Condonation of delay in filing application under Section 34 of the Arbitration Act beyond 120 days
Section 34 of the Arbitration Act – Delay in filing application – Condonation of delay – Trial Court was closed for vacation on 24.12.2016 when the extended period of 30 days as per proviso to Section 34(3) had expired. Section 34 application with condonation of delay application was filed on 2.1.2017 on reopening of the trial Court – Important question whether the delay is condonable when the last day of condonable period of 30 days falls on holiday or during court vacation –
On 24.8.2016 the Arbitral Award was passed against the appellant. The period of initial 90 days for filing application under Section 34 of AA to challenge the Award expired on 24.11.2016 and further extended period of 30 days was upto 24.12.2016.
The trial Courts were closed for vacation from 19.12.2016 to 1.1.2017.
On 2.1.2017 of reopening of the trial Court, the application under Section 34 of AA challenging the Award accompanied by the application for condonation of delay was filed.
The trial Court, however, rejected the application for condonation of delay on the ground that the period beyond 120 days counted from 24.8.2016 was not condonable.
This was challenged in the High Court. The appellant filed affidavit in the High Court that although it had received the copy of the award on 24.8.2016, it was misplaced and thereafter, fresh copy was obtained on 29.12.2016. However, the High Court dismissed the appeal.
HELD – On consideration of the contentions of the parties with reference to the Section 34(3) of the Arbitration Act, Section 4 of the Limitation and Section 10 of the General Clauses Act and applying its earlier decision in Assam Urban case (2012(2) SCC 624, it was held that the benefit of exclusion of period during which the Court is closed shall be available when application for setting aside award is filed within “prescribed period of limitation”. It was also held that the decision in Sridevi Datia Vs. Union of India (2021) (5) SCC 321 did not notice the decision in Assam Urban case. It was held that the application for setting aside award has to be made within three months prescribed under Section 34(3) and a further period of 30 days if sufficient cause is shown but not thereafter. The Civil Appeal was dismissed.
Civil Appeal No.6810 of 2022 – Bhimashankar Sahakri Sakkare Karkhane Niyamita Vs. Walchandnagar Industries Ltd (WIL)
