2011 Supreme(All) 1927
ALLAHABAD HIGH COURT
S.S.Chauhan, J.
Hotel Pradeep -Appellant
Versus
Airports Authority of India and Another -Respondent
Civil Revision No.129 of 2006
Decided On : 11-07-2011
The main legal point established in the judgment is the interpretation of the limitation period under Section 34 of the Arbitration and Conciliation Act, 1996, and the application of the Supreme Court's decision in the case of State of Himachal Pradesh and another v. Himachal Techno Engineers and another, (2010) 12 SCC 210, in calculating the period of limitation.
Headnote:
Delay Condonation - Arbitration Proceedings - Arbitration and Conciliation Act, 1996, Section 34 - Summary of Acts and Sections: Section 340 Cr.P.C., Section 34 (3) of the Arbitration and Conciliation Act, 1996 - The court discussed the condonation of delay under Section 34 of the Arbitration and Conciliation Act, 1996, and the interpretation of the limitation period. The court also referred to the provisions of Section 340 Cr.P.C. and their application in the case.
Fact of the Case:
The case involved a dispute between the revisionist and the respondents arising from arbitration proceedings. The respondents filed an application under Section 34 (3) of the Arbitration and Conciliation Act, 1996, seeking condonation of delay in filing the application to set aside the arbitral award. The revisionist objected to the application, alleging manipulation in the record by the respondents to extend the limitation period.
Finding of the Court:
The court found that the delay in filing the application under Section 34 of the Act was liable to be condoned as it was beyond the control of the respondents. The court also concluded that the award was served upon the respondents on 9.1.2006, and the application for setting aside the award was filed on 9.5.2006, within the extended limitation period. The court upheld the order condoning the delay but disagreed with the reasoning of the lower court.
Issues: The main issues were the condonation of delay under Section 34 of the Arbitration and Conciliation Act, 1996, and the interpretation of the limitation period for filing the application to set aside the arbitral award.
Ratio Decidendi: The court held that the application for setting aside the award was within the extended limitation period, as calculated based on the provisions of the Arbitration and Conciliation Act, 1996, and the interpretation of the limitation period provided by the Supreme Court in the case of State of Himachal Pradesh and another v. Himachal Techno Engineers and another, (2010) 12 SCC 210.
Final Decision: The court dismissed the revision and upheld the order condoning the delay, but disagreed with the reasoning of the lower court in accepting the calculation presented by the Munsarim and assuming the period of limitation to be 90 days.
2. The proceedings emanated on account of initiation of arbitration proceedings before the arbitrator in respect of a dispute between the revisionist and the respondents. After the pleading of the parties and receiving the evidence, the award was given on 7.1.2006. The said award was served upon the respondents on 9.1.2006. The respondents moved an application under Section 34 (3) of the Arbitration and Conciliation Act, 1996 (for short “the Act”) for condoning the delay, inter alia, on the ground that the award dated 7.1.2006 was received in the office of Director, Amausi Airport, Lucknow on 10.1.2006 along with covering letter and after receipt of the award, the matter was referred to the New Delhi Office for advice and simultaneously an advice was also taken from the counsel at New Delhi. The consultation went on up till the end of March, 2006. It is stated that at later stage the file was given to Sri K.D. Nag, Advocate for study and for rendering his advice in the matter in the second week of April, 2006. Sri K.D. Nag, demanded relevant record and indulged into certain correspondence. The documents could be provided to Sri K.D. Nag in the third week of April, 2006. Sri K.D. Nag held three conferences on three different dates with the official of the Lucknow Airport and prepared the notes. The petition for setting aside the arbitral award could be dictated in the first week of May, 2006 and at last the same could be filed on 9.5.2006. The entire process of consultation, collection of documents and conferencing resulted in moving the application a little bit late for setting aside the award. The application was delayed by only 29 days. The delay in filing the application under Section 34 of the Act was liable to be condoned as it was beyond the control of the respondents to have preferred the application before the said date.
3. An objection was filed against this application for condonation of delay on behalf of the revisionist and it was alleged that copy of the award was duly received by the competent authority of the respondents on 9.1.2006. It was also stated that as provided under Section 34 (3) of the Act, any application for setting aside an award may not be made after three months have elapsed from the date on which the party making the application had received the arbitral award, provided that if the court is satisfied that the applicant was prevented by sufficient cause from making the application within the said period of three months, it may, entertain the application with a further period of 30 days but not thereafter. The date of service of the award will be the starting point of limitation to challenge the award in the court. The period of 90 days and grace period of 30 days came to an end on 8.5.2006. The entire period came to an end on 8.5.2006. The respondents instituted the petition for setting aside the award on 9.5.2006. The court after expiry of limitation as provided under Section 34 of the Act had got no jurisdiction to condone the delay. Reliance was also placed by the learned counsel for the revisionist on a decision rendered in the case of Union of India v. Polular Construction Company, AIR 2001 S.C. Page 4010.
4. Supplementary affidavit as well as rejoinder affidavit had also been filed by the parties before the learned District Judge. Learned District Judge heard the matter and came to the conclusion that there was manipulation in the record as certified copy was present for his perusal which was obtained on 20.5.2006 in which there was no over-cutting and 9.1.2006 was clearly mentioned therein whereas the court