Bhimashankar Sahakari Sakkare vs Walchandnagar Industries ...
2022 Latest Caselaw 3062 Kant

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             IN THE HIGH COURT OF KARNATAKA
                    KALABURAGI BENCH
                                                                         R
       DATED THIS THE 23RD DAY OF FEBRUARY 2022

                               PRESENT

     THE HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR

                                AND

       THE HON'BLE MRS. JUSTICE K.S.HEMALEKHA


                   M.F.A. NO.201018/2018 (AA)

BETWEEN:

Bhimashankar Sahakari Sakkare
Karkhane Niyamita
Indi Taluk, Vijayapur District
Represented by its Managing Director
Sri Mallikarjun D. Mallur
                                                         ... Appellant

(By Sri I.S.Uppin, Advocate)

AND:

Walchandnagar Industries Ltd. (WIL)
"Walchand House"
No.15/1, B-2
Kulkarnipeth, Katraud
Pune-400038
                                                       ... Respondent

(By Sri Pradeep Nayak, Advocate for
 Sri Mahadev S. Patil, Sri Vikas Mahendra, Smt. Anupama Hebbar, Smt.
Varsha Shivanagouda, Smt. Mahika Hegade, Smt. Shailaja Agarwal, Smt.
Prerana A.N., Sri Vedanth Anand, Sri Nishanth S. Kadur, Sri Shahnawaz
Mamadapur, Advocates)
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        This Miscellaneous First Appeal is filed under Section 37 (1) of the
Arbitration and Conciliation Act, 1996, praying to call for the records in the
Arbitration application No.2/2017 on the file of III Addl. District Judge,
Vijayapur and set aside the judgment and award passed by the sole
arbitrator dated 24.08.2016, etc.

         This appeal having been heard and reserved on 10.01.2022,
coming on for pronouncement of judgment this day, S.R.Krishna Kumar
J., delivered the following:

                               JUDGMENT

This appeal is directed against the impugned judgments

and orders dated 02.04.2018 passed in Arbitration Application

No.2/2017 by the III Additional District Judge, Vijayapura (for

short, 'the Trial Court') whereby the interlocutory application

I.A.No.1 and the additional affidavit filed by the appellant for

condonation of delay under Section 5 of the Limitation Act

1963 (for short, 'the Limitation Act') were dismissed by the

Trial Court which consequently also dismissed the aforesaid

Application No.2/2017 filed by the appellant under Section 34

of the Arbitration and Conciliation Act, 1996 (for short, 'the

said Act of 1996').

2. Briefly stated, the facts giving rise to the present

appeal are as under:

The appellant, a society registered under the Karnataka

Co-operative Societies Act filed a claim petition against the

respondent before the learned Sole Arbitrator (Former Judge

of this Court) seeking specific performance of agreement

dated 17.07.1997 and supplemental agreement dated

16.01.2001 said to have been entered into between the

parties and in the alternative for compensation of `11,362.73

lakhs and for other reliefs. The said petition filed by the

appellant was opposed and contested by the respondent who

also put forth a counter claim. During the pendency of the

arbitral proceedings before the Sole Arbitrator, the respondent

filed an application I.A.No.5 for framing of an additional issue

and requesting the Arbitrator to treat the said additional issue

as a preliminary issue. The said application having been

opposed by the appellant herein, the learned Arbitrator

allowed I.A.No.5 and framed an additional issue regarding

constitution of the Arbitral Tribunal and its jurisdiction to

adjudicate upon the claim put forth by the appellant.

Thereafter, the learned Arbitrator treated the said issue as a

preliminary issue and after having heard both sides, the

Arbitrator proceeded to pass an award dismissing the claim

petition on the ground that the Arbitral Tribunal did not have

jurisdiction to proceed further and that the claim put forth by

the appellant was barred by limitation. It is relevant to state

that the said award was passed by the Arbitral Tribunal on

24.08.2016.

3. Aggrieved by the aforesaid award dated

24.08.2016, the appellant herein preferred an application/

petition under Section 34 of the said Act of 1996 on

02.01.2017 before the Trial Court. The said application/petition

was filed by the appellant on 02.01.2017, i.e., the date on

which the Trial Court reopened after the 2016

Winter/Christmas Vacations for the Trial Courts which was

from 19.12.2016 to 01.01.2017.

4. In the aforesaid petition filed under Section 34 of

the said Act of 1996, the appellant specifically stated at

paragraph-26 of the application/petition relating to limitation

that the Arbitral Tribunal having passed the award on

24.08.2016, the application/petition was out of time and that

accordingly a separate application for condonation of delay

was filed by the appellant. The said application I.A.No.1 was

filed by the appellant under Section 34 (3) of the said Act of

1996 read with Section 5 of the Limitation Act and Section 151

CPC seeking condonation of delay of 24 days in filing the

application/petition under Section 34 of the said Act of 1996.

In the affidavit in support of the application, in addition to

reiterating the facts of the case, at paragraph Nos.6 and 7, the

Managing Director of the appellant - Co-operative Society

stated that copy of the arbitral award dated 24.08.2016 was

received by the appellant on 24.08.2016 itself and the same

having been forwarded to the learned Senior Counsel for legal

opinion which was furnished on 18.11.2016, the matter

relating to challenging the arbitral award was placed before

the Board of Management on 30.11.2016, on which day a

decision was taken to file the aforesaid application/petition

under Section 34 of the said Act of 1996; however, the

process of obtaining permission from the Board of

Management, approaching the earlier counsel and sending all

the papers, documents, etc. to the counsel at Dharwad to file

the application/petition under Section 34 of the said Act of

1996 consumed a lot of time; meanwhile, the

Winter/Christmas Vacations for the year 2016 for the Trial

Courts commenced on 19.12.2016 on account of which, the

appellant could not file the Section 34 application/petition

within the period of limitation which expired during

Winter/Christmas Vacation and as such, the Section 34

application/petition was filed on 02.01.2017, the reopening day

for the Trial Courts after completion of the Winter/Christmas

Vacations.

5. Appellant contended that the delay in filing the

Section 34 application/petition by the appellant was due to

administrative reasons and that the same was not deliberate

or intentional and due to bona fide reasons, unavoidable

circumstances and sufficient cause; that the appellant had a

good case to urge on merits and that the balance of

convenience was in favour of the appellant and if the delay in

filing the Section 34 application/petition was not condoned,

appellant would be put to irreparable injury and hardship and

that consequently, it was necessary to condone the delay in

filing the Section 34 application/petition which deserves to be

heard and disposed of on merits.

6. The said application was opposed by the

respondent who filed a detailed statement of objections to the

application.

7. Subsequently, appellant filed an additional

affidavit in support of I.A.No.1 referred to supra; in the said

additional affidavit, the deponent, i.e., the Managing Director

of the appellant - Society who had filed the earlier affidavit in

support of I.A.No.1 further stated that he was incharge of the

case on behalf of the appellant and on 24.08.2016, the arbitral

award was passed against the appellant; that during August,

2016, since he was preoccupied, he could not contact the

learned Senior Counsel for the appellant and the matter was

being looked after by a learned counsel for the appellant

residing at Bengaluru; that after the learned Senior Counsel

furnished his opinion on 18.11.2016 opining that the arbitral

award was incorrect and erroneous and was liable to be

challenged, only the legal opinion of the learned Senior

Counsel was furnished to the appellant without the original

award copy. It was averred that since the original award copy

was not available, the aforesaid learned counsel for the

appellant at Bengaluru made a request on 29.12.2016 to the

learned Arbitrator for another copy of the award pursuant to

which, a fresh copy was furnished to the appellant. It was

therefore contended that the appellant had not received the

award dated 24.08.2016 till the end of December, 2016 and

consequently, the petition/application filed by the appellant on

02.01.2017 within the prescribed period from the date on

which the award was received by the appellant was very much

within time and there was no delay in filing the Section 34

application/petition by the appellant. Under these

circumstances, it was contended that though to avoid

technicalities, the appellant had filed an application I.A.No.1

for condonation of delay, there was actually no delay in filing

the petition which was well within time from the date on which

the award copy was received by the appellant. It was

therefore contended on behalf of the appellant that the

additional affidavit be received on record and the Trial Court

proceed to hear the Section 34 application/petition filed by the

appellant on merits.

8. The respondent filed its objections to the

additional affidavit also and inter alia pointed out that the

contentions and allegations put forth in I.A.No.1 and its

accompanying affidavit as well as the additional affidavit dated

13.01.2018 were mutually inconsistent, contradictory and

destructive to one another particularly when the additional

affidavit was a clear after thought filed after one year of

presentation of the Section 34 application/petition by the

appellant. It was submitted that even according to the

appellant, it received the award on 24.08.2016 on the day the

award was made itself and merely because the award was

misplaced and another copy was obtained on 29.12.2016, the

said circumstance cannot be relied upon by the appellant

either to seek condonation of delay or to contend that there

was no delay in filing the Section 34 application/petition by the

appellant. The respondent contended that in the light of

several decisions of the Apex Court and this Court to the

effect that Section 5 of the Limitation Act does not apply to

applications/petitions filed under Section 34 of the said Act of

1996 after the expiry of 120 days (90 days + 30 days), the

Section 34 application/petition filed by the appellant beyond

the aforesaid period of 120 days was not condonable and the

Trial Court did not have jurisdiction, power or authority of law

to entertain or consider I.A.No.1 filed by the appellant. It was

further contended that apart from the fact that neither valid nor

sufficient cause was shown by the appellant to seek

condonation of delay, Section 4 of the Limitation Act which

enables filing of a petition/application on the reopening day in

cases where the prescribed period of limitation expired during

court vacations was not applicable to the extended period of

limitation of 30 days as contemplated in the proviso to Section

34 (3) of the said Act of 1996 and consequently, even the

additional affidavit and I.A.No.1 were liable to be dismissed. It

was pointed out that under the guise of the additional affidavit,

it was not open for the appellant to withdraw/resile from its

admission in the Section 34 application/petition and/or

I.A.No.1 and its accompanying affidavit wherein the appellant

had clearly admitted that it had received the arbitral award on

24.08.2016 itself. It was therefore contended that there was

no merit in the application as well as the main petition and that

the same were liable to be dismissed.

9. After hearing the parties, the Trial Court

proceeded to reject I.A.No.1 on the ground that as held by the

Apex Court and this Court in several decisions, having regard

to the specific language employed in Section 34 (3) of the said

Act of 1996 and the proviso appended thereto, it was not

permissible for the appellant to seek condonation of delay

beyond a period of 30 days which was maximum period for

which the delay in filing the Section 34 application/petition by

the appellant could be condoned; that as per the specific

provisions contained in Section 34 (3) of the said Act of 1996,

the Trial Court did not have jurisdiction, power or authority of

law to entertain any application/petition beyond the period of

120 days from the date of receipt of the award; that the

appellant had itself admitted that it had received the copy on

24.08.2016 itself and consequently, the Section 34

application/petition filed by the appellant on 02.01.2017 after

the expiry of the period of 120 days which ended on

23.12.2016 was not maintainable; that in the light of the

decision of the Apex Court in the case of Assam Urban

Water Supply and Sewerage Board vs. Subash Projects

and Marketing Limited reported in (2012) 2 SCC 624 which

arose out of identical facts and circumstances in relation to

applicability of Section 4 of the Limitation Act to the proviso to

Section 34 (3) of the said Act of 1996, the Section 34

application/petition filed by the appellant was liable to be

dismissed.

10. Insofar as the additional affidavit dated

13.01.2018 filed by the appellant before the Trial Court was

concerned, it was held by the Trial Court that the said

additional affidavit was a vain attempt on the part of the

appellant to nullify the earlier admission of facts which were

already on record in the affidavit in support of I.A.No.1; that no

compelling circumstances or genuine reasons were shown as

to why an additional affidavit was sought to be filed which was

contrary to the earlier affidavit; that filing of the additional

affidavit was merely an attempt by the appellant to alter or

modify the statement of admission already on record in the

affidavit in support of IA.No.1 which was not permissible in

law; that appellant had failed to invoke any statutory provision

or cite any precedent which permits him to file the aforesaid

additional affidavit which was contrary to the contents of the

earlier affidavit. Under these circumstances, the Trial Court

proceeded to reject the additional affidavit filed by the

appellant also.

11. Aggrieved by the impugned order passed by the

Trial Court rejecting I.A.No.1 as well as the additional affidavit,

appellant is before this Court by way of the present appeal.

12. We have heard the learned counsel for the

appellant and the learned counsel for the respondent and

perused the material on record.

13. In addition to reiterating the various contentions

urged in the appeal and referring to the material on record,

learned counsel for the appellant submits that the Trial Court

erred in rejecting I.A.No.1 filed by the appellant as well as the

additional affidavit in support of the said application filed by

the appellant for condonation of delay. It is submitted that the

Trial Court failed to consider and appreciate that the delay in

filing the Section 34 application/petition by the appellant was

due to bona fide reasons, unavoidable circumstances and

sufficient cause; that the Trial Court has adopted a hyper

technical approach in rejecting the application I.A.No.1 and

the additional affidavit filed by the appellant without

appreciating that in the light of the undisputed fact that the

period of 30 days contemplated in the proviso to Section 34

(3) of the said Act of 1996 expired on 23.12.2016 on which

day, it was physically impossible for the appellant to file the

Section 34 application/petition since the Trial Court was

closed for Winter/Christmas Vacation from 19.12.2016 to

01.01.2017 and consequently, having regard to Section 4 of

the Limitation Act and/or Section 10 of the General Clauses

Act 1897, the appellant was entitled to file the instant Section

34 application/petition on the reopening day i.e., 02.01.2017

which was perfectly and legally permissible in law.

14. It is submitted that the decision of the Apex Court

in Assam Urban Water Supply's case supra was not

applicable to the facts of the instant case particularly in view of

the additional affidavit filed by the appellant which clearly

establishes that the appellant received the copy of the award

only on 29.12.2016 and not earlier and the averment made in

the earlier affidavit in support of I.A.No.1 had been sufficiently

and satisfactorily explained by the appellant in the subsequent

additional affidavit and failure to consider this has resulted in

erroneous conclusion. Learned counsel submitted that the

appellant has a good case to urge in the Section 34

application/petition filed before the Trial Court and

consequently it is necessary that a justice oriented approach

is adopted in the matter and an opportunity is granted in

favour of the appellant to prosecute the Section 34 application

/petition on merits failing which the appellant would be put to

irreparable injury and hardship and justice would suffer.

15. Per contra, learned counsel for the respondent

would support the impugned judgment and order passed by

the Trial Court and submits that there is no merit in the appeal

and that the same is liable to be dismissed. It is submitted that

as held by the Apex Court, this Court and other High Courts,

neither the provisions of Sections 4 and 5 of the Limitation Act

nor Section 10 of the General Clauses Act are applicable to

the extended/discretionary/condonable period of 30 days

contemplated in the proviso to Section 34(3) of the said Act of

1996 and consequently, the trial court was fully justified in

dismissing the Section 34 application/petition filed by the

appellant and the impugned order does not warrant

interference by this Court in the present appeal. In support of

his contentions, learned counsel for the respondent relied

upon the following decisions:

a) Assam Urban Water Supply and Sewerage Board vs. Subash Projects and Marketing Ltd. - (2012) 2 SCC 624

b) Sagufa Ahmed and others vs Upper Assam Polywood Products Private Limited and others -

      (2021)2 SCC 317
   c) Eagle     MPCC(JV)       vs     Union   of    India     -

W.P.39483/2016 dated 27.02.2019(Karnataka)

d) General Manager Southern Railway vs Eagle Omega - 2020 SCC OnLine Mad 24354

e) Obulapuram Mining Company Pvt. Ltd. Vs JSW Steel Limited - 2019 SCC OnLine Bom 556

f) The State of Himachal Pradesh vs Sanjay Chauhan - MANU/HP/1233/2021

g) Union of India vs. Popular Construction Co.- (2001) 8 SCC 470

h) Simplex Infrastructure Ltd. Vs. Union of India- (2019) 2 SCC 455

i) State of Maharashtra vs. Ramdas Construction Co.-(2006) 6 Mh.L.J 678

j) Government of Maharashtra vs. M/s Borse Brothers-2021 SCC OnLine SC 233

k) Union of India vs. Varindera Constructions Limited-(2020)2 SCC 111

l) N.V. International vs. State of Assam-(2020)2 SCC

m) Consolidated Engineering Enterprises vs. Irrigation Department - (2008)7 SCC 169

n) P.Radha Bai and others vs. P.Ashok Kumar and another - AIR 2018 SC 5013

16. We have given our anxious consideration to the

rival submissions and perused the material on record.

17. The following points arise for our consideration in

the present appeal:

1) Whether the Trial Court was justified in dismissing the additional affidavit dated 13.01.2018 filed by the Appellant in support of its application, I.A.No.1 filed for condonation of delay in filing the Section 34 petition/application?

2) Whether the Trial Court was justified in dismissing the application I.A.No.1 filed for condonation of delay in filing the Section 34 petition/application

and consequently dismissing the said petition/application?

Point No.1:

18. The facts leading to the appellant filing the

petition/application under Section 34 of the said Act of 1996

before the Trial Court are not in dispute; the sequence of

events are as under:

x Arbitral Award was passed on 24.08.2016;

x The period of 90 days prescribed under Section 34(3) expired on 24.11.2016;

x The appellant was entitled to a further extended /discretionary/condonable period of 30 days from 23.11.2016 onwards in terms of the proviso to Section 34(3) according to which appellant was entitled to file the Section 34 application/petition on or before 24.12.2016;

x The Trial Courts were closed on account of Winter/Christmas Vacations from 19.12.2016 to 01.01.2017;

x The extended/discretionary/condonable period of 30 days as contemplated in the proviso to Section 34(3) expired 24.12.2016 on which day the Trial Court was closed as stated supra on account of Winter/Christmas Vacations;

x Both the Section 34 application/petition as well as the application, I.A.No.1 for condonation of delay were filed on the reopening day, i.e., on 02.01.2017;

19. In his Section 34 application/petition and his

application I.A.No.1 for condonation of delay and the

accompanying affidavit, appellant stated that he received the

Award on the date of the award itself, i.e., 24.08.2016;

however, the additional affidavit in support of I.A.No.1 was

filed by the Appellant on 13.01.2018.

20. In the additional affidavit, appellant stated that the

award received by it earlier was misplaced and that on

29.12.2016, the appellant applied for a fresh/additional copy of

the award and after receiving the same, the Section 34

application/petition was filed on 02.01.2017, upon reopening

of courts after Winter/Christmas Vacations; it was contended

that there was no delay in filing the Section 34

application/petition and even if there was any delay, the same

deserves to be condoned having regard to the reasons stated

in the additional affidavit.

21. A perusal of the Section 34 application/petition

discloses that at paragraph 25 dealing with limitation,

appellant has categorically admitted that the

application/petition was out of time and that I.A.No.1, an

application for condonation of delay had been filed; in the

affidavit in support of I.A.No.1, appellant had clearly admitted

that the arbitral award had been received on 24.08.2016 itself;

it is relevant to state that in the additional affidavit also, except

alleging that the said arbitral award (received on 24.08.2016)

had been misplaced, the earlier admission made in the

affidavit in support of I.A.No.1 had neither been withdrawn nor

explained by the appellant; to put it differently, the clear,

definite, certain, unequivocal and unambiguous admission on

the part of the appellant that the arbitral award had been

received on 24.08.2016 itself was confirmed, reinforced and

affirmed in the additional affidavit also.

22. In the case of P.Radha Bai and others vs

P.Ashok Kumar and another - AIR 2018 SC 5013, the Apex

Court held that Section 34(3) reflects the principle of un-

breakability, i.e., the period of limitation under Section 34(3) is

'unbreakable' and is meant to run continuously; it was held

that once a party receives the arbitral award, the limitation

period under Section 34(3) commences. In the light of the

aforesaid facts and circumstances of the case which clearly

establish that the period of limitation under Section 34(3) of

the said Act of 1996 commenced from 24.08.2016 on which

date the Appellant undisputedly received the arbitral award,

merely because the appellant is said to have misplaced the

award and obtained a fresh copy (that too on 29.12.2016),

after the maximum period of 120 days commencing from

24.08.2016, none of the contentions urged in the additional

affidavit could have been relied upon by the appellant in order

to contend that there was no delay in filing the Section 34

application/petition or that the delay deserves to be condoned.

23. As rightly contended by the learned counsel for

the respondents, the contentions and allegations put forth in

I.A.No.1 and its accompanying affidavit were mutually

inconsistent, contradictory and destructive to the additional

affidavit which was a clear after thought having been filed on

13.01.2018 after a lapse of more than one year from

02.01.2017 when the Section 34 application/petition was filed

by the appellant. While dealing with the aforesaid additional

affidavit, the Trial Court has come to the correct conclusion

that the said additional affidavit was nothing but a vain attempt

on the part of the appellant to nullify the earlier admission of

facts which were already on record in the affidavit in support of

I.A.No.1; that no compelling circumstances or genuine

reasons were shown as to why an additional affidavit was

sought to be filed which was contrary to the earlier affidavit;

that filing of the additional affidavit was merely an attempt by

the appellant to alter or modify the statement of admission

already on record in the affidavit in support of I.A.No.1 which

was not permissible in law; that appellant had failed to invoke

any statutory provision or cite any precedent which permits

him to file the aforesaid additional affidavit which was contrary

to the contents of the earlier affidavit. In our considered

opinion, the impugned order passed by the Trial Court

dismissing the additional affidavit does not suffer from any

illegality or infirmity nor can the same be said to be perverse

or erroneous warranting interference by this Court and

consequently, the Trial Court was fully justified in dismissing

the said additional affidavit. Point No.1 is accordingly

answered against the appellant.

Point No.2:

24. As stated supra, in the Section 34

application/petition, the appellant admitted that the arbitral

award having been received on 24.08.2016, the appellant had

filed the Section 34 application/petition on 02.01.2017 which

was after the period of 90 days as provided under Section 34

(3) as well as the extended/discretionary/condonable period of

30 days as contemplated under the proviso to Section 34 (3)

of the said Act of 1996. Accordingly, the Section 34

application/petition ought to have been filed before the expiry

of 120 days (90 days + 30 days) which expired on 24.12.2016.

Under these circumstances, there was a delay of 9 days in

filing the Section 34 application/petition by the appellant which

was sought to be condoned by filing I.A.No.1 by the appellant

by invoking Section 5 of the Limitation Act.

25. The question with regard to applicability of

Section 5 of the Limitation Act to a Section 34

application/petition in the light of Section 29(2) of the

Limitation Act is no longer res integra in the light of several

decisions of the Apex Court, this Court and other High Courts

commencing from the decision in the case of Union of India

vs. Popular Construction Co. - (2001) 8 SCC 455 and

reiterated in the recent decision of the Three Judge Bench of

the Apex Court in the case of Mahindra and Mahindra

Financial Services Ltd. Vs. Maheshbhai Tinabhai Rathod

and others- 2021 SCC Online SC 1315 wherein it has been

consistently held that Section 5 of the Limitation Act was not

applicable to an application/ petition against an arbitral award

which was filed beyond the period of 120 days (90 days + 30

days) as contemplated under Section 34 (3) of the said Act of

1996. It was also held that the applicability of Section 5 of the

Limitation Act to Section 34 application/petition was excluded

as provided under Section 29 (2) of the Limitation Act and

consequently, the Trial Court dealing with Section 34

application/petition did not have jurisdiction or authority of law

to entertain any application/petition filed beyond the period of

120 days. In view of the law laid down by the Apex Court and

the aforesaid facts and circumstances, we are of the

considered opinion that Section 5 of the Limitation Act is not

applicable to an application/petition filed by a party challenging

an arbitral award under Section 34 (3) of the Arbitration Act

Conciliation Act, 1996 and the Court before whom such an

application is filed does not have jurisdiction or authority of law

to entertain any application/petition filed beyond the period of

120 days (90 days + 30 days) from the date of receipt of a

copy of the arbitral award.

26. The next question that arises for consideration is

as to whether Section 4 of the Limitation Act and/or Section 10

of the General Clauses Act would be applicable to an

application/petition filed under Section 34 of the said Act of

1996. As stated supra, the arbitral award having been passed

on 24.08.2016, the period of 90 days expired on 24.11.2016

whilst the extended/discretionary/condonable period of 30

days as contemplated in the proviso to Section 34 (3) of the

said Act of 1996 expired on 24.12.2016 on which day the Trial

Court was closed for Winter/Christmas Vacations; it is the

specific contention of the appellant that it was physically

impossible for the appellant to file a Section 34

application/petition after 19.12.2016 on account of the Courts

being closed due to Winter/Christmas Vacations and

consequently, the appellant would be entitled to the benefit of

Section 4 of the Limitation Act which enables/entitles the

appellant to file the said Section 34 application/petition on the

reopening day; it is therefore contended that in view of the

undisputed fact that the prescribed period of 30 days being the

extended/discretionary/condonable period expired on

24.12.2016 on which day the Trial Court was closed on

account of Winter/Christmas Vacations, the appellant was fully

entitled to file the Section 34 application/petition when the

Court reopened on 02.01.2017 and as such, the said

application/petition was perfectly legal, proper and

maintainable in law.

27. A perusal of the impugned order will indicate that

the Trial Court has placed reliance upon the decision of the

Apex Court in Assam Urban Water Supply's case supra,

wherein while dealing with applicability of Section 4 of the

Limitation Act to the extended/discretionary/condonable period

of 30 days contained in the proviso to Section 34 (3) of the

said Act of 1996, the Apex Court held as under:

"10. The facts in the present case are peculiar. The arbitral awards were received by the appellants on 26-08-2003. No application for setting aside the arbitral awards was made by the appellants before

elapse of three months from the receipt thereof. As a matter of fact, three months from the date of the receipt of the arbitral award by the appellants expired on 26-11-2003. The District Court had Christmas vacation for the period from 25-12-2003 to 01-01-

2004. On reopening of the court i.e., 02-01-2004, admittedly, the appellants made applications for setting aside those awards under Section 34 of the 1996 Act. If the period during which the District Court, Kamrup, Guwahati, remained closed during Christmas vacation, 2003 is extended and the appellants get benefit of that period over and above the cap of thirty days as provided in Section 34(3), then the view of the High Court and the District Judge cannot be sustained. But this would depend on the applicability of Section 4 of the 1963 Act.

11. The question, therefore, that falls for our determination is whether the appellants are entitled to extension of time under Section 4 of the 1963 Act in the above facts?

12. Section 4 of the 1963 Act reads as under:

"4. Expiry of prescribed period when court is closed.-Where the prescribed period for any suit, appeal or application expires on a day when the court is closed, the suit, appeal or application may be

instituted, preferred or made on the day when the court reopens.

Explanation.-A court shall be deemed to be closed on any day within the meaning of this section if during any part of its normal working hours it remains closed on that day."

The above Section enables a party to institute a suit, prefer an appeal or make an application on the day the court reopens where the prescribed period for any suit, appeal or application expires on the day when the court is closed.

13. The crucial words in Section 4 of the 1963 Act are "prescribed period". What is the meaning of these words?

14. Section 2(j) of the 1963 Act defines:

"2. (j) 'period of limitation'[ which] means the period of limitation prescribed for any suit, appeal or application by the Schedule, and 'prescribed period' means the period of limitation computed in accordance with the provisions of this Act;"

Section 2(j) of the 1963 Act when read in the context of Section 34(3) of the 1996 Act, it becomes amply clear that the prescribed period for making an application for setting aside arbitral award is three months. The period of 30 days mentioned in proviso

that follows sub-section (3) of Section 34 of the 1996 Act is not the 'period of limitation' and, therefore, not "prescribed period" for the purposes of making the application for setting aside the arbitral award. The period of 30 days beyond three months which the court may extend on sufficient cause being shown under the proviso appended to sub-section (3) of Section 34 of the 1996 Act being not the "period of limitation" or, in other words, "prescribed period", in our opinion, Section 4 of the 1963 Act is not, at all, attracted to the facts of the present case.

15. Seen thus, the applications made by the appellants on 2-1-2004, for setting aside the arbitral award dated 26-08-2003 were liable to be dismissed and have rightly been dismissed by the District Judge, Kamrup, Guwahati, as time-barred."

28. The said decision was reiterated by a 3 Judge

Bench of the Apex Court which also dealt with Section 10 of

the General Clauses Act in the case of Sagufa Ahmed and

others vs Upper Assam Polywood Products Private

Limited and others - (2021)2 SCC 317 wherein it was held

as under:

"16. To get over their failure to file an appeal on or before 18.03.2020, the appellants rely upon the order of this Court dated 23.03.2020 in Suo Motu Writ Petition (Civil) No.3 of 2020. It reads as follows:

"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."

17. But we do not think that the appellants can take refuge under the above order. What was extended by the above order of this Court was only "the period of limitation" and not the period upto which delay can be condoned in exercise of discretion conferred by the statute. The above order passed by this Court was intended to benefit vigilant litigants who were prevented due to the pandemic and the lockdown, from initiating proceedings within the period of limitation prescribed by general or special law. It is needless to point out that the law of limitation finds its root in two latin maxims, one of which is Vigilantibus Non Dormientibus Jura Subveniunt which means that the law will assist only those who are vigilant about their rights and not those who sleep over them.

18. It may be useful in this regard to make a reference to Section 10 of the General Clauses Act, 1897 which reads as follows:

"10. Computation of time (1) Where, by any 19 [Central Act] or Regulation made after the commencement of this Act, any act or proceeding is directed or allowed to be done or taken in any Court or office on a certain day or within a prescribed period, then, if the Court or office is closed on that day or the last day of the prescribed period, the act or proceeding shall be considered as done or taken in due time if it is done or taken on the next day afterwards on which the Court or office is open:

Provided that nothing in this section shall apply to any act or proceeding to which the Indian Limitation Act, 1877 (15 of 1877), applies.

(2) This section applies also to all [Central Acts] and, Regulations made on or after the fourteenth day of January, 1887."

19. The principle forming the basis of Section 10(1) of the General Clauses Act, also finds a place in Section 4 of the Limitation Act, 1963 which reads as follows: "4. Expiry of prescribed period when court is closed.-- Where the prescribed period for any suit, appeal or application expires on a day when the court is closed, the suit, appeal or application may be instituted, preferred or made on the day when the court reopens.

Explanation.-- A court shall be deemed to be closed on any day within the meaning of this section if during any part of its normal working hours it remains closed on that day."

20. The words "prescribed period" appear in several Sections of the Limitation Act, 1963. Though these words "prescribed period" are not defined in Section 2 of the Limitation Act, 1963, the expression is used throughout, only to denote the period of limitation. We may see a few examples:

20.1 Section 3(1) makes every proceeding filed after the prescribed period, liable to be dismissed, subject however to the provisions in Sections 4 to 24.

20.2 Section 5 enables the admission of any appeal or application after the prescribed period. 20.3 Section 6 uses the expression prescribed period in relation to proceedings to be initiated by persons under legal disability.

21. Therefore, the expression "prescribed period" appearing in Section 4 cannot be construed to mean anything other than the period of limitation. Any period beyond the prescribed period, during which the Court or Tribunal has the discretion to allow a person to institute the proceedings, cannot be taken to be "prescribed period".

22. In Assam Urban Water Supply and Sewerage Board Versus Subash Projects and Marketing Limited-(2012) 2 SCC 624 , this Court dealt with the meaning of the words "prescribed period" in paragraphs 13 and 14 as follows:

"13. The crucial words in Section 4 of the 1963 Act are "prescribed period". What is the meaning of these words?

14. Section 2(j) of the 1963 Act defines: "2(j) 'period of limitation' which means the period of limitation prescribed for any suit, appeal or application by the Schedule, and 'prescribed period' means the period of limitation computed in accordance with the provisions of this Act.

Section 2(j) of the 1963 Act when read in the context of Section 34(3) of the 1996 Act, it becomes amply clear that the prescribed period for making an application for setting aside arbitral award is three months. The period of 30 days mentioned in proviso that follows subsection (3) of Section 34 of the 1996 Act is not the 'period of limitation' and, therefore, not 'prescribed period' for the purposes of making the application for setting aside the arbitral award. The

period of 30 days beyond three months which the court may extend on sufficient cause being shown under the proviso appended to subsection (3) of Section 34 of the 1996 Act being not the 'period of limitation' or, in other words, 'prescribed period', in our opinion, Section 4 of the 1963 Act is not, at all, attracted to the facts of the present case."

23. Therefore, the appellants cannot claim the benefit of the order passed by this Court on 23.03.2020, for enlarging, even the period up to which delay can be condoned. The second contention is thus untenable. Hence the appeals are liable to be dismissed. Accordingly, they are dismissed."

29. The decision of the Apex Court in Assam Urban

Water Supply's case supra has been followed by this Court

and others High Courts viz.,

a) Eagle MPCC(JV) vs Union of India -

W.P.39483/2016 dated 27.02.2019(Karnataka)

b) General Manager Southern Railway vs Eagle Omega - 2020 SCC OnLine Mad 24354

c) Obulapuram Mining Company Pvt. Ltd. Vs JSW Steel Limited - 2019 SCC OnLine Bom 556

d) The State of Himachal Pradesh vs Sanjay Chauhan - MANU/HP/1233/2021

30. In view of the law laid down in the aforesaid

decisions, we are of the considered opinion that both Section

4 of the Limitation Act and/or Section 10 of the General

Clauses Act are not applicable to the extended/ discretionary

/condonable period of 30 days contained in the proviso to

Section 34 (3) of Arbitration and Conciliation Act, 1996.

31. Our attention is drawn to the decision of the

Chennai High Court in the case of Stanford Laboratories

Pvt. Limited vs. Centaur Pharmaceuticals Private Limited

and another AS No.2056/2020 dated 20.04.2021 in order to

contend that subsequently the Madras High Court has

followed the order passed by the Apex Court in Suo Moto Writ

Petition (Civil) No.3/2020 dated 08.03.2021 to come to the

conclusion that even the extended/discretionary/condonable

period can be excluded for the purpose of computing limitation

on account of the Covid-19 Pandemic; it is contended that the

said decision of the Madras High Court was confirmed by the

Apex Court vide order dated 04.01.2022.

32. In this context it is relevant to state that in the

aforesaid order in Suo Moto Writ Petition (Civil) No.3/2020

dated 08.03.2021, the Apex Court held as under:

"3. The period from 15.03.2020 till 14.03.2021 shall also stand excluded in computing the periods prescribed under Section 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."

33. As can be seen from the aforesaid order passed

by the Apex Court, in view of specific reference only to

Sections 23 (4) and 29A of the said Act of 1996, it is clear that

the Apex Court was neither dealing with a Section 34

application/petition nor come to the conclusion that the

exclusion of the period of 30 days as contemplated in the

proviso to Section 34 (3) was permissible on account of the

Covid-19 Pandemic; further, in addition to the fact that the

Apex Court was dealing with limitation being extended/

excluded/condoned on account of the Covid-19 Pandemic, the

applicability of the said exclusion was not extended by the

Apex Court to a Section 34 application/petition which was filed

prior to the Covid-19 Pandemic; on the other hand, in Sagufa

Ahmed's case supra, the Apex Court has not only affirmed its

earlier decision in Assam Urban Water Supply's case supra,

but has also held that neither Section 4 of the Limitation Act

and/or Section 10 of the General Clauses Act are applicable to

a Section 34 application/petition filed after expiry of the

extended/condonable/discretionary period of 30 days as

contemplated in the proviso to Section 34 (3) of the said Act of

1996. In other words, if the period of 90 days as provided in

Section 34 (3) of the said Act of 1996 expires on a day on

which the Court is closed, the period during which the court is

closed would stand excluded and a party would be entitled to

file an application on the reopening day without any necessity

of seeking condonation of delay in view of Section 4 of the

Limitation Act and/or Section 10 of the General Clauses Act.

However, if the extended/discretionary/ condonable period of

30 days as contemplated in the proviso to Section 34 (3) of

the said Act of 1996 expires on a day on which the court is

closed, a party would not be entitled to the benefit of Section 4

of the Limitation Act and in the event the said period of 30

days expires during the period when the court is closed, a

party cannot take recourse to Section 4 of the Limitation Act

and/or Section 10 of the General Clauses Act and file a

Section 34 application/petition after the Court reopens and an

application seeking condonation of delay under the proviso to

Section 34 (3) would not be maintainable; needless to state

that as held in the aforesaid decisions, since neither Section 5

of the Limitation Act and/or Section 10 of General Clauses Act

is applicable, any Section 34 application/petition filed after the

expiry of the extended/discretionary period of 30 days which

expires on a day the Court is closed would not be

maintainable on the reopening day.

34. In view of the aforesaid facts and circumstances

and decisions referred to supra, we are of the considered

opinion that the impugned order passed by the Trial Court

dismissing the application for condonation of delay and

consequently the Section 34 application/petition does not

suffer from any illegality or infirmity warranting interference by

this Court in the present appeal. Under these circumstances,

we are of the considered opinion that the Trial Court was fully

justified in rejecting the application I.A.No.1 for condonation of

delay filed by the appellant and consequently dismissing the

Section 34 application/petition filed by the appellant.

Accordingly, Point No.2 is also answered accordingly against

the appellant.

35. In view of the foregoing, we do not find any merit

in the appeal and the same is hereby dismissed.

Sd/-

JUDGE

Sd/-

JUDGE swk