IN THE HIGH COURT OF DELHI AT NEW DELHI
Vibhu Bakhru, Amit Mahajan, JJ.
Indira Gandhi National Open University - Appellant
Versus
Sharat Das And Associates Pvt. Ltd. - Respondent
FAO(OS) (COMM) 112 of 2020, CM APPL. 22633 of 2020, CM APPL. 22715 of 2020 & CM APPL. 26072 of 2020
Decided On : 11-12-2023
Arbitration and Conciliation Act - Delay in Filing Application - Section 34(3) - Section 14 of the Limitation Act, 1963 - Section 37 - OMP(COMM) 26/2019
Fact of the Case:
The appellant filed an appeal under Section 37 of the Arbitration and Conciliation Act, 1996, challenging the rejection of their application under Section 34 of the A&C Act, which assailed an arbitral award. The delay in filing the application and re-filing it before the court was the main issue.
Finding of the Court:
The court allowed the appellant's application for condonation of delay under Section 14 of the Limitation Act, 1963, for the initial delay but set aside the finding that the initial filing was non est and declined the appellant's application for condonation of delay in re-filing the application.
Issues: The main issue was the delay in filing the application under Section 34 of the A&C Act and the subsequent re-filing, along with the applicability of Section 14 of the Limitation Act, 1963.
Ratio Decidendi: The court found that the delay in filing the application was partly justified under Section 14 of the Limitation Act, 1963, but the question of condonation of delay in re-filing was left for the learned Single Judge to consider.
Final Decision: The impugned judgment was set aside to the extent that the initial filing was held to be non est, and the matter was remanded to the learned Single Judge to consider the question of condonation of delay in filing and re-filing.
JUDGMENT
Vibhu Bakhru, J. (Oral) - The appellant has filed the present appeal under Section 37 of the Arbitration and Conciliation Act, 1996 (hereafter `the A&C Act'), impugning a judgment dated 04.06.2020 (hereafter `impugned judgment'), rendered by the learned Single Judge in OMP(COMM) 26/2019, captioned as Indira Gandhi National Open University v. M/s. Sharat Das and Associates Pvt. Ltd..
2. By the impugned judgment, the appellant's application under Section 34 of the A&C Act assailing an arbitral award dated 25.04.2018 (hereafter `the impugned award'), was rejected on the ground that it was filed beyond the period of limitation as stipulated under Section 34(3) of the A&C Act.
3. It is not disputed that the impugned award was rendered on 25.04.2018 and delivered on the same date.
4. In terms of Section 34(3) of the A&C Act, the time available for the appellant to file an application under Section 34 of the A&C Act expired on 24.07.2018. Admittedly, the appellant filed an application under Section 34 of the A&C Act (CIS-ARBTN-233-2018 captioned Indira Gandhi National Open University (IGNOU) v. M/s. Sharat Das & Associates Pvt. Ltd.) before the learned Commercial Court on the last date of period of limitation, that is on 24.07.2018
5. Notice in the said application was issued by the learned Commercial Court on 06.08.2018. The respondent appeared in the said proceedings and objected to the jurisdiction of the learned Commercial Court to hear the said application. Concededly, the objection raised was merited. Given the value of the dispute, the learned Commercial Court did not have the jurisdiction to entertain the said application. Accordingly, on 28.08.2018, the learned counsel for the appellant, on instructions, sought to withdraw the said application. His statement was recorded, and the learned Commercial Court dismissed the application as withdrawn with liberty to file a fresh petition in accordance with law.
6. In view of the above, the appellant filed the application under Section 34 of the A&C Act before this Court on 11.09.2018. The said application was dismissed by the impugned judgment on the ground of delay in filing as well as re-filing the application.
7. The learned Single Judge allowed the application of the appellant for condonation of delay under Section 14 of the Limitation Act, 1968. However, rejected the application for condonation of delay in re-filing the application, inter alia, construing the appellant's initial filing before this Court as non est. Whilst the appellant, being aggrieved by this decision has filed the present appeal, the respondent has filed cross-objections assailing the impugned judgment to the extent that the appellant's application for condonation of delay under Section 14 of the Limitation Act, 1963 was allowed.
8. As is apparent from the sequence of events as noted above, there was a delay of 48 (forty eight) days in filing the application under Section 34 of the A&C Act. The delay of 35 (thirty-five) days is sought to be explained on account of the appellant pursuing its remedy against the impugned award in a Court not competent to entertain the same. In terms of Section 14 of the Limitation Act, 1963, a litigant who approaches the Court, which does not have jurisdiction and pursues his remedy in good faith, is entitled to the benefit of Section 14 of the Limitation Act, 1963. Thus, the period spent by the said litigant to pursue its remedy is required to be excluded for the purpose of computing the period of limitation.
9. We find no infirmity with the decision of the learned Single Judge in allowing the appellant's application for condonation of delay of 35 (thirty-five) days - that is, from 24.07.2018 to 28.08.2018 - under Section 14 of the Limitation Act, 1968.
10. It is apparent from the above that even if the appellant is granted the benefit of Section 14 of the Limitation Act, 1968, it is also required to explain a further delay of 13 (thirteen) days being the period between withdraw
The judgment established the application of Section 14 of the Limitation Act, 1963, in justifying the delay in filing the application under Section 34 of the A&C Act, and highlighted the discretion o....
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....
The judgment establishes the principle that inordinate delay in refiling an application under the Arbitration and Conciliation Act without sufficient justification cannot be condoned.
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 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.
A petition under Section 34 of the Arbitration Act must be complete and timely; failure to include required documents leads to dismissal as barred by limitation.
The court emphasized the strict timelines prescribed in the Arbitration and Conciliation Act and the Limitation Act, and held that delays beyond the statutory periods cannot be condoned.
Filing requirements under Section 34 of the Arbitration Act must be strictly adhered to; failure to do so renders filings non est and unable to stop limitation periods from running.
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....
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