JUDGMENT R.M. Savant, J.
1. This Appeal challenges the order dated 13.8.2001 passed by the II Additional District Judge, Nanded by which order the application being Misc. Civil Application (RJE) No. 157 of 2000 filed by the Respondent no. 2 State of Maharashtra through the Executive Engineer, Upper Division, Hadgaon came to be allowed and the award passed by the sole Arbitrator M.S. Dandwate dated 9.9.1999 came to be set aside.
2. The facts in brief are stated thus:
I. The Appellant is a license contractor registered with the Respondent. The Respondent had invited tender for carrying out work of Kayadhu branch canal in 1984-85. The offer of the Petitioner being the lowest was accepted for an amount of Rs. 39,32,000/-. The period of completion of work was 30 months. However on account of the fact that the work was not completed the Respondent had granted three extensions for completion of the work. The last of such extension was upto 30.6.1989. However prior to the completion of the said last extension period, the work came to be withdrawn by the Respondent invoking Clause 44 of the tender conditions.
II. The Petitioner on such withdrawal raised various claims and issued notice to the parties after following the due procedure. As laid down by Clause 51 and 52 of the contract agreement an arbitrator came to be appointed. The said arbitrator Shri M.S. Dandawate after recording evidence of the parties passed his award on 9.9.1989. After the award was passed by the Arbitrator on 9.9.1999, the same was filed by the Arbitrator as required under the Arbitration and Conciliation Act, 1940 for making it a decree of the Court before the Joint Civil Judge Senior Division, Nanded on 14.9.1999.
III. The copy of the said award was despatched to the Respondent herein. The Respondent submitted an objection application on 14.1.2000 objecting to the said award inter-alia on various grounds mentioned therein. The learned Civil Judge Senior Division in whose Court the award was filed by an order dated 8.11.2000 directed the return of the said objection Petition and presentation before the appropriate forum as the Court of Civil Judge Senior Division did not have the jurisdiction.
IV. The Respondent thereafter on 29.11.2000 filed the objection Petition under Section 34 of the Arbitration and Conciliation Act, 1996. The said application was numbered as Misc. Application no. (RJE) 157 of 2000. It was the case of the Respondent in the said Application that the appointment of the arbitrator is illegal on account of the fact that the said appointment was not in terms of the contract conditions. The award of the arbitrator was also challenged on the ground that the same is not in keeping with tender conditions and therefore the award is required to be set aside. However prior to that the Respondents had also filed an application for condonation of delay being Misc. Application (RJE) 148 of 2000. The said Application was filed invoking 14 of the Limitation Act, 1965.
V. The said delay condonation application being Misc. Application (RJE) 148 of 2000 came to be allowed and the delay came to be condoned. The learned III Additional District Judge, Nanded held that the period when the Respondents were bonafide pursuing the objection Petition before the learned Civil Judge Senior Division, Nanded needed to be excluded. However, what is significant from the point of the present Appeal is that the learned Judge has merely stated in the operative part of the said order that after exclusion of the said period the application filed under Section 34 is in limitation. The learned Judge has not gone into the details and calculated whether the application would still be within time. The said order condoning the delay is also under challenge in the present Appeal.
VI. The Appeal is therefore directed against the order condoning the delay as well as the order passed in the Misc. Civil Application (RJE) 157 of 2000. In sofar as the condonation of delay part is concerned, the grounds A to H of the Appeal Memo are the grounds on which the condonation of delay is challenged.
VII. The said application being Misc. Application (RJE) 157 of 2000 was opposed by the Petitioner herein. The principal contention of the Petitioner was that the Application filed under Section 34 was beyond the prescribed period of limitation. The Appellant further contended that the appointment of Arbitrator is in conformity with the provisions of Clause 52 of the Arbitration Act and since the work was withdrawn there was no date of completion of work and therefore the clause relating to defect liability was not attracted. It was further contended on behalf of the Petitioner that the award by the Arbitrator could only be challenged on the grounds mentioned in Section 34(2) of the Act.
VIII. The said application was heard by the learned II Additional District Judge, Latur who by his judgment and order dated 31.8.2001 was pleased to allow the application filed by the Respondent under Section 34 of the Arbitration and Conciliation Act, 1996 and has set aside the award passed by the Arbitrator.
3. It is the said judgment and order dated 31.8.2001 which is the subject matter of the present Appeal. I have heard the learned Counsel for the respective parties Shri A.S. Bajaj the learned Counsel for the Petitioner and Shri G.B. Rajale the learned Counsel for the Respondent. The learned Counsel Shri Bajaj for the Petitioner submitted that since the Application under Section 34 of the Act was beyond limitation, the same was not maintainable. The learned Counsel further submitted that since the Objection Petition filed before the learned Civil Judge Senior Division was itself beyond limitation by three days, the benefit of Section 14 of the Limitation Act was not available to the Respondent. The learned Counsel further submitted that even if the period spent in prosecuting the remedy before the learned Civil Judge Senior Division is taken into consideration the application would be beyond limitation.
The learned Counsel relied upon a chronology of dates and events and submitted that if the same is taken into consideration the Misc. Civil Application is belated by 22 days. The learned Counsel lastly submitted that in view of the fact that the application was itself filed beyond limitation, the above Appeal is to be allowed on the said limited ground. The learned Counsel relied upon the judgment of the Apex Court in the matter of State of Goa v. Western Builders wherein the Apex Court has held that insofar as the provisions of Section 34(3) and the proviso thereto are concerned Sections 5 and 3 r/w Schedule of limitation Act are not applicable to an application under Section 34 made under the said Act. However Section 14 of the Limitation Act is applicable.
The relevant paragraphs 15, 17 and 25 of the judgment are reproduced hereinunder:
15. Therefore, general proposition by virtue of Section 43 of the Act of 1996 the Limitation Act, 1963 applies to the Act of 1996 but by virtue of Sub-section (2) of Section 29 of the Limitation Act, if any other period has been prescribed under the special enactment for moving the application or otherwise then that period of limitation will govern the proceedings under that Act, and not the provisions of the Limitation Act. In the present case under the Act of 1996 for setting aside the award on any of the grounds mentioned in Sub-section (2) of Section 34 the period of limitation has been prescribed and that will govern. Likewise, the period of condonation of delay i.e. 30 days in the proviso.
17. Therefore, by virtue of Sub-section (2) of Section 29 of the Limitation Act what is excluded is the applicability of Section 5 of the Limitation Act and under Section 3 read with the Schedule which prescribes the period for moving application.
25. Therefore, in the present context also it is very clear to us that there are no two opinions in the matter that the Arbitration and Conciliation Act, 1996 does not expressly exclude the applicability of Section 14 of the Limitation Act. The prohibitory provision has to be construed strictly. It is true that the Arbitration and Conciliation Act, 1996 intended to expedite commercial issues expeditiously. It is also clear in the Statement of Objects and Reasons that in order to recognise economic reforms the settlement of both domestic and international commercial disputes should be disposed of quickly so that the country's economic progress be expedited. The Statement of Objects and Reasons also nowhere indicates that Section 14 of the Limitation Act shall be excluded. But on the contrary, intendment of the legislature is apparent in the present case as Section 43 of the Arbitration and Conciliation Act, 1996 applies the Limitation Act, 1963 as a whole. It is only by virtue of Sub-section (2) of Section 29 of the Limitation Act that its operation is excluded to that extent of the area which is covered under the Arbitration and Conciliation Act, 1996. Our attention was also invited to the various decisions of this Court interpreting Sub-section (2) of Section 29 of the Limitation Act with reference to other Acts like the Representation of the People Act or the provisions of the Criminal Procedure Code where separate period of limitation has been prescribed. We need not overburden the judgment with reference to those cases because it is very clear to us by virtue of Sub-section (2) of Section 29 of the Limitation Act that the provisions of the Limitation Act shall stand excluded in the Act of 1996 to the extent of area which is covered by the Act of 1996. In the present case under Section 34 by virtue of Sub-section (3) only the application for filing and setting aside the award a period has been prescribed as 3 months and delay can be condoned to the extent of 30 days. To this extent the applicability of Section 5 of the Limitation Act will stand excluded but there is no provision in the Act of 1996 which excludes operation of Section 14 of the Limitation Act. If two Acts can be read harmoniously without doing violation to the words used therein, then there is no prohibition in doing so.
The learned Counsel relying upon the said judgment submitted that the Trial Court has possibly proceeded on an erroneous assumption that the other provisions of the Limitation Act and especially Section 5 are applicable and therefore without going into the details and calculating as to whether the application was within limitation has allowed the same.
4. On the other hand the learned Counsel for the Respondents Shri G.B. Rajale submitted that the learned District Judge has rightly granted the benefit of Section 14 of the Limitation Act and condoned the delay. The learned Counsel submitted that on account of the fact that the Respondents were bonafide pursuing the remedy before the Civil Judge Senior Division the said period would have to be excluded. The learned Counsel relied upon the judgment of the Apex Court in the matter of Union of India v. Popular Construction Co. in support of his submission that the limitation Act is applicable to the proceedings filed under Section 34 of the said Act.
5. Since the issue of limitation has been raised on behalf of the Appellants and since the said issue goes to the root of the matter in my view it would be necessary to consider the said issue first. However at the outset it would have to be made clear that the Arbitration and Conciliation Act, 1996 was applicable to the proceedings in question. It would be necessary to reproduce Section 34(3) of the said Act which reads as under:
34(3) An application for setting aside may not be made after three months have elapsed from the date on which the party making that application had received the arbitral award or, if a request had been made under Section 33, from the date on which that request had been disposed of by the arbitral tribunal:
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 within a further period of thirty days, but not thereafter.
6. What emerges from reading of the said provision is that the period of three months is available from the date of receipt of the award by a party for challenging the same by making an application under Section 34. The proviso to the said provision grants a further period of one month if the Court is satisfied that the Applicant was prevented by sufficient cause by making an application within the said period of three months.
In the said context of Section 34(3) it is therefore necessary to refer to the chronology of dates and events. Sr. Date Event No. 01. 9.9.1999 Award was passed by the Arbitrator 02. 14.9.1999 Award filed by the Arbitrator before the Civil Judge (Senior Division), Nanded 03. 14.9.1999 Copy of the Award received by both the parties 04. 13.12.1999 Three months completed for filing objection under Section 34(3) of Arbitration and Conciliation Act, 1996 05. 12.1.2000 30 days completed as per Section 34(3) (There is three days delay in filing the application under Section 34(3) ). 06. 15.1.2000 Objection/Application filed by the Respondent Department before Civil Judge (Senior Division), Nanded after 124 days 07. 8.11.2000 Order of return of Application/ Objection passed by the Civil Judge Senior Division, Nanded. The total 298 days calculated as per Section 14 of the Limitation Act from the date of receipt of the Award by the Respondent Department till the date of Order dated 8.11.2000. 08. 29.11.2000 Fresh Objection/Application filed by the Respondent Department before the District Court, Nanded 09. 29.11.2000 Delay condonation application under Section 14 of Limitation Act was filed by the Respondent Department.
From the aforesaid chronology it is clear that initially the objection Petition itself was filed three days late than the maximum period available as per Section 34(3) of the said Act.
7. There is considerable merit in the submission of the learned Counsel for the Petitioner that the Respondents were not bonafide pursuing the remedy before the learned Civil Judge Senior Division. The Respondents ought to have known that there was no need under the 1996 Act to file the award in Court. The Arbitrator is also expected to be aware of the said legal position. The Respondent therefore ought to have filed the objection Petition before the District Court and therefore it cannot be said that they were bonafide pursuing the remedy before the wrong forum. It is therefore submitted on behalf of the Appellant that they are not entitled to the benefit of Section 14 of the limitation Act. Assuming the delay spent in pursuing the remedy before the learned Civil Judge Senior Division is to be excluded still the application filed under Section 34 is still belated. As observed hereinabove the original objection petition before the Civil Judge Senior Division was itself belated by three days in terms of Section 34(3) of the said Act. The total time span between the date of receipt of the award on 15.9.1999 upto filing of the Objection petition on 29.11.2000 is 441 days as per the chronology reproduced hereinabove. Deleting the said period spent whilst pursuing the remedy before the learned Civil Judge Senior Division which is 298 what remains out of 441 is 143 days. Taking the period available under Section 34(3) the Respondent's application under Section 34 of the said Act is belated by 22 days. In my view the benefit of Section 14 cannot be given to a party which has filed a proceeding before a wrong forum beyond limitation and therefore in my view the benefit of Section 14 cannot be given to the Respondent, however assuming that the said benefit is to be given still the application is belated by 22 days.
8. The submission of the learned Counsel for the Respondents that the limitation Act is applicable in my view cannot be countenanced in the teeth of the judgment of the Apex Court in the matter of State of Goa v. Western Builders (Supra).
9. In that view of the matter, the Appeal from Order would have to be allowed on the limited ground of the application i.e. (RJE) no. 157 of 2000 being filed beyond the period of limitation and was therefore not maintainable. Resultantly the said application would stand dismissed. Appeal is accordingly allowed.