The application under Section 34 of the Arbitration Act was dismissed as barred by limitation since filed after the three-month period following the award, with no eligibility for an extension under Section 4 of the Limitation Act.

JUDGMENT :

BIPIN CHANDER NEGI, J.

The appellant is aggrieved by the judgment dated 02.05.2023, passed by the learned District Judge, whereby its application moved under Section 34 of the Arbitration and Conciliation Act, 1996, (the Act in short) was dismissed as barred by limitation.

2. Heard learned counsel for the parties and considered the case file.

3. Admitted facts are that: - An award was passed on 03.02.2022 by the learned Divisional Commissioner, exercising powers of Arbitrator under the National Highways Act, 1956. The appellant received certified copHy of the award on 13.10.2022. Three months’ time available to the appellant in terms of Section 34 (3) of the Act for assailing the aforesaid award lapsed on 12.01.2023. Admittedly, award dated 03.02.2022 had not been assailed by the appellant till 12.01.2023.

4. Learned District Judge relying upon Bhimashankar Shakari Sakkare Karkhane Niyamita Vs. Walchandnagar Industries Limited (WIL), (2023) 8 SCC 453 , held that the appellant could have taken the benefit of Section 4 by excluding the period when the Courts were closed during the ninety days and not thereafter. The period of thirty days had also expired before the Courts were closed for winter vacation. Hence, the application was held barred by limitation. Therefore, the validity of award dated 17.01.2022 was not gone into.

5. Learned District Judge did not err in holding that benefit of Section 4 by excluding the period when the Courts are closed, can be taken only during ninety days’ (sic three months) period.

Hon’ble Apex Court in Bhimashankar Shakari Sakkare Karkhane Niyamita1 has held that benefit of exclusion of period during which Court is closed is available only when application for setting aside the award is filed within “prescribed period of limitation”. The prescribed period of limitation for assailing the award under Section 34 of the Act is three months. The benefit of exclusion it is not available in respect of the period which may be extended by the Court in exercise of its discretion under the proviso attached to Section 34 (3) of the Act.

In The State of West Bengal represented through the Secretary & Ors. Vs. Rajpath Contractors and Engineers Ltd., Civil Appeal No. 7426 of 2023 decided on 08.07.2024, Hon’ble Apex Court held that applicability of Section 5 of the LIMITATION ACT to the petition under Section 34 of the Act has been excluded. Relevant para of the judgment reads as under: -

“8. We may note here that Section 43 of the Arbitration Act provides that the LIMITATION ACT shall apply to the arbitrations as it applies to proceedings in the Court. We may note here that the consistent view taken by this Court right from the decision in the case of Union of India v. Popular Construction Co. is that given the language used in proviso to subsection (3) of Section 34 of the Arbitration Act, the applicability of Section 5 of the LIMITATION ACT to the petition under Section 34 of the Arbitration Act has been excluded.”

In respect of applicability of Section 4 of the LIMITATION ACT to Section 34 of the Act, it was held that it was only where the “prescribed period” expires on the day when the Court is closed, the application can be preferred on the day when the Court re-opens. The prescribed period of limitation in context of Section 34 (3) of the Act for making an application for setting aside the arbitral award is three months. Period of thirty days mentioned in the proviso that follows Sub-Section 3 of Section 34 of the Act, is not the prescribed period for the purpose of making application for setting aside the arbitral award. Relevant paras from the judgment read as under: -

“9. Now, we proceed to consider whether the appellant will be entitled to the benefit of Section 4 of the LIMITATION ACT . Section 4