Procedural Impediments In Govt Machinery Not 'Sufficient Cause' For Condoning Delay In Filing Appeal U/S 37 Of Arbitration Act: Patna High Court

Additionally, the court held that the conduct, behaviour and attitude of a party relating to its inaction or negligence are relevant factors in condoning delay.

Brief Facts:

The present appeal has been filed under Section 37(1)(c) of the Arbitration and Conciliation Act, 1996 against the order passed by the District Judge. The District Judge dismissed the application filed by the appellant under Section 34 of the Act at the admission stage on the ground of limitation without giving benefit under Section 5 of the Limitation Act, 1963. The appeal is accompanied by an interlocutory application seeking condonation of a delay of 129 days in filing this appeal.

The appellant contended that the delay in filing the appeal had occurred primarily because the file moved from the field to headquarters/department and in the department, it also moved from the level of Assistant and reached the level of Joint Secretary/Secretary after crossing various officers. Additionally, the appellant relied on the judgment in the State of Bihar and Ors. v. Kameshwar Pd. Singh (2000).

However, the respondent argued that the appellants failed to assign the 'sufficient cause' of delay in filing the appeal on a day-to-day basis and stated the reason for the delay as primarily due to procedural delay as the file moves to headquarters and the department takes time in decision making and has to cross various stages and hence the administrative reason alone cannot be the reason for condoning the delay.

Observations:

The court observed that the discretion to condone the delay has to be exercised judiciously based on the facts and circumstances of each case and that, the expression 'sufficient cause' cannot be liberally interpreted, if based on the facts of the case it is evident that there has been negligence, inaction or lack of bonafides on the part of the petitioner. The term 'sufficient cause' means that the party should not have acted in a negligent manner or there was a want of bonafide on the part of the petitioner in view of the facts and circumstances of the case.

Additionally, the court held that procedural impediments in the government machinery are not a 'sufficient cause' for condoning the delay. The rules of limitation are not meant to destroy the rights of parties. They are meant to see that parties do not resort to dilatory tactics but seek their remedy promptly. The law of limitation fixes a lifespan for such legal remedy for the redress of the legal injury suffered. The law of limitation is founded on public policy. It is enshrined in the maxim interest republicae up sit finis litium (it is for the general welfare that a period be put to litigation).

Further, the court held that the appellant does not show any “sufficient cause” whatsoever for condonation of delay of 129 days in filling of the appeal, which was otherwise required to be filed within 90 days as prescribed under Section 37 of the Arbitration and Conciliation Act. The court affirmed that the conduct, behaviour and attitude of a party relating to its inaction or negligence are relevant factors in condoning delay. Finally, the appeal was dismissed by the court.

Case Title: The State of Bihar V. M/s Baba Hans Construction Pvt. Ltd.

LL Citation: 2025 LiveLaw (Pat) 8

Case Number: Miscellaneous Appeal No.679 of 2023

Counsel for the Appellants: Mr. Nadim Seraj, Advocate Mr. Shailesh Kumar, Advocate Mr. Afham Akhtar, Advocate

Counsel for the Respondents: Mr. Ramakant Sharma, Senior Advocate Mr. Sourav Suman, Advocate Mr. Pragati Patra, Advocate Mr. Aalekhanand, Advocate Mr. Sarveshwar Tiwary, Advocate

Date of Judgment: 08.01.2025

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