Recently, the single judge bench of the Jammu and Kashmir High Court held that the period of limitation to challenge the award starts to run against the party challenging the award from the date of delivery of the signed copy of the award to such party, and not from the date of award.
Brief facts:
The factual matrix of the case is that with the arisen of the certain disputes between the parties the respondent-claimant invoked the arbitration clause. The arbitral award was passed on 01.03.2024. Furthermore, in terms of Section 31(5) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the “Act”), a signed copy of the award was delivered by the learned Arbitrator to the respondent-claimant on the same day, but copy of the award was not delivered to the petitioners on the ground that they had failed to pay the outstanding amount of fee and the incidental charges. On 17.10.2024 the petitioners paid the balance amount of fee to the learned Arbitrator and accordingly, on 18.10.2024 a signed copy of the award was delivered to the petitioners, then, the instant petition under Section 34 of the Act of 1996 came to be filed on 04.02.2025. The Respondent/claimant raised the preliminary objection with respect to the maintainability of the Petition with regard to the limitation.
Contentions of the Respondent:
The learned counsel appearing on behalf of the Respondent contended that the limitation period for the challenging of the award runs from the date of award and not from the date when the copy of the arbitral award was received. It was furthermore contended that the Petitioner cannot take the advantage of their default in the payment of the fee.
The learned counsel appearing on behalf of the Respondent relied upon the judgment titled Krishna Devi @ Sabitri Devi (Rani) vs. Union of India and others (2025).
Observations of the court:
The Hon’ble Court observed that Section 34(3) of the Act (as applicable to UT of J&K), it provides that an application for setting aside the award has to be made within six months from the date on which the party making an application had received the arbitral award. Proviso to said provision further lays down that if the applicant was prevented by sufficient cause from making the application within the said period of six months the application can be entertained within a further period of 60 days, but not thereafter.
The court while relying upon the judgment titled Union of India vs. Tecco Trichy Engineers & Contractors (2005) observed that delivery of an arbitral award to a party is of paramount importance so far as initiating of various processes under the Arbitration and Conciliation Act are concerned. Delivery of copy of the arbitral award sets in motion the limitation period, it confers certain rights upon the parties and it terminates the arbitral proceedings.
The court noted that there is a distinction between making of award and delivering an award. Making an award refers to the period when Arbitral Tribunal finalizes its decision resolving disputes between the parties. An award is deemed to have been made when it is signed by the Arbitrator. Delivering of an award refers to formal communication or handing over of the signed award to the parties in terms of Section 31 (5) of the Act of 1996. The time to challenge the award under Section 34 of the Act starts only from the date the award is delivered to the parties and not from the date when it is made.
It was furthermore noted that merely because the petitioners defaulted in paying the fee of the learned Arbitrator for a few months, cannot alter the situation in favour of the respondent/claimant.
Based on these considerations, the court was of the opinion that the present petition filed by the Petitioner is within the period of limitation. The court further overruled the objection raised by the Respondent
The decision of the court:
With the above direction, the court overruled the objection raised by the Respondent.
Case Title: Chief Engineer PW(R&B) Department and another v. M/s Abdul Salam Mir
Coram: Hon’ble Mr. Justice Sanjay Dhar
Case No.: Arb P. No. 03/2025
Advocate for the Petitioner: Mr. Syed Musaib, Dy.AG
Advocate for the Respondent: Mr. Showkat Ali Khan, Advocate
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