DELHI STATE INDUSTRIAL & INFRASTRUCTURE DEVELOPMENT CORPORATION LTD v. M/S MAPSA TAPES PVT LTD

1. This is an application seeking condonation of delay of 129 days in filing the present petition under Section 34 of the Arbitration and Conciliation Act, 1996 (Act).

2. The petition assails an award passed by the Arbitral Tribunal on 24th December, 2018. 2019:DHC:6372

3. The ground stated in the application to show ‘sufficient cause’ for condonation of delay in the application is that the petitioner herein is a State and it is common knowledge that the departmental procedures involved in the State machinery make it difficult to prepare a petition within the stipulated period of limitation. There are different departments involving senior officers and the decision making consumes a lot of time, besides the work pressure which already exists in the department.

4. Reliance in the application is placed on the judgment of the Supreme Court in Special Tehsildar, Land Acquisition, Kerala v. K. V. Ayisumma (1996) 10 SCC 634 wherein it was held that the State machinery involves different stages at which decisions are taken and hence complete explanation of delay is very difficult. Reliance is also placed on the judgment in the case of State of Nagaland v. Lipok AO and Ors AIR 2005 SC 2191 for the same proposition.

5. Learned counsel for the petitioner submits that though the Award was received by the petitioner on 24th December, 2018 but because of administrative procedures involved in the decisionmaking process, the petition could not be filed within the limitation period. Learned counsel argued that the Impugned Award is totally inconsistent with the law laid down in State of Rajasthan v. Nav Bharat Construction Co. (2006) 1 SCC 86 that the Arbitrator cannot go beyond the terms of the contract between the parties. It was argued that several grounds have been taken in the petition which would demonstrate that the award is perverse and deserves to be set aside.

6. I have heard the learned counsel for the petitioner and perused the application seeking condonation of delay.

7. Para 3 4 5 and 6 are extracted hereunder for ready reference:- “3. That there is delay in filing the Petition. The reasons for delay are explained as under:-

4. It is respectfully submitted that the Petitioner herein is the State and it is in the common knowledge that the departmental procedures involved in the State Machinery makes it difficult to prepare a petition within the stipulated period as sanctioned by limitation. That there are different branches of State offices involving senior officers and hence decision making consumes a lot of time besides the work pressure, which already exists in the State Departments.

5. That Hon'ble Supreme Court in Special Tehsildar, Land Acquisition, Kerala v. K. V. Ayisumma (1996) 10 SCC 634 held that State machinery involves different stages of authorities when it comes to taking decisions and hence, complete explanation of delay is very difficult.

6. That the Hon'ble Supreme Court of India in the case of State of Nagaland Vs. Lipok AO and Ors; AIR 2005 SC 2191 wherein in para 14 it was observed that in State machineries decisions taken by the officers/agencies are proverbially at a slow pace and encumbered process of pushing the files from table to table and keeping it on table for considerable time causing time delay-intentionally or otherwise is a routine. That considerable delay of procedural redtape in the process of their making decisions is a common feature and therefore certain amount of latitude is not impermissible.”

8. Section 34(3) of the Act provides limitation period of three months for filing the objection against the award after a signed copy of the Award is received by a party. Proviso to Section 34 (3) of the Act provides an extended period of 30 days within which the objections can be filed. This is, however, with a rider that the objector would have to show a ‘sufficient cause’ which prevented the objector from filing the petition within 3 months period as envisaged in Section 34(3) of the Act. A combined reading of the substantive section and the proviso thereto leaves no manner of doubt that the total period available to an objector is 120 days and beyond the outer limit of 120 days, Court has no power to condone delay of even one day.

9. The Supreme Court in the case of M/s Simplex Infrastructure Ltd. v Union of India (2019) 2 SCC 455 has clearly held that beyond the outer limit of 120 days the Court has no power or discretion to condone the delay. Relevant portion of the judgment reads as under:- “18. A plain reading of sub-section (3) along with the proviso to Section 34 of the 1996 Act, shows that the application for setting aside the award on the grounds mentioned in sub-section (2) of Section 34 could be made within three months and the period can only be extended for a further period of thirty days on showing sufficient cause and not thereafter. The use of the words “but not thereafter” in the proviso makes it clear that the extension cannot be beyond thirty days. Even if the benefit of Section 14 of the Limitation Act is given to the respondent, there will still be a delay of 131 days in filing the application. That is beyond the strict timelines prescribed in subsection (3) read along with the proviso to Section 34 of the 1996 Act. The delay of 131 days cannot be condoned. To do so, as the High Court did, is to breach a clear statutory mandate.”

10. Counsel for the petitioner does not dispute the fact that the present petition has been filed after the outer limit of 120 days as the application itself seeks condonation of delay of 129 days. The application does not even mention any cause for condonation of delay, leave alone ‘sufficient cause’ except for stating that the State machinery is burdened with work and several departments are involved in taking decisions. Even this aspect has been considered by the Apex Court in the case of Simplex (supra) and this contention has been negated. The Supreme Court has clearly held that administrative delays and hierarchy and cannot be termed as ‘sufficient cause’ for condonation of delay in a petition under Section 34 of the Act. Relevant para reads as under:- “20… It is an admitted position that on 27 October 2014, the arbitrator made an award in favour of the Appellant and on 31 October 2014, the Union of India received a copy of the award. One of the reasons stated by the Respondent for delay in filing an application Under Section 34 of the 1996 Act was that the departmental office was located at Port Blair, Andaman and it was a time-consuming process for obtaining permission from the circle office at Chennai. Administrative difficulties would not be a valid reason to condone a delay above and beyond the statutory prescribed period Under Section 34 of the 1996 Act.”

11. Be that as it may, this issue is otherwise of no relevance in the present case as even assuming that a ‘sufficient cause’ had been shown by the petitioner, this Court has no discretion to condone the delay, as it is beyond the outer limit of 120 days.

12. For the aforesaid reasons, the application is dismissed. O.M.P. (COMM) 489/2019 & I.A.16414/2019 (delay 76 days in re-filing) In view of the dismissal of the application seeking condonation of delay in filing the petition, the present petition along with pending applications, is hereby dismissed.