Full Judgment Text
2024 INSC 477
Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 7426 OF 2023
The State of West Bengal represented
through the Secretary & Ors. … Appellants
versus
Rajpath Contractors and Engineers Ltd. … Respondent
J U D G M E N T
ABHAY S. OKA, J.
FACTUAL ASPECTS
1. The first appellant – the State of West Bengal appointed
the respondent as a contractor for the construction of a
bridge. As there was a dispute between the parties, the
respondent invoked the arbitration clause in the contract, and
th
a sole arbitrator was appointed. On 30 June 2022, the
Arbitral Tribunal passed an award directing the appellants to
pay a sum of Rs . 2,11,67,054.00 (Two Crores Eleven Lakhs
SixtySeven Thousand FiftyFour Rupees Only) to the
Signature Not Verified
Digitally signed by
Anita Malhotra
Date: 2024.07.08
18:10:00 IST
Reason:
respondent with interest thereon, as directed. The counter
claim made by the appellants was dismissed. The appellants
Civil Appeal No.7426 of 2023 Page 1 of 8
received a copy of the award on the same day. The High
Court of Judicature at Calcutta was closed for pooja vacation
st th
from 1 October 2022 to 30 October 2022 (both days
st
inclusive). On 31 October 2022, the appellants filed a
petition under Section 34 of the Arbitration and Conciliation
Act, 1996 (for short, ‘the Arbitration Act’) to challenge the
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award. By the impugned order dated 4 May 2023, the High
Court dismissed the petition under Section 34 of the
Arbitration Act filed by the appellants on the ground of bar of
limitation. The High Court held that the period of limitation
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for filing a petition under Section 34 expired on 30
September 2022. Therefore, the appellants are not entitled to
the benefit of Section 4 of the Limitation Act of 1963 (for
short, ‘the Limitation Act’).
2. Being aggrieved by the view taken by the High Court,
the appellants are in this appeal. We may note here that
under the impugned judgment, the High Court granted a
certificate to prefer an appeal before this Court by exercising
powers under Article 133 (1) and Article 134(A)(a) of the
Constitution of India.
SUBMISSIONS
3. The learned counsel appearing for the appellants
submitted that as the period of limitation for filing a petition
under Section 34 of the Arbitration Act ought to have been
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calculated from 1 July 2022, the prescribed period of
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limitation ended on 1 October 2022, which was the first day
Civil Appeal No.7426 of 2023 Page 2 of 8
of pooja vacation. Therefore, the petition under Section 34 of
the Arbitration Act filed immediately after the reopening of
st
the Court on 31 October 2022 must be held to be within
limitation. The learned counsel relied upon Section 9 of the
General Clauses Act, 1897 (for short, ‘the General Clauses
Act’). The learned counsel also submitted that the petition
could not be efiled in pooja vacation as the relevant efiling
notification provided for efiling of only urgent matters during
the vacations. The learned counsel relied upon a decision of
this Court in the case of
State of Himachal Pradesh and
1
.
Another v. Himachal Techno Engineers and Another
4. The learned counsel appearing for the respondent
supported the findings recorded by the High Court. He
submitted that in any event, the benefit of Section 4 of the
Limitation Act is available only if the proceedings are filed
within the prescribed period of limitation, which will be three
months in this case in terms of Section 34(3) of the
Arbitration Act. The learned counsel relied upon a decision
made by this court in the case of
Assam Urban Water
Supply & Sewerage Board v Subash Projects & Mktg.
2
. He also invited our attention to a decision of this Court
Ltd.
in the case of
Union of India v. Popular Construction
3
Company . He submitted that, as held by this Court in the
said decision, the applicability of Section 5 of the Limitation
1 (2010) 12 SCC 210]
2
(2012) 2 SCC 624
3 (2001) 8 SCC 470
Civil Appeal No.7426 of 2023 Page 3 of 8
Act is excluded in view of the language used in the proviso to
subsection (3) of Section 34.
OUR VIEW
The facts are undisputed. The award made by the
5.
th
Arbitral Tribunal on 30 June 2022 was served upon the
st
appellant on the same day. Between 1 October 2022 and
th
30 October 2022 (both days inclusive), the High Court was
closed for pooja vacation. The petition under Section 34 of
st
the Arbitration Act was filed on 31 October 2022.
The period of limitation for filing a petition under
6.
Section 34 of the Arbitration Act is governed by subsection
(3) of Section 34. Subsection (3) of Section 34 reads thus:
“(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.”
7. As per Section 12(1) of the Limitation Act, the day from
which the limitation period is to be reckoned must be
excluded. In this case, the period of limitation for filing a
Civil Appeal No.7426 of 2023 Page 4 of 8
| petition under Section 34 will have to be reckoned from 30th<br>June 2022, when the appellants received the award. In view<br>of Section 12(1) of the Limitation Act, 30th June 2022 will<br>have to be excluded while computing the limitation period.<br>Thus, in effect, the period of limitation, in the facts of the<br>case, started running on 1st July 2022. The period of<br>limitation is of three months and not ninety days. Therefore,<br>from the starting point of 1st July 2022, the last day of the<br>period of three months would be 30th September 2022. As<br>noted earlier, the pooja vacation started on 1st October 2022. | |||
|---|---|---|---|
| 8. We may note here that Section 43 of the Arbitration Act<br>provides that the Limitation Act shall apply to the arbitrations<br>as it applies to proceedings in the Court. We may note here<br>that the consistent view taken by this Court right from the<br>decision in the case of Union of India v. Popular<br>Construction Co.3 is that given the language used in proviso<br>to subsection (3) of Section 34 of the Arbitration Act, the<br>applicability of Section 5 of the Limitation Act to the petition<br>under Section 34 of the Arbitration Act has been excluded. | |||
| 9. Now, we proceed to consider whether the appellant will<br>be entitled to the benefit of Section 4 of the Limitation Act.<br>Section 4 of the Limitation Act reads thus: | |||
| “4. Expiry of prescribed period when court<br>is closed.—Where the prescribed period for<br>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. |
Civil Appeal No.7426 of 2023 Page 5 of 8
| Explanation.—A court shall be deemed to be<br>closed on any day within the meaning of this<br>section if during any part of its normal<br>working hours it remains closed on that day.” | ||||
|---|---|---|---|---|
| (underline supplied) | ||||
| The meaning of “the prescribed period” is no longer res<br>integra. In the case of Assam Urban Water Supply &<br>Sewerage Board v. Subash Projects & Mktg. Ltd.2, in<br>paragraphs nos. 13 and 14, the law has been laid down on the<br>subject. The said paragraphs read thus: | ||||
| “13. The crucial words in Section 4 of the 1963<br>Act are “prescribed period”. What is the meaning<br>of these words?<br>14. Section 2(j) of the 1963 Act defines:<br>“2. (j) ‘period of limitation’ [which] means<br>the period of limitation prescribed for any<br>suit, appeal or application by the Schedule,<br>and ‘prescribed period’ means the period of<br>limitation computed in accordance with the<br>provisions of this Act;<br>Section 2(j) of the 1963 Act when read in<br>the context of Section 34(3) of the 1996 Act,<br>it becomes amply clear that the prescribed<br>period for making an application for setting<br>aside an arbitral award is three months.<br>The period of 30 days mentioned in the<br>proviso that follows subsection (3) of<br>Section 34 of the 1996 Act is not the “period<br>of limitation” and, therefore, not the<br>“prescribed period” for the purposes of<br>making the application for setting aside the | “13. The crucial words in Section 4 of the 1963<br>Act are “prescribed period”. What is the meaning<br>of these words? | |||
| 14. Section 2(j) of the 1963 Act defines: | ||||
| “2. (j) ‘period of limitation’ [which] means<br>the period of limitation prescribed for any<br>suit, appeal or application by the Schedule,<br>and ‘prescribed period’ means the period of<br>limitation computed in accordance with the<br>provisions of this Act; | ||||
| Section 2(j) of the 1963 Act when read in<br>the context of Section 34(3) of the 1996 Act,<br>it becomes amply clear that the prescribed<br>period for making an application for setting<br>aside an arbitral award is three months.<br>The period of 30 days mentioned in the | ||||
| proviso that follows subsection (3) of | ||||
| Section 34 of the 1996 Act is not the “period | ||||
| of limitation” and, therefore, not the | ||||
| “prescribed period” for the purposes of | ||||
| making the application for setting aside the |
Civil Appeal No.7426 of 2023 Page 6 of 8
| arbitral award. The period of 30 days<br>beyond three months which the court may<br>extend on sufficient cause being shown<br>under the proviso appended to subsection<br>(3) of Section 34 of the 1996 Act being not<br>the “period of limitation” or, in other words,<br>the “prescribed period”, in our opinion,<br>Section 4 of the 1963 Act is not, at all,<br>attracted to the facts of the present case.” | ||
|---|---|---|
| (underline supplied) | ||
| Even in this case, this Court was dealing with the period of<br>limitation for preferring a petition under Section 34 of the<br>Arbitration Act. We may note that the decision in the case of<br>State of Himachal Pradesh and Another v. Himachal<br>Techno Engineers and Another1 which is relied upon by the<br>appellant, follows the aforesaid decision. | ||
| 10. In the facts of the case in hand, the three months<br>provided by way of limitation expired a day before the<br>commencement of the pooja vacation, which commenced on<br>1st October 2022. Thus, the prescribed period within the<br>meaning of Section 4 of the Limitation Act ended on 30th<br>September 2022. Therefore, the appellants were not entitled<br>to take benefit of Section 4 of the Limitation Act. As per the<br>proviso to subsection (3) of Section 34, the period of<br>limitation could have been extended by a maximum period of<br>30 days. The maximum period of 30 days expired on 30th<br>October 2022. As noted earlier, the petition was filed on 31st<br>October 2022. |
Civil Appeal No.7426 of 2023 Page 7 of 8
Thus, looking from the angle, the High Court was right
11.
in holding that the petition filed by the appellants under
Section 34 of the Arbitration Act was not filed within the
period specified under subsection (3) of Section 34. Hence, we
find no merit in the appeal, and it is, accordingly, dismissed.
….…………………….J.
(Abhay S. Oka)
…..…………………...J.
(Pankaj Mithal)
New Delhi;
July 08, 2024.
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