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October 07, 2019

Section 14 of the Limitation Act would apply to proceedings under Section 34 of the Arbitration and Conciliation Act subject to the petition under Section 34 at the first instance being filed within time: SC


[ by Legal Era News Network ]

Justices-R-Banumathi-and-A-S-Bopanna

A bench of Supreme Court Justices R. Banumathi and A.S. Bopanna ruled that Section 14 of the Limitation Act would apply to proceedings under Section 34 of the Arbitration and Conciliation Act, 1996 (the Act) subject to the petition under Section 34 at the first instance being filed within time. The Court reiterated that Section 5 of the Limitation Act is not applicable to condone the statutory period under Section 34(3) of Act.

The brief facts of the case are that the appellant insurance company had issued fire insurance policy in respect of the plant and machinery of the respondent company. In respect of the claim, the appellant insurance company offered part of the amount claimed. Being aggrieved that insurance reimbursement was not satisfied, the respondent had approached the National Consumer Disputes Redressal Commission (NCDRC).

NCDRC reffered the matter to the Civil Court as the said claim involved complicated questions of law. The matter was, however referred to arbitration by an Arbitral Tribunal. The insurance company presented the petition before the Jodhpur District Judge on 10.04.2008, instead of the specified date of 02.04.2008. The insurance company filed an application dated 03.05.2008 under Section 14 of the Limitation Act 1963, seeking that the time spent in the proceedings before the learned District Judge, Jaipur, be excluded and the petition be entertained on its merits.

Meanwhile, the respondent filed an application under Section 3 of the Limitation Act. The District Judge dismissed the petition filed by the insurance company. The insurance company appealed before the High Court of Judicature for Rajasthan at Jodhpur. The High Court dismissed the appeal.

The question before the Supreme Court in this case was to determine whether the dismissal of the petition under Section 34 of the Act on the ground of limitation is justified.

The Supreme Court observed that through Rule 10A to Order 7 of the Code Civil Procedure (CPC), on an application being made a date is to be specified for its presentation so as to enable the appearance before the Court in which it would be represented. The Court held that when time had been granted and date was fixed by the learned District Judge at Jaipur and if the representation was not possible on that date, the appellant should have filed an application under Section 148 of CPC before the Court at Jaipur which ordered for return and fixed the time for presentation in the Court at Jodhpur, seeking extension of time granted earlier. However, since the appellant did not resort to it and the petition was represented before the District Court at Jodhpur with a delay of about 8 days from the date fixed for presentation and as no extension was also sought condonation of such delay ought to have been sought. The Court noted that “Therefore, in that circumstance even if the term “sufficient cause” as contained under Section 5 of the Limitation Act is taken note, in the present facts the same is not with reference to petition under Section 34 of Act for condonation of delay beyond the period prescribed under Section 34(3) of the Act.”

The Court concluded that Section 14 of the Limitation Act is applicable to an application submitted under Section 34 of the Act seeking for exclusion of certain period if the application under Section 34 of the Act is at the first instance filed within the limitation period provided under Section 34(3) of the Act.

Full View Judgement


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