Indian Oil Corporation Ltd. vs Standard Casting Pvt. Ltd.
2022 Latest Caselaw 1544 Del

              $~7
              *            IN THE HIGH COURT OF DELHI AT NEWDELHI
                                                            Reserved on: April 01, 2022
                                                            Decided on: May 13, 2022



              +           CM No. 12923/2021 IN FAO (COMM.) No. 83/2021

                           INDIAN OIL CORPORATION LTD
                                                                    ....Appellant
                                          Through:    Mr. Man Mohan Kalra, Advocate

                                                      V

                           STANDARDCASTING PVT LTD
                                                                .....Respondent
                                         Through:     Mr. Bhuvan Gugnani, Advocate
              %

              CORAM

              HON'BLE MR. JUSTICE SURESH KUMAR KAIT
              HON'BLE MR. JUSTICE SUDHIR KUMAR JAIN
              ORDER

SUDHIR KUMAR JAIN, J.

This order shall decide an application dated 10.02.2021 filed by the appellant

under Section 5 of Limitation Act, 1963 read with Section 151 of the Code of

Civil Procedure, 1908 for condonation of delay of 352 days in filing thepresent

appeal.

1. Brief facts of the case are that the appellant is one of the largest Corporations

engaged in supply of fuel and other allied products throughout India. The

respondent is largest manufacturer of refuellers in India and is serving the Signature Not Verified Digitally Signed By:HARVINDER KAUR 1/25 BHATIA Signing Date:20.05.2022 15:17:11 appellant since the last over 30 years. The appellant vide letter dated 25.02.2002

containing terms and conditions placed an order with the respondent for

fabrication and supply of 6 Nos. 45 KL capacity aviation articulated refuellers

with tank made up of mild steel material. Due to disputes and differences arose

between the appellant and the respondent, the respondent vide legal notice dated

19.08.2006 invoked the Arbitration Clause contained in the contract and sought

for an appointment of an Arbitrator. The appellant through Director (Marketing)

appointed M K Jain as Sole Arbitrator who entered on reference on 29.08.2007.

The Sole Arbitrator vide Arbitral Award dated 16.03.2011 (hereinafter referred

to as "the Impugned Award") dismissed claim of the respondent. Thereafter,

the respondent filed the petition under Section 34 of Arbitration & Conciliation

Act,1996 titled as Standard Casting Pvt. Ltd. V Indian Oil Corporation Ltd.

bearing OMP No. 538/2011 for setting aside Impugned Award before this

Court, which was subsequently transferred to Dwarka District Courts and

numbered as Arbtn. No. 80/2017(72/2019). The Court of Additional District

Judge-01, South-West District, Dwarka Courts (hereinafter referred to as "the

Trial Court") vide judgment dated 13.01.2020 (hereinafter referred to as "the

Impugned Judgment") allowed the petition under section 34 of the Arbitration

Act and set aside the Impugned Award. The appellant being aggrieved filed

present appeal under section 37(1)(B) of the Act read with section 13 of the

Commercial Courts Act, 2015 against Impugned Judgment but after a delay of

352 days.

Signature Not Verified
Digitally Signed
By:HARVINDER KAUR                                                                           2/25
BHATIA
Signing Date:20.05.2022
15:17:11

2. The appellant in the application under disposal stated that the appellant has

filed present appeal on 18.03.2021 i.e., after delay of 352 days. The respondent

had initially filed the petition under Section 34 of the Arbitration Act bearing

OMP No. 538/2011before High Court of Delhi, which was subsequently

transferred to the DwarkaDistrict Courts and registered as Arbtn.No.80/2017.

The petition was tried as Arbtn.No.80/2017 and fixed for orders on 06.01.2020.

The Trial Court at the time of pronouncing impugned judgment also inserted

72/2019 after 80/2017. The counsel for appellant was never made aware that the

trial court has started treating Arbtn. No.80/2017 as 72/2019. The counsel for

the appellant handed over application for obtaining certified copy of the

impugned judgment to his clerk but he stopped reporting for duty on 15.02.2020

as he was blessed with a son. The clerk of the counsel for the appellant did not

join back and never informed about status of the application submitted for

obtaining certified copy of the impugned judgment. The lock down was

announced in the country on 25th March, 2020 due to Covid-19 pandemic. The

Supreme Court in Writ Petition (Civil) No.3 of 2020 issued direction for

exclusion of period from 15.03.2020 till 14.03.2021 while computing the

limitation for any suit, appeal, application or proceeding. The counsel for

appellant was unable to apply for certified copy of impugned judgment due to

old age and also infected by Covid-19.He applied for the certified copy on

21.09.2020 which was received on 08.10.2020. The decision to file appeal

against impugned judgment could not be taken till December, 2020due to lack Signature Not Verified Digitally Signed By:HARVINDER KAUR 3/25 BHATIA Signing Date:20.05.2022 15:17:11 of coordination amongst officers of the appellant caused by prevailing Covid-19

pandemic. The appeal thereafter was prepared and sent to Mumbai for

signatures and attestation.The counsel for the appellant realized that the appeal

was to be filed within 60 days. The delay of 352 days in filing the present

appeal was neither intentional nor deliberate. It is prayed that delay of 352 days

in filing the appeal be condoned.

3. The respondent filed reply to contest the application. The respondent in

preliminary objections stated that application is an abuse and misuse of the

process of Court and is devoid of any merit. The appellant has not given

satisfactory explanation for condonation of delay beyond usual administrative

exigency. The respondent besides mentioning factual background of present

case also stated that Section 13(1A) Commercial Courts Act, 2015 provides that

an appeal under Section 37 of the Arbitration Act must be filed within 60 days.

The Central Government imposed lockdown on 25.03.2020 due to break-out of

Covid-19.The Supreme Court inWrit Petition (Civil) bearing no. 3/2020

extended period of limitation in petitions/applications/suits/appeals/all other

proceedings prescribed under General Law or Special Law and ordered that

period with effect from 15/03/2020 till14/03/2021 shall also stand excluded in

computing the period of limitation prescribed under Sections 23(4) and 29(A) of

the ArbitrationAct, Section 12(A) of the Commercial Act and provisos (b) and

(c) of Section 138 of the Negotiable Instruments Act, 1881 and any other laws

which prescribe period(s) of limitation for instituting proceedings, outer limits Signature Not Verified Digitally Signed By:HARVINDER KAUR 4/25 BHATIA Signing Date:20.05.2022 15:17:11 (within which the Court or Tribunal can condone delay) and termination of

proceedings. The appellant did not mention or state any particular date on which

the application was made for supply of certified copy and as such the

application under disposal is devoid of any material information. The period of

limitation of 60 days as per Commercial Courts Act, 2015 expired on

13/03/2020 and as such the appellant cannot take benefit of the order passed by

the Supreme Court extending period of limitation. The appellant filed

application for supply of certified copy of the Impugned Judgment on

21/09/2020 and received certified copy of the Impugned Judgment on

08/10/2020 but filed the present appeal on 25/03/2021. The facts as stated in

application under disposal reflects careless attitude of the appellant in filing

present appeal. The appellant cannot be given concession merely being a

governmental body. The delay in filing the present appeal is purely intentional

and deliberate and can't be condoned in any manner. The present application

deserves to be dismissed.

4. The appellant filed rejoinder wherein stated that application is bona fide and

delay in filing appeal was caused due to circumstances beyond the control of the

appellant. There are sufficient reasons of not filing present appeal within the

scheduled time. The application is liable to be allowed by condoning delay.

5.We before appreciating facts as stated in application under disposal and

arguments advanced by respective counsels of the appellant and the respondent

would refer relevant provisions of the Arbitration & Conciliation Act, Signature Not Verified Digitally Signed By:HARVINDER KAUR 5/25 BHATIA Signing Date:20.05.2022 15:17:11 1996(hereinafter referred to as "the Arbitration Act");the Limitation Act,

1963(hereinafter referred to as "the Limitation Act")and the Commercial

Courts Act, 2015(hereinafter referred to as "the Commercial Act").The

Arbitration Act was enacted with objectives to make fair and efficient

provisions for arbitral procedure which is capable of meeting needs of the

specific arbitration and to minimise the supervisory role of Courts in the arbitral

process. The efficient arbitral procedure with minimum supervisory role of

Courts in arbitral process reflects one of the main objectives of the Arbitration

Act i.e. speedy disposal of disputes through the arbitral process. Section 5 of

the Arbitration Act deals with extent of judicial intervention in arbitral process

and provides that no judicial authority shall intervene except where so provided

in the Arbitration Act. Section 29 B of the Act deals with fast track procedure to

be followed by Arbitral Tribunal. Section 34 of the Arbitration Act deals with

application filed for setting aside arbitral award. Section 34(3) of Arbitration

Act provides that an application for setting aside award may not be made after

three months from the date on which the party making that application had

received the Arbitral Award. Proviso clause extends period of limitation and

provides that the application may be entertained within a further period of thirty

days but not thereafter if the court is satisfied that the applicant was prevented

by sufficient cause from making the application within period of three months.

As per section 37(1)(c) of the Arbitration Act, an appeal shall lie from the order

setting aside or refusing to set aside an Arbitral Award under section 34 of the Signature Not Verified Digitally Signed By:HARVINDER KAUR 6/25 BHATIA Signing Date:20.05.2022 15:17:11 Arbitration Act. Section 43(1) of the Arbitration Act provides that the

Limitation Act shall apply to arbitrations as it applies to proceedings in court.

6. The Law of limitation is based on equitable principle that equity helps

the diligent and not the indolent. It provides that a litigant should be

prompt in claiming the relief. It is founded on public policy with aims to

secure peace in the community. It mandates to bury acts of the past which

become stale due to lapse of time and have not been agitated within

time.Section 3 of the Limitation Act provides that every suit, appeal and

application if filed or instituted after the prescribed period is liable to be

dismissed although limitation has not been set up as a defence. The Limitation

Act prescribed time period for institution of a suit, appeal and application and

expiry of such time period leads to extinguish remedy for the aggrieved party.

Section 5 of the Limitation Act, deals with the extension of prescribed period of

limitation. The Court with discretionary jurisdiction can condone the delay and

proceed with the case if concerned party furnishes sufficient cause for delay in

institution of a suit, appeal and application. Section 5 of the Limitation Act,

reads as under:-

5. Extension of prescribed period in certain cases. --Any appeal or any application, other than an application under any of the provisions of Order XXI of the Code of Civil Procedure, 1908 (5 of 1908), may be admitted after the prescribed period, if the appellant or the applicant satisfies the court that he had sufficient cause for not preferring the appeal or making the application within such period.

Explanation.-- The fact that the appellant or the applicant was misled by any order, practice or judgment of the High Court in Signature Not Verified Digitally Signed By:HARVINDER KAUR 7/25 BHATIA Signing Date:20.05.2022 15:17:11 ascertaining or computing the prescribed period may be sufficient cause within the meaning of this section.

7. Section 29(2) of the Limitation Act, provides 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 such period were the period prescribed by the Schedule and for the

purpose of determining any period of limitation prescribed for any suit, appeal

or application by any special or local law, the provisions contained in Section 4

to 24 (inclusive) shall apply only in so far as, and to the extent to which, they

are not expressly excluded by such special or local law.

8. The combined reading of Sections 37 and 43 of the Arbitration Act makes

clear that the provisions of the Limitation Act would apply to appeals that are

filed under Section 37 of the Arbitration Act. Articles 116 and 117 of the

Limitation Act provide for a limitation period of 90 days and 30 days depending

upon whether the appeal is from any other court to a High Court or an intra-

High Court appeal.Accordingly, Section5 of the Limitation Act would apply to

present appeal due to Section 43 of the Arbitration Act and Section 29(2) of the

Limitation Act.

9. The Commercial Act was enacted to provide for speedy disposal of high

value commercial disputes which involve complex facts and question of law.

The early resolution of commercial disputes shall create a positive image to the

investor world about the independent and responsive Indian legal system and Signature Not Verified Digitally Signed By:HARVINDER KAUR 8/25 BHATIA Signing Date:20.05.2022 15:17:11 shall accelerate economic growth, improve the international image of the Indian

Justice delivery system and the faith of the investor world in the legal culture of

the nation. Section 2(1)(i) defines Specified Value in relation to a commercial

dispute which mean the value of the subject matter in respect of a suit as

determined in accordance with Section 12 which shall not be less than three

lakh rupees or such higher value as may be notified by the Central Government.

Chapter II of the Commercial Act deals with setting of Commercial Courts,

Commercial Appellate Courts, Commercial Divisions and Commercial

Appellate Divisions. Section 10 deals with jurisdiction in respect of arbitration

matters where the subject-matter of arbitration is a commercial dispute of a

Specified Value. Most of the appeals under section 37 of the Arbitration Act are

governed by section 13 of the Commercial Act which deals with forum of

Appeals from decrees of Commercial Courts and Commercial Divisions as well

as period of limitation. As per Section 13(1A) of the Commercial Act, appeal

from judgment or order of a Commercial Court at the level of District Judge

exercising original civil jurisdiction or Commercial Division of a High Court

may be preferred to the Commercial Appellate Division of High Court within a

period of sixty days from the date of the judgment or order. Section 13(1A)

does not contain any provision for condonation of delay beyond period of sixty

days like section 34(3) of the Arbitration Act. It was also observed in

Government of Maharashtra (Water Resources Department) V M/S Borse

Brothers Engineers & Contractors Pvt. Ltd., 2021 (4) SCALE 338 regarding Signature Not Verified Digitally Signed By:HARVINDER KAUR 9/25 BHATIA Signing Date:20.05.2022 15:17:11 period of limitation preferred under section 37 of the Arbitration Act, observed

as under:-

The bulk of appeals, however, to the appellate court under section 37 of the Arbitration Act, are governed by section 13 of the Commercial Courts Act. Sub-section (1A) of section 13 of the Commercial Courts Act provides the forum for appeals as well as the limitation period to be followed, section 13 of the Commercial Courts Act being a special law as compared with the Limitation Act which is a general law, which follows from a reading of section 29(2) of the Limitation Act. Section 13(1A) of the Commercial Courts Act lays down a period of limitation of 60 days uniformly for all appeals that are preferred under section 37 of the Arbitration Act.

10. The Supreme Court in Government of Maharashtra (Water Resources

Department) V M/S Borse Brothers Engineers & Contractors Pvt. Ltd. also

rejected arguments that the application of Section 5 of the Limitation Act is

excluded from scheme of the Commercial Act.Section 14 of the Commercial

Act, deals with expeditious disposal of appeals and provides that the

Commercial Appellate Court and the Commercial Appellate Division shall

endeavour to dispose of appeals within a period of six months from the date of

filing of such appeal. However, period of six months is directory and not

mandatory.

11. The issue pertaining to condonation of delay under section 5 of the

Limitation Act, in appeals filed under the Arbitration Act needs to be examined

in context of its object of speedy resolution of disputes. The Supreme Court in

State of Goa V Western Builders, (2006) 6 SCC 239heldas under: -

25. It is true that the Arbitration and Conciliation Act, 1996 intended to expedite commercial issues expeditiously. It is also clear in the Signature Not Verified Digitally Signed By:HARVINDER KAUR 10/25 BHATIA Signing Date:20.05.2022 15:17:11 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.

12. The Supreme Court in ICOMM Tele Ltd. V Punjab State Water Supply

and Sewerage Board, (2019) 4 SCC 401 again observed that several judgments

of this Court have also reiterated that the primary object of arbitration is to

reach a final disposal of disputes in a speedy, effective, inexpensive and

expeditious manner.

13. The term "sufficient cause" as appearing in Section 5 of the Limitation Act

is not defined in the Act and is required to be interpreted liberally to advance

cause of justice. The Supreme Court in Ramlal, Motilal And Chhotelal V

Rewa Coalfields Ltd, 1962 SCR (3) 762 connected Section 5 of the Limitation

Actwith doctrine of substantial justice and observed as under:-

In construing S.5, it is relevant to bear in mind two important considerations. The first consideration is that the expiration of the period of limitation prescribed for making an appeal gives rise to a right in favour of the decree-holder to treat the decree as binding between the parties. In other words, when the period of limitation prescribed has expired the decree-holder has obtained a benefit under the law of limitation to treat the decree as beyond challenge, and this legal right which has accrued to the decree-holder by lapse of time should not be light-heartedly disturbed. The other consideration which cannot be ignored is that if sufficient cause for excusing delay is shown discretion is given to the Court to condone delay and admit the appeal. This discretion has been deliberately conferred on the Court in order that judicial power and discretion in that behalf should be exercised to advance substantial justice.

Signature Not Verified Digitally Signed By:HARVINDER KAUR 11/25 BHATIA Signing Date:20.05.2022 15:17:11

14. The Supreme Court in Collector Land Acquisition V Mst. Katiji& others,

1987 SCR (2) 387 observed that the legislature has conferred the power to

condone delay by enacting Section 5 of the Limitation Act in order to enable the

Courts to do substantial justice to parties by disposing of matters on merits.The

expression "sufficient cause" is adequately elastic to enable the Courts to apply

the law in a meaningful manner which sub-serves the ends of justice which is

being the life-purpose for the existence of the institution of Courts. The

Supreme Court laid down certain principles which need to be followed while

employing doctrine of condonation of delay which are as under:-

1. Ordinarily a litigant does not stand to benefit by lodging an appeal late.

2. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this when delay is condoned the highest that can happen is that a cause would be decided on merits after hearing the parties.

3. "Every day's delay must be explained" does not mean that a pedantic approach should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational common sense pragmatic manner.

4. When substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay.

5. There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact he runs a serious risk.

6. It must be grasped that judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so.

Signature Not Verified Digitally Signed By:HARVINDER KAUR 12/25 BHATIA Signing Date:20.05.2022 15:17:11

15. It must be noted that no party can claim condonation of delay even if

sufficient cause has been made out in the facts of a given case. It was held in

Ramlal V Rewa Coalfields Ltd., (1962) 2 SCR 762 as under:-

It is, however, necessary to emphasise that even after sufficient cause has been shown a party is not entitled to the condonation of delay in question as a matter of right. The proof of a sufficient cause is a condition precedent for the exercise of the discretionary jurisdiction vested in the court by s. 5. If sufficient cause is not proved nothing further has to be done; the application for condoning delay has to be dismissed on that ground alone. If sufficient cause is shown then the Court has to enquire whether in its discretion it should condone the delay. This aspect of the matter naturally introduces the consideration of all relevant facts and it is at this stage that diligence of the party or its bona fides may fall for consideration; but the scope of the enquiry while exercising the discretionary power after sufficient cause is shown would naturally be limited only to such facts as the Court may regard as relevant. It cannot justify an enquiry as to why the party was sitting idle during all the time available to it. In this connection we may point out that considerations of bona fides or due diligence are always material and relevant when the Court is dealing with applications made under s. 14 of the Limitation Act. In dealing with such applications the Court is called upon to consider the effect of the combined provisions of ss. 5 and 14. Therefore, in our opinion, considerations which have been expressly made material and relevant by the provisions of s. 14 cannot to the same extent and in the same manner be invoked in dealing with applications which fall to be decided only under s. 5 without reference to s. 14.

16. The Supreme Court in Ramlal V Rewa Coalfields Ltd.also considered

condonation of delay in relation to delay caused in filing an appeal by the State

and observed as under:-

Making a justice-oriented approach from this perspective, there was sufficient cause for condoning the delay in the institution of the appeal. The fact that it was the 'State' which was seeking condonation and not a private party was altogether irrelevant. The doctrine of equality before law demands that all litigants, including the State as a litigant, are accorded the same treatment and the law is administered Signature Not Verified Digitally Signed By:HARVINDER KAUR 13/25 BHATIA Signing Date:20.05.2022 15:17:11 in an even handed manner. There is no warrant for according a step motherly treatment when the 'State' is the applicant praying for condonation of delay. In fact experience shows that on account of an impersonal machinery (no one in charge of the matter is directly hit or hurt by the judgment sought to be subjected to appeal) and the inherited bureaucratic methodology imbued with the note-making, file pushing, and passing-on-the-buck ethos, delay on its part is less difficult to understand though more difficult to approve. In any event, the State which represents the collective cause of the community does not deserve a litigant-non-grata status. The Courts therefore have to be informed with the spirit and philosophy of the provision in the course of the interpretation of the expression "sufficient cause".

17. However, the Supreme Court after relying on Postmaster General v.

Living Media India Ltd., (2012) 3 SCC 563 in Government of Maharashtra

(Water Resources Department) V M/S Borse Brothers Engineers &

Contractors Pvt. Ltd. held that merely because the government is involved, a

different yardstick for condonation of delay cannot be laid down. Similar view

was again taken in State of M.P. V Chaitram Maywade, (2020) 10 SCC 667.

18. The Supreme Court while describing and explaining meaning to sufficient

cause in T Basawaraj V Land Acquisition Officer, (2013) 14 SCC 81

observed as under:-

9. Sufficient cause is the cause for which the defendant could not be blamed for his absence. The meaning of the word "sufficient" is "adequate" or "enough", inasmuch as may be necessary to answer the purpose intended. Therefore, the word "sufficient" embraces no more than that which provides a platitude, which when the act done suffices to accomplish the purpose intended in the facts and circumstances existing in a case, duly examined from the viewpoint of a reasonable standard of a cautious man. In this context, "sufficient cause" means that the party should not have acted in a negligent manner or there was a want of bona fide on its part in view of the Signature Not Verified Digitally Signed By:HARVINDER KAUR 14/25 BHATIA Signing Date:20.05.2022 15:17:11 facts and circumstances of a case or it cannot be alleged that the party has "not acted diligently" or "remained inactive". However, the facts and circumstances of each case must afford sufficient ground to enable the court concerned to exercise discretion for the reason that whenever the court exercises discretion, it has to be exercised judiciously. The applicant must satisfy the court that he was prevented by any "sufficient cause" from prosecuting his case, and unless a satisfactory explanation is furnished, the court should not allow the application for condonation of delay. The court has to examine whether the mistake is bona fide or was merely a device to cover an ulterior purpose.

11. The expression "sufficient cause" should be given a liberal interpretation to ensure that substantial justice is done, but only so long as negligence, inaction or lack of bona fides cannot be imputed to the party concerned, whether or not sufficient cause has been furnished, can be decided on the facts of a particular case and no straitjacket formula is possible.

19. It is also need to be determined about applicability of section 5 of the

Limitation Actto appeals which are governed by uniform period of 120 days

under the Arbitration Act and 60 days under the Commercial Act. The Supreme

Court in N.V. International V State of Assam, (2020) 2 SCC 109 held that

delay beyond 120 days in filing appeal under section 37 of the Arbitration Act,

is not liable to be condoned. However, the Supreme Court in Government of

Maharashtra (Water Resources Department) V M/S Borse Brothers

Engineers & Contractors Pvt. Ltd. observed that N.V. International was not

correctly decided and was overruled.

20. As mentioned hereinabove, one of the objects of the Arbitration Act and the

Commercial Act is the speedy disposal of appeals filed under section 37 of the

Arbitration Act. The expression "sufficient cause" contained in section 5 of the

Limitation Act is elastic enough to be interpreted differently depending upon Signature Not Verified Digitally Signed By:HARVINDER KAUR 15/25 BHATIA Signing Date:20.05.2022 15:17:11 the object and context of a particular statute.It is necessary to determine

meaning of expression "sufficient cause" in the context of condoning delay in

filing appeals under section 37 of the Arbitration Act, which should be

consistent with the aforesaid object.

21. The Supreme Court in Government of Maharashtra (Water Resources

Department) V M/S Borse Brothers Engineers & Contractors Pvt. Ltd.

considered three appeals.In Civil Appeal arising out of SLP (C) No. 665 of

2021 and Civil Appeal arising out of SLP (C) Diary No.18079 of 2020, the

High Courts of Bombay and Delhi vide judgments dated 17.12.2020 and

15.10.2019 respectively, dismissed the appeals filed by the Government of

Maharashtra and by the Union of India respectively refusing to condone the

delay in the filing of the appeal under section 37 of the Arbitration Act beyond

120 days. In Civil Appeal arising out of SLP (C) No.15278 of 2020, High Court

of Madhya Pradesh condoned delay of 57 days by observing that that there is a

conflict between N.V. International and Consolidated Engg. Enterprises V

Irrigation Deptt., (2008) 7 SCC 169. The Supreme Court held as under:-

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 Signature Not Verified Digitally Signed By:HARVINDER KAUR 16/25 BHATIA Signing Date:20.05.2022 15:17:11 party may have acquired both in equity and justice, what may now be lost by the first party's inaction, negligence or laches.

22. The Supreme Court while dismissing Civil Appeal arising out of SLP (C)

No. 665 of 2021 against Impugned Judgment of the High Court of Bombay

dated 17.12.2020 has found that the Govt. of Maharashtra had not approached

the court bona fide and also noticed that there was a long delay of 131 days

beyond the 60 day period provided for filing an appeal under section 13(1A) of

the Commercial Act, which was not explained beyond usual file-pushing and

administrative exigency.

23. The Supreme Court in Civil Appeal arising out of SLP (C) No. 15278 of

2020 preferred against Impugned Judgment dated 27.01.2020 passed by the

High Court of Madhya Pradesh while setting aside observed that the High Court

was bound to follow N.V. Internationals on the date of the judgment and

further there was a long delay of 75 days beyond the period of 60 days provided

by the Commercial Act.

24. The Supreme Court while dismissing civil appeal arising out of SLP (C)

Diary No. 18079 of 2020 from a judgment passed by Delhi High Court

observed that there was a huge delay of 227 days in filing the appeal and 200

days delay in refilling and no sufficient cause whatsoever was shown to

condone such a long delay.

25. The counsel for the appellant argued that present appeal was filed after

delay of 352 days which neither intentional nor deliberate and cannot be Signature Not Verified Digitally Signed By:HARVINDER KAUR 17/25 BHATIA Signing Date:20.05.2022 15:17:11 attributed to the appellant. He was never made aware that the Trial Court treated

Arbtn. No.80/2017 as 72/2019 as reflected from impugned judgment. He

handed over application for obtaining certified copy of the impugned judgment

to his clerk who was blessed with a son and stopped reporting for duty since

15.02.2020. The clerk never informed about status of the application submitted

for obtaining certified copy. The lock down was announced in the country due

to Covid-19 pandemic. The Supreme Court in Writ Petition (Civil) No.3 of

2020excluded period with effect from 15.03.2020 till 14.03.2021 due to

countrywide lockdown caused by Covid-19 pandemic from computing the

limitation. He applied for certified copy of impugned judgment on 21.09.2020

which was delivered on 08.10.2020. Due to lack of coordination amongst

officers of the appellant, the decision to file appeal against impugned judgment

could not be taken till December, 2020.

26. The counsel for the respondent argued that present appeal was to be filed

within 60 days as per section 13 (1A) of the Commercial Act and no satisfactory

explanation is given by the appellant for condonation of delay beyond usual

administrative exigency.The Central Government imposed lockdown on

25.03.2020 due to break-out of Covid-19. The Supreme Court in Writ Petition

(Civil) bearing no. 3/2020 excluded period with effect from 15/03/2020 till

14/03/2021 in computing the period of limitation. The appellant did not mention

specific date on which the application was submitted for obtaining certified

copy of impugned judgment. The period of limitation of 60 days had expired on Signature Not Verified Digitally Signed By:HARVINDER KAUR 18/25 BHATIA Signing Date:20.05.2022 15:17:11 13.03.2020 and the appellant is not entitled to claim benefit of extension of

period of limitation as directions issued by the Supreme Court. The appellant

applied for certified copy of the impugned judgment on 21.09.2020 which was

received on 08.10.2020 but filed the present appeal on 25.03.2021. The

appellant was careless in filing present appeal and cannot be given any

concession merely being a governmental body. The counsel for the respondent

cited Government of Maharashtra (Water Resources Department) V M/S

Borse Brothers Engineers & Contractors Pvt. Ltd.

27. It is reflecting from record that the trial court allowed objections preferred

by the respondent under section 34 of the Arbitration Act and set aside

impugned award vide impugned judgment which was passed on 13.01.2020.The

present appeal was required to be filed within 60 days as per section 13(1A) of

the Commercial Act.The appellant applied for obtaining certified copy of the

impugned judgment on 21.09.2020 which was supplied to the appellant on

08.10.2020.The appellant filed present appeal on 18.03.2021. The present

appeal as such was filed after delay of 352 days and this delay of 352 days is

calculated by the appellant after deducting statutory limitation period of 60 days

as per section 13(1A) of the Commercial Act and time taken in obtaining

certified copy of impugned judgmenti.e., 21.09.2020 to 08.10. 2020. The

prescribed statutory period of limitation of 60 days as per section 13(1A) of the

Commercial Act expired on 13.03.2020. It is pertinent to mention that appellant

during statutory period of limitation of 60 days as per section 13(1A) of the Signature Not Verified Digitally Signed By:HARVINDER KAUR 19/25 BHATIA Signing Date:20.05.2022 15:17:11 Commercial Act did not apply for obtaining certified copy of the impugned

judgment but applied after expiry of statutory period of limitation of 60 days as

per section 13(1A) of the Commercial Act i.e. on 21.09.2020.

28. The Supreme Court due to outbreak of Covid-19 pandemic videorder dated

23.03.2020 passed in suo motto Writ Petition (C) No. 3 of 2020 excluded period

with effect from 15.03.2020 to 14.03.2021 in computation of period of

limitation in all proceedings before Courts/Tribunals including the Supreme

Court and passed following directions:-

1. In computing the period of limitation for any suit, appeal, application or proceeding, the period from 15.03.2020 till 14.03.2021 shall stand excluded. Consequently, the balance period of limitation remaining as on 15.03.2020, if any, shall become available with effect from 15.03.2021.

2. In cases where the limitation would have expired during the period between 15.03.2020 till 14.03.2021, notwithstanding the actual balance period of limitation remaining, all persons shall have a limitation period of 90 days from 15.03.2021. In the event the actual balance period of limitation remaining, with effect from 15.03.2021, is greater than 90 days, that longer period shall apply.

3. The period from 15.03.2020 till 14.03.2021 shall also stand excluded in computing the periods prescribed under Sections 23 (4) and 29A of the Arbitration and Conciliation Act, 1996, Section 12A of the Commercial Courts Act, 2015 and provisos (b) and (c) of Section 138 of the Negotiable Instruments Act, 1881 and any other laws, which prescribe period(s) of limitation for instituting proceedings, outer limits (within which the court or tribunal can condone delay) and termination of proceedings.

29. The Supreme Court again vide order dated 10.01.2022 passed while

disposing of M.A. No. 21 of 2022 filed in suo motto Writ Petition (C) No. 3 of

2020 restored order dated 23.03.2020 and directed that period from 15.03.2020

till 28.02.2022 shall stand excluded for purposes of limitation as may be Signature Not Verified Digitally Signed By:HARVINDER KAUR 20/25 BHATIA Signing Date:20.05.2022 15:17:11 prescribed under any general or special laws in respect of all judicial or quasi-

judicial proceedings and passed following directions:-

I. The order dated 23.03.2020 is restored and in continuation of the subsequent orders dated 08.03.2021, 27.04.2021 and 23.09.2021, it is directed that the period from 15.03.2020 till 28.02.2022 shall stand excluded for the purposes of limitation as may be prescribed under any general or special laws in respect of all judicial or quasi-judicial proceedings.

II. Consequently, the balance period of limitation remaining as on 03.10.2021, if any, shall become available with effect from 01.03.2022. III. In cases where the limitation would have expired during the period between 15.03.2020 till 28.02.2022, notwithstanding the actual balance period of limitation remaining, all persons shall have a limitation period of 90 days from 01.03.2022. In the event the actual balance period of limitation remaining, with effect from 01.03.2022 is greater than 90 days, that longer period shall apply. IV. It is further clarified that the period from 15.03.2020 till 28.02.2022 shall also stand excluded in computing the periods prescribed under Sections 23 (4) and 29A of the Arbitration and Conciliation Act, 1996, Section 12Aof the Commercial Courts Act, 2015 and provisos (b) and (c) of Section 138 of the Negotiable Instruments Act, 1881 and any other laws, which prescribe period(s) of limitation for instituting proceedings, outer limits (within which the court or tribunal can condone delay) and termination of proceedings.

30. As mentioned hereinabove the impugned judgment was passed on

13.01.2020 and the prescribed period of limitation of 60 days for filing present

appeal as per section 13(1A) of the Commercial Act expired on 13.03.2020. As

per directions given by the Supreme Court, due to outbreak of Covid-19

pandemic, vide order dated 23.03.2020 in suo motto Writ Petition (C) No. 3 of

2020 excluded period with effect from 15.03.2020 to 14.03.2021 in computation

of period of limitation in all proceedings before Courts/Tribunals including the

Supreme Court which was again extended to 28.02.2022 as detailed Signature Not Verified Digitally Signed By:HARVINDER KAUR 21/25 BHATIA Signing Date:20.05.2022 15:17:11 hereinabove. The appellant filed present appeal on 18.03.2021 i.e. during

extended period of limitation as per directions of the Supreme Court. It is

apparent from analysis of factual position as discussed and detailed

hereinabove, the prescribed period of limitation of 60 days as per section

13(1A) of the Commercial Act has expired before extension of period of

limitation by the Supreme Court in suo motto Writ Petition (C) No. 3 of 2020

and this is also argued by the counsel of the respondent.

31. Reverting back to facts stated in application under disposal, we are of

considered view that the facts are not convincing. The arguments advanced by

the counsel of the appellant that the trial court treated Arbtn. No.80/2017 as

72/2019 which was not in his knowledge is without any legal force.The pleas of

the appellant that the counsel handed over application for obtaining certified

copy of the impugned judgment to his clerk who was blessed with a son and

stopped reporting for duty since 15.02.2020 and the clerk never informed about

status of the application submitted for obtaining certified copy are lacking

material particulars. There is nothing on record to show that clerk of the counsel

of the appellant has ever applied for obtaining certified copy of the impugned

judgment. It appears that the appellant was not diligent in filing present appeal

within time. The appellant also cannot take shelter of plea and defence that due

to lack of coordination amongst officers of the appellant, the decision to file

appeal against impugned judgment could not be taken till December, 2020. The

appellant is government body and merely because the government is involved, a Signature Not Verified Digitally Signed By:HARVINDER KAUR 22/25 BHATIA Signing Date:20.05.2022 15:17:11 different yardstick for condonation of delay cannot be laid down. This view find

support from decisions given by the Supreme Court in Postmaster General v.

Living Media India Ltd., Government of Maharashtra (Water Resources

Department) V M/S Borse Brothers Engineers & Contractors Pvt. Ltd. And

State of M.P. V Chaitram Maywade referred hereinabove. The appellant was

required to take appropriate steps for pursuing further judicial remedy as per

section 37 of the Arbitration Act and Section 13(1A) of the Commercial Act

against the impugned judgment diligently and without unnecessary delay.

32. The expression "sufficient cause" warrants a liberal interpretation to

advance cause of justice but simultaneously it must be ensure that there is no

negligence, inaction or lack of bona fides attributable to concerned party. The

concerned party should not have acted in a negligent manner or remained

passive. The concerned party need to act in bona fide manner in pursuing

appropriate further legal and judicial remedies. The interpretation of expression

"sufficient cause" in relation to condoning delay in filing appeals under section

37 of the Arbitration Act should be in consonance with underlying objects of

the Act. However, the existence of sufficient cause is to be determined on the

facts and circumstances of a particular case and for this no strait jacket formula

cannot be laid down.

33. The application under disposal also needs to be considered from different

perspective. In beginning of 2020, world faced unprecedented situation due to

outbreak of corona virus across the world including India. The Central Signature Not Verified Digitally Signed By:HARVINDER KAUR 23/25 BHATIA Signing Date:20.05.2022 15:17:11 Government in month of March, 2020 announced world largest lockdown in the

country which was further extended from time to time followed by enforcement

of various regulations thereby affecting normal functioning in private and public

sectors. The normal functioning of the courts was also adversely affected due to

outbreak of corona virus and courts in India including High Courts remained

closed either wholly and partially although every possible effort was made by

the judiciary for access to justice. The litigants faced difficulties in approaching

courts to seek redressal of their legal grievances. In present case limitation for

filing the present appeal expired on 13.03.2020 and immediately thereafter

countrywide lockdown was enforced by the Central and States governments.The

Supreme Court also excluded period with effect from 15.03.2020 to 28.02.2022

while calculating period of limitation for any legal proceedings to be initiated

before any court or tribunal. The appellant filed present appeal during extended

period of limitation. The counsel for the appellant also contacted Covid.

Although the appellant was not appropriately diligent in filing present appeal

within period of limitation and cannot be allowed to plead slackness on part of

its concerned officers but the appellant cannot be denied benefit of

unprecedented situation caused by outbreak of corona virus. In Government of

Maharashtra (Water Resources Department) V M/S Borse Brothers

Engineers & Contractors Pvt. Ltd.the delay on part of government agencies

in pursuing legal remedies was not attributable due to outbreak of corona virus.

Signature Not Verified
Digitally Signed
By:HARVINDER KAUR                                                                            24/25
BHATIA
Signing Date:20.05.2022
15:17:11

34. In view of the above factual and legal discussion we are opinion that the

appellant is entitled for condonation of delay in filing present appeal. The

application under disposal is accordingly allowed and delay in filing present

appeal is condoned under peculiar facts and circumstances of the case.

FAO (COMM.) No. 83/2021

35. List along with FAO (COMM.) No.84/2021 on 07.09.2022.

SURESH KUMAR KAIT, J.

SUDHIR KUMAR JAIN, J.

              MAY , 2022
              'j/kg'




Signature Not Verified
Digitally Signed
By:HARVINDER KAUR                                                                      25/25
BHATIA
Signing Date:20.05.2022
15:17:11