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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

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
CAV DATE
Uploading Date         29.06.2026
Transmission Date


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