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High Court of Delhi Condones Delay in Arbitration Petition

Background

In a recent ruling by the High Court of Delhi, the court addressed the case of M/S Prime Interglobe Private Limited versus M/S Super Milk Products Private Limited . The petitioner sought to challenge an arbitral award issued on March 11, 2023, which was received on the same day. Following the award, the respondent filed an application for an additional award on March 28, 2023, leading to further developments in the arbitration process.

Arguments

The petitioner argued that the delay in filing the petition was due to the time taken for the arbitral tribunal to address subsequent applications, specifically a Section 33 application that was disposed of on April 24, 2023. The petitioner contended that this timeline should be considered when calculating the limitation period for filing under Section 34 of the Arbitration and Conciliation Act.

Conversely, the respondent's counsel contended that the petition was filed beyond the permissible period of three months and thirty days from the date of the original award, thus rendering it non-est. They argued that the petitioner could not rely on the timeline of the respondent's Section 33 application to justify the delay.

Court's Analysis and Reasoning

The court analyzed the procedural requirements under Section 34(3) of the Arbitration and Conciliation Act, which allows for a maximum of thirty days' extension beyond the initial three-month period for filing a petition to set aside an arbitral award. The court noted that the petitioner was entitled to reckon the limitation period from the date the respondent's Section 33 application was disposed of, as this provision does not restrict the benefit to the party who filed the Section 33 application.

The court emphasized that the defects in the filing were curable and did not render the application non-est. It also clarified that the entitlement to challenge both the original and additional awards separately does not affect the computation of the limitation period.

Decision

Ultimately, the High Court condoned the delay of 28 days in filing the petition, allowing the petitioner to proceed with their challenge against the arbitral award. The court's decision underscores the importance of ensuring that litigants are not unduly hindered in their right to challenge arbitral awards, particularly when procedural complexities arise.

The court issued a notice returnable on December 4, 2024, allowing the respondent to file a reply within four weeks, with the petitioner permitted to file a rejoinder thereafter.