Patna High Court
India through the General Manager, East Central Railway, HazipurversusM/s. Oberoi Thermit Pvt. Ltd.
- Decided
- Disposal
- DISMISSED
Holding
The High Court held that the application to set aside the arbitral award was barred by limitation and the district judge was correct in refusing any condonation beyond the thirty‑day extension.
Summary
The Union of India (East Central Railway) appealed against a district court order that dismissed its application under Section 34 of the Arbitration and Conciliation Act, 1996 for setting aside an arbitral award dated 14‑Dec‑2021, on the ground of limitation. The appellants argued that the Supreme Court’s COVID‑19 direction excluded the period from 15‑Mar‑2020 to 28‑Feb‑2022 from the limitation clock and that the delay could be condoned. The respondents contended that even with the excluded period, the application was filed well beyond the three‑month statutory period plus the permissible 30‑day extension. The High Court examined the applicability of Section 14 of the Limitation Act, 1963 to Section 34 applications and reiterated Supreme Court precedents that the limitation period under Section 34 is absolute and cannot be extended beyond the 30‑day grace. It held that the district judge was correct in finding the appeal hopelessly barred by limitation and that no condonation was warranted. Consequently, the appeal was dismissed.
Issues considered
- The period excluded by the Supreme Court’s COVID‑19 direction can be deducted when computing the limitation period for a Section 34 application.
- Whether Section 14 of the Limitation Act, 1963 applies to applications filed under Section 34 of the Arbitration and Conciliation Act, 1996.
- Whether a court may condone delay beyond the statutory three‑month period plus a further thirty‑day extension under Section 34(3).
- Whether the district judge erred in rejecting the condonation plea and dismissing the application as time‑barred.
Legislation cited
- Arbitration and Conciliation Act, 1996 — s. 34(1), 34(3)
- Code of Civil Procedure, 1908 — s. 151
- Limitation Act, 1963 — s. 14, 5
Subjects
- Arbitration
- Section 34
- Limitation period
- Condonation of delay
- COVID‑19 exclusion
- Supreme Court direction
- Statutory interpretation
Judgment
IN THE HIGH COURT OF JUDICATURE AT PATNA
COMMERCIAL APPEAL No.3 of 2024
======================================================
1. The Union of India through the General Manager, East Central Railway,
Hazipur Bihar.
2. The Sr. DEN/2/DNR, Danapur.
... ... Appellants
Versus
M/s. Oberoi Thermit Pvt. Ltd. through its Authorized representative Sri Arjun
Rajput, D-33, Sector- 59, Noida (U.P.) 201301.
... ... Respondent
======================================================
Appearance :
For the Appellant/s : Mr. Alok Kumar Agrawal, Sr. CGSC
For the Respondent/s : Mr. Bhavneet Singh, Advocate
Mr. Shrawan Kumar Singh, Advocate
======================================================
CORAM: HONOURABLE MR. JUSTICE RAJEEV RANJAN PRASAD
and
HONOURABLE MR. JUSTICE KUMAR MANISH
ORAL JUDGMENT
(Per: HONOURABLE MR. JUSTICE RAJEEV RANJAN PRASAD)
Date : 25-06-2026
Heard learned counsel for the appellants and learned
counsel for the State.
2. This appeal has been preferred seeking setting aside
of the order dated 17.08.2023 passed by the learned District Judge,
Patna in Miscellaneous (Arbitration) Case No. 133 of 2022 (Union
of India through the General Manager, East Central Railways,
Hazipur, Bihar and Anr. vs. M/s. Oberoi Thermit Private Limited)
whereby and whereunder the learned District Judge has been
pleased to dismiss the application under Section 34 of the
Arbitration and Conciliation Act, 1996 (hereinafter referred to as
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the ‘the Act of 1996’ as amended upto date) read with Section 151
of the Code of Civil Procedure filed on behalf of the petitioners-
respondents for setting aside the arbitral award dated 14.12.2021
passed by a learned sole Arbitrator in Arbitration Case No. 05A of
2019 arising out of Request Case No. 28 of 2019.
3. On perusal of the impugned order, it appears that the
application preferred by the present appellant for setting aside the
arbitral award has been rejected on the ground of the same being
hopelessly barred by limitation. The Sheristedar’s report was that
there was a delay of 222 days in filing of the application.
4. It is submitted that on behalf of the appellants an
application seeking condonation of delay was filed and it was
pointed out to the learned court that due to the COVID period
delay was caused in preparation of the draft and its approval. It is
submitted that after taking approval and sanction from the
competent authority of the Railways, the matter was sent to
Railway Lawyers for drafting the challenge petition in May, 2022
and the department was waiting for the final drafting of the
petition. It is also stated that the counsel for the East Central
Railways was delisted from its panel by the order of Ministry of
Law and Justice and thereafter the deponent assigned the work to
one of the learned Standing Government Counsel after approval of
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the same from the competent authority. It is finally submitted that
the Hon’ble Supreme Court has also given a direction to condone
the delay, if any, and after 01.03.2022, there is a delay of only 89
days in filing of the present application.
5. This Court finds that the learned District Judge has
taken note of report of Sheristedar which showed that there is a
delay of 222 days in filing of the present case. The Court has also
taken note of subsection (3) of Section 34 of the Act of 1996 and
held that the delay of 222 days in filing of the case cannot be
condoned.
6. Mr. Alok Kumar Agarwal, learned counsel for the
appellants, has strenuously argued before this Court that the
learned District Judge, Patna has not considered the order passed
by this Court as well as the Hon’ble Supreme Court during the
COVID period in Suo Motu Writ Petition (Civil) No. 03 of 2020 in
which the period between 15.03.2020 and 28.02.2022 have been
excluded in reckoning of the period of limitation. It is submitted
that the learned court has merely considered the Sheristedar’s
report and based on that the order impugned has been passed. In
his submissions, the impugned order suffers from non-
consideration of the materials, therefore, it is liable to be set aside.
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7. On the other hand, Mr. Bhavneet Singh, learned
counsel for the respondent submits that on a bare perusal of the
impugned order it would appear that the learned District Judge has
duly considered the scope and ambit of subsection (3) of Section
34 of the Act of 1996. So far as Sheristedar’s report is concerned,
there is no contest that the appeal has been filed on 22.10.2022 for
setting aside of the arbitral award delivered on 14.12.2021. It is
submitted that if the overall period is computed, the Sheristedar’s
report is correct. So far as the COVID period is concerned, no
doubt the learned District Judge has not specifically taken note of
the said report in the impugned order but that would not make any
change in the opinion of the court and the same would be totally
irrelevant so far as the present case is concerned. Even if the
period between 14.12.2021 and 28.02.2022 are excluded in
reckoning the period of limitation, the fact remains that the
application under Section 34(1) has been preferred after eight
months.
8. It is submitted that in such circumstance, the learned
District Judge could not have condoned the delay of more than 30
days from the date of expiry of the period of limitation i.e. three
months from the date of receipt of the arbitral award by the party
making the application.
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Consideration
9. We have heard the rival contentions. The facts are not
in dispute. The arbitral award has been delivered on 14.12.2021. It
is not the case of the appellant that the Award was served on the
appellant on any other date. Thus, the period of limitation of three
months for filing of an application under Section 34(1) of the Act
of 1996 would have expired on 14th March, 2022. By virtue of the
order of the Hon’ble Supreme Court in Suo Motu Writ Petition
(Civil) No. 03 of 2020 the period between 15.03.2020 and
28.02.2022 were liable to be excluded. In this case, the last date
for filing of the application under subsection (1) of Section 34 of
the Act of 1996 was due to expire on 14 th March, 2022. The period
between 14th December, 2021 and 15th March, 2022 are liable to be
excluded for the purpose of filing of the application.
10. The application was not filed within a period of three
months even if the period between 14th December, 2021 and 15th
March, 2022 are excluded, still on showing sufficient cause for not
preferring the application within the prescribed period of
limitation, the appellant would have got a condonation of another
thirty days. Unfortunately, the appellant being such a big
organisation having battery of lawyers, law officers and the senior
officers dealing with the matter did not take care of the period of
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limitation and the mandatory nature of subsection (3) of Section 34
of the Act of 1996. They have to blame themselves for this gross
negligence on their part in not attending their matter within time.
This is not the solitary case in which such inordinate delay has
taken place. It is for the Railways to set their house in order and
the means and ways by which it is to be taken care of or the
responsibilities are to be fixed are in the domain of Railways. Sub-
section (1) and sub-section (3) of Section 34 of the Act of 1996 are
quoted hereunder for a ready reference:-
“34. Application for setting aside arbitral award.-
(1) Recourse to a Court against an arbitral award may
be made only by an application for setting aside such
award in accordance with sub-section (2) and sub-
section (3).
(2) …...
(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.”
11. We remind ourselves of the two judgments of the
Hon’ble Supreme Court on this issue. In the case of Simplex
Infrastructure Ltd. vs. Union of India reported in (2019) 2 SCC
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455, the Hon’ble Supreme Court has held that condonation of
delay beyond a period of limitation, even when applicant is the
State and delay is owing to the administrative difficulties would be
impermissible and in such cases, there would be no application
under Section 5 of the Limitation Act. We would reproduce
paragraph ‘11’, ‘12’, ‘13’ and ‘14’ of the said judgment hereunder
for a ready reference:-
“11. Section 5 of the Limitation Act, 1963 deals
with the extension of the prescribed period for any
appeal or application subject to the satisfaction of
the court that the appellant or applicant had
sufficient cause for not preferring the appeal or
making the application within the prescribed period.
Section 5 of the Limitation Act, 1963 has no
application to an application challenging an arbitral
award under Section 34 of the 1996 Act. This has
been settled by this Court in its decision in Union of
India v. Popular Construction Company7 wherein it
held as follows : (SCC pp. 474-75, paras 12 &14)
“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.
***
7. [Union of India v. Popular Construction Company, (2001) 8 SCC 470]
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14. Here the history and scheme of the 1996 Act
support the conclusion that the time-limit
prescribed under Section 34 to challenge an
award is absolute and unextendible by court
under Section 5 of the Limitation Act.”
12. Section 14 of the Limitation Act, 1963 provides
thus:
“14. Exclusion of time of proceeding bona
fide in court without jurisdiction.—(1) In
computing the period of limitation for any suit
the time during which the plaintiff has been
prosecuting with due diligence another civil
proceeding, whether in a court of first instance
or of appeal or revision, against the defendant
shall be excluded, 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.
(2) In computing the period of limitation for
any application, the time during which the
applicant has been prosecuting with due
diligence another civil proceeding, whether in
a court of first instance or of appeal or
revision, against the same party for the same
relief shall be excluded, where such
proceeding 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.
(3) Notwithstanding anything contained in
Rule 2 of Order 23 of the Code of Civil
Procedure, 1908 (5 of 1908), the provisions of
sub-section (1) shall apply in relation to a
fresh suit instituted on permission granted by
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the court under Rule 1 of that Order, where
such permission is granted on the ground that
the first suit must fail by reason of a defect in
the jurisdiction of the court or other cause of a
like nature.
Explanation.—For the purposes of this
section,—
(a) in excluding the time during which a
former civil proceeding was pending, the day
on which that proceeding was instituted and
the day on which it ended shall both be
counted;
(b) a plaintiff or an applicant resisting an
appeal shall be deemed to be prosecuting a
proceeding;
(c) misjoinder of parties or of causes of action
shall be deemed to be a cause of a like nature
with defect of jurisdiction.”
13. Section 14 of the Limitation Act deals with the
“exclusion of time of proceeding bona fide” in a
court without jurisdiction, subject to satisfaction of
certain conditions. The question whether Section 14
of the Limitation Act would be applicable to an
application submitted under Section 34 of the 1996
Act has been answered by this Court in
Consolidated Engg. Enterprises v. Irrigation
Deptt8. This Court observed thus : (SCC pp. 181-82,
para 23)
“23. At this stage it would be relevant to ascertain
whether there is any express provision in the
1996 Act, which excludes the applicability of
Section 14 of the Limitation Act. On review of
the provisions of the 1996 Act, this Court finds
8. [Consolidated Engg. Enterprises v. Irrigation Deptt., (2008) 7 SCC 169]
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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.
Sub-section (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 1996 Act, more particularly where no
provision is to be found in the 1996 Act, which
excludes the applicability of Section 14 of the
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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 1996 Act 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 four months. From the scheme and language
of Section 34 of the 1996 Act, 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 1996 Act for
setting aside an arbitral award.”
14. The position of law is well settled with respect
to the applicability of Section 14 of the Limitation
Act to an application filed under Section 34 of the
1996 Act. By applying the facts of the present case
to the well-settled position of law, we need to assess
whether the learned Single Judge of the High Court
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was justified in condoning the delay for filing an
application under Section 34 of the 1996 Act.”
12. Earlier in the case of Union of India vs. Popular
Construction Co., reported in (2001) 8 SCC 470, the Hon’ble
Supreme Court has held that the application challenging the award
filed beyond the period mentioned in Section 34(3) would not be
an application “in accordance with” subsection (3) as required
under Section 34(1).
13. This Court has discussed both the judgments with
the learned counsel for the appellant. Even as we have noticed that
in its application under Section ‘5’ of the Limitation Act, 1963
filed before the learned District Judge, the appellant took a plea
that the Hon’ble Supreme Court has directed for condonation of
delay, if any, we are of the view that the blanket plea taken by the
appellant before the learned District Judge has no basis to stand.
14. In result, we are of the considered opinion that the
learned District Judge is correct in taking a view that the
miscellaneous arbitration application preferred by the present
appellant was hopelessly barred by limitation. In view of the clear
mandate of subsection (3) of Section 34 of the Act of 1996, the
learned Court could not have condoned the delay of more than 30
days from the date of expiry of the prescribed period of limitation
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of three months. Thus, no illegality or infirmity may be found in
the impugned order.
16. This appeal fails.
(Rajeev Ranjan Prasad, J)
(Kumar Manish, J)
Rishi/-
AFR/NAFR
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Uploading Date 29.06.2026
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