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2023 Supreme(Online)(KER) 1048
HIGH COURT OF KERALA
A. BADHARUDEEN, J
MATHEW P J – Appellant
Versus
M/S. CHOLAMANDALAM INVESTMENT AND FINANCE CO LTD – Respondent
Arb.A 26/2023
T.G. RAJENDRAN, T.R. TARIN
The court established that the specific timelines under Section 34 of the Arbitration and Conciliation Act override the general provisions of the Limitation Act.
Headnote:
Limitation - Arbitration Appeal - Limitation Act Section 5, Arbitration and Conciliation Act Section 34 - The court clarified that the Limitation Act's Section 5 does not apply to petitions under Section 34 of the Arbitration and Conciliation Act, which has its own strict timelines for challenging arbitration awards.
Fact of the Case:
The appeal arises from the dismissal of an original petition challenging an arbitration award. The appellants filed a petition for condonation of delay of 1306 days in filing their appeal after being set ex parte in arbitration proceedings.
Finding of the Court:
The court found that the appellants failed to contest the arbitration proceedings and delayed in filing their appeal. It concluded that the application for condoning the delay could not be entertained as it was beyond the stipulated time frame set by the Arbitration and Conciliation Act.
Issues: Whether Section 5 of the Limitation Act applies to condone delay in filing a petition under Section 34 of the Arbitration and Conciliation Act, and the maximum period available to challenge an arbitration award.
Ratio Decidendi: The court determined that Section 5 of the Limitation Act does not apply to challenges under Section 34 of the Arbitration and Conciliation Act, as that act provides specific timelines which, if not adhered to, bar the appeal.
Final Decision: The appeal was dismissed as barred by limitation.
JUDGMENT
Arb.Appeal No.26 of 2023 This appeal arose out of O.P.(Arbitration) No.749/2019 on the files of the District Court, Kozhikode, challenging dismissal of the above original petition by the District Judge, Kozhikode. Appellants are the original petitioners in the Original Petition.
C.M.Appl.No.1 of 2023 This is a petition filed under Section 5 of the Limitation Act for condoning delay of 1306 days in filing the Arbitration Appeal.
2. Heard the learned counsel for the appellants on admission. The learned counsel pressed for condonation of delay of 1306 days in filing the appeal and admission of this appeal for hearing.
3. The reasons stated in the affidavit in support of the petition to condone the delay are as under:
“2. The above Appeal was filed challenging the Order in IA No. 2886/2019 in OP Arbitration No. 749/2019 on the files of the District Judge, Kozhikode, confirming the order in ACP No. (Chola) 5435 of 2014 on the files of the Arbitrator, Adv. G. Ashokapathy, wherein the Appellant was set exparte and was directed to pay an amount of Rs. 2.07,555/- along with interest. The Arbitration award was passed without hearing the Appellant and the award was not also communicated.
3. I have entrusted the matter for filing the appeal with the counsel at Kozhikode and the counsel has filed appeal also with an application for condoning delay. The court below dismissed the application for condonation of delay and consequently the Arbitration OP was also dismissed. Even though the case was dismissed as per order dated 10.12.2019 the same was not communicated to me by the counsel and I came to know about the same only when the Respondent finance company initiated recovery proceedings. On coming to know about the same I filed an application for getting the certified copy of the order on 23.09.2023 and the stamp was called on 26.03.2023 and the same was produced on 27.09.2023. The copy was ready on 29.9.2023 and the same was taken delivery on 30.09.2023. The appeal ought to have been filed on or before 9.3.2020. Due to the above said reason now there is a delay of 1306 days in filing the appeal. If the delay in filing the appeal before this Hon'ble Court is not condoned the same will cause severe hardship and financial difficulty to me and other Appellant."
4. On perusal of the reasons, it is emphatically clear that as early in the year 2014, arbitration proceedings commenced before the Arbitrator and the same was allowed as against the petitioners/appellants, since the appellants herein, who are the respondents in the above arbitration proceedings, did not contest the matter.
5. After having noticed and received the award against the appellants in time, the appellants remained silent for about 1781 days in preferring the first appeal before the District Court. Consequently, O.P.(Arbitration) No.749/2019 was dismissed as per order dated 10.12.2019, after dismissing I.A.No.2886/2019, which was filed to condone delay of 1781 days. Now the present appeal, challenging the said order, has been filed along with the delay of 1306 days.
6. The questions to be answered are;
1. Whether Section 5 of the Limitation Act has application to condone delay in filing a petition under Section 34 of the Arbitration and Conciliation Act ?
2. What is the maximum period available to a party to an arbitration proceeding to challenge an award passed by the Arbitrator by invoking Section 34 of the Arbitration and Conciliation Act ?
7. Insofar as challenge against arbitration award is concerned, the same is in accordance with Section 34 of the Arbitration and Conciliation Act , since specific period of limitation is provided therein. Therefore, Section 5 of the Limitation Act has no application to condone delay in filing a petition under of the . of the provides appeal to set aside an award. (3)
provides as under:
“(3) An application for setting aside may not be made after three months have elapsed from the date on which the party making that applicat
