Summary
A sugar cooperative received an arbitral award on 24 August 2016. The three-month period under Section 34(3) of the Arbitration and Conciliation Act, 1996 expired on 24 November 2016 and the further condonable period of thirty days on 24 December 2016, which fell during the trial court's winter vacation. The application under Section 34 with a delay condonation application was filed on the reopening day, 2 January 2017, and was rejected as beyond 120 days; the Karnataka High Court affirmed. The Supreme Court dismissed the appeal, holding that under Assam Urban Water Supply the benefit of Section 4 of the Limitation Act applies only to the prescribed period of three months and not to the discretionary further period of thirty days, and that Section 10 of the General Clauses Act is excluded by its proviso because the Limitation Act applies to arbitration proceedings under Section 43(1).
Issues
- Whether, when the last day of the thirty-day condonable period under the proviso to Section 34(3) of the Arbitration and Conciliation Act, 1996 falls during a court vacation, the application may be filed on the reopening day by virtue of Section 4 of the Limitation Act, 1963.
- Whether Section 10 of the General Clauses Act, 1897 separately extends the condonable period to the next working day.
Provisions considered
- Section 34(3) and proviso, Arbitration and Conciliation Act, 1996An application to set aside an award may not be made after three months from receipt of the award; the court may entertain it within a further period of thirty days on sufficient cause, but not thereafter. The words but not thereafter are an express exclusion under Section 29(2) of the Limitation Act, so the limit is mandatory. (¶¶ 7, 7.1, 8.1, 8.2)
- Section 2(j) and Section 4, Limitation Act, 1963Prescribed period means the period of limitation; the three months under Section 34(3) is the prescribed period, while the further thirty days which the court may allow in its discretion is not, so Section 4 permitting filing on the reopening day does not apply when the thirty days expire during a vacation. (¶¶ 7, 7.1, 9)
- Section 10 and its proviso, read with Section 8, General Clauses Act, 1897Section 10 does not apply to any act or proceeding to which the Limitation Act applies; the reference to the 1877 Act is read as the 1963 Act, which by Section 43(1) of the Arbitration Act applies to arbitration proceedings, so Section 10 cannot be invoked. (¶¶ 7, 9)
- Section 43(1), Arbitration and Conciliation Act, 1996The Limitation Act applies to arbitrations as it applies to court proceedings, save to the extent excluded by the express provision in Section 34(3). (¶ 8)
Held
- The issue is squarely covered by Assam Urban Water Supply: the benefit of exclusion of the period during which the court is closed is available only when the application to set aside the award is filed within the prescribed period of limitation of three months, and not in respect of the further thirty days extendable by the court in its discretion. (¶¶ 7.1, 9, 11)
- The contention that the Limitation Act does not apply to proceedings under the Arbitration Act has no substance; Section 43(1) applies it save to the extent excluded by Section 34(3), and Popular Construction and Hindustan Construction establish that an application beyond three months and the further thirty days is not one in accordance with Section 34(3). (¶¶ 8, 8.1, 8.2)
- Reliance on Section 10 of the General Clauses Act is untenable because its proviso excludes proceedings to which the Limitation Act applies; Sridevi Datla did not notice Assam Urban Water Supply and contains no discussion of the distinction between the prescribed period and the discretionary condonable period, whereas Assam Urban is binding and directly on point. (¶¶ 9, 10)
Result
Appeal dismissed; Karnataka High Court judgment dated 23.02.2022 affirming the trial court's refusal to condone the delay in filing the application under Section 34 of the Arbitration and Conciliation Act, 1996 upheld; no costs.