final Decision: The appeal was dismissed, and the appellant was directed to release the deposited amount in favor of the respondent.

JUDGMENT :

GITA MITTAL, J.

1. This appeal, filed under Section 37 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as “the Arbitration Act, 1996”), assails the order dated 30th August, 2017 by the ld. Single Judge dismissing I.A. No.16401/2015 in OMP No.436/2015.

2. By way of this application, filed under Section 34(3), the appellant had sought condonation of delay of a period of 38 days in filing the objections under Section 34 of the Arbitration Act, 1996 challenging the arbitral award dated 17th March, 2015 by the Sole Arbitrator.

3. The factual matrix giving rise to the present appeal is in a narrow compass and to the extent necessary, the relevant facts are noted hereinafter.

4. Arbitral proceedings between the parties culminated in the passing of an Award dated 16th March, 2015 in favour of the respondent, who was the claimant before the Arbitral Tribunal. There is no dispute that on the 18th of March, 2015, the Award was received by the appellant. Objections thereto were filed by the appellant under Section 34 of the Arbitration Act, 1996 on the 24th of July, 2015.

5. These objections, which were registered as OMP No.436/2015, were accompanied by an application being I.A. No.16401/2015 seeking condonation of delay. The ground which was pressed by the appellant in support of this application for condonation of delay, was that the period of 90 days for filing the objections expired on 17th June, 2015 when the Court was closed on account of summer vacations.

6. The appellant contended that therefore by virtue of proviso to sub-section(3) of Section 34 of the Arbitration Act, 1996, the appellant was entitled to a further period of 30 days after expiry of the period of three months. As such it was claimed by the appellant that, as the Court was closed for summer vacations on the date of expiry of the limitation, period of 10 days between the 17th June, 2015 (when the period expired) and 29th June, 2015 (when the court reopened) had to be excluded for the purposes of computation of the limitation. The appellant submitted that as such, the objections had been validly filed on the 24th of July, 2015 i.e. within the extended period of ninety days.

7. This contention of the appellant was rejected by the ld. Single Judge by the order dated 30th August, 2017, which has been assailed before us by way of the present appeal.

8. We have heard Mr. Ratan K. Singh, ld. counsel for the appellant. The respondent is also represented, who has also been heard.

9. Before dealing with the issues raised before us, we may usefully extract relevant provision of Section 34 (3) of the Arbitration Act, 1996 which reads as follows:

“34 Application for setting aside arbitral award. —

(1) xxx xxx xxx

(2) xxx xxx xxx

(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.”

(Emphasis by us)

10. The construction of the limitation prescribed under Section 34(3) of the Arbitration Act, 1996 and the issue as to whether Section 5 of the Limitation Act, 1963 would apply to an application under Section 34 of the Arbitration and Conciliation Act, 1996 as well as submissions similar to those made on behalf of the appellant, came up for consideration before the Supreme Court in the judgment reported as 2001 (8) SCC 470 Union of India vs. Popular Construction Co. For expediency, we may extract in extenso the observations of the Supreme Court on the submissions advanced on behalf of the petitioner before the Supreme Court regarding the permissibility of extension of th








































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