Case Note & Summary
The case involves a Letters Patent Appeal filed by the Defence Estate Officer, Mumbai Circle, against the judgment of a Single Judge of the Bombay High Court (Nagpur Bench) dated 3.10.2012 in Writ Petition No. 3773 of 2012. The Single Judge had set aside the order of the District Judge condoning delay in filing an application under Section 34 of the Arbitration and Conciliation Act, 1996. The background facts are that an arbitral award was served on the appellant on 6.10.2004. On 10.1.2005, the appellant filed an application under Section 34 before the Bombay High Court, which was returned on 25.1.2005 on the ground that the District Judge had jurisdiction. The application was then filed before the District Judge, Nagpur on 8.2.2005, along with an application for condonation of delay. The District Judge rejected the condonation application on 20.8.2005, relying on H.M.P. Engineers Ltd. v. Ralies India Ltd., which held that Section 14 of the Limitation Act is not applicable to Section 34 applications. This order was upheld by the Single Judge and Division Bench of the High Court. The appellant then approached the Supreme Court in Civil Appeal No. 2601/2006. The Supreme Court, by judgment dated 15.2.2011, set aside the orders of the District Judge, Single Judge, and Division Bench, relying on Consolidated Engineering Enterprises v. Principal Secretary, Irrigation Department, which held that Section 14 of the Limitation Act is applicable to applications under Section 34. The matter was remanded to the District Judge for fresh consideration. On remand, the District Judge, by order dated 11.11.2011, allowed the condonation application. The respondent challenged this order by filing a writ petition before the High Court. The Single Judge allowed the writ petition, setting aside the District Judge's order. The present appeal is against that decision. The Division Bench, after hearing both sides, held that the Supreme Court's decision in Consolidated Engineering Enterprises is binding and that the District Judge had correctly applied Section 14 to exclude the time spent before the wrong forum. The delay was only of a few days, and the appellant had acted diligently. The Division Bench set aside the Single Judge's order and restored the District Judge's order condoning the delay. The appeal was allowed.
Headnote
A) Limitation Act - Section 14 - Applicability to Arbitration Act - Exclusion of time spent in wrong forum - The issue was whether the benefit of Section 14 of the Limitation Act, 1963 is available for an application under Section 34 of the Arbitration and Conciliation Act, 1996. The Supreme Court in Consolidated Engineering Enterprises v. Principal Secretary, Irrigation Department held that Section 14 is applicable. Consequently, the time spent by the appellant in pursuing the application before the High Court (wrong forum) from 10.1.2005 to 25.1.2005 was liable to be excluded, and the delay of a few days in filing before the District Judge was condonable. The Division Bench upheld the District Judge's order condoning delay. (Paras 2-4) B) Arbitration and Conciliation Act, 1996 - Section 34 - Condonation of delay - Application of Limitation Act - The appellant filed an application under Section 34 before the High Court instead of the District Judge. The application was returned on 25.1.2005 and filed before the District Judge on 8.2.2005. The District Judge initially rejected the condonation application relying on H.M.P. Engineers Ltd. v. Ralies India Ltd., which held Section 14 inapplicable. However, the Supreme Court in Civil Appeal No. 2601/2006 set aside that order, directing rehearing in light of Consolidated Engineering Enterprises. On remand, the District Judge condoned the delay. The Single Judge set aside that order, but the Division Bench restored it, holding that the delay was only of a few days and the appellant had acted diligently. (Paras 2-4)
Issue of Consideration
Whether Section 14 of the Limitation Act, 1963 is applicable to an application under Section 34 of the Arbitration and Conciliation Act, 1996 for setting aside an arbitral award, and whether the delay in filing such application can be condoned by excluding the time spent in pursuing the remedy before a wrong forum.
Final Decision
The Division Bench allowed the appeal, set aside the order of the Single Judge dated 3.10.2012, and restored the order of the District Judge dated 11.11.2011 condoning the delay. The District Judge was directed to decide the application under Section 34 on merits.
Law Points
- Section 14 of Limitation Act applicable to applications under Section 34 of Arbitration and Conciliation Act
- 1996
- Condonation of delay permissible even if delay is few days
- Benefit of Section 14 available for time spent in pursuing remedy before wrong forum
