TaxTMI 
TaxTMI 
TaxTMI 
2023 (4) TMI 477
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....8.2016. As per Section 34(3) of the Arbitration Act, 90 days are prescribed for preferring an application under Section 34 of the Arbitration Act against the arbitral award. However, the said period was extendable by a further period of 30 days in terms of the proviso to Section 34(3) of the Act, 2016. In the present case, the period of 90 days prescribed under Section 34(3) of the Arbitration Act expired on 24.11.2016. The appellant was entitled to a further extended period of 30 days from 23.11.2016 onwards in terms of the proviso to Section 34(3) which was upto 24.12.2016. 2.2 The trial Courts were closed on account of winter / Christmas vacations from 19.12.2016 to 01.01.2017. However, it so happened that extendable / condonable period of 30 days as contemplated in the proviso to Section 34(3) expired on 24.12.2016 on which day the trial Court was closed on account of winter / Christmas vacation. The appellant herein filed the application under Section 34 of the Arbitration Act, challenging the award passed by the Arbitral Tribunal. The appellant also filed IA No.1 for condonation of delay. Both, Section 34 application as well as the application for condonation of delay were f....
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....ion 34 is three months from the date on which the party making application has received the award. However, if the Court is satisfied that the applicant was prevented by sufficient cause from making the application within the said period of three months, the proviso to the Section specifies a further period of 30 days within which the application under Section 34 may be filed/entertained. 4.1 It is submitted that the central question in the present petition is whether when the last day of condonable period of 30 days falls on a holiday or during a court vacation, would the benefit of Section 10 of the General Clauses Act, 1897 would be available to the appellant? 4.2 It is submitted that in other words, can the petitioner - appellant file the application on the next date when the Court reopens, in line with the settled principle that the law does not compel a person to do an impossible act. It is submitted that in the present case the petitioner - appellant had filed the application under Section 34 on the very day when the Court reopened. 4.3 It is submitted by Shri Shyam Diwan, learned Senior Counsel that not extending the benefit of Section 10 of the General Clauses Act to th....
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.... in to fill the vacuum left by Section 4 of the Limitation Act. 4.7 It is further submitted by Shri Diwan, learned Senior Counsel appearing for the appellant that although the same general principle of "elementary justice" is embodied in both Sections of the two Acts, there is a crucial distinction between the Limitation Act, 1963 and the General Clauses Act, 1897. 4.8 It is submitted that Section 2(j) of the Limitation Act defines "period of limitation". It is submitted that thus, while the term "prescribed period" has a narrower meaning in the context of Limitation Act, there is no such restrictive definition clause in the General Clauses Act. It is submitted that in fact, the scheme of Section 10 of the General Clauses Act is clear from a bare perusal of the provision and indicates that there are two prescribed periods in this Section viz. (1) the prescribed period within which something is directed to be done, or (2) the prescribed period within which something is allowed to be done. 4.9 It is submitted that therefore, reading of Section 10 of the General Clauses Act, 1897 makes it clear that the period in which something is allowed to be done, such as 30 days condonable per....
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....roceedings, it is submitted that Section 43(1) of the Arbitration Act merely states that "the Limitation Act, 1963 shall apply to arbitrations as it applies to proceedings in Court". It is submitted that this cannot be interpreted to mean that the Limitation Act, in its entirety applies to proceeding under Section 34 of the Arbitration Act and that the present proceedings are an act or proceeding to which the Limitation Act applies. It is submitted that in fact, in matters of limitation, Section 34 of the Arbitration Act is a complete code. It is submitted that the respondent's entire case, on one hand, is that the benefit of Limitation Act, particularly Section 4 of the Limitation Act, cannot be given to the condonable period in the instant case. It is submitted that therefore on one hand, the respondent is arguing that the benefit of Section 4 of the Limitation Act, as well as Section 5 of the Limitation Act has no application to the condonable period under Section 34 of the Arbitration Act, i.e. the Limitation Act has no application in the present proceedings, at the same time, the respondent is contending that the benefit of Section 10 of the General Clauses Act, 1897 cannot be....
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....e present instance and denying the benefit of Section 10 of the General Clauses Act, 1897 (with the elementary rule of justice captured in it) will cause a grave miscarriage of justice. Making above submissions, it is prayed to set aside the order passed by the learned trial Court as well as the High Court and to condone the delay caused in preferring application under Section 34 of the Arbitration Act and to direct the learned trial Court to hear the application under Section 34 of the Arbitration Act on merits by giving the appellant an opportunity to put forth its case on merits. 5. Present appeal is vehemently opposed by Shri Dhruv Mehta, learned Senior Counsel appearing on behalf of the respondent. 5.1 It is submitted that in the present case the appellant admittedly received the award on 24.08.2016. As per Section 34 of the Arbitration Act, "the prescribed period" of 3 months to challenge the award expired on 24.11.2016 and further period of 30 days under the proviso to Section 34(3) of the Arbitration Act expired on 24.12.2016. That, the learned trial Court was on winter vacation between 19.12.2016 to 01.01.2017. The appellant preferred its Section 34 of the Arbitration A....
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....ould have no discretion to condone the delay in excess of 30 days. Section 5 of the Limitation Act was, therefore, held to be inapplicable to Section 34(1) of the Arbitration Act. 5.3 It is submitted that Section 4 of the Limitation Act is only applicable when the last date of the "prescribed period" falls on a day on which the Court is closed. It is submitted that the term, "prescribed period" is defined in Section 2(j) of the Limitation Act as being the period of limitation computed in accordance with the provisions of the Limitation Act. 5.4 It is submitted that this Court in the case of Assam Urban (Supra) (Paras 10 to 14) has held that "prescribed period" under Section 34(3) of the Arbitration Act is three months. It is submitted that "further period" of 30 days mentioned in the proviso to Section 34(3) of the Arbitration Act cannot be said to be the "period of limitation" and therefore, would not be the "prescribed period" for the purposes of making an application for setting aside the arbitral award. It is submitted that thus, in the said decision, this Court has categorically held that Section 4 of the Limitation Act which applies only to "prescribed period" is not attrac....
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....of the Limitation Act cannot be construed to mean anything other than the period of limitation. Any period beyond the "prescribed period" during which the Court or Tribunal has the discretion to allow a person to institute the proceedings cannot be taken to be "prescribed period". 5.9 Now, so far as the submission on behalf of the appellant that the judgment in the case of Assam Urban (Supra) has the effect of denying the parties to right to file their application for condonation in situation where the discretionary period expires during vacation and that such interpretation was incorrect inasmuch as it leaves parties at the mercy of "fortuitous circumstance", it is submitted that such a submission is not tenable. It is submitted that the Court vacations are notified well in advance and would not account to a fortuitous circumstance as alleged. It is submitted that on the date of receipt of award, the party would be well aware of the limitation period under Section 34(3) of the Arbitration Act and ought to diligently secure its right. It is submitted that in the present case, having received the award on 24.08.2016, the appellant had a further period of 25 days after expiry of "pr....
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....f Section 10(1) of the General Clauses Act, 1897 also finds a place in Section 4 of the Limitation Act. Therefore, when the benefit of Section 4 of the Arbitration Act is not available, the appellant cannot seek to take recourse to Section 10 of the General Clauses Act, 1897 which embodies the same principle. 5.13 It is further submitted that just like Section 4 of the Limitation Act, Section 10 of the General Clauses Act, 1897 also uses the term "prescribed period". Section 10 of the General Clauses Act, 1897 provides that where any act is directed to be done on a certain day, or any proceeding is allowed to be done in any Court or office within prescribed period, if the Court or office is closed on that certain day, or the last day of the prescribed period, it may be done or taken on the next working day. Accordingly, if Section 10 of the General Clauses Act, 1897 was to be applicable, the term "prescribed period" must be given the same meaning as that in the Limitation Act. Thus, Section 10 of the General Clauses Act, 1897 will also only then apply for the prescribed period of three months under Section 34(3) of the Arbitration Act and not to the discretionary period of 30 days....
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....rdance with the provisions of this Act;" "4. Expiry of prescribed period when court is closed. Where the prescribed period for any suit, appeal or application expires on a day when the court is closed, the suit, appeal or application may be instituted, preferred or made on the day when the court reopens. Explanation. A court shall be deemed to be closed on any day within the meaning of this section if during any part of its normal working hours it remains closed on that day." "Section 10 of the General Clauses Act, 1897 10. Computation of time. ( 1) Where, by any 47 (Central Act) or Regulation made after the commencement of this Act, any act or proceeding is directed or allowed to be done or taken in any Court or office on a certain day or within a prescribed period, then, if the Court or office is closed on that day or the last day of the prescribed period, the act or proceeding shall be considered as done or taken in due time if it is done or taken on the next day afterwards on which the Court or office is open: Provided that nothing in this section shall apply to any act or proceeding to which the Indian Limitation Act, 1877, 48 applies. (2) This section applie....
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....nded period under the proviso, would render the phrase "but not thereafter" wholly otiose. No principle of interpretation would justify such a result". 8. Recently, in State of Maharashtra v. Hindustan Construction Company Limited2, a twoJudge Bench of this Court speaking through one of us (R.M. Lodha, J.) emphasised the mandatory nature of the limit to the extension of the period provided in proviso to Section 34(3) and held that an application for setting aside arbitral award under Section 34 of the 1996 Act has to be made within the time prescribed under subsection (3) of Section 34 i.e., within three months and a further period of 30 days on sufficient cause being shown and not thereafter. 9. Section 43(1) of the 1996 Act provides that the 1963 Act shall apply to arbitrations as it applies to proceedings in court. The 1963 Act is thus applicable to the matters of arbitration covered by the 1996 Act save and except to the extent its applicability has been excluded by virtue of the express provision contained in Section 34(3) of the 1996 Act." Before this Court there existed, similar facts like in the present case. In the case before this Court, the arbitral awards were r....
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....making the application for setting aside the arbitral award. The period of 30 days beyond three months which the court may extend on sufficient cause being shown under the proviso appended to subsection (3) of Section 34 of the 1996 Act being not the "period of limitation" or, in other words, the "prescribed period", in our opinion, Section 4 of the 1963 Act is not, at all, attracted to the facts of the present case. 15. Seen thus, the applications made by the appellants on 2-1-2004 for setting aside the arbitral award dated 26-8-2003 were liable to be dismissed and have rightly been dismissed by the District Judge, Kamrup, Guwahati, as timebarred." Therefore, as such the question involved in the present appeal is squarely answered against the appellant and the said issue is as such not res integra. 8. Now, so far as the submission on behalf of the appellant that the Limitation Act shall not be applicable to the proceedings under the Arbitration Act is concerned, the aforesaid has no substance. Section 43(1) of the Arbitration Act specifically provides that Limitation Act, 1963 shall apply to arbitrations as it applies to proceeding in Court. However, as observed and held by ....