IMPORTANT POINT
The statutory limitation period under Section 34(3) of the Arbitration and Conciliation Act is inflexible, and applications filed beyond this period cannot be entertained.

JUDGMENT :

REKHA PALLI, J.

1. The present appeal under Section 37 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as “Act”) seeks to assail order dated 07.05.2024 passed by the learned District Judge, Commercial Court, Patiala House Courts, New Delhi in OMP (Comm.) 121/2023.

2. Vide the impugned order, the learned Trial Court has rejected the application preferred by the appellant under Section 34 (3) of the Act for setting aside of the arbitral award dated 21.02.2023 on the sole ground of the same having been filed beyond the period of limitation as provided under the Act.

3. The brief factual matrix as emerging from the record shows that the appellant is a Government body under the aegis of the Ministry of Health and Welfare, Government of India and the respondent is a contractor who was awarded the contract for renovation of the office of the appellant in the Jeevan Bharti Building, Connaught Place, New Delhi.

4. On 19.08.2019, the appellant issued a tender inviting bids for renovation of its office at the third floor of the said Jeevan Bharti Building. The respondent, being the lowest bidder was awarded the contract for “Refurbishment and Renovation of approx. 10235 Sq. Fts.” vide agreement dated 28.11.2019 (hereinafter referred to as “Contract”). The value of the entire contract was initially fixed at Rs.3,65,00,000/- but was later reduced to Rs. 3,14,95,840/- and the work was to be completed within a period of 80 days, i.e. by 16.02.2020.

5. As per the appellant, since time was an essence of the contract, it was agreed that in case the work was not completed by the respondent within the agreed 80 days, the appellant would be entitled to liquidated damages of Rs.5,00,000/- per day, a term, which was also encapsulated in clause 6 of the Contract. As the work, which commenced on 28.11.2019, was completed on 25.02.2020 there was a delay of eight days and consequently the appellant was entitled to deduct an amount of Rs. 40,00,000/-, by way of liquidated damages. However, as the building was closed from 01:00 p.m. on 25.01.2020 and on 26.01.2020 i.e. for 1½ days, on account of Republic day, liquidated damages of Rs. 32,50,000/- were levied on the respondent on account of the 6½ days delay as per clause 6.2.3 of the Contract.

6. This resulted in invocation of arbitration by the respondent, and upon conclusion of the arbitration proceedings the learned Arbitrator vide arbitral award dated 21.02.2023 (hereinafter referred to as “Award”) awarded a sum of Rs. 35,53,500/- in favour of the respondent.

7. Being aggrieved by the Award, the appellant filed an application under Section 34 of the Act before this Court on 03.05.2023 only to be subsequently withdrawn on 03.07.2023 for want of pecuniary jurisdiction albeit with liberty to move an appropriate application before the appropriate Court. It is then that the appellant after waiting for over two months chose to file a fresh application under Section 34 of the Act before the learned Trial Court i.e., the District Judge, Commercial Court, Patiala House Courts, New Delhi on 05.09.2023.

8. It is this application, filed by the appellant, which has been rejected under the impugned order by the learned Trial Court by holding as under:

“11. It is not in dispute that the petitioner received the award on 21.02.2023 exactly 71 days after the receipt of award, filed a petition under Section 34 of the Act before Hon’ble High Court of Delhi on 04.05.2023. On 03.07.2023, Hon’ble High Court of Delhi dismissed as withdrawn the petition for want of jurisdiction and on 05.09.2023, the respondent filed instant petition before this court for setting aside arbitral award. After the order of dismissal as withdrawn of the petition before Hon’ble High Court of Delhi, it transpires that petitioner took almost 63 days (excluding the date of 03.07.2023) in filing the instant petition. Thus, even if the petitioner is given benefit of the provisions of Section 14 of the Limitation Act, in respect