Kal Airways Private Limited v. Spicejet Limited

14. Also, the Division Bench, which was hearing the respondents’ FAOs, was never apprised by the appellants of the filing of the present appeals, or that they were pending with the Registry for removal of defects, despite the appellants having continuously participated in the hearing of the FAOs.

15. The defects noted by the Registry in the present FAOs filed by the appellants were allowed to remain uncured, till 30 July 2024, when they were removed and the FAOs refiled after 226 days delay.

16. After the filing of the present FAOs by the appellants under defects on 23 and 24 November 2023, the FAOs filed by the respondents had been heard on seven more occasions, i.e., 30 November 2023, 8 December 2023, 14 December 2023, 8 January 2024, 15 January 2024, 29 January 2024 and 7 February 2024, and had finally been disposed of on 17 May 2024. As already noted earlier, the Division Bench allowed the FAOs of the respondents and restored their OMPs to the file of the learned Single Judge for decision afresh.

17. Even at this stage, the appellants did not cure the defects in the present FAOs and refile them. Instead, they chose to challenge the judgment dated 17 May 2024 of the Division Bench in the respondents’ FAOs before the Supreme Court, by way of SLP (C) 14936/2024 and SLP (C) 14741/2024.

18. The Supreme Court dismissed the SLPs of the appellants, by the following order dated 26 July 2024:

7. The Special Leave Petitions are accordingly disposed of.

8. Pending applications, if any, stand disposed of.

19. This constitutes the factual and litigative background, in which we have to consider the appellants’ prayer for condonation of delay of 55 days in filing, and 226 days in refiling, the present appeals. Rival Contentions Submissions of Mr. Gaurav Pachnanda

20. Mr. Pachnanda submits that the Court has classically to adopt an expansive approach while dealing with prayers for condonation of delay in refiling proceedings. He has also candidly drawn our attention to Rule 5 of Part A of Chapter 1 Volume V of the Delhi High Court Rules and Orders13, which reads: “5(1) The Deputy Registrar/Assistant Registrar, In-charge of the Filing Counter, may specify the objections (a copy of which will be kept for the Court Record) and return for amendment and refiling within a time not exceeding 7 days at a time and 30 days in the aggregate to be fixed by him, any memorandum of appeal, for the reason specified in Order XLI, Rule 3, Civil Procedure Code. (2) If the memorandum of appeal is not taken back, for amendment within the time allowed by the Deputy sub-rule (1), it shall be registered and listed before the Court for its dismissal for non-prosecution. (3) If the memorandum of appeal is filed beyond the time allowed by the Deputy Registrar/Assistant Registrar, in charge of the Filing Counter, under sub-rule (1) it shall be considered as fresh institution. “the DHC Rules” hereinafter Explanation: The period of seven days or thirty days mentioned above shall commence from the date, the objections are put on the notice board. Note: The provisions contained in Rule 5(1), 5(2) and 5(3) shall mutatis mutandis apply to all matters, whether Civil or Criminal.” Mr. Pachnanda submits that the respondents’ contention is that, under Rule 5(3) in Part A of Chapter 1 Volume V of the DHC Rules supra, the re-filing of the present appeals by the appellants on 30 July 2024 had to be treated as a fresh filing, by which reckoning the delay in filing the appeal would be of 281 days. The rigour of Rule 5(3), submits Mr. Pachnanda, has been practically effaced by the following paragraphs from the judgment of the Supreme Court in Northern Railway v Pioneer Publicity Corporation Ltd14:

Mr. Pachnanda also relies on the following paragraphs from the judgment of a learned Single Judge of this Court in Dr Narender Kumar Sharma v Maharana Pratap Educational Center15, in which

2018 SCC OnLine Del 13146 reliance had been sought to be placed on the judgment of the Division Bench in Northern Railway v Pioneer Publicity Corporation Pvt Ltd16, which was reversed by the judgment of the Supreme Court in Pioneer Publicity (supra):

appropriate term to be used here, of the counsel on his client, does not deserve to be so rigorous so as to deny condensation of delay in refiling the application. The casual approach of the counsel is evident as no timely efforts were made firstly to find out after filing application on 19th August, 1995 as to whether the Registry had raised any objection or not. Secondly, despite order of the Joint January, 1996, the objection was removed only on 4th March, 1996 i.e. after the date which the Joint Registrar had fixed for the application being posted for hearing before the Court. When the application was refiled on 4th March, 1996, one would expect the person filing to be more careful thereby not giving an opportunity to the Registry to raise any other objection. But that was no so. The result was that the second objection was raised which, as noticed above, was removed on 21st March, 1996 but application was refiled only on 27th March, 1996. Apart from this casual approach, we do not find any mala fide intention on the part of the appellant to delay the proceedings. When there is negligence or causal approach in a matter like this in refiling of an application, though the court may not be powerless to reject an application seeking condensation and may decline to condone the delay but at the same time, passing of any other appropriate order including imposition of cost can be considered by the court to compensate the other party from delay which may occur on account of refiling of the application.”

9. Similarly, the Supreme Court in Indian Statistical Institute v Associate Builders held as follows:-

Limitation Act. The application filed before the High Court for condonation of the delay in preferring the objections and the order of the court declining to condone the delay are all due to misunderstanding of the provisions of the Civil Procedure Code. As we have already pointed out in the return the Registrar did not even specify the time within which the petition will have to be re-presented.”

10. I may now note that the judgment of the Division Bench of this court, relied by the learned counsel for the appellant in Northern Railway v Pioneer Publicity Corporation Pvt. Ltd. (supra) was set aside by the Supreme Court in Northern Railway v Pioneer Publicity Corporation Pvt. Ltd., wherein it has held as follows:

”

21. Apropos the delay between the filing of the present FAOs on 23 November 2023 and their refiling on 30 July 2024, Mr. Pachnanda submits that the delay was inadvertent, and that it was only occasioned because the appellants were simultaneously negotiating the FAOs filed by the respondents.

22. Responding to Mr. Pachnanda, Mr. Sibal emphasizes the egregiousness of the attitude of the appellants, and submits that the delay between the filing of the present FAOs and their refiling cannot be said to be attributable either to inadvertence or even negligence. He submits that the appellants are fence sitters, who were taking a chance, complacent in the belief that, as interim relief had initially been delayed to the respondents in their FAOs, the appeals themselves would ultimately fail. When the appeals succeeded, and the SLPs preferred thereagainst by the appellants were dismissed, they decided to revitalize the present FAOs. No courtesy of any condonation of delay can, in such circumstances, be extended to the appellants.

23. Not only were the appellants fence sitters, points out Mr Sibal, they had also studiedly concealed, both from the Division Bench as well as from the respondents, the fact of filing of the present FAOs, throughout the entire period when they continued to appear in, and contest, the FAOs filed by the respondents. They even concealed the fact of the filing of the present FAOs, and their languishing under objections, from the Supreme Court. They cannot, therefore, be entitled to any leniency in the matter of condonation of delay. This, therefore, is, he submits, an exceptional case in which the present FAOs have to be dismissed on the ground of delay both in filing and in re-filing. Analysis

24. From the judgments noted hereinabove, it is clear that, while the Court has ordinarily to be expansive in its approach while dealing with applications for condonation of delay in refiling, the principle is not inelastic. The prevailing philosophy behind the theory that delay in refiling is to be treated with a lighter hand than delay in filing is essentially premised on the presumption that, if a party has approached the Court in time or without any unreasonable delay, the delay in removing objections is essentially attributable to the counsel or, even if the litigant has filed the proceedings in person, the delay is removing objections is essentially a ministerial act. The delay in refiling, therefore, does not represent delay in approaching the Court for seeking legal redress. If a party has approached the Court within a reasonable period of time, the delay in curing objections and refiling the proceedings is, therefore, treated as more liberally condonable than delay in filing.

25. One of the primary reasons for incorporating a provision of limitation is to avoid divesting of rights which may have crystallized in favour of the opposite party in the interregnum. Where a successful party in a litigation is not placed on notice regarding any challenge, to the order or judgement in his favour, by the opposite party, within the period of limitation prescribed therefor, he is entitled to believe that the rights, that enure to his benefit as the successful litigant, stand crystallized. Belated divesting of this right is, therefore, permissible only where the party who challenges the decision beyond the prescribed limitation period is able to demonstrate sufficient cause for doing so.

26. Where, however, the successful litigant is placed on notice regarding the challenge to the decision in his favour by the opposite party, there is a radical change in the equity balance. If the opposite party has raised the challenge within time, or with delay, if at all, which is reasonable and condonable, the successful litigant is shaken out of his complacency and placed on notice regarding the challenge. Delay in removal of objections, thereafter, cannot retore the equity balance, unless it is gross and inordinate. It is for this reason that delay in removing objections, i.e., delay in refiling, is not accorded as strict a treatment as delay in filing.

27. Where, however, the delay in refiling is completely lacking in bona fides, and represents a gamble by the unsuccessful litigant keeping all, including the successful litigant before the Court below, in the dark, the entire paradigm changes. Limitation is a statute of equity and repose, and if the delay, whether in filing or refiling, is found to be lacking in bona fides, it has to be sternly dealt with.

28. We may profitably refer, in this context, to the following passages from the recent decision of the Supreme Court in Thirunagalingam v Lingeswaran19:

2025 SCC OnLine SC 1093 The most crucial element in assessing whether the delay in moving the Court is, or is not, explained by sufficient cause is, therefore, the bona fides of the party concerned. Where there are no bona fides, no cause is sufficient. This may be regarded in a sense as axiomatic, but the words of the Supreme Court, nonetheless, enlighten.

29. Apropos condonation of delay in commercial disputes, the Supreme Court has held thus, in Borse Brothers, incidentally in the context of an appeal under Section 37 of the 1996 Act:

cover an ulterior purpose. (See Manindra Land & Building Corpn. v Bhutnath Banerjee21, Mata Din v A. Narayanan22, Parimal v Veena23 and Maniben Devraj Shah v Municipal Corpn. of Brihan Mumbai24.) *****

11. The expression “sufficient cause” should be given a liberal interpretation to ensure that substantial justice is done, but only so long as negligence, inaction or lack of bona fides cannot be imputed to the party concerned, whether or not sufficient cause has been furnished, can be decided on the facts of a particular case and no straitjacket formula is possible. (Vide Madanlal v Shyamlal25 and Ram Nath Sao v Gobardhan Sao26.) *****

15. The law on the issue can be summarised to the effect that where a case has been presented in the court beyond limitation, the applicant has to explain the court as to what was the “sufficient cause” which means an adequate and enough reason which prevented him to approach the court within limitation. In case a party is found to be negligent, or for want of bona fide on his part in the facts and circumstances of the case, or found to have not acted diligently or remained inactive, there cannot be a justified ground to condone the delay. No court could be justified in condoning such an inordinate delay by imposing any condition whatsoever. The application is to be decided only within the parameters laid down by this Court in regard to the condonation of delay. In case there was no sufficient cause to prevent a litigant to approach the court on time condoning the delay without any justification, putting any condition whatsoever, amounts to passing an order in violation of the statutory provisions and it tantamounts to showing utter disregard to the legislature.” (emphasis supplied) ***** AIR 1964 SC 1336

63. Given the aforesaid and the object of speedy disposal sought to be achieved both under the Arbitration Act and the Commercial Courts Act, for appeals filed under Section 37 of the Arbitration Act that are governed by Articles 116 and 117 of the Limitation Act or Section 13(1-A) of the Commercial Courts Act, a delay beyond 90 days, 30 days or 60 days, respectively, is to be condoned by way of exception and not by way of rule. In a fit case in which a party has otherwise acted bona fide and not in a negligent manner, a short delay beyond such period can, in the discretion of the court, be condoned, always bearing in mind that the other side of the picture is that the opposite party may have acquired both in equity and justice, what may now be lost by the first party's inaction, negligence or laches.” (Italics in original; underscoring supplied)

30. Albeit in the context of an application under Section 11 of the 1996 Act for appointment of an arbitrator, the Supreme Court has thus distilled the prevailing philosophy of Section 5 of the Limitation Act, in HPCL Bio-Fuels Ltd v Shahaji Bhanudas Bhad27:

31. Adverting to the facts of the present case, the undisputed position is that the appellants filed the present appeals, challenging the order dated 31 July 2023, after 55 days’ delay on 23 November 2023 and 24 November 2023, by which time the FAOs filed by the respondents, within time, had already been heard by the Division Bench on five occasions. It was between the fifth and sixth dates of hearing in the FAOs of the respondents, that the appellants filed the present FAOs in defects, without serving any copy thereof on the respondents. The appellants never informed the Division Bench, which was hearing the FAOs filed by the respondents, of the fact that they had also filed FAOs challenging the order passed by the learned Single Judge on 31 July 2023 in their OMPs, though all arose out of a common arbitral award. Neither did the appellants choose to remove the objections in the present FAOs filed by them, so that they could be taken up and heard along with the FAOs of the respondents. Instead, they allowed the present FAOs to remain under objections for 226 days till 30 July 2024. In the interregnum, the FAOs of the respondents were allowed by way of remand, to the learned Single Judge, by judgment dated 17 May 2024 passed by the Division Bench, and the SLPs preferred by the appellants thereagainst were also dismissed by the Supreme Court on 26 July 2024. The appellants, all along, kept the Division Bench of this Court, and even the Supreme Court, in the dark regarding the fact that they had filed the present FAOs, which were languishing without removal of objections. It was only after the Supreme Court also dismissed the SLPs filed by the appellants on 26 July 2024, that the appellants, within 4 days of the dismissal, served the copies of the present FAOs to the respondents, removed the objections in the present FAOs and refiled them.

32. It is impossible for the Court to believe, in such circumstances, that the delay in removing objections raised by the Registry and refiling of the present FAOs was bona fide. The case presents a classic example of fence sitting, keeping, in the process, the respondents, the Division Bench of this Court, as well as the Supreme Court, completely in the dark regarding the filing of the present FAOs, and of their languishing under objections. It is impossible to believe the appellants’ plea of “inadvertence”, given the fact that, after waiting for the respondents’ FAOs to be listed on 23 August 2023, 24 August 2023, 31 October 2023, 9 November 2023 and 17 November 2023, the appellants filed the present FAOs on 23 and 24 November 2023 and again proceeded to participate in the remaining hearings in the respondents’ FAOs on 30 November 2023, 8 December 2023, 14 December 2023, 8 January 2024, 15 January 2024, 29 January 2024 and 7 February 2024 as though nothing on earth had happened between 17 and 30 November 2023. The matter in which the appellants acted in the present case is frankly disquieting to the conscience of the court.

33. Perhaps as a Freudian slip, the appellants have acknowledged as much, in para 5(e) of CM Appl 45532/2024 filed by them for condonation of delay in refiling the present appeals, which reads: “e) It is submitted that the Judgment dated 17.05.2024 passed by the Hon’ble Division Bench of this Hon’ble Court, in the understanding and humble submission of the Applicant herein, was not in accordance and in conformity with the principles of law laid down by the Hon’ble Supreme Court in relation to Section 34 and Section 37 of the Act. Aggrieved by the Judgment dated 17.05.2024, the management of the Applicant decided to challenge the said judgment before the Hon’ble Supreme Court as well as refile the captioned Appeal. However, due to the summer vacations, the Special Leave Petition and the refiling of the subject Appeal was further delayed.” (Emphasis supplied) As one may say, Q.E.D.

34. In the above paragraph, the appellants have candidly, albeit perhaps unwittingly, admitted that the delay in refiling the present appeals was not because of oversight or inadvertence, as they so assiduously seek to contend even at the Bar, but because the FAOs filed by the respondents were decided in their favour. The only inaccuracy in this admission is that the appellants did not decide to revitalize the present appeals, by removing the objections therein, even after the judgment dated 17 May 2024 passed by the Division Bench, but only after the SLPs filed by the appellants before the Supreme Court, thereagainst, were also dismissed.

35. The inaction in removing the objections in the present FAOs and have them relisted, therefore, does not admit even of a scintilla of bona fides.

36. The facts of the present case, therefore, do not attract the general principles regarding leniency in the matter of condonation of delay in refiling. This is not a case in which the appellants bona fide filed the present FAOs in time and were merely indolent or even negligent in removing objections in refiling the FAOs. This is a case in which the appellants took a calculated gamble, of which the delay in refiling, and allowing the FAOs to languish in objections, constitutes the fundamental modus operandi.

37. The respondents had already filed their FAOs on 22 August

2023. There was no reason why the appellants did not do so likewise. They waited for five dates of hearing to be over in the FAOs filed by the respondents before filing the present FAOs on 23 November 2023 and 24 November 2023 with 55 days’ delay. Obviously in order to conceal the fact that they had filed the FAOs, no advance copy of the FAOs was served on the respondents. The Registry pointed out objections in the FAOs on 24 November 2023 itself, one of the primary objections being that no advance service had been effected on the respondents. The present appellants did not, however, choose to remove the objections and allowed the FAOs to languish under objections. This position continued throughout the pendency of the FAOs filed by the respondents before the Division Bench and even thereafter till the SLPs against that decision were dismissed by the Supreme Court. At no stage did the appellants ever make the Court wise about the fact that they had filed FAOs on 23 and 24 November 2023 and had chosen not to remove objections or even serve a copy thereof on the respondents. It was only after the Supreme Court dismissed the present appellants’ SLPs against the judgment dated 17 May 2024 of the Division Bench in the FAOs against the respondents that the present appellants chose to serve a copy of the present FAOs on the respondents and, thereafter, refile the FAOs on 30 July 2024. The alacrity with which the appellants effected service of the present FAOs on the respondents, removed the objections in the FAOs and refile the FAOs within four days of the Supreme Court order on 26 July 2024, indicates that the entire exercise was carefully orchestrated.

38. This, therefore, we reiterate, is not a simple case of delay in removing objections in refiling the appeals. It is a case of deliberate and wilful concealment of facts both from the Division Bench as well as from the respondents and a calculated gamble taken by the appellants.

39. As we have already noted earlier in this judgment, the appellants have, perhaps unwittingly, acknowledged this fact in para 5(e) of CM Appl 45532/2024, which admits, in so many words, that their decision to refile the present appeals was prompted by their grievance at the judgment dated 17 May 2024 passed by the Division Bench in the FAOs of the respondents. In actual fact, the appellants waited till the SLPs preferred by them against the said judgment dated 17 May 2024 of the Division Bench were also dismissed by the Supreme Court.

40. The Court cannot, in any circumstance, condone the delay which is attributable to such factors. In such circumstance, it hardly matters whether the delay is in filing or in refiling of the appeals.

41. We do not, in the circumstances, deem it necessary to enter into the rival contentions with respect to Rule 5(3) in Part A of Chapter 1 Volume V of the DHC Rules.

42. Accordingly, we decline to condone the delay of 55 days in filing and 226 days in re-filing the present appeals. The applications for condonation of delay in filing and re-filing are, accordingly, dismissed. FAO(OS) (COMM) 173/2024 and FAO(OS) (COMM) 171/2024

43. As the applications for condonation of delay in filing and refiling have been dismissed, the appeals also stand dismissed on the ground of delay without going into merits.

C. HARI SHANKAR, J.