State Of West Bengal vs M/S. Chowdhury Construction
2021 Latest Caselaw 4505 Cal

                IN THE HIGH COURT AT CALCUTTA
                    Civil Appellate Jurisdiction
                      (Commercial Division)
                           Appellate Side

Present :-      Hon'ble Mr. Justice I. P. Mukerji
                Hon'ble Mr. Justice Aniruddha Roy


                              CAN 1 OF 2021
                                    in
                             FMAT 124 OF 2021
                                   with
                              CAN 2 OF 2021

                             State of West Bengal
                                       Vs.
                       M/S. Chowdhury Construction

   For the Appellant              :-    Mr. Jishnu Chowdhury,
                                        Ms. Manali Ali, Advs.


   For the Respondent             :-    Mr. Tilak Kumar Bose, Sr. Adv

Mr. Ayan Banerjee, Mr. Arijit Bhowmick, Ms. Debasree Dhamali, Advs.

   Judgment On                    :-     06.09.2021

I. P. MUKERJI, J.:-
CAN 1 of 2021-

We have to decide on the application under Section 5 of the Limitation Act,

1963, first before considering admission of the appeal. There a delay of 355

days in filing the appeal.

This appeal arise from a judgment and order dated 21st December, 2019

made by the learned Judge, Commercial Court at Asansol, in an application

under Section 34 of the Arbitration and Conciliation Act, 1996 by the

appellant. It challenged an award dated 27th June, 2018 made by the

learned Arbitrator. The petitioner before the court was the State of West

Bengal.

This arbitration arose out of a typical works contract. The learned Arbitrator

awarded Rs.33,19,300/- on account of onsite expenses incurred by the

respondent for "prolongation of the work", Rs.1,01,40,800/- on account of hire charges of machinery deployed at the site, Rs.16,54,790/- for

"additional cost of execution....", Rs.3,61,653/- on account of "unusual

increment in the price of bitumen" together with interest @12 per annum,

the claim aggregating to Rs.13,28,690/-. The counter claim of the

government was dismissed.

The learned judge in the impugned judgment and order dismissed the

Section 34 application which had the effect of upholding the award.

Very promptly immediately after the award the respondent had levied

execution thereof by filing an application in this court on 14th December,

2018. It was taken up for consideration on 4th February, 2021. An order was

made that day to the effect that on deposit of Rs.1.68 crores with the

learned Registrar Original Side, further execution, would be stayed. The

appellant has duly deposited that amount with the said official.

The period of limitation for filing the appeal expired on 22nd February, 2020.

This appeal was filed on 12th February, 2021 with a delay of 355 days.

Mr. Tilak Kumar Bose, learned senior advocate appearing for the

respondent, very seriously opposed the prayer for condonation of delay. He

argued that this question should be decided threadbare by the court.

The material dates should now be noticed.

The impugned order was made on 21st December, 2019. The period of

limitation for preferring the appeal expired on 22nd February, 2020. This

appeal was filed i.e. on 12th February, 2021.

On 23rd March, 2020 the Supreme Court in re: "In cognizance for extension

of limitation," passed the following order:-

"1.This Court has taken Suo Motu cognizance of the situation arising out of the challenge faced by the country on account of Covid19 Virus and resultant difficulties that may be faced by litigants across the country in filing their petitions/applications/suits/appeals/all other proceedings within the period of limitation prescribed under the general

law of limitation or under Special Laws (both Central and/or State).

2. To obviate such difficulties and to ensure that lawyers/litigants do not have to come physically to file such proceedings in respective Courts/Tribunals across the country including this Court, it is hereby ordered that a period of limitation in all such proceedings, irrespective of the limitation prescribed under the general law or Special Laws whether condonable or not shall stand extended w.e.f. 15th March 2020 till further order/s to be passed by this Court in present proceedings.

3. We are exercising this power under Article 142 read with Article 141 of the Constitution of India and declare that this order is a binding order within the meaning of Article 141 on all Courts/Tribunals and authorities.

4. This order may be brought to the notice of all High Courts for being communicated to all subordinate Courts/Tribunals within their respective jurisdiction.

5. Issue notice to all the Registrars General of the High Courts, returnable in four weeks."

On 24th March, 2020 a complete lock down following the onset Covid-19

pandemic was declared all over the country.

As pointed by the Supreme Court in N. V. International Vs. State of

Assam & Ors. reported in (2020) 2 SCC 109 and in Sagufa Ahmed & Ors.

Vs. Upper Assam Polywood Products Pvt. Ltd. & Ors reported in (2021)

2SCC 317, cited by Mr. Bose the 23rd March, 2020 order only extended the

period of limitation and did not specify any standard for condoning the

delay or the length of delay which could be condoned.

In this case the period of limitation had expired on 22nd February, 2020.

When the period of limitation had expired before the order dated 23rd March

2020 it was not capable of any extension.

Mr. Bose cited the above decisions together with a so far unreported

decision of the Supreme Court in Civil Appeal No.999 of 2021 & Civil Appeal

No. 996-998 of 2021, relying on inter alia, the following paragraph:

"61. Given the aforesaid and the object of speedy disposal sought to be achieved both under the Arbitration Act and the Commercial Courts Act, for appeals filed under Section 37 of the Arbitration Act that are governed by Articles 116 and 117 of the Limitation Act or Section 13(1A) of the Commercial Courts Act, a delay beyond 90 days, 30 days or 60 days, respectively, is to be condoned by way of exception and not by way of rule. In a fit case in which a party has otherwise acted bona fide and not in a negligent manner, a short delay beyond such period can, in the discretion of the court, be condoned, always bearing in mind that the other side of the picture is that the opposite party may have acquired both in equity and justice, what may now be lost by the first partys inaction, negligence or laches."

He said relying on this case that in commercial matters, irrespective of

whether the appellant was the State, the court should take a very strict view

of limitation.

The appellant petitioner has forwarded the following explanation for the

delay in the Section 5 application.

(a) The impugned judgment and order was made on 21st December,

2019.

(b) The certified copy thereof was obtained on 24th December, 2019.

(c) Between that date and the first week of March, 2020 the records of

the case were collected, copies made and papers handed over to

learned Advocates engaged in the matter through the Legal

Remembrancer Cell.

(d) By the first week of March, 2020 the Covid-19 pandemic had started

reducing "the mobility of the personnel and inter district travelling

was being avoided."

(e) Country wide lockdown was declared on 24th March, 2020.

(f) Preparing the briefs and notes for learned advocates and holding

conferences were severely affected by the pandemic and the

lockdown declared consequent thereto.

(g) The memorandum of appeal and the stay application could only be

got ready in January, 2021.

If the appeal had been filed just at the time the lockdown was declared, the

delay would have been in the region of a month or so.

The onset of the Covid-19 Pandemic changed the way of life throughout the

world. The disease posed a serious risk to the lives of the people. The

magnitude of the risk was and a still unknown and is constantly being

predicted by medical experts. Millions of people have died and a few million

are suffering. People are continuing to be affected by the virus in spite of the

invention of the vaccine. The economy has slowed down all over the world.

Still, all human activities are restricted.

This court notes and appreciates the enormous difficulties that arose and

still arise in conducting litigation in this pandemic.

Take for example a hypothetical case where the application for condonation

of delay has to be got ready and filed along with the appeal. Government

offices have been functioning with limited and rotational attendance.

Medical reasons prevent or slow down handling files physically. An

application to explain delay may not be possible to be prepared without

physical interaction with the officers responsible for handling the litigation.

It may also not be possible without a physical conference with the learned

lawyers. Physical conference may not be feasible at all. Then, there is the

task of getting an application ready, affirming it before an Oath

Commissioner and filing it in court.

It would not be out of place to think that all these difficulties were also faced

by the appellant.

In my opinion, these unforeseen difficulties which have arisen during this

Covid pandemic should be taken into account in assessing whether there

was sufficient cause which prevented the appellant from preferring the

appeal within time.

We observe that this appeal was filed on 12th February, 2021. The pandemic

still continued. But the situation had brightened a little bit, just before the

second wave struck.

We hold that there was sufficient cause for this delay. It is condonable.

In such circumstances we allow the Section 5 application, (CAN 1 of 2021)

condoning the delay. However, the respondent has been put to the

inconvenience of defending this application, by incurring costs. This delay,

in my opinion, has had a serious effect on the respondent. They are unable

to ascertain whether they would at all get the benefit of the award. In those

circumstances, the respondent is entitled to costs which I assess at

Rs.51,000/- to be paid by the appellant to the respondent within 30th

September, 2021. In default, the appeal would automatically stand

dismissed.

FMAT 124 of 2021 CAN 2 of 2021:-

We admit the appeal.

List the appeal along with the application for stay (FMAT 124 of 2021 with

CAN 2 of 2021) as an application on 13th September, 2021.

Urgent certified photo copy of this judgment and order, if applied for, be

furnished to the appearing parties on priority basis upon compliance of

necessary formalities.

I agree.

(Aniruddha Roy, J.)                                         (I. P. Mukerji, J.)