Limitations under Section 34(3) of the Arbitration and Conciliation Act are strict, and additional proceedings or negotiations do not extend the prescribed three-month period for filing objections.

JUDGMENT :

1. Heard.

2. In both the appeals, the challenge is to the judgment passed by the learned Commercial Court-II, Jaipur Metro-II, whereby the objections raised under Section 34 of the Arbitration and Conciliation Act, 1996 (for short ‘the Act of 1996’), were rejected by the learned Commercial Court on the ground that the same had been raised beyond period of limitation, as provided for filing objections in terms of Section 34(3) of the Act of 1996.

3. Brief facts which have come up before us are that the appellant had initially raised a dispute and in terms of Section 18 of the Micro, Small and Medium Enterprises Development Act, 2006 (for short ‘MSMED Act’) preferred an application before the Micro, Small and Medium Enterprises Facilitation Council, Jaipur (for short ‘Council’) claiming compound interest. The Council vide its order dated 10.05.2022, noticed that in terms of the contract, there was a provision of raising a dispute before the Settlement Committee of the Ajmer Vidyut Vitran Nigam Limited in terms of the conditions of tender. It is further observed that the claim had been directly put up before the Council. Thereafter, it proceeded to examine the claim on merits and reached to the conclusion that there had been no violation of Section 15 of the MSMED Act by the respondent-purchaser and, therefore, the claim of three times compound interest on the ground of delay of one month was not acceptable. Having reached to that conclusion, the Council closed the case unanimously. It however, further proceeded to observe that the supplier could further raise its claim relating to interest before the Settlement Committee, which would examine the case separately and pass an order taking into consideration the interest payable and lay down the same accordingly. It appears that after the dispute had been closed by the Council, the appellant approached the Settlement Committee, which passed an order on 05.08.2022 allowing simple interest at the prevailing bank rate to the appellant with direction that the same be paid within a further period beyond 45 days in all the cases referred to it.

4. After the said order has been passed by the Settlement Committee, the appellant raised objections relating to the order passed by the Council dated 10.05.2022 under Section 34 of the Act of 1996 before the learned Commercial Court. Learned Commercial Court, however, found the said claim of objections under Section 34 of the Act of 1996 to be beyond the period of limitation, as provided under Section 34(3) of the Act of 1996 and rejected the same. Aggrieved thereto, the present appeals have been filed.

5. Learned counsel for the appellant submits that period during which the proceedings remained pending i.e. between 10.05.2022 and the order passed by the Council dated 05.08.2022, should be treated as dies non and should not be counted for the purpose of counting limitation, as provided under Section 34(3) of the Act of 1996 and, therefore, the objections raised under Section 34 of the Act of 1996, would be treated to be within limitation and on that count, he assails the order passed by the learned Commercial Court to be unjustified and illegal.

6. Learned counsel for the appellant relied on the judgments passed by the Hon’ble Supreme Court in the cases of M/s Sonali Power Equipments Pvt. Ltd. Vs. Chairman, Maharashtra State Electricity Board, Mumbai & Ors., 2025 SCC OnLine SC 1467 and Geo Miller and Company Private Limited Vs. Chairman, Rajasthan Vidyut Utpadan Nigam Limited , (2020) 14 SCC 643 .

7. We have carefully considered the submissions.

8. It would be ap