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IN THE HIGH COURT OF DELHI AT NEW DELHI
Satish Chandra Sharma, Subramonium Prasad, JJ.
Delhi Development Authority - Appellant
Versus
Ajab Singh And Co. - Respondent
FAO (COMM) 20/2022 & C.M. Nos. 5663/2022, 5664/2022, 5665/2022 & 5666/2022
Decided On : 29-07-2022
Condonation of Delay - Arbitration and Conciliation Act - Section 34, Section 33 - The court allowed the condonation of delay application and directed the trial court to decide the matter on merits. The delay of 23 days was condoned as sufficient cause was explained by the DDA. The court's observations were confined to the application under Section 5 of the Limitation Act.
Fact of the Case:
The appellant, Delhi Development Authority (DDA), filed an application under Section 34 of the Arbitration and Conciliation Act, 1996 to set aside an arbitral award. The application was dismissed by the trial court due to a delay of 23 days in filing the objection. The DDA had explained the delay by citing wrong understanding of territorial jurisdiction and marking the case to a counsel for filing in Karkardooma Courts.
Finding of the Court:
The court found that the delay of 23 days was due to wrong understanding of territorial jurisdiction and marked the case to a counsel for filing in Karkardooma Courts. The court allowed the condonation of delay application and directed the trial court to decide the matter on merits.
Issues: The main issue was the delay of 23 days in filing the objection under Section 34 of the Arbitration and Conciliation Act, 1996.
Ratio Decidendi: The court held that the delay of 23 days was condoned as sufficient cause was explained by the DDA. The court adopted a liberal and justice-oriented approach in the matter of condonation of delay.
Final Decision: The court allowed the condonation of delay application and directed the trial court to decide the matter on merits. The observations made by the court were only confined to the extent the application under Section 5 of the Limitation Act is concerned.
JUDGMENT
Satish Chandra Sharma, CJ. - The present appeal is arising out of the order dated 12.10.2020 by which the Application for condonation of delay in filing the objection to the Additional Award dated 30.06.2018 as well as Award dated 12.05.2018, which were served to the Delhi Development Authority (DDA) on 03.07.2018, has been rejected and dismissal of Application for condonation of delay has resulted in dismissal of OMP (COMM) No. 12/2018 (New No. 8/ 2020).
2. The facts of the case reveal that the Appellant before this Court has floated a tender for the work of D/o Yamuna River Front Vijay Ghat (Pushta), subhead: C/o Parking at Golden Jubilee Park near old railwaybridge through its Executive Engineer on 28.10.2011 with an estimated cost of Rs. 80,65,617/-.
3. The respondent was declared as successful bidder and vide letter dated 26.12.2011, the work was awarded to the respondent for an amount of Rs. 1,24,18,320/-, and finally agreement was executed between the parties on 03.01.2012. The date of commencement of work was 05.01.2012, and the stipulated date of completion was 04.07.2012.
4. The Respondent requested for extension of work as the same was not completed within the time frame as per the terms and conditions of the agreement, and finally the respondent Claimant vide letter dated 17.01.2013, requested the Appellant to close the contract, and resultantly, the contract was closed as the work was not completed even after grant of extension of seven months.
5. A dispute arose between the parties when the bill was submitted by the Respondent Claimant, and the dispute was referred to Arbitration.
6. The DDA appointed Sh. Lakhvinder Chaudhary, SE (Arbn.)/ DDA as the Sole Arbitrator vide order dated 18.06.2013, and later on, on account of transfer of Sh. Lakhvinder Chaudhary, one Sh. S. K. Jain, SE (Arbn.)/ DDA was appointed as an Arbitrator vide order dated 17.02.2014.
7. Thereafter, again, on account of, transfer of Sh. S. K. Jain one Sh. D. V. Raghav, SE(Arbn.) was appointed as Arbitrator on 05.03.2015, and finally one Sh. S. P. Banwait (Retd) Addl. Director General, CPWD was appointed as Arbitrator vide order dated 03.01.2017.
8. The Claimant submitted statement of claim before the Arbitrator and counter statement was submitted by the Appellant Department, and finally an award was passed on 12.05.2018, and an additional award was passed on 30.06.2018 awarding an amount of Rs. 1,31,12,790/-.
9. The Appellant before this Court submitted Application under Section 34 of Arbitration and Conciliation Act, 1996 before the Court for setting aside the arbitral Award dated 12.05.2018 and modified Award dated 30.06.2018
10. An Application was preferred under Section 5 of the Limitation Act, for condonation of delay of 23 days, and the Learned Presiding Officer (Commercial Court- 05) has dismissed the Application for condonation of delay. The order passed by the Court below in Paragraph 5 to 18 reads as follows:
'5) Petitioner alongwith the petition has filed an application under Section 5 of the Limitation Act for condonation of delay of 21 days and reasons of delay are mentioned from para No. 4 to 7 of the application. It is mentioned in this application that appeal could not be filed within statutory period due to the reasons that case file was earlier assigned to a counsel for the Karkardooma Court inadvertently on 24-9-2018 who returned the same on 28-9-2018 on account of lack of jurisdiction. Thereafter, after approval and permission of the concerned authorities, file was assigned to present counsel and handed over to him on 6-10- 2018. As per petitioner, due to mistake of fact and unintentional delay in communication between the counsel and the official, delay has happened and the appeal could not be filed within the prescribed time. Hence, this appeal is now filed along with the application for condonation of delay.
6) Three months period is available to the party to challenge the award under Section 34 (3) of the Arbitration and Con
The court adopted a liberal and justice-oriented approach in the matter of condonation of delay, allowing the delay of 23 days to be condoned as sufficient cause was explained by the DDA.
The court emphasized a pragmatic approach in determining 'sufficient cause' for delays attributed to government entities, asserting equal application of limitation laws for all parties involved.
The court established that limitation provisions in Section 34(3) of the Arbitration and Conciliation Act must be interpreted liberally for the State, recognizing that bureaucratic processes, though ....
Point of Law : Merely because the appellant is Government organization, lenience cannot be shown to condone such a long delay.
The court reinforced that strict compliance with limitation periods under the Arbitration and Conciliation Act is mandatory, and delays beyond the prescribed time cannot be condoned without adequate ....
Delay beyond 120 days (90+30) in Section 34 petitions or corresponding appeals under Section 37 of Arbitration Act not condonable via Limitation Act Section 5; negligence, inaction, lack of bonafides....
The court emphasized that delay in filing appeals under the Arbitration Act must be justified by sufficient cause, with negligence being insufficient for condonation.
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