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2024 Supreme(All) 768

IN THE HIGH COURT OF ALLAHABAD
SHEKHAR B. SARAF, J.
Dharmveer Tyagi and Others – Appellants
Versus
Competent Authority, Special Land Acquisition and Others – Respondents
Appeal Under Section 37 of Arbitration and Conciliation Act 1996 No. 257 of 2024
Decided On : 13-05-2024

IMPORTANT POINT
The limitation period for challenging an arbitral award under Section 34(3) of the Arbitration and Conciliation Act, 1996 is strict and non-extendable, emphasizing the need for timely recourse to maintain the integrity of the arbitration process.

Headnote:

ARBITRATION - APPLICATION UNDER SECTION 34 - Arbitration and Conciliation Act, 1996 - Section 34(3), Limitation Act, 1963 - Section 5 - The court emphasized the strict timelines established under Section 34(3) of the Arbitration and Conciliation Act, 1996 for challenging arbitral awards, which cannot be extended by the courts. The phrase 'but not thereafter' indicates a non-negotiable deadline, reinforcing the integrity and efficiency of the arbitration process. The court concluded that the appellants' application was time-barred, as it was filed beyond the prescribed period, and thus dismissed the appeal.

Fact of the Case:

The appellants challenged an arbitration award passed in 2018, but their application under Section 34 of the Arbitration and Conciliation Act was dismissed as time-barred by the Additional District Judge, who noted that the application was filed beyond the 120-day limit and that Section 5 of the Limitation Act did not apply.

Finding of the Court:

The court found that the appellants failed to provide the date of their writ petition filing, which was crucial for calculating the limitation period. The application was filed after the statutory period, and the court upheld the dismissal of the application as time-barred, emphasizing the importance of adhering to statutory timelines in arbitration.

Issues: Whether the application under Section 34 of the Arbitration and Conciliation Act was filed within the prescribed limitation period and whether the court could condone the delay under Section 5 of the Limitation Act.

Ratio Decidendi: The court reiterated that the limitation period under Section 34(3) of the Arbitration and Conciliation Act is absolute and cannot be extended by the courts. The phrase 'but not thereafter' in the statute signifies a strict deadline for challenging arbitral awards, which is essential for maintaining the efficiency and finality of the arbitration process.

Final Decision: The appeal was dismissed, affirming the lower court's decision that the application was time-barred.

JUDGMENT :

SHEKHAR B. SARAF, J.

1. Heard Sri Sushil Kumar Shukla, learned counsel for the appellants.

2. This is an appeal filed against an order dated March 22, 2024 passed by the Additional District Judge, Court No. 1, Saharanpur in an application filed under Section 34 of the Arbitration and Conciliation Application Act, 1996 (hereinafter referred to as the “Act”) whereby the said application was dismissed as time barred.

3. Acquisition of the land of the appellants was carried out in the year 2015 and thereafter an arbitration award was passed by the learned Arbitrator/Commissioner, Saharanpur on March 15, 2018. Subsequently, on November 21, 2019, the appellants filed a writ petition before this Court bearing Writ-C No. 4985 of 2020. This writ petition was disposed of by this Court on February 20, 2020 with the following direction:

    “Upon perusal of the averments made in the writ petition and the documents appended thereto, it transpires that the petitioners are challenging the validity of the award made under Section 20F(6) of The Railways Act, 1989.

In our opinion, the remedy if any, available to the petitioners against the impugned award is to file an objection under Section 34 of the Indian Arbitration & Conciliation Act, 1996.

Subject to aforesaid observations, writ petition stands disposed of.”

4. Upon being reverted by this Court, the appellants filed an application under Section 34 of the Act before the court of Additional District Judge on July 13, 2020. Learned Additional District Judge, after granting hearing to the appellants, passed a detailed order taking into consideration the submissions made by the appellants and dismissed the said application on the ground that the application was beyond 120 days and, Section 5 of the Limitation Act, 1963 (hereinafter referred to as the ‘Limitation Act’) would not apply. Accordingly, the learned Additional District Judge dismissed the application under Section 34 of the Act as time barred. Relevant portion of the judgment is extracted herein:

    “15. That in this case, the impugned order was passed by Ld. Arbitrator/Commissioner, Saharanpur on 15.03.2018 and it is the case of the applicants that they went to the Hon'ble High Court against that order and filed writ petition, but it is not mentioned on what date that writ petition was filed before the Hon'ble High Court. The Court can condone the time spent before the Hon'ble High Court while pursuing writ petition as per Section 14 of the Limitation Act. However, in this case, as the applicants have not mentioned when they have filed the writ petition before the Hon'ble High Court and therefore, it is not possible to calculate the time spent by the applicants before the Hon'ble High Court. Even though, the writ petition was disposed off on 20.02.2020 and the present application filed by the applicants before this Court on 13.07.2020 i.e. after five months from the date of order of the Hon'ble Allahabad High Court, when the writ petition of the applicants were disposed off. Though, the applicants have mentioned that certain times were taken for getting certified copy of the order, but the applicants were already aware about the impugned order and also went to the Hon'ble High Court against that order. Thus, the applicants cannot take the advantage of its own mistake. Admittedly, in this case the objection was filed beyond 120 days and therefore, the present application under Section 5 of the Limitation Act is not maintainable and the same is liable to be dismissed.

The present application of the applicants under Section 5 read with Section 34(3) of the Arbitration and Conciliation Act, 1996 is hereby dismissed.

The file be consigned to the record room.”

5. Upon a perusal of the order passed by the learned Additional District Judge, it appears that the appellants did not inform the Court of the date of the filing of the writ petition before the High Court. This factual matrix has, however, been addressed before this Court and it appears tha

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