CHINTELS INDIA LTD. versus BHAYANA BUILDERS PVT. LTD. on 11 February 2021

1. A reading of section 34(1) of the Arbitration andConciliation Act, 1996 would make it clear that an applicationmade to set aside an award has to be in accordance with bothsub-sections (2) and (3). This would mean that such applicationwould not only have to be within the limitation period prescribedby sub-section (3), but would then have to set out grounds undersub-sections (2) and/or (2A) for setting aside such award. What

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Afollows from this is that the application itself must be within time,and if not within a period of three months, must be accompaniedwith an application for condonation of delay, provided it is withina further period of 30 days, this Court having made it clear thatsection 5 of the Limitation Act, 1963 does not apply and that anydelay beyond 120 days cannot be condoned – State of HimachalBPradesh v. Himachal Techno Engineers and Anr. (2010) 12 SCC210 at paragraph 5. [Para 8][839-G-H; 840-A-B]

2. Now coming to section 37(1)(c) of the 1996 Act. It isimportant to note that the expression “setting aside or refusingto set aside an arbitral award” does not stand by itself. TheCexpression has to be read with the expression that follows -“under section 34”. Section 34 is not limited to grounds beingmade out under section 34(2). Obviously, therefore, a literalreading of the provision would show that a refusal to set aside anarbitral award as delay has not been condoned under sub-sectionD(3) of section 34 would certainly fall within section 37(1)(c). Theaforesaid reasoning is strengthened by the fact that under section37(2)(a), an appeal lies when a plea referred to in sub-section (2)or (3) of section 16 is accepted. This would show that theLegislature, when it wished to refer to part of a section, asopposed to the entire section, did so. Contrasted with theElanguage of section 37(1)(c), where the expression “under section34” refers to the entire section and not to section 34(2) only, thefact that an arbitral award can be refused to be set aside for refusalto condone delay under section 34(3) gets further strengthened.[Para 9][840-B-E]

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3. In Essar Constructions, a judgment rendered undersection 39 of the Arbitration Act, 1940 this Court was faced withthe same question as is raised in this appeal. In EssarConstructions it was held that “the order refusing to condonethe delay in filing the claim petition has the effect of finallyGdisposing of the original petition. Such an order can, therefore,be treated as an award and hence it is appealable”. [Paras 10 and12][840-E-F; 841-G-H; 842-A]

4. It will be noticed that so far as the present question isinvolved, section 39(1)(vi) of the 1940 Act is in pari materia toHsection 37(1)(c) of the Arbitration Act, 1996. This was held in two of the judgments of the Supreme Court i.e. Chief Engineerof BPDP/REO Ranchi v. Scoot Wilson Kirpatrick India (P.) Ltd.and Fuerst Day Lawson Ltd. v. Jindal Exports Ltd. [Para 14][843-C-D]

5. The reasoning in Essar Constructions commends itselfto this Court, being on a pari materia provision to that containedin section 37(1)(c) of the Arbitration Act, 1996. This Court mayonly add that the reasoning of the aforesaid judgment is furtherstrengthened by analysis of the additional words “under section34” which occur in section 37(1)(c), and which are absent in section39(1)(vi) [the pari materia provision to section 34 of theArbitration Act, 1996 being section 30 of the Arbitration Act,1940]. [Para 19][846-C-E]

6. The counsel for the respondent has relied on section 5of the Arbitration Act, 1996. According to respondent, infurtherance of this object, section 37 was enacted giving a limitedright of appeal. He argued that an appeal, being a creature ofstatute should not, therefore, be enlarged beyond what isprovided by the Legislature. This section does not takerespondent’s argument much further, as after the non-obstanteclause, the section states that no judicial authority shall intervene“except where so provided in this Part”. What is “provided inthis part” is section 37, which therefore brings us back to squareone. Undoubtedly, a limited right of appeal is given under section37 of the Arbitration Act, 1996. But it is not the province or dutyof this Court to further limit such right by excluding appeals whichare in fact provided for, given the language of the provision asinterpreted by us hereinabove. Thus, this last argument also hasno legs on which to stand. [Paras 35 and 36][856-G-H]

7. Consequently, the question of law is answered by statingthat an appeal under section 37(1)(c) of the Arbitration Act, 1996would be maintainable against an order refusing to condone delayin filing an application under section 34 of the Arbitration Act,1996 to set aside an award. [Para 37][857-B-D]

Essar Constructions v. N.P. Rama Krishna Reddy (2000)6 SCC 94 : [2000] 3 SCR 923; Chief Engineer ofBPDP/REO Ranchi v. Scoot Wilson Kirpatrick India (P.)Ltd. (2006) 13 SCC 622 : [2006] 8 Suppl. SCR 836; A

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AFuerst Day Lawson Ltd. v. Jindal Exports Ltd. (2011) 8SCC 333 : [2011] 11 SCR 1; Union of India v. Manager,Jain and Associates (2001) 3 SCC 277 : [2001] 1 SCR 889; Amar Nath Om Prakash v. State of Punjab (1985)1 SCC 345 : [1985] 2 SCR 72 – relied on.

BState of Maharashtra and Anr. v. M/s RamdasConstruction Co. and Anr. 2006 (6) Mah. L.J. 678;Union of India v. Radha Krishna Seth and Anr. 2005SCC OnLine All 8400 – overruled.

BGS SGS Soma JV. v. NHPC Limited (2020) 4 SCC 234C– distinguished.Union of India v. Simplex Infrastructures Ltd. (2017)14 SCC 225 – held inapplicable.

Harmanprit Singh Sidhu v. Arcadia Shares and StockBrokers Pvt. Ltd. 2016 SCC OnLine Del 5383; StateDof Himachal Pradesh v. Himachal Techno Engineersand Anr. (2010) 12 SCC 210 – referred to.

Case Law Reference

CIVIL APPELLATE JURISDICTION : Civil Appeal GNo. 4028 of 2020.

From the Judgment and Order dated 04.12.2020 of the High Courtof Delhi at New Delhi in FAO(OS)(Comm) No. 68 of 2020.

Mukul Rohtagi, Sr. Adv., Rajshekhar Rao, Arshdeep Singh, KotlaHarshavardhan, Ms. Neeha Nagpal, Areeb Amanullah, Karthik Sundar,H

Ms. Mansi Sood, Ms. Vishakha Gupta, Shreedhar Kale, Udbhav Nanda,Malak Manish Bhatt, Saurabh Kirpal, Gaurav Mitra, Ms. Meghna Mishra,Debmalya Banerjee, Ms. Manmeet Kaur, Rohan Sharma, KartikBhatnagar, Yashvardhan Bandi, Ujjwal Singh, Vardaan Wanchoo, Ms.Anjali Dwivedi for M/S. Karanjawala & Co., Advs. for the appearingparties.

The Judgment of the Court was delivered by

R. F. NARIMAN, J.

1. This appeal arises out of a certificate issued under Article 133read with Article 134A of the Constitution of India by the High Court ofDelhi in the impugned judgment dated 04.12.2020. The question raisedin this appeal is whether a learned single Judge’s order refusing tocondone the Appellant’s delay in filing an application under section 34 ofthe Arbitration and Conciliation Act, 1996 (“Arbitration Act, 1996”) isan appealable order under section 37(1)(c) of the said Act. Afterconsidering, in particular, two judgments of this Court, the High Courtheld:

“18. We have considered the rival contentions. Though, as observedby us in the hearing on 5th November, 2020, in view of BGS SGSSoma JV supra having referred to the grounds under Section 34in entirety and not confined to Section 34(2) only, we were inclinedto differentiate between a case of return of an application underSection 34 on the ground of the Court to which it is presented nothaving territorial jurisdiction, on the one hand and rejection of anapplication under Section 34 on the ground of having not beenfiled within the prescribed time, on the other hand, but in view ofthe Supreme Court having been approached against RamdasConstruction Co. supra, expressly holding an appeal as the onebefore us, to be not maintainable under Section 37, and havingdismissed the appeal with a speaking order, though not expressingany opinion on the maintainability of the appeal, we considerourselves bound thereby and hold this appeal to be notmaintainable.

19. We may however observe that Section 37(1)(b) also, whileproviding for the appealable orders, refers to Section 34 in entiretyand not to Section 34(2); though BGS SGS Soma JV supra hasheld that the order which is appealable thereunder is an order A

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Atesting the arbitral award on the grounds set out in Section 34 butin our humble opinion if the intention of the legislature was toconfine the appeals only to grounds under Section 34(2), nothingprevented them from, instead of referring to Section 34 generallyin Section 37(1)(c), referring only to Section 34(2). We are of theview that sub-section (3) of Section 34, by use of the words ‘butBnot thereafter’, as interpreted in Union of India Vs. PopularConstruction Co. (2001) 8 SCC 470, restricts the power otherwisevested in Court to condone the delay beyond thirty days, the samealso creates a ground of time bar for refusing to set aside theaward and is part of the self-contained code for setting aside ofCthe award; thus, refusal to set aside an award on the ground ofthe said time bar, would be a refusal within the meaning of Section37 and appealable under Section 37. There is also merit in thecontention of Mr. Rajshekhar Rao, Advocate for the appellantthat refusal to condone the delay also entails affirmation of theunderlying order. Mention in this regard may be made of SectionD27 of the Limitation Act, 1963 which, though in the context of suitfor possession of any property, extinguishes the right to propertyat the determination of the period prescribed for instituting thesuit for possession thereof. However we need not discuss furthersince, as aforesaid, we are bound by the dicta in BGS SGS SomaEJV and Ramdas Construction Co. supra.

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20. We may also consider another aspect. By reading Section 37as not permitting an appeal against refusal to condone the delay inapplying for setting aside of the award, the persons aggrieved bythe award are left with no remedy but to approach the SupremeFCourt by way of a petition under Article 136 of the Constitution ofIndia. The refusal to set aside the award may not necessarily beby the Commercial Division of the High Court but may also be bythe Commercial Courts of the country. No other remedy wouldbe available to the persons aggrieved by the award, against thedecision of any Commercial Court in the country refusing toGcondone the delay in applying for setting aside of the award, leavingsuch persons either with the option of accepting / remaining boundby the award even if having excellent grounds for setting aside ofthe same or of approaching the Supreme Court under Article 136of the Constitution of India, thereby putting an avoidable burdenHon the Supreme Court which, as per the scheme of the Constitution of India, was envisaged to hear limited number of matters entailingconstitutional issues and not to hear matters of condonation ofdelay. Though undoubtedly the scheme of expediency and limitedjudicial intervention is ingrained in the Arbitration Act but at thesame time it cannot be forgotten that the Act nevertheless providesremedies against the arbitral award and it is felt that to vest theorder, of any Commercial Court in the country refusing to condonethe delay in applying for setting aside of the award, and whichdelay can be for varying reasons as diverse as the social,geographical and economic conditions prevalent in this country,and not even providing any opportunity to the High Courts to havea look therein, would be a very harsh outcome.

21. Thus, while dismissing the appeal as not maintainable, beingbound by the dicta of the Supreme Court in BGS SGS Soma JVand in Ramdas Construction Co. supra, we grant certificate underArticle 133 read with Article 134A of the Constitution of India tothe appellant.”

2. It may be noted that the learned single Judge of the High Courtdismissed the application for condonation of delay in an application filedunder section 34 of the Arbitration Act, 1996 to set aside an awarddated03.05.2019vide its judgment dated 04.06.2020, and consequentlydismissed the section 34 application itself.

3. Shri Rajshekhar Rao, learned Advocate appearing on behalf ofthe Appellant, has relied strongly upon the judgment of this Court inEssar Constructions v. N.P. Rama Krishna Reddy (2000) 6 SCC94, which was a judgment delivered under section 39 of the ArbitrationAct, 1940. His argument is that since section 39 of the 1940 Act is inparimateria with section 37 of the Arbitration Act, 1996, in that an appeallies where a single Judge refuses to condone delay, resulting in an orderrefusing to set aside an arbitral award, the ratio ofEssar Constructions(supra) would apply on all fours to the same provision contained in section37. This being so, he argued that it is clear that refusal to condone delaywould result in a refusal to set aside an award, an appeal against suchorder being maintainable under section 37 of the Arbitration Act, 1996.He also strongly relied upon the judgments of this Court in ChiefEngineer of BPDP/REO Ranchi v. Scoot Wilson Kirpatrick India(P.) Ltd. (2006) 13 SCC 622 and Fuerst Day Lawson Ltd. v. JindalExports Ltd. (2011) 8 SCC 333 to buttress his submission that section A

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A39 of the 1940 Act was aparimateria provision to section 37 of theArbitration Act, 1996. He then relied upon judgmentsof the MadhyaPradesh[1], Bombay[2], Karnataka[3], Delhi[4] and Calcutta[5] High Courts toargue that an order refusing to condone delay stands on a completelydifferent footing from an order which condones delay, as the latter ordercannot be said to impart any finality to the proceeding, as, when an orderBcondones delay, it cannot be said that the court has refused to set asidean award as it may ultimately set aside the aforesaid award on the groundsmentioned in section 34(2) of the Arbitration Act, 1996. He further arguedthat the judgment of the Allahabad High Court in Union of India v.Radha Krishna Seth and Anr., 2005 SCC OnLine All 8400 and that ofCthe Bombay High Court in State of Maharashtra v. RamdasConstruction Co. 2006 (6)Mah. L.J. 678 did not state the law correctlyand ought to be overruled by this Court. He argued that where a right ofappeal is granted by statute, a dismissal on a preliminary ground isnevertheless a dismissal of the appeal, since it cannot be heard thereafter.

He also argued that a right of appeal, once granted, ought not to beDlimited by statutory interpretation where the words used are capable ofa wider construction. In particular, referring to the language of section37(1)(c) of the Arbitration Act, 1996, he argued that there must be refusalto set aside an arbitral award “under section 34”, which includes section34(3), under which a court may refuse to condone delay in filing an Eapplication under section 34. Coming to the two Supreme Court judgmentsreferred to in the impugnedjudgment, it was his contention that the focusof thisCourt in BGS SGS Soma JV. v. NHPC Limited(2020) 4 SCC234, was on a completely different question, namely, as to whether anapplication to set aside an award under section 34 should be returned tothe proper court dependent upon where the seat of arbitration was located.F1Bisleri International Pvt. Ltd. and Ors. v. Sun Petpack Jabalpur Pvt. Ltd. and Anr.2009 (4) M.P.L.J. 514.

2E-Square Leisure Pvt. Ltd., Pune v. K.K. Dani Consultants and Engineers Pvt. Ltd.2013 (3) Mh.L.J. 24; Jayshri Ginning & Spinning Pvt. Ltd. v. C.A. Galiakotwala & Company Pvt. Ltd. 2016GSCC OnLine Bom 5067.3M/s Crompton Greaves Ltd. v. M/s Annapurna Electronics and Ors. ILR 2015 KAR4199.

4Harmanprit Singh Sidhu v. Arcadia Shares & Stock Brokers Pvt. Ltd. (2016) 234 DLT30.5Damodar Valley Corporation v. Sanjay Singh Rathor 2018 SCC OnLine Cal 4014.H

It was only in the course of discussion relatable to this question that thisCourt approved certain observations made in the decision of the DelhiHigh Court inHarmanprit Singh Sidhu v. Arcadia Shares and StockBrokers Pvt. Ltd. 2016 SCC OnLine Del 5383, in which a learnedsingle Judge of the Delhi High Court allowed an application forcondonation of delay,a Division Bench then holding that an appeal againstsuch an order was not maintainable under section 37 of the ArbitrationAct, 1996. He contended that it is only in this context that paragraph 17of BGS SGS Soma (supra) approved of the observations madeinHarmanprit Singh Sidhu (supra), inasmuch as it cannot be said thatthe Court has refused to set aside the award under section 34, as it mayyet do so if any of the grounds contained in section 34(2) are made out.So far as this Court’s order dated 12.04.2017 in State of Maharashtraand Anr. v. M/s Ramdas Construction Co. and Anr. [C.A. Nos.5247-5248 of 2007]is concerned, he argued that this Court did not gointo the maintainability aspect at all, but ultimately dismissed the CivilAppeals on the ground that the District Judge, Nagpur had held that theperiod of delay being beyond four months, the court had no jurisdictionto entertain the application for condonation of delay or the application onmerits under section 34 of the Arbitration Act, 1996.

4. Shri Mukul Rohatgi, learned Senior Advocate appearing onbehalf of the Respondent, strongly refuted the fact that section 37 of theArbitration Act, 1996 is in parimateria with section 39 of the 1940 Act.According to him,section 39 of the 1940 Act is materially different, andconcerns itself with grounds that were made out under section 30 of thesaid Act, which grounds were completely different from the groundsthat could be made out under section 34(2) and (2A) of the 1996 Act.Therefore, Shri Rohatgi argued that section 37 needs to be interpretedon its own terms, and that consequently, this Court’s judgment in EssarConstructions (supra) would not be applicable. He relied strongly uponsection 5 of the Arbitration Act, 1996, by which it was statutorily madeclear that judicial intervention is to be minimal in the arbitration process.Forthis purpose he also relied upon the Statement ofObjects and Reasonsfor enacting the Arbitration Act, 1996. He then went on to state thatsection 37 of the Arbitration Act, 1996 in fact carries out this object.Hestressed that this object was reinforced first, by the non-obstante clausecontained in section 37(1); andsecond, by the fact that the grounds ofappeal contained in section 37 are exhaustive, and makes explicit that anappeal shall lie only from the following orders “and from no others”. He AB

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Aalso stressed the fact that the word “namely” makes it clear that it isonly from the orders set out in section 37 that an appeal can be filed. Hewent on to argue that an appeal, being a creature of statute, has to beread as the statute provides without expanding any of the wordsused.According to him, section 37(1)(c) is clear and without anyambiguity – the expression “under Section 34” has to be read with theBpreceding words “setting aside or refusing to set aside an arbitral award”,and when so read, it is clear that the refusal to set aside the award canonly be on merits and not on some preliminary ground which would thenlead to a refusal to set aside the award. He relied strongly upon the factthat this Court in BGSSGS Soma (supra) had approved of HarmanpritCSingh Sidhu (supra), and stated exactly this in paragraph 17 thereof.Hethen strongly relied upon the judgment in Union of India v. SimplexInfrastructures Ltd. (2017) 14 SCC 225 for the proposition that whetherdelay is or is not condoned, the same result ensues – it cannot be saidthat by condoning or refusing to condone delay, an arbitral award eithergets or does not get set aside. He ended by saying that in point of factDthe Bombay High Court Division Bench judgment in RamdasConstruction Co. (supra) was the correct enunciation of the law, andthat we should accept this enunciation and overrule the judgments of theother High Courts.

5. Having heard learned counsel for the parties, it is important toEfirst set out section 37 of the Arbitration Act, 1996 which is asfollows:

“37. Appealable orders.—(1) Notwithstanding anythingcontained in any other law for the time being in force, an appealshall lie from the following orders (and from no others) to theFCourt authorised by law to hear appeals from original decrees ofthe Court passing the order, namely:—

(a) refusing to refer the parties to arbitration under section 8; (b) granting or refusing to grant any measure under section 9;G(c) setting aside or refusing to set aside an arbitral award undersection 34.

(2) Appeal shall also lie to a court from an order of the arbitraltribunal—

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(a) accepting the plea referred to in sub-section (2) or sub-section

(3) of section 16; or

(b) granting or refusing to grant an interim measure under section17.

(3) No second appeal shall lie from an order passed in appealunder this section, but nothing in this section shall affect ortakeaway any right to appeal to the Supreme Court.”

6. Since we are directly concerned with section37(1)(c), it isimportant to advert to the language of section 34 as well. Section 34(1)reads as follows:

“34. Application for setting aside arbitral award.— (1)Recourse to a Court against an arbitral award may be made onlyby an application for setting aside such award in accordance withsub-section (2) and sub-section (3).”

7. Section 34(2) and (2A) then sets out the grounds on which anarbitral award may be set aside. Section 34(3), which again is materialfor decision of the question raised in this appeal, reads as follows:

“(3) An application for setting aside may not be made after threemonths have elapsed from the date on which the party makingthat application had received the arbitral award or, if a requesthad been made under section 33, from the date on which thatrequest had been disposed of by the arbitral tribunal:

Provided that if the Court is satisfied that the applicant wasprevented by sufficient cause from making the application withinthe said period of three months it may entertain the applicationwithin a further period of thirty days, but not thereafter.”

8. A reading of section 34(1) would make it clear that an applicationmade to set aside an award has to be in accordance with both sub-sections (2) and (3). This would mean that such application would notonly have to be within the limitation period prescribed by sub-section(3),but would then have to set out grounds under sub-sections (2) and/or(2A) for setting aside such award. What follows from this is that theapplication itself must be within time, and if not within a period of threemonths, must be accompanied with an application for condonation of A

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Adelay, provided it is within a further period of 30 days, this Court havingmade it clear that section 5 of the Limitation Act, 1963 does not applyand that any delay beyond 120 days cannot be condoned – see State ofHimachal Pradesh v. Himachal Techno Engineers and Anr. (2010)12 SCC 210 at paragraph 5.B9. We now come to section 37(1)(c). It is important to note thatthe expression “setting aside or refusing to set aside an arbitral award”does not stand by itself. The expression has to be read with the expressionthat follows -”under section 34". Section 34 is not limited to groundsbeing made out under section 34(2). Obviously, therefore, a literal readingof the provision would show that a refusal to set aside an arbitral awardCas delay has not been condoned under sub-section (3) ofsection 34 wouldcertainly fall within section 37(1)(c).The aforesaid reasoning isstrengthened by the fact that under section 37(2)(a), an appeal lies whena plea referred to in sub-section (2) or (3) of section 16 is accepted. Thiswould show that the Legislature, when it wished to refer to part ofDasection, as opposed to the entire section, did so. Contrasted with thelanguage of section 37(1)(c), where the expression “under section 34”refers to the entire section and not to section 34(2) only, the fact that anarbitral award can be refused to be set aside for refusal to condonedelay under section 34(3) gets further strengthened.

E10. In Essar Constructions (supra), a judgment rendered undersection 39 of the 1940 Act, this Court was faced with the same questionas is raised in the appeal before us. In order to appreciate the ratio ofthis judgment, it is necessary to first set out section 39 of 1940 Act,which reads as under:

F“39. Appealable orders:- (1) An appeal shall lie from thefollowing orders passed under this Act (and from no others) tothe Court authorised by law to hear appeals from original decreesof the Court passing the order:

An order –

G(i) superseding an arbitration;

(ii) on an award stated in the form of a special case;

(iii) modifying or correcting an award;

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(v) staying or refusing to stay legal proceedings where there is anarbitration agreement;

(vi) setting aside or refusing to set aside an award; Provided that the provisions of this section shall not apply to any order passed by a Small Cause Court.

(2) No second appeal shall lie from an order passed in appealunder this section, but nothing in this section shall affect or takeaway any right to appeal to the Supreme Court.”

11. The question which the Court was required to answer was setout as follows:

“5. But was the Civil Judge’s order dismissing the respondent’sapplication under Section 5 at all revisable under Section 115 ofthe Code or did an appeal lie from it under Section 39 of theArbitration Act, 1940? The answer is of moment as the powersof an appellate court are wider than those available under Section115. Section 39(1)(vi) of the Arbitration Act, 1940 says that anappeal shall lie inter alia from an order “refusing to set aside anaward”.

6. To arrive at a conclusion as to whether the order passed by theSenior Civil Judge, Kakinada was an order “refusing to set asidethe award”, we have to consider the facts.”

12. After setting out the order of the Senior Civil Judge, whorefused to condone delay in filing an application for setting aside theaward, the Court then held:

“11. The outcome of the order in effect wasthat the prayer forsetting aside the award was refused on the ground of delay.

12. The “effect test” was applied by the High Court of AndhraPradesh in Babumiyan&Mastan v. K. Seethayamma [AIR 1985AP 135] which said:

“In the light of the rulings in G. Gopalaswami v. G.Navalgaria [AIR 1967 Mad 403] and the decision of the Benchin CMA No. 612 of 1977 dated 3-4-1978, the legal position maybe enunciated as follows: The order refusing to condone the delayin filing the claim petition has the effect of finally disposing of the A

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original petition. Such an order can, therefore, be treated as anaward and hence it is appealable.”

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13. Again a Division Bench of the Assam High Courtin MafizuddinBhuyan v. AlimuddinBhuyan [AIR 1950 Ass 191]has said:

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“Whether objections to an award are dismissed on the merits orthey are dismissed on the ground that they are filed beyond time,the Court by dismissing them in effect refuses to set aside theaward, and an order refusing to set aside an award is clearlyappealable under Section 39.”

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14. In some High Courts, no separate application is filed underSection 5 of the Limitation Act and the prayer for condonation of delayis included along with the prayers made for substantive relief. Courtshave entertained appeals from an order dismissing an application onthe ground of limitation. Thus, in State of W.B. v. A. Mondal [AIR1985 Cal 12 (DB)] where an application under Section 30 of theArbitration Act was dismissed on the ground of limitation, an appealwas entertained.(See also Damodaran v. Bhaskaran [(1988) 2 KLT753].)

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15. The procedure appears to have been approved by the SupremeCourt in the case of Union of India v. Union Builders [AIR1985 Cal 337 (DB)] where on an appeal to the Supreme Courtfrom an order dismissing an application under Section 30 on theground of delay, the appeal was remanded to the High Court to bedisposed of.

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F16. The position should be no different in courts where a separateapplication under Section 5 of the Limitation Act is required to befiled. If the various High Courts’ decisions noted earlier are correct,then the application under Section 5 being dismissed, the applicationunder Section 30 would consequently also have to be dismissedalthough this might be a mere formality. The end result would beGthe same.

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21. Section 39(1)(vi) of the Arbitration Act, 1940 does not indicatethe grounds on which the court may refuse to set aside the award.There is nothing in its language to exclude a refusal to set aside H

the award because the application to set aside the award is barredby limitation. By dismissing the application albeit under Section 5,the assailability of the award is concluded as far as the courtrejecting the application is concerned. Ultimately therefore, it isan order passed under Section 30 of the Arbitration Act though byapplying the provisions of the Limitation Act.”

13. The Court ultimately concluded:

“25. Reading Section 39(1)(vi) and Section 17 together, it wouldtherefore follow that an application to set aside an award which isrejected on the ground that it is delayed and that no sufficientcause has been made out under Section 5 of the Limitation Actwould be an appealable order.”

14. It will be noticed that so far as the present question is involved,section 39(1)(vi) of the 1940 Act is inparimateria to section 37(1)(c) ofthe Arbitration Act, 1996. This was in fact held in two of the judgmentsof this Court. In Chief Engineer of BPDP/REO Ranchi (supra), thisCourt when considering a similar question held as follows:

“5. Section 37(1)(b) of the Act is in parimateria with Section39(1)(vi) of the Arbitration Act, 1940 (in short “the old Act”). Theprovisions in the Acts read as follows:

1996 Act

“37. (1) An appeal shall lie from the following orders (and fromno others) to the court authorised by law to hear appeals fromoriginal decrees of the court passing the order, namely—***

(b) setting aside or refusing to set aside an arbitral award underSection 34.”

1940 Act

“39. Appealable orders.—(1) An appeal shall lie from thefollowing orders passed under this Act (and from no others) tothe court authorised by law to hear appeals from original decreesof the court passing the order:

An order—***

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A(vi) setting aside or refusing to set aside an award:”

15. Having so held, this Court then referred to and followed thejudgment in Essar Constructions (supra) and the judgment containedin Union of India v.Manager, Jain and Associates(2001) 3 SCC277, ultimately holding:

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“8. The decision in Popular Construction case [(2001) 8 SCC470] did not deal with specific issues in this case. In that decisionit was held that in respect of “sufficient cause cases” the provisionsof Section 34(3) of the Act which are special provisions relatingto condonation of delay override the general provisions of Section5 of the Limitation Act, 1963 (in short “the Limitation Act”). Theposition was reiterated in the Western Builders case [(2006) 6SCC 239] and also in Fairgrowth InvestmentsLtd. v. Custodian [(2004) 11 SCC 472] . There can be no quarrelwith the proposition that Section 5 of the Limitation Act providingfor condonation of delay is excluded by Section 34(3) of the Act.

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9. But the question in the instant case is not about the applicabilityof Section 5 of the Limitation Act, and the question really iswhether the appeal was maintainable. The High Court did notconsider this aspect. The appeal is clearly maintainable. Therefore,the order of the High Court is set aside. The High Court shall dealwith the matter and examine the respective stand on merits treatingthe appeal to be maintainable.”

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16. Likewise, in Fuerst Day Lawson Ltd. (supra)this Court held:

“37. These general principles are culled out from the decisions ofthis Court rendered under Section 104 CPC and various otherActs, as noted above. But there is another set of decisions of thisCourt on the question under consideration rendered in the contextof Section 39 of the 1940 Act. Section 39 of the erstwhile Actcontained the provision of appeal and provided as follows:

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“39.Appealable orders.—(1) An appeal shall lie from the followingorders passed under this Act (and from no others) to the courtauthorised by law to hear appeals from original decree of thecourt passing the orders:

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An order—

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CHINTELS INDIA LTD. v. BHAYANA BUILDERS PVT. LTD.[R.F. NARIMAN, J.]

(i) superseding an arbitration;

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(ii) on an award stated in the form of a special case;

(iii) modifying or correcting an award;

(iv) filing or refusing to file an arbitration agreement; B(v)staying or refusing to stay legal proceedings where there isan arbitration agreement;

(vi) setting aside or refusing to set aside an award:

Provided that the provisions of this section shall not apply to anyorder passed by a Small Cause Court.

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(2) No second appeal shall lie from an order passed in appealunder this section, but nothing in this section shall affect or takeaway any right to appeal to the Supreme Court.”

(Insofar as relevant for the present, Section 37 of the 1996 Act, isvery similar to Section 39 of the previous Act as quoted above.)”

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17. It then referred to an argument of counsel that there would beno material difference between the provisions of section 39 of ArbitrationAct, 1940 and section 37 of the Arbitration Act, 1996 vis-à-vis section50 of the 1996 Act, as follows:

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“43. Mr Dave, in reply submitted that the words “(and from noothers)” occurring in Section 39 of the 1940 Act and Section 37of the 1996 Act were actually superfluous and seen, thus, therewould be no material difference between the provisions of Section39 of the 1940 Act or Section 37 of the 1996 Act and Section 50of the 1996 Act and all the decisions rendered on Section 39 ofthe 1940 Act will apply with full force to cases arising under Section50 of the 1996 Act.”

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18. So far as section 37 of the Arbitration Act, 1996 and section39 of the Arbitration Act, 1940 were concerned, this Court agreed withcounsel’s argument, but disagreed with the submission insofar as section50 of the 1996 Act was concerned, as follows:

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“52. Having regard to the grammatical use of brackets orparentheses, if the words “(and from no others)” occurring inSection 39 of the 1940 Act or Section 37 of the 1996 Act areviewed as “an explanation or afterthought” or extra information H

Aseparate from the main context, then, there may be some substancein Mr Dave’s submission that the words in parenthesis aresurplusage and in essence the provisions of Section 39 of the1940 Act or Section 37 of the 1996 Act are the same as Section50 of the 1996 Act. Section 39 of the 1940 Act says no more andno less than what is stipulated in Section 50 of the 1996 Act. ButBthere may be a different reason to contend that Section 39 of the1940 Act or its equivalent Section 37 of the 1996 Act arefundamentally different from Section 50 of the 1996 Act and hence,the decisions rendered under Section 39 of the 1940 Act may nothave any application to the facts arising under Section 50 of theC1996 Act. But for that we need to take a look at the basic schemeof the 1996 Act and its relevant provisions.”

19. The reasoning in Essar Constructions (supra) commendsitself to us, being on a parimateria provision to that contained in section37(1)(c) of the Arbitration Act, 1996. We may only add that the reasoningDof the aforesaid judgment is further strengthened by our analysis of theadditional words “under section 34” which occur in section 37(1)(c),and which are absent in section 39(1)(vi) [the pari858

materia provision to section 34 of the Arbitration Act, 1996 beingsection 30 of the Arbitration Act, 1940].

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20. In point of fact, the “effect doctrine” referred to in EssarConstructions (supra) is statutorily inbuilt in section 37 of the ArbitrationAct, 1996 itself.For this purpose, it is necessary to refer to sections37(1)(a) and 37(2)(a).So far as section 37(1)(a) is concerned, where aparty is referred to arbitration under section 8, no appeal lies. This is forFthe reason that the effect of such order is that the parties must go toarbitration, it being left to the learned Arbitrator to decide preliminarypoints under section 16 of the Act, which then become the subject matterof appeal under section 37(2)(a) or the subject matter of grounds to setaside under section 34 an arbitral award ultimately made, dependingupon whether the preliminary points are accepted or rejected by theGarbitrator. It is also important to note that an order refusing to referparties to arbitration under section 8 may be made on a prima faciefinding that no valid arbitration agreement exists, or on the ground thatthe original arbitration agreement, or a duly certified copy thereof is notannexed to the application under section 8. In either case,i.e. whetherHthe preliminary ground for moving the court under section 8 is not made out either by not annexing the original arbitration agreement, or a dulycertified copy, or on merits – the court finding that prima facie no validagreement exists – an appeal lies under section 37(1)(a).

21. Likewise, under section 37(2)(a), where a preliminary groundof the arbitrator not having the jurisdiction to continue with theproceedings is made out, an appeal lies under thesaid provision, as suchdetermination is final in nature as it brings the arbitral proceedings to anend. However, if the converse is held by the learned arbitrator, then asthe proceedings before the arbitrator are then to carry on, and theaforesaid decision on the preliminary ground is amenable to challengeunder section 34 after the award is made, no appeal is provided. This ismade clear by section 16(5) and (6) of the Arbitration Act, 1996 whichread as follows:

“16. Competence of arbitral tribunal to rule on itsjurisdiction.—

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(5) The arbitral tribunal shall decide on a plea referred to in sub-section (2) or sub-section (3) and, where the arbitral tribunal takesa decision rejecting the plea, continue with the arbitral proceedingsand make an arbitral award.

(6) A party aggrieved by such an arbitral award may make anapplication for setting aside such an arbitral award in accordancewith section 34.”

22. Given the fact that the “effect doctrine” is part and parcel ofthe statutory provision for appeal under section 37, and the expresslanguage of section 37(1)(c), it is difficult to accede to the argument ofShri Rohatgi.

23. We now come to the judgment inSimplex InfrastructuresLtd. (supra). In this judgment, what was argued before thisCourt is setout with reference to the Division Bench judgment under appeal as follows:

“11. The Division Bench of the High Court, however, made afine distinction by holding that the judgment of the learned SingleJudge of condoning delay in filing of the petition under Section 34of the Act was without jurisdiction and not in terms of the provisionsof the Act. It is not possible to countenance this approach. TheDivision Bench, in our opinion, was not right in observing that the AB

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Adecision in Tanusree Art Printers [Tanusree ArtPrinters v. Rabindra Nath Pal, 2000 SCC OnLine Cal 217] beingof a Special Bench of three Judges of the same court, was binding,in spite of having noticed the decision of this Court in Fuerst DayLawson Ltd. [Fuerst Day Lawson Ltd. v. Jindal Exports Ltd.,(2011) 8 SCC 333] — which is directly on the point and wasBpressed into service by the appellant. Neither the Division Benchof the High Court of Calcutta which dealt with Modi KoreaTelecommunication Ltd. [Modi Korea TelecommunicationLtd. v. Appcon Consultants (P) Ltd., 1999 SCC OnLine Cal 19]nor the three-Judge Bench which decided Tanusree Art Printers,Chad the benefit of the judgment of this Court in Fuerst DayLawson Ltd., which is later in time.”

24. In stating that the Division Bench was wrong, as a judgmentof a single Judge condoning delay in the filing of a petition under section34 cannot be said to be without jurisdiction, the Court then held:

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“12… On a bare reading of this provision, it is noticed that theremedy of the appeal has been provided only against an order ofsetting aside or refusing to set aside an arbitral award under Section34. No appeal is provided against an order passed by the court ofcompetent jurisdiction condoning the delay in filing the petitionEunder Section 34 of the Act as such. The Division Bench in theimpugned judgment, therefore, rightly noted that remedy of appealagainst the impugned order of the learned Single Judge was nototherwise available under Section 37 of the Act.

13. In our opinion, the issue is squarely answered against theFrespondent by the decision of this Court in Fuerst Day LawsonLtd. [Fuerst Day Lawson Ltd. v. Jindal Exports Ltd., (2011) 8SCC 333] In that, the judgment of the learned Single Judge dated27-4-2016 [Union of India v. Simplex Infrastructures Ltd., 2016SCC OnLine Cal 12045], was passed on an application purportedto be under Section 34(3) of the Act, for condoning delay in filingGof the petition for setting aside the arbitral award. Hence, theremedy of letters patent appeal against that decision is unavailable.The question as to whether the learned Single Judge had rightlyexercised the discretion or otherwise, could be assailed by therespondent before this Court by way of special leave petition.But, certainly not by way of a letters patent appeal under H

Clause 15. For, even if the learned Single Judge may havecommitted manifest error or wrongly decided the application forcondonation of delay, that judgment is ascribable to exercise ofjurisdiction under Section 34(3) of the Act. In other words, whetherthe prayer for condonation of delay can be accepted or whetherthe application deserves to be rejected, is a matter well within thejurisdiction of that court.”

25. This judgment does not in any manner militate against whathas been held by us. In answer to the question as to whether a singleJudge’s judgment condoning delay in filing an application under section34 was without jurisdiction, this Court correctly held that such an orderis in exercise of jurisdiction conferred by the statute.This judgmenttherefore cannot be said to be an authority for the proposition that, asthe converse position to the facts contained in the present appeal beforeus has been held to be not appealable, it must follow that even wheredelay is not condoned, the same position obtains. This would fly in theface of the reasoning contained in this judgment, as well as the reasoningcontained in Essar Constructions (supra), which has commended itselfto us.

26. We now come to this Court’s judgment in BGS SGS Soma(supra).As correctly pointed out by Shri Rao, the question before thisCourt in BGS SGS Soma (supra) was a completely different one, beingset out in paragraph 1 of the judgment as follows:

“1. Leave granted. Three appeals before us raise questions as tomaintainability of appeals under Section 37 of the Arbitration andConciliation Act, 1996 (hereinafter referred to as “the ArbitrationAct, 1996”), and, given the arbitration clause in these proceedings,whether the “seat” of the arbitration proceedings is New Delhi orFaridabad, consequent upon which a petition under Section 34 ofthe Arbitration Act, 1996 may be filed dependent on where theseat of arbitration is located.”

27. In answering this question, the Court first went into the interplaybetween section 37 of the Arbitration Act, 1996 and section 13 of theCommercial Courts Act, 2015, holding that section 37 of the ArbitrationAct alone provides grounds for appeal, section 13(1) of the CommercialCourts Act providing the procedure thereof. In the course of discussion,this Court then referred to a judgment of the Delhi High Court as follows:

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A“16. Shri Chowdhury also referred to another Delhi High Courtjudgment reported as Harmanprit Singh Sidhu v. ArcadiaShares & Stock Brokers (P) Ltd. [(2016) 234 DLT 30], in whicha learned Single Judge of the Delhi High Court allowed anapplication for condonation of delay in filing a Section 34 petition.The Division Bench, in holding that an appeal against such anBorder would not be maintainable under Section 37 of the ArbitrationAct, 1996, read with the Commercial Courts Act, 2015 held:

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“10. Coming to Section 37(1), it is evident that an appeal can liefrom only the orders specified in clauses (a), (b) or (c). In otherwords, an appeal under Section 37 would only be maintainableCagainst (a) an order refusing to refer the parties to arbitrationunder Section 8 of the A&C Act; (b) an order granting or refusingto grant any measure under Section 9 of the A&C Act; or (c) anorder setting aside or refusing to set aside an arbitral award underSection 34 of the A&C Act. The impugned order [Arcadia SharesD& Stock Brokers (P) Ltd. v. Harmanprit Singh Sidhu, 2016 SCCOnLine Del 6625] is clearly not relatable to Section 8 or 9 of theA&C Act. It was sought to be contended by the learned counselfor the appellant that the present appeal would fall within Section37(1)(c) which relates to an order “setting aside” or “refusing toset aside” an arbitral award under Section 34. We are unable toEaccept this proposition. By virtue of the impugned order, the arbitralaward dated 10-9-2013 has not been set aside. Nor has the court,at this stage, refused to set aside the said arbitral award underSection 34 of the A&C Act. In fact, the appellant in whose favourthe award has been made, would only be aggrieved if the award D

Fwere to have been set aside in whole or in part. That has nothappened. What the learned single Judge has done is to havecondoned the delay in re-filing of the petition under Section 34.This has not, in any way, impacted the award.”

17. The reasoning in this judgment in Harmanprit SinghSidhu commends itself to us, as a distinction is made betweenjudgments which either set aside, or refuse to set aside, an arbitralaward after the court applies its mind to Section 34 of theArbitration Act, 1996, as against preliminary orders of condonationof delay, which do not in any way impact the arbitral award thathas been assailed.”

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CHINTELS INDIA LTD. v. BHAYANA BUILDERS PVT. LTD.[R.F. NARIMAN, J.]

28. It is well settled that judgments are not to be construed likeEuclid’s theorems (see Amar Nath Om Prakash v. State of Punjab(1985) 1 SCC 345), but all observations made therein must relate to thecontext in which they were made. In that case, the Court put it thus:

“10. There is one other significant sentence in SreenivasaGeneral Traders v. State of A.P [(1983) 4 SCC 353] with whichwe must express our agreement, it was said:

“With utmost respect, these observations of the learned Judgeare not to be read as Euclid’s theorems, nor as provisions of astatute. These observations must be read in the context in whichthey appear.”

We consider it proper to say, as we have already said in othercases, that judgments of courts are not to be construed as statutes.To interpret words, phrases and provisions of a statute, it maybecome necessary for Judges to embark into lengthy discussionsbut the discussion is meant to explain and not to define. Judgesinterpret statutes, they do not interpret judgments. They interpretwords of statutes; their words are not to be interpreted as statutes.

In London Graving Dock Co. Ltd. v. Horton [1951 AC 737,761] Lord MacDermott observed:

“The matter cannot, of course, be settled merely by treatingthe ipsissima verba of Willes, J., as though they were part of anAct of Parliament and applying the rules of interpretationappropriate thereto. This is not to detract from the great weight tobe given to the language actually used by that most distinguishedJudge....

In Home Office v. Dorset Yacht Co. Ltd. [(1970) 2 All ER 294]Lord Reid said:

“Lord Atkin’s speech [Donoghue v. Stevension, 1932 All ER Rep1, 11] ... is not to be treated as if it was a statutory definition. Itwill require qualification in new circumstances.”

Megarry, J. in (1971) 1 WLR 1062 observed:

“One must not, of course, construe even a reserved judgment ofeven Russell, L.J. as if it were an Act of Parliament.”

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And, in Herrington v. British Railways Board [1972 AC 877(HL)] Lord Morris said:

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“There is always peril in treating the words of a speech or ajudgment as though they were words in a legislative enactment,and it is to be remembered that judicial utterances are made in thesetting of the facts of a particular case.”

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11. There are a few other observations in Kewal Krishan Puricase [(1980) 1 SCC 416] to which apply with the same force allthat we have said above. It is needless to repeat the oft-quotedtruism of Lord Halsbury that a case is only an authority for whatit actually decides and not for what may seem to follow logicallyfrom it.”

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29. The context in which paragraph 17 of BGS SGS Soma (supra)was made, was a context in which an application under section 34 wouldhave to be returned to the Court which had jurisdiction to decide a sectionD34 application, dependent upon where the seat of the arbitral tribunalwas located. In this context, it was held that a mere preliminary step,which did not lead to the application being rejected finally, cannot becharacterised as an order which would result in the application’s fatebeing sealed once and for all. The Court’s focus was not on the languageof section 37(1)(c), nor were any arguments addressed as to its correctEinterpretation. As a matter of fact, Harmanprit Singh Sidhu (supra)itself went on to hold:

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“13. In sum, the impugned order does not fall within the categoryof appealable orders specified in Section 37(1) of the A&C Act.Therefore, even if the provisions of Section 37(1) are read withSection 13 of the Commercial Courts Act, the present appeal isnot maintainable. This, however, does not mean that the appellantcannot take up the ground that is sought to be urged before us ifthe decision in OMP 294/2014 (under Section 34 of the A&CAct) goes against him. In other words, if the arbitral award is setaside in part or in whole and the appellant is aggrieved thereby, hemay prefer an appeal under Section 37 of the A&C Act on meritsas also on the ground that the delay in re-filing ought not to havebeen condoned. This is in line with the scheme of the A&C Act ofnot, in any way, stalling the proceedings thereunder. For example,under Section 13(4) of the A&C Act, if a challenge to an arbitrator F

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is not successful, the arbitral tribunal is required to continue thearbitral proceedings and make an arbitral award and, in such aninstance, as provided in Section 13(5) of the A&C Act, the partychallenging the arbitrator may make an application for setting asidesuch an arbitral award in accordance with Section 34. In otherwords, recourse to a remedy for an unsuccessful challenge to anarbitrator is deferred till the stage of the making of the award.Similarly, under Section 16, an arbitral tribunal may rule on itsjurisdiction. In a case where the arbitral tribunal rejects a pleawith regard to its jurisdiction, it is enjoined by Section 16(5) of theA&C Act to continue with the arbitral proceedings and to makethe arbitral award. Section 16(6) stipulates that a party aggrievedby such an arbitral award may make an application for settingaside the award in accordance with Section 34. Here, too, theunsuccessful party, who challenges the jurisdiction of an arbitraltribunal, is asked to wait till the award is made. The remedy ofquestioning the decision of the arbitral tribunal with regard to thearbitrator’s jurisdiction in such a case is not extinguished but ismerely deferred till the making of the arbitral award. In similarvein, in the present case, the remedy of challenging the decisionof condoning the delay in re-filing is not extinguished but is deferredtill the final decision of the court on the pending Section 34 petition.”

30. Obviously therefore, an observation of this Court torn out ofits context cannot be said to conclude the issue that is now before us.

31. We now come to the sheet anchor of Shri Rohatgi’s case,namely, Ramdas Construction Co. (supra). In this judgment, a DivisionBench of the Bombay High Court held:

“9. Sub-section (3) of section 34 of the Act provides that anapplication for setting aside may be made after three months haveelapsed from the date on which the party making such applicationhad received the arbitral award or, if a request had been madeunder section 33, from the date on which that request had beendisposed of by the arbitral tribunal, provided that if the Court issatisfied that the applicant was prevented by sufficient cause frommaking the application within the said period of three months, itmay entertain the application within a further period of thirty days,but not thereafter. This provision of law expressly reveals that thelegislature has provided a specific period of limitation for filing an AB

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Aapplication for setting aside of the award and simultaneously theCourt has been given discretion to extend such period only bythirty days, and not beyond the said period of thirty days. Theprovision is very clear in that regard. However, the scope of enquiryunder sub-section (3) is restricted to the cause for delay in filingthe application but it does not relate to the merits of the applicationBfor setting aside of the award. Being so, an order which is to bepassed in exercise of powers under sub-section (3) of section 34of the Act cannot extend to the subject matter of the applicationfor setting aside of the award but has to restrict to the aspect ofdelay in filing such application only. Such an order is notCcontemplated to be an appealable order within the meaning of thesaid expression under section 37 of the Act. It is very clear fromthe fact that section 37 refers to the orders dealing with the aspectof setting aside or refusing to set aside an arbitral award. It doesnot refer to the proceedings preceding the enquiry in relation tothe issue of setting aside or refusing to set aside an arbitral award.DThe subject-matter of delay in filing an application and thecondonation thereof relates to the proceedings preceding theenquiry for setting aside or refusing to set aside an arbitral award.Once it is clear that section 37(1)(b) does not contemplate anyorder passed in such proceeding relating to the matter precedingEthe enquiry in relation to setting aside or refusing to set aside anarbitral award, such an order cannot be considered as an appealableorder within the meaning of the said expression under section 37of the Act.

10. Undoubtedly the impugned order while rejecting the applicationfor condonation of delay, clearly observes:

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“Consequently, application under section 34 of the Arbitration andConciliation Act, 1996 for setting aside the award is also rejectedbeing barred by time.”

In other words, the Court has not dealt with the application forsetting aside of the award on merits and the same has been disposedof solely as a consequence of rejection of the application forcondonation of delay and there has been no enquiry as regardsthe rights of the parties on the issue of setting aside of the award.The appealable order which is contemplated for the purpose ofexercise of appellate jurisdiction is the one which deals with the G

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merits of the case in relation to the claim for setting aside orrefusing to set aside an arbitral award. As already stated above,the appellate powers under section 37 are not in relation to theproceedings which precedes the enquiry regarding setting asideor refusing to set aside an arbitral award. Being so, theconsequence of the order of dismissal of the application forcondonation of delay cannot itself amount to an appealable orderunder section 34(1) for the purpose of appeal under section 37(1)of the Act.”

32. This judgment cannot be said to state the law correctly as itdoes not advert to the decision of this Court in Essar Constructions(supra), and is against the interpretation of section 37(1)(c) of theArbitration Act, 1996 given by us above. We may also add that thisCourt, in dismissing the Civil Appeal against the aforesaid judgment,held:

“1. The appellants before this Court, in the first instance, impugnedthe award rendered by the Chief Engineer on 30.06.2005, bypreferring an appeal before the District Judge, Nagpur. The DistrictJudge, Nagpur, declined to entertain the appeal on merits, as hefound the same barred by limitation, and as such, the applicationfor condonation of delay was dismissed. The District Judge, Nagpurin his order dated 23.12.2005 recorded as under:

“17. In nut-shell, what emerges from the material placed on therecord is that the applicants or in other words, party makingapplication under Section 34 duly received the award on 4.7.2005,but approached this Court on 18.11.2005. Time in between 4.7.2005and 18.11.2005 was consumed in taking administrative decision.Beyond statutory period of limitation of three months, further periodof thirty days can be condoned, but not thereafter. On 4.11.2005,entire period of four months elapsed. In this view of the matter,this Court has no jurisdiction to entertain the application forcondonation of delay and for that matter, application under Section34 of the Act.”

2. The order dated 23.12.2005 was assailed by the appellantsbefore the High Court. Having remained unsuccessful, theappellants have approached this Court. The primary issue, thatemerges for consideration is, whether the dismissal of the A

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Aapplication filed by the appellants under Section 34 of theArbitration and Conciliation Act, 1996 (hereinafter referred to asthe ‘Arbitration Act’), by the District Judge, Nagpur, was justifiedin law.

3. So far as the issue in hand is concerned, having heard learnedBcounsel for the rival parties, we are satisfied that on an earlieroccasion, the same proposition came up for consideration beforethis Court, and stands declared by this Court in State of HimachalPradesh vs. Himachal Techno Engineers (2010) 12 SCC 210. Inview of the legal position declared by this Court, on the subject oflimitation under Section 34 of the Arbitration Act, we are of theCview, that the order passed by the District Judge, Nagpur, callsfor no interference.”

33. The order of this Court does not in any manner touch upon thereasoning of the Bombay High Court. On the contrary, this court refersto the judgment of this Court in Himachal Pradesh Techno EngineersD(supra), which as has been held by us hereinabove, makes it clear thatSection 5 of the Limitation Act is excluded by section 34(3) of theArbitration Act, 1996 and that no condonation of delay can take placebeyond the period of 120 days. It is on this ground, citing the learnedDistrict Judge’s order, that this Court did not interfere. Consequently, itEcannot be said that this Court approved of the judgment of the DivisionBench of the Bombay High Court. Likewise, the reasoning contained inRadha Krishna Seth (supra), does not commend itself to us.Both thesejudgments therefore do not state the law correctly and stand overruled.

34. Shri Rohatgi referred to the Statement of Objects and ReasonsFof the Arbitration Act, 1996and in particular clause 4(v), which reads asfollows:

“4. Main objects of the Bill are as under:

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(v) to minimise the supervisory role of courts in the arbitralGprocess;”

35. Shri Rohatgi then read section 5 of the Arbitration Act, 1996to us. According to him, in furtherance of this object,section 37 wasenacted giving a limited right of appeal. He argued that an appeal, beinga creature of statute should not, therefore, be enlarged beyond what isH

provided by the Legislature. Section 5 of the Arbitration and ConciliationAct reads as follows:

“5. Extent of judicial intervention.—Notwithstanding anythingcontained in any other law for the time being in force, in mattersgoverned by this Part, no judicial authority shall intervene exceptwhere so provided in this Part.”

36. This section does not take Shri Rohatgi’s argument muchfurther, as after the non-obstante clause, the section states that nojudicial authority shall intervene “except where so provided in this Part”.What is “provided in this part” is section 37, which therefore brings usback to square one. Undoubtedly, a limited right of appeal is given undersection 37 of the Arbitration Act, 1996. But it is not the province or dutyof this Court to further limit such right by excluding appeals which are infact provided for, given the language of the provision as interpreted byus hereinabove. Thus, this last argument also has no legs on which tostand.

37. Consequently, the question of law is answered by stating thatan appeal under section 37(1)(c) of the Arbitration Act, 1996 would bemaintainable against an order refusing to condone delay in filing anapplication under section 34 of the Arbitration Act, 1996 to set aside anaward.

38. The appeal is accordingly allowed. The impugned judgmentof the Division Bench under appeal is set aside, and the matter is remittedto a Division Bench of the High Court of Delhito decide whether theSingle Judge’s refusal to condone delay is or is not correct.

39. The appeal is allowed in the aforesaid terms. All pendingapplications are disposed of.

Ankit Gyan

Appeal allowed.

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