Bombay High Court
Oil & Natural Gas Corporation Ltd vs M/S. Dinamic Corporation on 12 October, 2012
Bench: Dr. D.Y. Chandrachud, A.A. Sayed
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
NOTICE OF MOTION NO. 3054 OF 2011
IN
APPEAL (L) NO. 390 OF 2011
IN
ARBITRATION PETITION NO. 153 OF 2008
Oil & Natural Gas Corporation Ltd. .. Appellant.
versus
M/s. Dinamic Corporation. ..Respondent.
.....
Ms. S.A. Bhalwal with Mr. P.N. Singh and Ms. Hemali K. i/by
Vyas & Bhalwal for the Appellant.
None for the Respondent.
Mr. Pravin Samdani, Sr. Adv. Amicus Curiae present with Adv.
Mr. Gauraj Shah.
......
CORAM : DR.D.Y.CHANDRACHUD, AND
A.A. SAYED, JJ.
12 OCTOBER 2012.
ORAL JUDGMENT (Per Dr. D.Y. Chandrachud, J.)
The present Motion is for condoning a delay of sixty
days in filing an Appeal against an order of a learned Single Judge
arising out of a Petition for setting aside an arbitral Award under
Section 34 of the Arbitration and Conciliation Act, 1996. When the
Motion came up on Board for hearing, Counsel appearing on
behalf of the Applicant relied on a judgment of a Single Judge of
this Court in Oil and Natural Gas Corporation Ltd. vs. Jagson
International Ltd.1 and urged that since the Arbitration and
Conciliation Act, 1996 has not prescribed any limitation for filing an
1 2005(3) Mh.L.J. 1141
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appeal under Section 37(1)(b) against an order setting aside or
refusing to set aside an arbitral Award under Section 34, such an
appeal would not be governed by the Limitation Act, 1963. On the
basis of the judgment of the learned Single Judge in ONGC vs.
Jagson International Ltd. it was sought to be urged that an
appeal could be filed within a reasonable period of time. The
Respondents have not appeared despite service of notice and an
order of substituted service. Since the issue raises a matter of
some importance, we requested Mr. Pravin Samdani, learned
Senior Counsel to assist the Court as amicus curiae.
2. Before we deal with the issue which arises in these
proceedings, it will be necessary, at the outset, to notice the
judgment of the learned Single Judge in Oil and Natural Gas
Corporation Ltd. vs. Jagson International Ltd. (supra). In that
case, an appeal was filed under Section 37 of the Arbitration and
Conciliation Act, 1996 against an order of the Arbitral Tribunal
under Section 17. An objection was raised to the maintainability of
the appeal. The learned Single Judge held that Parliament was
cognizant of the necessity of providing a period of limitation and
whenever it found it necessary to so provide, specific provisions
were made in the Act such as in Section 34 as well as in Sections
11, 13 and 16. However, the Single Judge held that while
providing an appeal under Section 37, Parliament did not provide
any period of limitation. Moreover, the Single Judge held that
there was no provision in the Limitation Act, 1963 for providing a
period of limitation for filing an appeal under Section 37. The
Single Judge held as follows :
"Perusal of Section 37 also shows that there is no period
of limitation laid down for filing an appeal under that
provision. Perusal of the provision of Section 34 shows
that there is a clear provision made for filing an
application under that provision for challenging an award
made by the Arbitral Tribunal. Therefore, when the
Legislature provided the remedy against the arbitral
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award, it also provided a period of limitation for making
an application under Section 34. Perusal of the
provisions of Section 11, Section 13 and Section 16
show that the Legislature has mentioned a period of time
for taking various steps. Therefore, it is clear that while
the Legislature was aware of the necessity of providing a
period of limitation and wherever the Legislature thought
that providing a period of limitation is necessary it has
been so provided for by various provisions of the Act.
However, while providing an appeal under Section 37,
the Legislature has chosen not to prescribe any period of
limitation. In this view of the matter, therefore, in my
opinion, the Court will not be justified in importing the
period of limitation provided by Section 34 for filing an
application and making it applicable to an appeal filed
under Section 37. Sub-section 1 of Section 43 makes the
provisions of Limitation Act applicable to arbitration as it
applies to proceedings in Court. Perusal of the provisions
of the Limitation Act also shows that the Limitation Act
does not provide for any period of limitation for filing an
appeal under Section 37. It is second Division of the
Schedule to the Limitation Act which deals with appeal.
Perusal of those provisions show that Articles 114 and
115 lays down period for filing an appeal under the Code
of Criminal Procedure and Article 116 provides for
limitation for filing an appeal under the Code of Civil
Procedure and Article 117 provides period of limitation for
filing an appeal from decree or order passed by the High
Court to the same court. Thus in the Limitation Act there
is no provision made prescribing the period of limitation
for filing an appeal under Section 37."
3. Section 37 of the Arbitration and Conciliation Act, 1996
provides as follows :
"Section 37. Appealable orders. --(1) An appeal shalll lie
from the following orders (and from no others) to the Court
authorised by law to hear appeals from original decrees of
the Court passing the order, namely:-
(a) granting or refusing to grant any measure under
section 9:
(b) setting aside or refusing to set aside an arbitral
award under section 34.
(2) An appeal shall also lie to a court from an order of the
arbitral tribunal-
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(a) accepting the plea referred to in sub-section (2) or
sub-section (3) of section 16; or
(b) granting or refusing to grant an interim measure
under section 17.
(3) No second appeal shall lie from an order passed in
appeal under this section, but nothing in this section shall
affect or taken away any right to appeal to the Supreme
Court."
4. Under Clause (b) of Sub-section (1) of Section 37 an
appeal lies from an order setting aside or refusing to set aside an
arbitral award under Section 34, to the Court. The expression
"Court" is defined in Section 2(e) to mean the Principal Civil Court of
original jurisdiction in a district and to include the High Court in the
exercise of its ordinary civil jurisdiction, having jurisdiction to decide
the questions forming the subject-matter of the arbitration if the
same had been the subject matter of a suit, but so as not to include
any civil Court of a grade inferior to such Principal Civil Court, or
any Court of Small Causes. Section 43 (1) provides that the
Limitation Act, 1963 shall apply to arbitrations as it applies to
proceedings in Court.
5. Section 29(2) of the Limitation Act, 1963 stipulates that
where any special or local law prescribes for any suit, appeal or
application a period of limitation different from the period
prescribed by the Schedule, the provisions of Section 3 shall apply
as if the said period were the period prescribed by the Schedule
and for the purpose of determining any period of limitation
prescribed for any such appeal or application by any special or
local law, the provisions contained in Sections 4 to 24 shall apply
only in so far as and to the extent to which they are not expressly
excluded by such special or local law.
6. In Consolidated Engineering Enterprises vs.
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Principal Secretary, Irrigation Department 1 the issues which fell
for consideration before the Supreme Court included whether the
Limitation Act, 1963 is inapplicable to a proceeding in a Court
under the Arbitration and Conciliation Act, 1996. In a concurring
judgment Mr. Justice R.V. Raveendran observed that if the
Limitation Act is inapplicable to Court proceedings under the Act,
there will be no limitation for filing an appeal under Section 37.
Conversely if the Limitation Act is applicable, the period of
limitation for appeals filed under Section 37 will be governed by
Article 117 of the Schedule to the Limitation Act. The judgment
took note of the well settled principle of law that the words
"appeals under Code of Civil Procedure 1908" occurring in Article
116 of the Schedule to the Limitation Act refer not only to appeals
preferred under the CPC but also to appeals where the procedure
for filing such appeals and the powers of the Court for dealing with
such appeals are governed by the Code. Explaining the import of
Section 29(2), the concurring judgment holds thus :
"The object of Section 29(2) is to ensure that the principles
contained in Sections 4 to 24 of the Limitation Act apply to
suits, appeals and applications filed in a court under special
or local laws also, even if it prescribes a period of limitation
different from what is prescribed in the Limitation Act,
except to the extent of express exclusion of the application
of any or all of those provisions."
The Supreme Court held that the purpose of Section 43(1) of the
Arbitration and Conciliation Act, 1996 is not to make the Limitation
Act inapplicable to proceedings before the Court but on the other
hand to make the Limitation Act applicable to arbitrations. The
Supreme court has, hence laid down that the provisions of the
Limitation Act, 1963 apply to all proceedings under the Arbitration
and Conciliation Act, 1996 both in Court and in arbitration except to
the extent expressly excluded by the provisions of the latter Act.
1 (2008) 7 SCC 169
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7. In the judgment in ITI Ltd. vs. Seimens Public
Communications Network Ltd.1 the Supreme Court held that an
appeal under Section 37(1) is not to any designated person but to
a civil court and in such a situation the proceedings before the
Court will have to be controlled by the provisions of the Code of
Civil Procedure, 1908. The conferment of appellate power on the
civil court under Part I of the Arbitration and Conciliation Act, 1996
would, it was held, also attract the provisions of the Code of Civil
Procedure, 1908.
8. With great respect, the judgment of the learned
Single Judge in Oil and Natural Gas Corporation Ltd. vs.
Jagson International Ltd. (supra) proceeds on an erroneous
premise when the Court holds that since Parliament had provided
a specified period of limitation in respect of certain provisions of
the Arbitration and Conciliation Act, 1996, no limitation would be
applicable in respect of those provisions where a period of
limitation is not specifically prescribed. The view of the learned
Single Judge overlooks both the provisions of Section 43(1) of the
Arbitration and Conciliation Act, 1996 and Section 29 of the
Limitation Act, 1963. Section 43(1) which lays down that the
Limitation Act, 1963 shall apply to arbitrations as it applies to
proceedings in Court has been specifically held to mean that the
Limitation Act, 1963 would apply to all proceedings under the Act of
1996 both in Court and in arbitration except to the extent excluded
by the latter Act. The learned Single Judge, with respect,
overlooked the fundamental position that if an appeal is provided
by the Arbitration and Conciliation Act, 1996 to a Court that will be
governed by the Code of Civil Procedure, 1908.
9. Article 116 of the Schedule to the Limitation Act,
1963 provides a period of limitation of 90 days when an appeal is
under the Code of Civil Procedure, 1908 to the High Court from
1 (2002) 5 SCC 510
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any decree or order and a period of limitation of 30 days when an
appeal is to any other Court from any decree or order. Under
Article 117 when the decree or order is of the High Court and an
appeal is filed to the same Court, the period of limitation is of 30
days. The expression "order" for the purpose of Articles 116 and
117 must receive a broad construction. In a judgment of the
Constitution Bench of the Supreme Court in Jaswant Sugar Mills
the Supreme Court while
construing the expression "order" for the purposes of Article 136
observed that a determination or an order must be judicial or
quasi-judicial. A determination is an effective expression of opinion
which ends a controversy or a dispute by some authority to whom
it is submitted under a valid law for disposal. The Supreme Court
observed that the expression "order" must also have a similar
meaning though it does not operate to end the dispute. A Division
Bench of the Allahabad High Court in the State of U.P. And
another v. Mahendra Pratap Timamah and others,2 has similarly
held that the term "order" is general and comprehensive enough to
include all kinds of orders including a "formal order". This
observation was made in the context of the provisions of the
Limitation Act, 1908. The same view has been taken by a Division
Bench of the Andhra Pradesh High Court in Divisional Forest
Officer vs. District Officer & Ors.3 in holding that the term 'order'
in legal parlance would always indicate some expression of opinion
which is to be carried out or enforced.
10. For these reasons, we are of the view that the
judgment of the learned Single Judge in Oil and Natural Gas
Corporation Ltd., vs. Jagson International Ltd. (supra) does not
reflect the correct position in law. The Appeal filed by the Applicant
against an order of the learned Single Judge allowing a Petition
under Section 34 and setting aside an arbitral Award would be
1 Air 1963 SC 677
2 1956 Allahabad 585
3 AIR 2002 AP 224
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governed by Article 117 of the Schedule to the Limitation Act.
Though the appeal was filed beyond the period of limitation
prescribed, we find from the Affidavit in support that sufficient
cause has been shown for condoning the delay having regard to
the fact that at the relevant time the judgment of the learned
Single Judge in Oil and Natural Gas Corporation Ltd., vs.
Jagson International Ltd. (supra) held the field.
10. The Motion is made absolute in terms of prayer
clause (a).
11. Before concluding, the Court would like to express its
appreciation for the able assistance rendered by the learned
Amicus Curiae.
(DR. D.Y. CHANDRACHUD, J.)
(A.A. SAYED, J.)
