Himachal Pradesh High Court
Maidan vs Unknown on 15 December, 2021
Bench: Tarlok Singh Chauhan, Satyen Vaidya
Reportable
IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA
ON THE 15th DAY OF DECEMBER, 2021
BEFORE
.
HON'BLE MR. JUSTICE TARLOK SINGH CHAUHAN
&
HON'BLE MR. JUSTICE SATYEN VAIDYA
ARBITRATION APPEAL NO. 16 of 2021
Between:
CHAURA
MAIDAN,
HIMACHAL PRADESH ELECTRICITY
BOARD LIMITED VIDYUT BHAWAN
SHIMLA,
THROUGH ITS EXECUTIVE
DIRECTOR (PERSONAL)
...APPELLANT
(BY MR. TARA SINGH CHAUHAN,
ADVOCATE)
AND
SHYAM INDUS POWER SOLUTION PVT. LTD HAVING
ITS REGISTERED OFFICE AT 129 TRANSPORT
CENTRE, ROHTAK ROAD PUNJABI BAGH, NEW DELHI,
110035 THROUGH ITS CHAIRMAN/DIRECTOR MR.
SATYA PAL SANDHU
...RESPONDENT
::: Downloaded on - 31/01/2022 23:26:17 :::CIS
(BY MR. NEERAJ GUPTA, SENIOR
ADVOCATE WITH MR. AJEET PAL
SINGH JASWAL AND MR. PANKAJ
KUMAR SINGH ADVOCATES)
Reserved on : 10.12.2021
.
This petition coming on for admission this day, Hon'ble
Mr. Justice Tarlok Singh Chauhan, J passed the following:
ORDER
The instant appeal under Section 37 of the Arbitration
and Conciliation Act, (hereinafter referred to as "the Act), has been
filed by the appellant for setting aside the order passed by the
learned Single Judge in OMP(M) No. 63 of 2019, whereby the
application for condonation of delay in filing the application under
Section 34 of the Act, against the award dated 16.1.2019 came to
be dismissed.
2. An arbitration award to the extent of Rs. 4,28,98,551/
alongwith interest at the rate of 6% per annum came to be passed
against the appellant and aggrieved thereby, the appellant preferred
an application under Section 34 of the Act for setting aside the
award. Alongwith the same, he also filed an application under
Section 34(3) of the Act, seeking condonation of delay in filing the
same on the ground that at no point of time had the arbitrator
supplied the signed copy of the award till 1.8.2019, therefore there
was no occasion for the appellant to have filed the objections.
3. Learned Single Judge, after perusing the record came
to the conclusion that signed copy of the award was supplied by
the Arbitrator to one Robin Kumar Bansal, Assistant Executive
Engineer with the respondentHPSEBL on 16.1.2019 and therefore
.
the appellant could not feign ignorance regarding passing of the
award.
4. It was thus concluded by learned Single Judge that
having supplied copy of the award, the appellant failed to file the
objections, within the stipulated period and therefore, objections
were liable to be dismissed solely on the ground of limitation as per
provisions of Section 34(3) of the Act.
5. We have heard learned counsel for the parties and gone
through the provisions of Arbitration and Conciliation Act.
6. It is no longer resintegra that the period of limitation
for filing the objections would only commence after signing of the
award. A reference in this regard can conveniently be made to the
judgment rendered by Hon'ble Supreme Court in Dakshin Haryana
Bijli Vitran Nigam Ltd. vs. M/s Navigant Technologies Pvt. Ltd.
2021(7) SCC 657.
7. In fact a similar reiteration of law can be found in an
earlier judgment rendered by a Division Bench of this Court, which
is authored by one of us (Hon'ble Mr. Justice Tarlok Singh
Chauhan) in case titled as "Himachal Pradesh Housing Board and
another versus Ranjit Singh Rana" ILR 2015(I) HP 488.
8. Section 34 (3) of the Act reads as under:
"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."
9. Section 34(3) of the Act provides that an application for
setting aside the award cannot be made after three months and it is
only if the Court is satisfied that the applicant was prevented by
sufficient cause for making an application within such period of
three months, which may entertain an application within a further
period of 30 days but not thereafter, after considering Section 29 (2)
of the Limitation Act.
10. An identical issue came up for consideration before the
Hon'ble Supreme Court in "Union of India versus Popular
Construction Company", (2001) 8 Supreme Court Cases 470,
wherein it was observed as under:
"11. Thus, where the legislature prescribed a special limitation for
the purpose of the appeal and the period of limitation of 60 days
was to be computed after taking the aid of Sections 4, 5 and 12 of
the Limitation Act, the specific inclusion of these sections meant
that to that extent only the provisions of the Limitation Act stood
extended and the applicability of the other provisions, by
necessary implication stood excluded.
12. As for as the language of Section 34 of the 1996 Act is
concerned, the crucial words are 'but not thereafter' used in the
proviso to subsection (3). In our opinion, this phrase would
amount to an express exclusion within the meaning of Section
.
29(2) of the Limitation Act, and would therefore bar the
application of Section 5 of that Act. Parliament did not need to go
further. To hold that the Court could entertain an application to
set aside the Award beyond the extended period under the
proviso, would render the phrase 'but not thereafter' wholly
otiose. No principle of interpretation would justify such a result.
14. Here the history and scheme of the 1996 Act support the
conclusion that the time limit prescribed under Section 34 to
challenge an Award is absolute and unextendable by Court under
Section 5 of the Limitation Act. The Arbitration and Conciliation
Bill, 1995 which preceded the 1996 Act stated as one of its main
objectives the need "to minimise the supervisory role of courts in
the arbitral process".6 This objective has found expression in
Section 5 of the Act which prescribes the extent of judicial
intervention in no uncertain terms :
"5. Extent of judicial intervention. - Notwithstanding anything
contained in any other law for the time being in force, in matter
governed by this Part, no judicial authority shall intervene except
where so provided in this Part."
11. In "State of Himachal Pradesh and another versus
Himachal Techno Engineers and Another", 2010 12 SCC 210,
the Hon'ble Supreme Court while dealing with the provisions of
Section 34(3) of the Act observed as under:
"Having regard to the proviso to Section 34(3) of the Act, the
provisions of Section 5 of the Limitation Act, 1963 will not apply
in regard to petitions under Section 34 of the Act. While section 5
of the Limitation Act does not place any outer limit in regard to
the period of delay that could be condoned, the proviso to
subsection (3) of Section 34 of the Act places a limit on the period
of condonable delay by using the words "may entertain the
application within a further period of thirty days but not
thereafter." Therefore, if a petition is filed beyond the prescribed
period of three months, the Court has the discretion to condone
the delay only to an extent of thirty days, provided sufficient
.
cause is shown. Where a petition is filed beyond three months
plus thirty days, even if sufficient cause is made out, the delay
cannot be condoned."
12. The similar issue came up before the Hon'ble Supreme
Court in "Simplex Infrastructure Limited versus Union of
India", (2019) 2 Supreme Court Cases 455, and it was held that
Section 5 of the Limitation Act has no application to an application
challenging an arbitral award under Section 34 of the 1996 Act, as
per para11 of the judgment (supra), which reads as under:
"Section 5 of the Limitation Act, 1963 deals with the extension of
the prescribed period for any appeal or application subject to the
satisfaction of the Court that the appellant or applicant had
sufficient cause for not preferring the appeal or making the
application within the prescribed period. Section 5 of the
Limitation Act, 1963 has no application to an application
challenging an arbitral award under Section 34 of the 1996 Act.
This has been settled by this Court in its decision in Union of
India v. Popular Construction Company,", wherein it held as
follows: (SCC pp. 47475, paras 12 & 14)
"12. As far as the language of Section 34 of the 1996
Act is concerned, the crucial words are "but not
thereafter" used in the proviso to subsection (3) In
our opinion, this phrase would amount to an express
exclusion within the meaning of Section 29(2) of the
Limitation Act, and would therefore bar the
application of Section 5 of that Act. Parliament did not
need to go further. To hold that the Court could
entertain an application to set aside the award beyond
the extended period under the proviso, would render
the phrase "but not thereafter" wholly otiose. No
Principle of interpretation would justify such a result.
14. Here the history and scheme of the 1996 Act
support the conclusion that the timelimit prescribed
.
under Section 34 to challenge an award is absolute
and unextendible by Court under Section 5 of the
Limitation Act."
13. Thereafter, the similar issue again came up before the
Hon'ble Supreme Court in "Dakshin Haryana Bijli Vitran Nigam
Ltd. Vs. M/s Navigant Technologies Pvt. Ltd.", case (supra),
wherein the Hon'ble Supreme Court after placing reliance upon the
judgments in "Union of India versus Popular Construction
Company", (2001) 8 Supreme Court Cases 470, and in "Simplex
Infrastructure Ltd. Vs. Union of India, (2019) 2 Supreme Court
Cases 455, observed as under:
"35. The date on which the signed award is provided to the
parties is a crucial date in arbitration proceedings under the
Arbitration and Conciliation Act, 1996. It is from this date that:
35.1 The period of 30 days for filing an application under Section
33 for correction and interpretation of the award, or additional
award may be filed.
35.2 The arbitral proceedings would terminate as provided by
Section 32(1) of the Act.
35.3 The period of limitation for filing objections to the award
under Section 34 commences.
36. Section 34 provides recourse for judicial scrutiny of the award
by a Court, upon making an application under subsections (2)
and (3) for setting aside the award. The period of limitation for
filing the objections to the award under Section 34 commences
from the date on which the party making the application has
"received" a signed copy of the arbitral award, as required by
Section 31 (5) of the 1996 Act. Section 34(3) provides a specific
timelimit of three months from the date of "receipt" of the award,
and a further period of thirty days, if the Court is satisfied that
the party was prevented by sufficient cause from making the
.
application within the said period, but not thereafter.
37. In Union of India v. Popular Construction Co., this Court held
that Section 5 of the Limitation Act, 1963 would not apply to
apply to applications filed under Section34 of the Arbitration Act.
It was held that : (SCC pp. 47475, para 12)
"12. As far as the language of Section 34 of the 1996 Act is
concerned, the crucial words are "but not thereafter" used in the
proviso to subsection (3). In our opinion, this phrase would
amount to an express exclusion within the meaning of Section
29(2) of the Limitation Act, and would therefore bar the
application of Section 5 of that Act. Parliament did not need to go
further. To hold that the Court could entertain an application to
set aside the award beyond the extended period under the
proviso, would render the phrase " but not thereafter" wholly
otiose. No principle of interpretation would justify such a result."
In Simplex Infrastructure Ltd. v. Union of India this Court held
that the phrase "but no thereafter" provided under Section 34(3)
of the Act makes it evident that the statutory period of limitation
for filing an application for setting aside is three months, which is
extendable by thirty days, if sufficient cause is made out. No
further period of time can be granted for the filing of an
application under Section 34."
14. Learned counsel for the appellant would still contend
that period of limitation as provided under Section 5 of the
Limitation Act is available to the appellant in terms of a judgment
rendered by a larger Bench of the Hon'ble Supreme Court,
comprising of three Hon'ble Judges in "Chintels India Limited
verus Bhayana Builders Private Limited" (2021) 4 Supreme
Court Cases 602.
15. It would be noticed that the Hon'ble Supreme Court in
the aforesaid case was primarily dealing with the case relating to
.
condonation of delay under Section 37 of the Act in filing of the
appeal and it was in this background that a primary issue was
whether an appeal against an order refusing to condone the delay
in filing an application under Section 34 of the Arbitration Act,
1996 is appellable under Section 34(i)(c) of the Act?
16. As regards, the interpretation of Section 34 of the Act,
it was categorically held that if the application for setting aside the
arbitral award is not filed within three months, then it must be
accompanied by an application for condonation of delay provided it
is within a period of 30 days, as is evident from the following
observations made in para11 of the judgment (supra)
"A reading of Section 34(1) would make it clear that an
application made to set aside an award has to be in accordance
with both subsection (2) and (3).This would mean that such
application would not only have to be within the limitation period
prescribed by subsection (3), but would then have to set out
grounds under subsection (2) and/or (2A) for setting aside such
award. What follows from this is that the application itself must
be within time, and if not within a period of three months, must
be accompanied with an application for condonation of delay,
provided it is within a further period of 30 days, this Court having
made it clear that Section 5 of the Limitation Act, 1963 does not
apply and that any delay beyond 120 days cannot be condoned
see State of H.P. v. Himachal Techno Engineers at para 5."
17. Hon'ble the Supreme Court while dismissing SLP
(Civil) Diary No(s) 19846/2020 titled as Union of India Vs. Central
Tibetan Schools Admin & Ors on 4.2.2021 on account of delay
observed as under:
"We have repeatedly being counseling through our orders various
Government departments, State Governments and other public
.
authorities that they must learn to file appeals in time and set
their house in order so far as the legal department is concerned,
more so as technology assists them. This appears to be falling on
deaf ears despite costs having been imposed in number of matters
with the direction to recover it from the officers responsible for the
delay as we are of the view that these officers must be made
accountable. It has not had any salutary effect and that the
present matter should have been brought up, really takes the
cake.
The aforesaid itself shows the casual manner in which the
petitioner has approached this Court without any cogent or
plausible ground for condonation of delay. In fact, other than the
lethargy and incompetence of the petitioner, there is nothing
which has been put on record. We have repeatedly discouraged
State Governments and public authorities in adopting an
approach that they can walk in to the Supreme Court as and
when they please ignoring the period of limitation prescribed by
the Statutes, as if the Limitation Statute does not apply to them.
In this behalf, suffice to refer to our judgment in the State of
Madhya Pradesh & Ors v. Bheru Lal [SLP (C) Diary No.
9217/2020 decided on 15.10.2020] and the State of Odisha &
Ors v. Sunanda Mahakuda [SLP [C] Diary No. 22605/2020
decided on 11.01.2021]."
18. It would be noticed that even though the appellant
vide impugned award was saddled with liability to pay a whopping
amount of Rs. 4,28,98,551/ yet it perceived delay in a non
serious matter and its lackadaisical tendency is exhibited by its
nonchalant manner in which an application was filed and
contested before the learned Single Judge.
19. In the given facts and circumstances of the case, we
are of the considered view that the matter cannot be led to rest
.
and it needs to be inquired into.
20. Accordingly, we find no merit in the appeal and the
same is dismissed. The Executive Director (Personnel) of the
appellantBoard is directed to conduct a detailed inquiry and fix
the responsibility so that such gross negligence is not given a
premium and the Board is not unnecessarily burdened with
financial liability. Such inquiry be conducted personally by the
Executive Director (Personnel) and completed as expeditiously as
possible and in no event later than 31.3.2022. A copy of this order
be sent to the Chief Secretary to the State of H.P. as also the
Chairman, H.P.S.E.B. Ltd for information as also for necessary
action in the matter. Pending application(s), if any, are also
disposed of.
(Tarlok Singh Chauhan)
Judge
(Satyen Vaidya)
Judge
December 15, 2021
Kalpana
