Full Text
HIGH COURT OF DELHI
OMP No. 509/2013
Judgement Reserved on: 1st August, 2014
Judgement pronounced on: 27th August, 2014 LALIT KALA AKADEMI ..... Petitioner
Through : Mr. R.N. Rai, Adv. for Mr.V.S. Krishna, Adv.
Through : Mr. Raman Gandhi, Adv.
JUDGMENT
(condonation of delay in re-filing)
1. A petition under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as ‘the Act’), has been filed by the petitioner, challenging the award dated 24.05.2010 and the interim order dated 30.10.2008 (which also 2014:DHC:4218 forms part of the final award dated 24.05.2010), passed by the Sole Arbitrator.
2. The admitted facts are that award in this case was passed on 24th May, 2010. The petitioner filed its objection against the said award under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as “the Act”) before the learned Additional District Judge, Patiala House courts on 7th September,
2010.
3. Vide the order dated 7th February, 2013, the learned trial court at Patiala House returned the objections filed by the petitioner on the ground of want of pecuniary jurisdiction to deal with the matter as the award was valued at more than Rs.20 lacs. On 15th February, 2013, the objections under Section 34 of the Act were filed by the petitioner in the registry of this Court. On 4th April, 2013, the insufficient court fee was made good and on 17th /18th May, 2013, the objections were finally cleared by the Registry.
4. The petitioner vide his application under Section 5 of the Limitation Act has prayed for condonation of delay on the ground that he had pursued his arbitration application NO. 294/2010 dated 7th September, 2010 under bonafide mistake and good faith before the learned District Judge, on the presumption that the learned District Judge had the jurisdiction to deal with the matter.
5. It is further submitted that the earlier award was challenged by him before this court and the said award was set aside and at that time, this court had the pecuniary jurisdiction over an award above the value of Rs. 5 lacs. In the meantime, the pecuniary jurisdiction of the courts had changed and the pecuniary jurisdiction of the District Court was increased up to Rs.20 lacs. It is submitted that the award was less than of Rs. 20 lacs and he challenged the same before the learned District Judge. It is further submitted that Section 14 of the Limitation Act speaks of the exclusion of the period spent in prosecuting with due diligence another civil proceeding, whether in a court of first instance or of appeal or revision, where the proceeding relates to the same matter in issue and is prosecuted in good faith in a court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it. Reliance is placed on the findings in the case of State of Goa v. Western Builders (2006) 6 SCC 239. It is submitted that the certified copies were supplied to him only on 14th February, 2013 and thereafter the petition under Section 34 of the Act was filed before the High Court of Delhi.
6. In the application for condonation of delay in re-filing, it is submitted that there is a short delay in re-filing which was neither intentional nor deliberate but has occurred due to the reasons beyond control of the petitioner. It is submitted that the Registry had raised certain objections and also asked to replace all dim documents/annexures which were voluminous and considerable time was taken for fresh typing of those documents and so refiling could not be done within the prescribed time. It is prayed that there was a delay of 60 days in re-filling the petition which may also be condoned.
7. Both the applications have been contested by the respondent since notice of the applications was issued to him. It is submitted that this court has no jurisdiction to condone the delay in filing of the objections under Section 34 of the Act beyond the period of 90 days extendable to 30 more days. It is further argued that the petitioner has to disclose cogent reasons for delay in filing the objections under the Act beyond the Limitation of 90 days.
8. It has been argued on behalf of respondent that the objections in this Court were first filed on 15th February, 2013 when they were returned by the Registry for being filed in a new format. The objections thereafter were filed on 12th March, 2013 and they were filed after being redrafted and totally changed and therefore it can only be said that the objections if any were filed on 12th March, 2013. It is further alleged that the petitioner has not disclosed about the objections under Section 34 of the Act which he allegedly filed on 15th February, 2013.
9. The record also shows that initially a court fee of Rs.19,000/- was filed with the objections but since the said court fee was insufficient an additional court fee of Rs.750/- was purchased on 5th April, 2013 and filed subsequently. It is submitted that since the court fee was purchased only on 5th April, 2013, it cannot be said that the objections were filed before the court fee was made good.
10. It is submitted that since the petition has been filed beyond 90 days plus 30 days and since Section 5 of the Limitation Act is not applicable, the delay cannot be condoned, the petition is barred by Limitation and is not maintainable. (b to b). It is argued that in no circumstance, the delay can be extended beyond 90 days plus 30 days. Reliance has been placed on Union of India v. Popular Construction Co. (2001) 8 SCC 470 and Consolidated Engineering Enterprises v. Principal Secretary, Irrigation, Full Bench, (2008) 8 SCC 169 (page 23). I have heard the arguments the parties and gone though the case law relied upon.
11. Section 34(3) prescribes the period of limitation for filing objections against the Award under Section 34 of the Act. The Supreme Court in Union of India v. Popular Construction (2001) 8 SCC 470, while interpreting the provisions of Section 34(3) of the Act, observed as under-:- Para 12 A to A
12. The law laid down in the case supra makes it abundantly clear that the period of limitation in filing any petition under Section 34 of the Act cannot be extended beyond ninety plus thirty days.
13. The sole point for consideration before this court, therefore, is, whether the present petition is within the period of limitation prescribed under Section 34 (3) of the Act. The sub Section (3) of Section 34 of the said Act provides that an objection to an award can be filed within 90 days from the date of receipt of the award. For sufficient reasons, showing the inability to file the objections within 90 days, the objections can be filed within further 30 days to 90 days. It is also clear that the filing of the objections in 30 days to 90 days is not automatic. The petitioner is required to seek condonation of delay in filing objections beyond ninety days by showing a reasonable reasons for not being able to file the objections within the prescribed period of limitation of 90 days. In case of UOI v. Popular Construction Company (2001) 8 SCC 470, the Supreme Court has clearly held that the benefit of condonation of delay is not available to the petitioner in filing the objections under Section 34 of the Act if the same has been filed beyond 30 days to 90 days. The court has clearly held “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. In the present case, the award was passed on 24th May, 2010 and the petitioner has stated that he had received the award on 7th June, 2010. In his rejoinder, however, he has contended that he only received the unsigned photocopy of the award on 7th June, 2010 through courier. He approached the Arbitrator vide letter dated 31st August, 2010 and the Arbitrator had authenticated the said photocopy by signing it on 1st 2010 and it is argued that the period of limitation of 90 days in view of Section 31 (5) and Section 34 of the Act starts running from the date he received the signed copy of the arbitration award and thus it had started running from 1st September, 2010.
15. Learned counsel for the respondent has argued that the petitioner has made out this story for the first time. This fact has not been mentioned by him in any of his two applications for the condonation of delay. It is further contended that the falsehood is apparent from the contention of the petitioner itself that he had approached the Arbitrator with a letter dated 31st August, 2010 and received the photocopy duly signed by the arbitrator on 1st September, 2010. It is argued that it is impossible that the arbitrator would have received his letter before 1st 2010 even if the letter dated 31st August, 2010 was posted by the petitioner to the learned arbitrator by courier. It is further argued that it is equally impossible for the arbitrator having received the letter of petitioner on 01.09.2010, signing it and sending it on the same day to petitioner and then, the petitioner also receiving it on the same day.
16. The submission of the learned counsel for the respondent has lot of force in it. It is impossible that a letter dated 31st August, 2010 seeking authentication of the learned Arbitrator on the photocopy of an award, which was earlier received by the petitioner on 7th June, 2010, and having sent by courier, would have been received by Arbitrator before 01.09.2010 and equally impossible is the fact that the petitioner would have received the authentication on the said photocopy of award, under the original signatures of the Arbitrator on 01.09.2010 itself. This story does not inspire any confidence and is improbable and impossible. Even otherwise, the petitioner has himself alleged that he received the award on 7th June, 2010 by courier. His only contention is that it was a photocopy. Till the filing of the rejoinder, this fact had not been contended by the petitioner before any forum. For the first time in his rejoinder, has stated that on 7.06.2010, he had received unsigned photocopy of award. It is strange that for more than three months that is with effect from 7th June, 2010 to 31st August, 2010, the petitioner and his team of advocates took no steps for applying for certified copies of the arbitral award or asking the arbitrator to send a signed copy of the award under Section 31 (5) of the Act. In the light of these facts, the petitioner’s story seems improbable and unbelievable. In any case, the petitioner had challenged the said award vide his petition filed on 7th September, 2010 before the District court, Patiala House and it was returned on 7th February, 2013 with the liberty to raise the objection before the appropriate forum by the learned District Judge for want of pecuniary jurisdiction, since the valuation of the award was more than Rs. 20 lacs. The petitioner has claimed the exclusion of this period from 7th September, 2010 to 7th February, 2013 while calculating the period of limitation under Section 34(3) of the Act. It is apparent that since the copy of the award was received on 7th June, 2010 and the objections were filed before the District court on 7th September, 2010, the same were filed within 90 days and so the period of limitation of 90 days laid down under Section 34(3) had been followed. The petitioner has relied upon a case of State of Goa (supra) in support of his contention that provisions of Section 14 of the Limitation Act are applicable to the proceedings under the Arbitration Act.
17. This judgment was relied upon by the Supreme Court in its subsequent judgment of Consolidated Engineering Enterprises v. Principal Secretary, Irrigation Department and others with Hatti Gold Mines Company Limited v. Vinay Equipments (2008) 7 SCC 169, wherein, it has held as under:- Para 22, 23
22. The policy of the Section is to afford protection to a litigant against the bar of limitation when he institutes a proceeding which by reason of some technical defect cannot be decided on merits and is dismissed. While considering the provisions of Section 14 of the Limitation Act, proper approach will have to be adopted and the provisions will have to be interpreted so as to advance the cause of justice rather than abort the proceedings. It will be well to bear in mind that an element of mistake is inherent in the invocation of Section 14. In fact, the section is intended to provide relief against the bar of limitation in cases of mistaken remedy or selection of a wrong forum. On reading Section 14 of the Act it becomes clear that the legislature has enacted the said section to exempt a certain period covered by a bona fide litigious activity. Upon the words used in the section, it is not possible to sustain the interpretation that the principle underlying the said section, namely, that the bar of limitation should not affect a person honestly doing his best to get his case tried on merits but failing because the court is unable to give him such a trial, would not be applicable to an application filed under Section 34 of the Act of 1996. The principle is clearly applicable not only to a case in which a litigant brings his application in the court, that is, a court having no jurisdiction to entertain it but also where he brings the suit or the application in the wrong court in consequence of bona fide mistake or law or defect of procedure. Having regard to the intention of the legislature this Court is of the firm opinion that the equity underlying Section 14 should be applied to its fullest extent and time taken diligently pursuing a remedy, in a wrong court, should be excluded.
23. At this stage it would be relevant to ascertain whether there is any express provision in the Act of 1996, which excludes the applicability of Section 14 of the Limitation Act. On review of the provisions of the Act of 1996 this Court finds that there is no provision in the said Act which excludes the applicability of the provisions of Section 14 of the Limitation Act to an application submitted under Section 34 of the said Act. On the contrary, this Court finds that Section 43 makes the provisions of the Limitation Act, 1963 applicable to arbitration proceedings. The proceedings under Section 34 are for the purpose of challenging the award whereas the proceeding referred to under Section 43 are the original proceedings which can be equated with a suit in a court. Hence, Section 43 incorporating the Limitation Act will apply to the proceedings in the arbitration as it applies to the proceedings of a suit in the court. Subsection (4) of Section 43, inter alia, provides that where the court orders that an arbitral award be set aside, the period between the commencement of the arbitration and the date of the order of the court shall be excluded in computing the time prescribed by the Limitation Act, 1963, for the commencement of the proceedings with respect to the dispute so submitted. If the period between the commencement of the arbitration proceedings till the award is set aside by the court, has to be excluded in computing the period of limitation provided for any proceedings with respect to the dispute, there is no good reason as to why it should not be held that the provisions of Section 14 of the Limitation Act would be applicable to an application submitted under Section 34 of the Act of 1996 more particularly where no provision is to be found in the Act of 1996, which excludes the applicability of Section 14 of the Limitation Act, to an application made under Section 34 of the Act. It is to be noticed that the powers under Section 34 of the Act can be exercised by the court only if the aggrieved party makes an application. The jurisdiction under Section 34 of the Act, cannot be exercised, suo motu. The total period of four months within which an application, for setting aside an arbitral award, has to be made is not unusually long. Section 34 of the Act of 1996 would be unduly oppressive, if it is held that the provisions of Section 14 of the Limitation Act are not applicable to it, because cases are no doubt conceivable where an aggrieved party, despite exercise of due diligence and good faith, is unable to make an application within a period of 4 months. From the scheme and language of Section 34 of the Act of 1996, the intention of the Legislature to exclude, the applicability of Section 14 of the Limitation Act, is not manifest. It is well to remember that Section 14 of the Limitation Act does not provide for a fresh period of limitation but only provides for the exclusion of a certain period. Having regard to the legislative intent, it will have to be held that the provisions of Section 14 of the Limitation Act, 1963 would be applicable to an application submitted under Section 34 of the Act of 1996 for setting aside an arbitral award”.
18. Thus, the benefit of Section 14 of Limitation Act is open to the petitioner and he is entitled for exclusion of the period from 7th September, 2010 to 7th February, 2013 while computing the period of limitation under Section 34 (3) of the Act. As discussed above, period of 90 days for filing of the objections under Section 34 of the Act had already expired on 7th September, 2010 when the petitioner had filed its objections before the court of defective jurisdiction. The petition was returned by the District Court on 07.02.2013 for filing the same before Court of Competent Jurisdiction. The petitioner filed the objections in the High court on 15th February, 2013. The Registry raised the following objection on 16th February, 2013:- “1. The plaint be filed in accordance with the new format”
19. After the plaint was returned to the petitioner, he was directed to re-file it within a week but the re-filing was done after a delay of more than three weeks on 12th March, 2013. The Registry again raised the following objections:- (12 objections from Part- II B of the file)
25. The above reproductions of the proceedings before the Registry clearly shows that on 15th February, 2013 the petitioner did not even bother to file the plaint in accordance with the new format. It would be absurd to think that the legal minds, engaged by the petitioner for pursuing their case were not aware of the new format. It only shows the casual approach of the petitioner. Moreover, it is also apparent that when the petition was filed it was filed with a deficient court fee and it was only after a considerable lapse of time, that the deficient court fee was made good. This objection could be removed only on 17th / 18th May
2013. Documents show the Petitioner purchased court fee only on 11th February, 2013 and 5th April, 2013.
26. The petition was returned as not being filed as per the format and the petitioner did not re-file it within a week but filed it only on 12th March, 2013 that too with deficient court fee and the registry also find several defects in filing as (enumerated about above). The date of filing of the objections that the petition can only be taken as 12th March, 2013 and not as 16th February, 2013 as on that date, there was no plaint before registry (Plaint being not filed in new format as per High Court rules and regulations). Even after filing the petition on 12th March, 2013, the petitioner took more than 60 days in removing the objections. It was refilled on 18th May, 2013. The period, of filing, thus has travelled beyond 90 days plus 30 days as prescribed under Section 34(3) of the Act.
27. The next question that arises is whether this delay in refiling beyond the extended period of 30 days prescribed in proviso to Section 34(3) of the Act can be condoned or not. This issue was discussed by the Division Bench of this court in Executive Engineer v. Sri Ram Construction Company 2010 (120) DRJ 615 (DB) in para Nos. 29 and 41 and has observed as follows:- Page 3 (c to c) Para 29, 41