S. 5 Limitation Act Inapplicable To Condone Delay In Filing Plea Challenging Arbitration Award U/S 34 Arbitration Act: Kerala HC

Justice A. Badharudeen observed thus:

“In so far as a challenge against arbitration award is concerned, the same is in accordance with Section 34 of the Arbitration and Conciliation Act, since a specific period of limitation is provided therein. Therefore, Section 5 of the Limitation Act has no application to condone delay in filing a petition under Section 34 of the Arbitration and Conciliation Act.”

The Court stated that when a special statute provides a special period of limitation, then Section 5 of the Limitation Act has no application. It held that Section 34 of the Arbitration and Conciliation Act provides the procedure to set aside an arbitral award. It stated that Section 34 (3) and proviso provides that the maximum period for preferring an appeal against arbitral award was 4 months. The Court stated thus:

“Thus, it is empathetically clear that when the special statute provides a specified period of limitation, Section 5 of the Limitation Act has no application. A conjoint reading of Section 34(3) of the Arbitration and Conciliation Act along with its proviso makes the position emphatically clear that challenge against an arbitral award beyond 4 months cannot be entertained, as the said claim is barred by limitation.”

The appellants have approached the High Court by filing an arbitration appeal under Section 34 of the Arbitration and Conciliation Act. The arbitration appeal was filed along with a delay petition under Section 5 of the Limitation Act for condoning the delay of 1306 days in filing the appeal.

The arbitration proceedings commenced before the Arbitrator as early as in 2014 and an Award was passed against the appellants. The appellants did not contest the matter before the arbitrator. They preferred an original petition before the District Court against the arbitral award after a delay of 1781 days. The District Court dismissed it and this Arbitration Appeal was preferred against its dismissal after a delay of 1306 days.

The Court noted that the arbitration appeal was filed beyond a period of four months contrary to the provisions of Section 34 of the Arbitration and Conciliation Act. It held that the original petition filed against the arbitral award was time-barred.

“Therefore, this appeal filed challenging dismissal of the delay petition filed beyond the period provided under Section 34(3) read with its proviso and the delay in filing the Arbitration Appeal cannot be condoned.”

Accordingly, the Court dismissed the arbitral appeal.

Counsel for the appellants: Advocates T.G.Rajendran and T.R.Tarin

Citation: 2023 LiveLaw (Ker) 747

Case title: Mathew P J v M/S. Cholamandalam Investment And Finance Co Ltd

Case number: ARB.A NO. 26 OF 2023

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