IN THE HIGH COURT OF DELHI AT NEW DELHI
Chandra Dhari Singh, J.
Dy. Ce/c/jalandhar City – Appellant
Versus
M/s Spacechem Enterprises Through Proprietor – Respondent
O.M.P. (COMM.) 459 of 2019
Decided On : 14-02-2023
Condonation of Delay - Arbitration and Conciliation - Section 34 of the Arbitration and Conciliation Act, 1996 - 34(3)
Fact of the Case:
The petitioner sought condonation of delay of 137 days in filing the petition under Section 34 of the Act to set aside the impugned Award. The respondent's bid was accepted for construction work, disputes arose, and the Arbitral Tribunal passed the impugned award. The petitioner attributed the delay to the respondent's changing stance and change of counsel. The respondent opposed, citing serious delay and defects.
Finding of the Court:
The Court found that the petitioner failed to diligently remove defects in the initial filing, leading to re-filing and significant delay. The Court referred to Delhi High Court Rules and Orders, observing that the petition should have been re-filed within the permissible time. The Court dismissed the condonation of delay application and the petition, as the conduct of the petitioner did not provide sufficient reason to entertain the petition by condoning the delay.
Issues: Delay in filing the petition under Section 34 of the Act, condonation of delay, and compliance with procedural requirements.
Ratio Decidendi: The Court emphasized the need for due diligence in removing defects and re-filing within the permissible time. The conduct of the petitioner signified an intent to evade the administration of justice by not complying with the procedure of law.
Final Decision: The Court dismissed the condonation of delay application and the petition, as the reasons stated for the delay were not sufficient to condone the delay, and the petition was barred by limitation.
ORDER
Chandra Dhari Singh, J. (Oral)
I.A. No. 2843/2023 (condonation of delay)
1. The present application has been filed by the petitioner seeking condonation of delay of 137 days in filing of the petition bearing No. OMP (COMM) 459/2019 under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter "the Act") by way of which, the petitioner has sought the indulgence of this Court in setting aside the impugned Award dated 31st March 2019 and the addendum Award dated 13th May 2019.
2. The respondent's bid to the tender dated 27th October 2015 was accepted by the petitioner on 5th January 2016 and consequently, the petitioner awarded the contract to the respondent for construction of additional road over bridge opposite steel girder and structure near Existing Bhandari Bridge, ROB No.156-A at KM 510/33-34 on Jalandhar-Amritsar Section.
3. It was stipulated in the awarded contract that the allotted work has to be completed by 4th July 2016. However, near to the stipulated time of completion, disputes arose between the parties due to reasons pertaining to various claims, raw materials and delay in the project work. The respondent therefore, invoked the Arbitral Clause vide letter dated 28th February 2017 and thereafter, disputes were referred for arbitration on 26th July 2018 and the Arbitral Tribunal was set up on 27th September 2018. The Certificate of Completion was awarded to the respondent on 19th June 2018.
4. The Arbitral Tribunal thereafter passed the impugned award dated 31st March 2019 and the addendum award dated 13th May 2019 which have been challenged by the petitioner herein.
5. Before adjudicating the main petition on merits, this Court is inclined to adjudicate the instant application to be satisfied of the fact that there existed just and sufficient reasons for the delay caused in filing of the main petition under Section 34 of the Act.
6. Learned counsel on behalf of the petitioner submitted that the delay in filing the main petition is attributable to the respondent as the respondent kept on changing his stance during the proceedings. It is submitted that there was a change of Counsel for the petitioner and the new counsel on behalf of the petitioner sought time to prepare the case.
7. It is submitted on behalf of the petitioner that since the addendum award was passed by the Arbitral Tribunal on 13th May 2019 and was delivered to the petitioner on 30th May 2019, the prescribed period of limitation under Section 34(3) of the Act would lapse on 14th August 2019 or 31st August 2019. It is further submitted that as per the log information of e-filing, the petition was first filed on 13th August 2019 and therefore, there is no delay in filing in accordance with the prescribed time period as provided under Section 34 (3) of the Act.
8. Per contra, learned counsel on behalf of the respondent vehemently opposed the averments made in the main petition and submitted that the petition is liable to be dismissed on the sole ground that the filing of the instant petition suffers from serious delay and defects.
9. It is submitted that the petitioner while seeking the condonation of delay has made the averments in the instant application which do not inspire confidence as the assertions regarding change of counsel, changing of stance by the respondents, etc. are ex-facie fabricated and bogus. Learned counsel on behalf of the respondent further submitted that the delay that has been sought to be condoned by this Court is not the delay in re-filing but the delay in filing itself as the petition suffered from grave infirmity and defects. The defects, as notified by the Registry, existed for more than two months after the petition was first filed on 13th August 2019.
10. Accordingly, it is submitted on behalf of respondent that the instant petition is liable to be dismissed due to extraordinary delay and defects in the initial and subsequent filings that were done to stop the limitation period from running.
11.
The law of limitation aims to prevent outdated, fictitious, or fraudulent claims and requires parties to exercise their rights within the prescribed time. The Court emphasized the need for due dilige....
The Court emphasized the importance of due diligence and dispatch in exercising the right to challenge an Arbitral Award within the prescribed time, as per the provisions of the Arbitration Act.
The judgment establishes the strict interpretation and application of the limitation period under Section 34(3) of the Arbitration Act, emphasizing the requirement for sufficient cause and the mandat....
The Court emphasized the importance of diligence in addressing procedural defects and allowed the condonation of delay based on the petitioner's consistent efforts to rectify the objections.
Adherence to time limits stipulated under the Arbitration Act and the requirement of due diligence in seeking condonation of delay.
The main legal point established in the judgment is that the period of limitation under Section 34(3) of the A&C Act refers to three calendar months, and the benefit of Section 14 of the Limitation A....
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