Union Of India vs M/S Onkar Nath Bhalla

Tashi Rabstan, J

The present appeal filed under Section 37 of the Jammu and Kashmir Arbitration and Conciliation Act, 1997 (hereinafter referred to as „the Act') by the appellant-Union of India through Garrison Engineer Jammu (P) seeking setting aside of order dated 16.07.2019 passed by learned Additional District Judge, Jammu whereby application to condone the delay in filing application under Section 34 of the Act against the award dated 29.02.2016 was dismissed.

The brief facts as narrated in the appeal are that:

A contract was executed on 23.08.2010 between Chief Engineer Pathankot Zone and M/s onkar Nth Bhalla and sons for provision of OTM Accn for the information Bn., at Domana for lump sum of Rs.14,09,04,47,892/-. After completion of the work, on account of disputes between the parties, the matter was referred to Arbitration and Brig. Arun Mehta was appointed as a Sole Arbitrator to adjudicate the disputes between the parties. Accordingly, the arbitration proceedings culminated by passing the award dated 29.02.2016, thereafter, in exercise of power under Section 33(3) of the Act the final award was amended by the Sole Arbitrator and it was published on the same date i.e., 29.02.2016. Feeling aggrieved of award 29.02.2016, the Union of India challenged the same however, there was some delay in filing the application under Section 34 of the Act, as such, the application for condoning the delay was also filed. After considering the arguments advanced by learned counsel for the parties and on the basis of pleadings, learned Additional District Judge, Jammu in terms of order dated 16.07.2019 rejected the condonation of delay application on the ground that the application cannot be entertained after expiry of maximum period of four months.

Being aggrieved of order dated 16.07.2019, the Union of India has preferred the present appeal under Section 37 of the Act on various grounds including the one that the Court below has committed an error in rejecting the condonation of delay application and has proceeded to hold that the maximum period of four months to file the petition under Section 34 of the Act expired on 09.07.2016 by presuming that the amended award was received by the appellant on 09.03.2019 which is totally perverse as there is no such evidence on record that the amended award was received by the appellant on 09.03.2016. It is contended in the appeal that the Court below even otherwise failed to appreciate by considering that the amended award has been received by the appellant on 19.03.2016, even that consideration also, the petition under Section 34 of the Act was very much within the maximum period of four months, therefore, the Court below instead of dismissing the application should have condone the delay in filing the petition under Section 34 of the Act. Further contention of the appellant is that the Court below also failed to appreciate the amendment of Section 34 of the Arbitration and Conciliation (Amendment) Act, 2018 whereby Section 34(3) of the Act of 1997 has been amended by substituting for the words "three months" the words "six months" thereby extending the period of limitation to file petition under Section 34 of the Act because the application for condonation of delay in filing the petition under Section 34 of the Act was pending before it for consideration, however the Court below has also failed to appreciate this fact. Thus, the order impugned rejecting the condonation of delay application is required to be set aside.

Heard learned counsel for the parties, considered their submissions and perused the record appended with the appeal.

Highlighting the averments made in the appeal, Mr. Vishal Sharma, learned ASGI has vehemently argued that the learned District Judge, Jammu at the most should have been counted the delay from the date of communication dated 19.03.2016. To buttress his arguments, Mr. Vishal Sharma, learned ASGI has relied upon a decision rendered by the Apex Court in Civil Appeal No.791 of 2021 (Arising out of SLP(C) No.10372 of 2020) title "Dakshin Haryana Bijli Vitran Nigam Ltd. Vs. M/s Navigant Technologies Pvt. Ltd".

Mr. R.K Gupta, learned senior counsel appearing for the respondent while resisting this appeal argued that the Sole Arbitrator has passed both the awards on the same date which is evident from the communication dated 19.03.2016.

Before dealing with the issue further, it would be apt to reproduce Section 34(3) of the Arbitration and Conciliation Act, 1997 hereunder:

"34. Application for setting aside arbitral award.

(1)..............................................................

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(2).............................................................

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(3) An application for setting aside may not be made after three months have elapsed from the date on which the party making that application had received the arbitral award or, if a request had been made under section 33, from the date on which that request had been disposed of by the arbitral tribunal :

Provided that if the Court is satisfied that the applicant was prevented by sufficient cause from making the application within the said period of three months it may entertain the application within a further period of thirty days, but not thereafter."

It is crystal clear from mandate of above Section that the petition under Section 34 of the Act can be filed within a period of three months at the first instance and one more month thereafter but no petition under Section 34 of the Act beyond the period mentioned above thereafter is maintainable.

Law is well settled on this issue in various pronouncements rendered by Hon‟ble the Supreme Court. In Union of India v. Popular Construction, (2001) 8 SCC 470, the Apex Court held that section 5 of the Limitation Act, 1963 would not apply to applications filed under section 34 of the Arbitration Act. It was held that:

"12. As far as the language of Section 34 of the 1996 Act is concerned, the crucial words are "but not thereafter" used in the proviso to sub-section (3). In our opinion, this phrase would amount to an express exclusion within the meaning of Section 29(2) of the Limitation Act, and would therefore bar the application of Section 5 of that Act. Parliament did not need to go further. 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."

In case "State of Himachal Pardesh and Another Vs. Himachal Techno Engineers and Another" reported in (2010) 12 Supreme Court Cases 210, Hon‟ble the Supreme Court has observed that:-

"5. Having regard to the proviso to section 34(3) of the Act, the provisions of section 5 of the Limitation Act, 1963 will not apply in regard to petitions under section 34 of the Act. While section 5 of the Limitation Act does not place any outer limit in regard to the period of delay that could be condoned, the proviso to sub-section (3) of section 34 of the Act places a limit on the period of condonable delay by using the words "may entertain the application within a further period of thirty days but not thereafter." Therefore, if a petition is filed beyond the prescribed period of three months, the court has the discretion to condone the delay only to an extent of thirty days, provided sufficient cause is shown. Where a petition is filed beyond three months plus thirty days, even if sufficient cause is made out, the delay cannot be condoned."

Hon‟ble the Supreme Court while dismissing SLP (Civil) Diary No(s).19846/2020 titled as Union of India Vs. Central Tibetan Schools Admin & Ors., on 04.02.2021 on account of delay observed as under:-

"We have repeatedly being counselling through our orders various Government departments, State Governments and other public authorities that they must learn to file appeals in time and set their house in order so far as the legal department is concerned, more so as technology assists them. This appears to be falling on deaf ears despite costs having been imposed in number of matters with the direction to recover it from the officers responsible for the delay as we are of the view that these officers must be made accountable. It has not had any salutary effect and that the present matter should have been brought up, really takes the cake!

The aforesaid itself shows the casual manner in which the petitioner has approached this Court without any cogent or plausible ground for condonation of delay. In fact, other than the lethargy and incompetence of the petitioner, there is nothing which has been put on record. We have repeatedly discouraged State Governments and public authorities in adopting an approach that they can walk in to the Supreme Court as and when they please ignoring the period of limitation prescribed by the Statutes, as if the Limitation statute does not apply to them. In this behalf, suffice to refer to our judgment in the State of Madhya Pradesh &Ors. v. Bheru Lal [SLP [C] Diary No.9217/2020 decided on 15.10.2020] and The State of Odisha & Ors. v. Sunanda Mahakuda [SLP [C] Diary No. 22605/2020 decided on 11.01.2021].........................".

A bare perusal of the communication issued by the Garrison Engineer dated 19.03.2016, Annexure-V appended with this appeal is indicative of the fact that the Arbitration Award published by the Sole Arbitrator, namely, Arun Mehta vide his letter dated 29.02.2016 has been received by the Garrison Engineer, appellant herein on 09.03.2016 along with copy of amended version of the award No.PAC/2609/AM/36/E8 dated 29.02.2016. Therefore, there is no question of any doubt that the final amended version of the award was not received by the appellant on 09.03.2016, even on appellant‟s own admission that the appellant-Union of India had received the amended award in terms of communication dated 19.03.2016. Thus, it suggests that the appellant has perceived delay as a non serious matter and its lackadaisical tendency is exhibited by its nonchalant manner in which the appellant has pursued the matter.

In view of the facts and circumstances of the case, discussions made hereinabove and the settled law position, I do not find any fault in the order impugned dated 16.07.2019 passed by learned Additional District Judge, Jammu who in fact has passed a well reasoned order. As such, I am not inclined to interfere with the order impugned. Resultantly, this appeal fails and the same is, accordingly, dismissed along with connected application, if any.