The High Court
Case Details
- 1 - NC: 2025:KHC:4366-DB MFA No. 5841 of 2024 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 30TH DAY OF JANUARY, 2025 PRESENT THE HON'BLE MR JUSTICE V KAMESWAR RAO AND THE HON'BLE MR JUSTICE S RACHAIAH MISCELLANEOUS FIRST APPEAL NO. 5841 OF 2024 (AA) BETWEEN: BOARD OF NEW MANGALORE PORT AUTHORITY, PANABUR-575 010. REP. BY ITS DEPUTY CONSERVATOR MR. S.R.PATTANAYAK. (BY SRI. SEETHARAM RAO, ADVOCATE) AND: …APPELLANT Digitally signed by K G RENUKAMBA Location: High Court of Karnataka 1. M/S CCC BUILDERS MERCHANT PVT. LTD.,
Legal Reasoning
C-06 IA, SUPERMART-1, DLF CITY PHASE IV, GURUGRAM, HARYANA-122 002. REP. BY ITS MANAGING DIRECTOR MR. GAURAV HOTA. 2. HON'BLE JUSTICE N.KUMAR, FORMER JUDGE, HIGH COURT OF KARNATAKA, ARBITRATION AND CONCILIATION CENTRE, KHANIJA BHAVAN, BENGALURU-560 001. (BY SRI. SHIVAKUMAR, ADVOCATE FOR C/R1) …RESPONDENTS - 2 - NC: 2025:KHC:4366-DB MFA No. 5841 of 2024 THIS MFA IS FILED UNDER SECTION 37(1)(C) OF THE ARBITRATION AND CONCILIATION ACT, AGAINST THE ORDER DATED 16.07.2024 PASSED ON IA.NO.1 IN AP.NO.79/2023 ON IV ADDITIONAL DISTRICT JUDGE, D.K., DISMISSING THE IA.NO.I FILED UNDER SECTION 34(3) OF THE ARBITRATION AND CONCILIATION ACT. THIS APPEAL, COMING ON FOR FINAL HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE V KAMESWAR RAO and HON'BLE MR JUSTICE S RACHAIAH ORAL JUDGMENT (PER: HON'BLE MR JUSTICE V KAMESWAR RAO) The challenge in this appeal is to an order dated 16.07.2024 passed by the Court of IV Additional District Judge, Mangalore (‘District Judge’ for short), whereby the learned District Judge has dismissed the IA No.I filed by the appellant herein under Section 34(3) of the Arbitration and Conciliation Act, 1996 (‘the Act’ for short) in AP No.79/2023 and resultantly dismissedIA No.IV filed under Order VII Rule 10 read with Section 151 of CPC and petition under Section 34 of the Act. 2. IA No.I was filed by the appellant herein under Section 34(3) of the Act seeking condonation of delay of 25 days in preferring the petition under Section 34 of the Act challenging - 3 - NC: 2025:KHC:4366-DB MFA No. 5841 of 2024 the arbitral award dated 12.08.2022 in AC No.69/2020. The application was filed on the ground that there was some confusion regarding the jurisdictional Court for filing the petition under Section 34 of the Act, due to which the petition could not be filed within three months, but the same was filed beyond the period of three months, but before acceptable period of 30 days, as is contemplated under the Act. The reasoning given by the appellant for seeking condonation of delay was not accepted by the learned District Judge, who held that the said reasoning is not a sufficient cause seeking condonation of delay in filing the petition and even otherwise, prior mandatory notice as per Section 34(5) of the Act was sent only on 17.03.2023 which is beyond the stipulated period of 90 days (must be read as three months) from the date of receipt of the award. 3. Even on the other ground, as to whether the award was received on 28.11.2022 which shall be the date for computing limitation for challenging the arbitral award, the learned counsel for the appellant has produced the copy of application register to contend that the award in AC No.69/2020 was, in fact, received on 28.11.2022. - 4 - NC: 2025:KHC:4366-DB MFA No. 5841 of 2024 4. The law in the facts is well settled that even if the petition under Section 34 is not filed within three months, but has been filed before the expiry of 30 days thereafter, there is a little bit of discretion available to the Court to condone the delay as refusal to condone the delay has a drastic effect in as much as the same shall have the effect of foreclosing the right of the appellant to challenge to the award, resulting in the arbitral award becoming final and required to be implemented. In this regard, we may refer to the judgment of the Supreme Court in the case of Mehta Construction Company [(2022) 5 SCC 432], wherein in paragraphs No.7 to 14, the Supreme Court has held as under: “7. As per sub-section (3) to Section 34 of the Act, an application for setting aside an award is to be made within three months from the date on which a party filing objections under sub-section (1) to Section 34 has received the arbitral award; or, if a request has been made under Section 33, from the date on which that request has been disposed of by the Arbitral Tribunal. However, the proviso states that the Court may condone delay of a period up to thirty days in filing of the objections if it is satisfied that the applicant is prevented by sufficient cause - 5 - NC: 2025:KHC:4366-DB MFA No. 5841 of 2024 from making an application under Section 34(1) of the Act. 8. In the present case, it is an accepted position that the application for setting aside of the award dated 20-12-2013 was made on 28-3-2014 accompanied by an application for condonation of delay. The Court, therefore, had the power to condone the eight days' delay, which was less than thirty days, in terms of the proviso to sub-section (3) to Section 34 of the Act. In the application seeking condonation of delay, it was inter alia stated that after receiving a copy of the award at about 6.50 p.m. on 20-3-2014, the appellant had engaged an empanelled advocate and the records pertaining to the arbitration case were constructed and examined. The short delay had also occurred as sanctions and approvals were required from the higher/competent authority. 9. Given the aforesaid background and the short condonable delay which had occurred, we do not think that the High Court and the Additional District Judge, Karnal were justified in refusing to condone the delay. The application for condonation of delay in filing of the objections should have been allowed. 10. The learned counsel for the respondent, however, contends that the Additional District Judge, - 6 - NC: 2025:KHC:4366-DB MFA No. 5841 of 2024 Karnal had also dismissed the objections on merits. We have considered this contention but observe that the observation and findings recorded by the Additional District Judge are cryptic and perfunctory. The same is equally true of the reasoning given by the High Court in the impugned order [Haryana Urban Development Authority (HUDA) v. Mehta Construction Co., 2019 SCC OnLine P&H 6257] , which is full of generalisation and does not deal with specific issues and contentions raised by the appellant in the objections. In particular, the objection that the claims of the respondent were barred by limitation. (Emphasis supplied) 4. Even otherwise, learned counsel for the 1st respondent do not really oppose the appeal, but only states that, the matter be remanded back to the District Judge for consideration of IA No.IV and the petition under Section 34 of the Act. 5. In view of our above conclusion and also noting the submission made by the learned counsel for the 1st respondent,
Decision
we set aside the order dated 16.07.2024 passed by the learned District Judge on IA No.I in AP No.79/2023; allow the same and condone the delay of 25 days in filing the petition under Section - 7 - NC: 2025:KHC:4366-DB MFA No. 5841 of 2024 34 of the Act; and restore IA No.IV and petition filed under Section 34 of the Act in AP No.79/2023 on the file of the District Judge who shall consider and decide the same in accordance with law. The appeal is disposed of. No costs. In view of disposal of the appeal, IA No.1/2024 is disposed of as infructuous. Sd/- (V KAMESWAR RAO) JUDGE Sd/- (S RACHAIAH) JUDGE PA List No.: 1 Sl No.: 47