Supreme Court of India

Bhimashankar Sahakari Sakkare ... vs Walchandnagar Industries Ltd. (Wil) on 10 April, 2023

Author:
M. R. Shah

Bench:
Krishna Murari
,
M. R. Shah

REPORTABLE

IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 6810 of 2022
(@SLP (C) NO.11216 of 2022)

Bhimashankar Sahakari
Sakkare Karkhane Niyamita ..Appellant(s)

Versus

Walchandnagar Industries
Ltd. (WIL) ..Respondent(s)

JUDGMENT

M. R. Shah, J.

Signature Not Verified

1. Feeling aggrieved and dissatisfied with the

Digitally signed by R

Natarajan

Date: 2023.04.10

16:38:21 IST

Reason:

impugned judgment and order dated

Civil Appeal No. 6810 of 2022 Page 1 of 44

23.02.2022 passed by the High Court of
Karnataka, at Kalaburagi in Misc. First Appeal
No.201018/2018 by which the High Court has
dismissed the said appeal and has confirmed
the order dated 02.04.2018 passed by the
learned III Additional District & Sessions
Judge, Vijayapur (hereinafter referred to as
“trial Court”) in rejecting the application for
condonation of delay caused in preferring the
application under
Section 34
of the Arbitration
and Conciliation Act, 1996 (hereinafter referred
to as “
Arbitration Act
”) , the original applicant
has preferred the present appeal.

2. The brief facts leading to filing of the present
appeal in nut­shell are as under:

2.1 That, an arbitral award was passed against the
appellant under the provisions of the

Arbitration Act
on 24.08.2016. As per Section
34(3) of the Arbitration Act, 90 days are
prescribed for preferring an application under

Section 34
of the Arbitration Act against the
arbitral award. However, the said period was

Civil Appeal No. 6810 of 2022 Page 2 of 44

extendable by a further period of 30 days in
terms of the proviso to
Section 34(3)
of the Act,
2016. In the present case, the period of 90
days prescribed under
Section 34(3)
of the
Arbitration Act expired on 24.11.2016. The
appellant was entitled to a further extended
period of 30 days from 23.11.2016 onwards in
terms of the proviso to
Section 34(3)
which was
upto 24.12.2016.

2.2 The trial Courts were closed on account of
winter / Christmas vacations from 19.12.2016
to 01.01.2017. However, it so happened that
extendable / condonable period of 30 days as
contemplated in the proviso to
Section 34(3)

expired on 24.12.2016 on which day the trial
Court was closed on account of winter /
Christmas vacation. The appellant herein filed
the application under
Section 34
of the
Arbitration Act, challenging the award passed
by the Arbitral Tribunal. The appellant also
filed IA No.1 for condonation of delay. Both,

Section 34
application as well as the

Civil Appeal No. 6810 of 2022 Page 3 of 44

application for condonation of delay were filed
on the reopening day i.e. on 02.01.2017. As
the application under
Section 34
of the
Arbitration Act was beyond the prescribed
period of provided under
Section 34
of the
Arbitration Act as well as beyond the
condonable period of 30 days, the learned trial
Court dismissed the IA No.1 and refused to
condone the delay by observing that the period
beyond 120 days is not condonable as under

the
Arbitration Act
, maximum period provided
for preferring an application under
Section 34

is 120 days. At this stage it is required to be
noted that in the affidavit filed by the appellant
before the High Court, filed in support of IA
No.1, the appellant as such admitted that it
received the copy of the award on 24.08.2016.
However, according to the appellant, the said
award was misplaced and thereafter obtained a
fresh copy on 29.12.2016. The learned trial
Court observed that in that view of the matter,
the period of limitation would commence from
24.08.2016 and 120 days are to be counted

Civil Appeal No. 6810 of 2022 Page 4 of 44

from 24.08.2016.

2.3 Feeling aggrieved and dissatisfied with the
order passed by the learned trial Court
refusing to condone the delay in preferring
application under
Section 34
of the Arbitration
Act, the appellant herein preferred an appeal
before the High Court.

2.4 Before the High Court,
Section 4
of the
Limitation Act, 1963 and
Section 10
of the
General Clauses Act, 1897 were pressed into
service. By the impugned judgment and order
the High Court has dismissed the said appeal
by observing that the expression “prescribed
period” appearing in
Section 4
of the Limitation
Act cannot be construed to mean anything
other than the period of limitation and
therefore, any period beyond the prescribed
period, during which the Court or Tribunal has
the discretion to allow a person to institute the
proceeding, cannot be taken to be “prescribed
period”.

Civil Appeal No. 6810 of 2022 Page 5 of 44

2.5 Feeling aggrieved and dissatisfied with the
impugned judgment and order passed by the
High Court, the original applicant has
preferred the present appeal.

3. Shri Shyam Diwan, learned Senior Advocate
has appeared on behalf of the appellant and
Shri Dhruv Mehta, learned Senior Advocate
has appeared on behalf of the contesting
respondent.

4. Shri Shyam Diwan, learned Counsel has
submitted that
Section 34(3)
of the Arbitration
Act specifies that the limitation period for filing
an application for setting aside the arbitral
award under
Section 34
is three months from
the date on which the party making application
has received the award. However, if the Court
is satisfied that the applicant was prevented by
sufficient cause from making the application
within the said period of three months, the
proviso to the Section specifies a further period
of 30 days within which the application under

Section 34
may be filed/entertained.

Civil Appeal No. 6810 of 2022 Page 6 of 44

4.1 It is submitted that the central question in the
present petition is whether when the last day
of condonable period of 30 days falls on a
holiday or during a court vacation, would the
benefit of
Section 10
of the General Clauses
Act, 1897 would be available to the appellant?

4.2 It is submitted that in other words, can the
petitioner – appellant file the application on the
next date when the Court reopens, in line with
the settled principle that the law does not
compel a person to do an impossible act. It is
submitted that in the present case the
petitioner – appellant had filed the application
under
Section 34
on the very day when the
Court reopened.

4.3 It is submitted by Shri Shyam Diwan, learned
Senior Counsel that not extending the benefit
of
Section 10
of the General Clauses Act to the
appellant in such circumstances leads to an
anomalous situation wherein the benefit of
statutorily prescribed condonable period is cut

Civil Appeal No. 6810 of 2022 Page 7 of 44

short for some persons due to intervention of a
holiday or a court vacation, while being fully
available to other persons due to the fortuitous
circumstance of no court vacation intervening.

It is submitted that this creates uncertainty
and unpredictability in the application of
provision in question.

4.4 It is submitted that the present case reflects an
anomalous situation where
Section 4
of the
Limitation Act, which only deals with the
period of limitation prescribed under the

Limitation Act
, leaves a vacuum as far as
statutory condonable period is concerned. It is
submitted that the judgment in the case of

Assam Urban Water Supply and Sewerage
Board vs. Subash Projects and Marketing
Limited
reported in (2012) 2 SCC 624 failed
to take into account that in the case of such
statutory condonable periods,
Section 10
of the
General Clauses Act, 1897, which is much
wider in its import and applicability, and
embodies the same legal principle, must

Civil Appeal No. 6810 of 2022 Page 8 of 44

necessarily step in to fill the vacuum.

4.5 It is submitted that while passing the
impugned judgment and order, the High Court
has heavily relied upon the decision of this
Court in the case of
Assam Urban
(Supra)
while holding that the term “prescribed period”
referred to in
Section 4
of the Limitation Act,
1963 only includes the limitation period and
not the 30­day condonable / grace period.

It is
submitted that however the case of
Assam
Urban
(Supra) does not notice or deal with

Section 10
of the General Clauses Act, 1897. It
only notices and deals with
Section 4
of the
Limitation Act, 1963 and holds that the term
“prescribed period” mentioned in
Section 4

means the period of limitation.

It is submitted
that the judgment in the case of
Assam Urban

(Supra) fails to notice that
Section 4
of the
Limitation Act, 1963 which deals with the
period of limitation prescribed under the

Limitation Act, 1963
, leaves a vacuum as far
as the statutory condonable period is

Civil Appeal No. 6810 of 2022 Page 9 of 44

concerned.

4.6 It is submitted that in failing to notice
Section
of the General Clauses Act, 1897, the
judgment in the case of
Assam Urban
(Supra)
disregards the principle embodied in the

General Clauses Act
which is much wider in its
import and applicability and must necessarily
step in to fill the vacuum left by
Section 4
of
the Limitation Act.

4.7 It is further submitted by Shri Diwan, learned
Senior Counsel appearing for the appellant
that although the same general principle of
“elementary justice” is embodied in both
Sections of the two Acts, there is a crucial
distinction between the
Limitation Act, 1963

and the
General Clauses Act, 1897
.

4.8 It is submitted that
Section 2(j)
of the
Limitation Act defines “period of limitation”. It
is submitted that thus, while the term
“prescribed period” has a narrower meaning in
the context of
Limitation Act
, there is no such

Civil Appeal No. 6810 of 2022 Page 10 of 44

restrictive definition clause in the
General
Clauses Act
. It is submitted that in fact, the
scheme of
Section 10
of the General Clauses
Act is clear from a bare perusal of the provision
and indicates that there are two prescribed
periods in this Section viz. (1) the prescribed
period within which something is directed to be
done, or (2) the prescribed period within which
something is allowed to be done.

4.9 It is submitted that therefore, reading of

Section 10
of the General Clauses Act, 1897
makes it clear that the period in which
something is allowed to be done, such as 30
days condonable period provided by proviso to

Section 34(3)
of the Arbitration Act is also a
prescribed period within the meaning of the

General Clauses Act, 1897
.

4.10 It is further submitted by Shri Shyam Diwan,
learned Senior Counsel appearing on behalf of
the appellant that the principle embodied in

Section 10
of the General Clauses Act, 1897 is
an elementary piece of justice. It is submitted

Civil Appeal No. 6810 of 2022 Page 11 of 44

that the 60th Law Commission Report on the
General Clauses Act reiterated the
parliamentary intention behind the Act and the
provision, which is to deliver elementary
justice.

4.11 It is submitted that in the case of
HUDA &
Anr. vs. Dr. Babeswar Kanhar & Anr.

reported in (2005) 1 SCC 191, this Court has
observed and held that every consideration of
justice and expediency would require that the
accepted principle which underlines
Section 10

of the General Clauses Act, 1897 should be
applied in cases where it does not otherwise in
terms apply. It is observed that the principles
underlying are lex non cogit ad impossibilia (law
does not compel a man to do the impossible)
and actus curiae neminem gravabit (the act of
court shall prejudice no man).

It is submitted
that in the case of
Manohar Joshi vs. Nitin
Bhaurao Patil and Ors.
reported in (1996) 1
SCC 169, it is observed and held by this Court
that the litigant has a right to avail limitation

Civil Appeal No. 6810 of 2022 Page 12 of 44

up to the last day and his only obligation is to
explain his inability to present the suit /
petition on the last day of limitation and each
day thereafter till it is actually presented.

4.12 It is further submitted that if as held in the
case of
Assam Urban
(Supra), the benefit of

Section 4
of the Limitation Act is only available
for the period of limitation and is not available
for the statutorily granted condonable period.

Section 10
of the General Clauses Act, 1897
must step in to fill the vacuum. It is submitted
that any contrary view would deny individuals
the full play of the statutory period of 30 days
for condonation of delay.

4.13 Now, so far as the contention on behalf of the
respondent that present proceeding is “any Act
or proceeding to which the
Limitation Act

applies” is a misconceived argument is
concerned, it is submitted that the
respondents have sought to rely on proviso to

Section 10
of the General Clauses Act, 1897.
Relying upon Section 43(1) of the Arbitration

Civil Appeal No. 6810 of 2022 Page 13 of 44

Act to contend that the
Limitation Act
applies
to the present proceedings, it is submitted that

Section 43(1)
of the Arbitration Act merely
states that “the
Limitation Act, 1963
shall
apply to arbitrations as it applies to
proceedings in Court”. It is submitted that this
cannot be interpreted to mean that the

Limitation Act
, in its entirety applies to
proceeding under
Section 34
of the Arbitration
Act and that the present proceedings are an
act or proceeding to which the
Limitation Act

applies. It is submitted that in fact, in matters
of limitation,
Section 34
of the Arbitration Act
is a complete code. It is submitted that the
respondent’s entire case, on one hand, is that
the benefit of
Limitation Act
, particularly

Section 4
of the Limitation Act, cannot be given
to the condonable period in the instant case. It
is submitted that therefore on one hand, the
respondent is arguing that the benefit of

Section 4
of the Limitation Act, as well as

Section 5
of the Limitation Act has no
application to the condonable period under

Civil Appeal No. 6810 of 2022 Page 14 of 44

Section 34
of the Arbitration Act, i.e. the

Limitation Act
has no application in the
present proceedings, at the same time, the
respondent is contending that the benefit of

Section 10
of the General Clauses Act, 1897
cannot be given to the appellant, as the
present proceeding falls within the ambit of the
phrase “any act or proceeding to which the
Indian Limitation Act, 1877, applies”.

4.14 It is further submitted by Shri Diwan, learned
Senior Counsel that the reliance placed on the
case of
Sagufa Ahmed & Ors. vs. Upper
Assam Polywood Products Private Limited
and Others
reported in (2021) 2 SCC 317 is
misconceived for the following two reasons:

(1) The reference to
Section 10
of the General
Clauses Act, 1897 in the case of
Sagufa
Ahmed
(Supra) is tangential at best;
(2) The facts of
Sagufa Ahmed
(Supra) are
clearly distinguishable from the case at
hand. In that case, the appellants had
waited 5 months after the discretionary

Civil Appeal No. 6810 of 2022 Page 15 of 44

period had expired to file an appeal against
the order of the Ld. NCLT. In the present
case, there was no undue delay on the part
of the Petitioner ­ appellant herein. The
petitioner ­ appellant filed the petition under
Section 34 of the very day of the reopening
of the Ld. Court.

4.15 It is submitted that this Court in its order
dated 08.03.2021 in suo moto Writ Petition
(Civil) No.3/2020, has put a quietus to the
artificial distinction between the ‘limitation
period’ and ‘grace period’, wherein it extended
the benefit of exemption due to COVID 19 to
the limitation period as well as the condonable
period.

4.16 It is further submitted by Shri Diwan, learned
Senior Counsel that the aim and object of the
limitation period and statutory grace period /
condonable period provided in the
Arbitration
Act
is to ensure that parties who sleep over
their rights and come to the court belatedly are
not allowed to upset the apple cart. It is

Civil Appeal No. 6810 of 2022 Page 16 of 44

submitted that in the present instance, the
appellant has been nothing but diligent and
approached the learned trial Court on the very
day of reopening. It is submitted that
Section
of the General Clauses Act, 1897 has been
enacted to address precisely this kind of a
situation and merely because the benefit of

Section 4
of the Limitation Act, 1963 is
unavailable in a case, should not ipso facto
exclude the application of the
General Clauses
Act, 1897
.

4.17 It is submitted that the appellant is an
agriculturists’ society, and despite having
suffered losses due to non­fulfillment of their
obligations by the respondent, the appellant’s
case has never been heard on merits. It is
submitted that therefore non­suiting the
appellant in the present instance and denying
the benefit of
Section 10
of the General
Clauses Act, 1897 (with the elementary rule of
justice captured in it) will cause a grave
miscarriage of justice.

Civil Appeal No. 6810 of 2022 Page 17 of 44

Making above submissions, it is prayed to
set aside the order passed by the learned trial
Court as well as the High Court and to
condone the delay caused in preferring
application under
Section 34
of the Arbitration
Act and to direct the learned trial Court to hear
the application under
Section 34
of the
Arbitration Act on merits by giving the
appellant an opportunity to put forth its case
on merits.

5. Present appeal is vehemently opposed by Shri
Dhruv Mehta, learned Senior Counsel
appearing on behalf of the respondent.

5.1 It is submitted that in the present case the
appellant admittedly received the award on
24.08.2016. As per
Section 34
of the
Arbitration Act, “the prescribed period” of 3
months to challenge the award expired on
24.11.2016 and further period of 30 days
under the proviso to
Section 34(3)
of the
Arbitration Act expired on 24.12.2016. That,
the learned trial Court was on winter vacation

Civil Appeal No. 6810 of 2022 Page 18 of 44

between 19.12.2016 to 01.01.2017. The
appellant preferred its
Section 34
of the
Arbitration Act before the learned trial Court
on 02.01.2017 i.e. on the day of reopening,
accompanied by an application seeking
condonation of delay. It is submitted that the
learned trial Court after considering both, the
maintainability and merits of the appellant’s
application for condonation, has found that the
application was not maintainable and also that
no sufficient cause had been shown by the
appellant. It is submitted that the High Court
has upheld the order of trial Court that the
petition under
Section 34
of the Arbitration Act
was not maintainable for being beyond the
“prescribed period” under
Section 34(3)
of the
Arbitration Act. It is submitted that therefore
the following questions arise for consideration
in the present case.

(1)Whether the benefit of
Section 4
of the
Limitation Act, 1963 is available to a party
when the “prescribed period” of 3 months for
filing a petition under Section 34(3) of the

Civil Appeal No. 6810 of 2022 Page 19 of 44

Arbitration Act
has already expired and the
discretionary period of 30 days under the
proviso to Section 34(3) falls on a day when
the Court is closed?

(2)Whether the benefit of
Section 10
of the
General Clauses Act,1897 is separately
available to a party in such circumstances?

5.2 Now, so far as the applicability of
Section 4
of
the Limitation Act is concerned, it is
vehemently submitted by Shri Dhruv Mehta,
learned Senior Counsel that
Section 4
of the
Limitation Act shall not be applicable to the 30
days’ discretionary condonable period
contemplated under proviso to
Section 34(3)
of
the Arbitration Act. It is submitted that
Section
34(3)
of the Arbitration Act stipulates that an
application under
Section 34(1)
of the
Arbitration Act challenging an arbitral award
may not be made after a period of three
months from the date on which the party
making the application had received the

Civil Appeal No. 6810 of 2022 Page 20 of 44

arbitral award. The proviso to
Section 34(3)

gives limited powers to the Court, on sufficient
cause being shown, to condone delay in filing
the application under
Section 34(1)
only for a
maximum period of 30 days, but not
thereafter. It is submitted that in the case of

Union of India v. Popular Construction Co.

reported in (2001) 8 SCC 470 (Paras 10, 12,
14 and 16), this Court has observed that
usage of words “but not thereafter” in the
proviso to
Section 34(3)
amounts to an express
exclusion within the meaning of
Section 29(2)

of the Limitation Act. Therefore, the Court
would have no discretion to condone the delay
in excess of 30 days.
Section 5
of the
Limitation Act was, therefore, held to be
inapplicable to
Section 34(1)
of the Arbitration
Act.

5.3 It is submitted that
Section 4
of the Limitation
Act is only applicable when the last date of the
“prescribed period” falls on a day on which the
Court is closed. It is submitted that the term,

Civil Appeal No. 6810 of 2022 Page 21 of 44

“prescribed period” is defined in
Section 2(j)
of
the Limitation Act as being the period of
limitation computed in accordance with the
provisions of the
Limitation Act
.

5.4 It is submitted that this Court in the case of

Assam Urban
(Supra) (Paras 10 to 14) has
held that “prescribed period” under
Section
34(3)
of the Arbitration Act is three months. It
is submitted that “further period” of 30 days
mentioned in the proviso to
Section 34(3)
of the
Arbitration Act cannot be said to be the “period
of limitation” and therefore, would not be the
“prescribed period” for the purposes of making
an application for setting aside the arbitral
award. It is submitted that thus, in
the said
decision
, this Court has categorically held that

Section 4
of the Limitation Act which applies
only to “prescribed period” is not attracted
when the last date of the “further period” of 30
days mentioned in
Section 34(3)
of the
Limitation Act falls on a day on which the
Court is closed.

It is submitted that the facts of

Civil Appeal No. 6810 of 2022 Page 22 of 44

the case in
Assam Urban
(Supra) are identical
to the facts of the present case.

It is submitted
that decision of this Court in the case of

Assam Urban
(Supra) has been affirmed by
Three Judges’ Bench of this Court in the case
of
Sagufa Ahmed
(Supra) (Paras 20 – 22).

5.5 It is further submitted by Shri Dhruv Mehta,
learned Senior Counsel that the correct
application of
Section 4
of the Limitation Act
will result in a petition being entertained as a
matter of right, without a party having to seek
condonation of delay, since it applies only to
petitions that would otherwise be within the
“prescribed period” but its presentation within
this period has been prevented due to closure
of the Court. However, on the other hand, this
cannot apply to a delayed petition where, in
any event, the right to present the petition is
subject sufficient cause being shown and
condonation of delay being sought.

5.6 Now, so far as the submission on behalf of the
appellant that the judgment in the case of

Civil Appeal No. 6810 of 2022 Page 23 of 44

Sagufa Ahmed
(Supra) is not a good law or is
distinguishable is concerned, it is submitted
that as such the decision in the case of
Sagufa
Ahmed
(Supra) lays down the correct law and
shall be applicable with full force on
interpretation of “to condone delay within
further period”.

5.7 It is submitted that the judgment in the case of

Sagufa Ahmed
(Supra), in the context of

Section 421(3)
of the Companies Act, 2013,
which provides a prescribed period of 45 days
for filing an appeal, and empowers the
appellate Tribunal to condone the delay within
“further period” not exceeding 45 days. A
Three­Judges Bench of this Court rejected the
contention of the appellants therein that the
benefit of order of this Court dated 23.03.2020
in Cognizance for Extension of Limitation, In
re, (2020) 19 SCC 10, is extendable to them, by
holding that under the order dated
23.03.2020, which was extended was only “the
period of limitation” and not the period up to

Civil Appeal No. 6810 of 2022 Page 24 of 44

which delay can be condoned in exercise of
discretion conferred by statute.

5.8 It is submitted that thus, in the case of
Sagufa
Ahmed
(Supra), this Court while affirming

Assam Urban
(Supra) has held that the
expression “prescribed period” appearing in

Section 4
of the Limitation Act cannot be
construed to mean anything other than the
period of limitation. Any period beyond the
“prescribed period” during which the Court or
Tribunal has the discretion to allow a person to
institute the proceedings cannot be taken to be
“prescribed period”.

5.9 Now, so far as the submission on behalf of the
appellant that the judgment in the case of

Assam Urban
(Supra) has the effect of denying
the parties to right to file their application for
condonation in situation where the
discretionary period expires during vacation
and that such interpretation was incorrect
inasmuch as it leaves parties at the mercy of
“fortuitous circumstance”, it is submitted that

Civil Appeal No. 6810 of 2022 Page 25 of 44

such a submission is not tenable. It is
submitted that the Court vacations are notified
well in advance and would not account to a
fortuitous circumstance as alleged. It is
submitted that on the date of receipt of award,
the party would be well aware of the limitation
period under
Section 34(3)
of the Arbitration
Act and ought to diligently secure its right. It is
submitted that in the present case, having
received the award on 24.08.2016, the
appellant had a further period of 25 days after
expiry of “prescribed period” and before
commencement of the winter vacation of the
trial Court. However, the petitioner ­ appellant
chose not to file its petition during this time
and therefore, as to suffer for the inevitable
consequences.

5.10 It is further submitted that right under
Section
of the Arbitration Act is a restricted right to
challenge an award on extremely limited
ground. The proviso to
Section 34(3)
of the
Arbitration Act further excludes the general

Civil Appeal No. 6810 of 2022 Page 26 of 44

power of the Court under
Section 5
of the
Limitation Act and imposes a strict timeline for
presentation of a petition under Section 34. In
such circumstances, acceptance of appellant’s
argument will have the effect of providing an
unduly enlarged time period (beyond the
statutory 30 day discretionary period) for
delayed presentation of a petition under
Section 34, which would be contrary to the
scheme and intent of the
Arbitration Act
.

5.11 Now, so far as the applicability of
Section 10
of
the General Clauses Act, 1897 as per the case
of the appellant is concerned, it is vehemently
submitted that as such the contention is
untenable in light of the proviso to
Section 10

of the General Clauses Act, 1897, which
specifically excludes the application of this
section to any Act or proceeding to which the

Indian Limitation Act
applies. It is submitted
that reference to 1877 Act will now have to be
read as reference to
Limitation Act, 1963
in
view of
section 8
of the General Clauses Act,

Civil Appeal No. 6810 of 2022 Page 27 of 44

1897. It is submitted that it is no longer res
integra that the
Limitation Act, 1963
applies to
arbitrations and court proceedings arising out
of the arbitrations in light of
Section 41(3)
of
the Arbitration Act. Reliance is placed upon the
decision of this Court in the case of
State of
Maharashtra v. Borse Brothers Engineers
and Contractors Pvt. Ltd.
reported in (
2021)
6 SCC 460 and Consolidated Engineering
Enterprises vs. Principal Secretary,
Irrigation Department and Ors.
reported in
(2008) 7 SCC 169. It is submitted that
therefore in light of the application of the

Limitation Act, 1963
applicable to the
proceedings under the
Arbitration Act
(both in
Court and in arbitration),
Section 10
of the
General Clauses Act, 1897 is specifically
excluded, and therefore, cannot be relied upon
by the appellant.

5.12 It is submitted that even otherwise this Court
in the
Sagufa Ahmed
(Supra) has held that
the principle forming the basis of
Section 10(1)

Civil Appeal No. 6810 of 2022 Page 28 of 44

of the
General Clauses Act, 1897
also finds a
place in
Section 4
of the Limitation Act.
Therefore, when the benefit of
Section 4
of the
Arbitration Act is not available, the appellant
cannot seek to take recourse to
Section 10
of
the General Clauses Act, 1897 which embodies
the same principle.

5.13 It is further submitted that just like
Section 4

of the Limitation Act,
Section 10
of the General
Clauses Act, 1897 also uses the term
“prescribed period”.
Section 10
of the General
Clauses Act, 1897 provides that where any act
is directed to be done on a certain day, or any
proceeding is allowed to be done in any Court
or office within prescribed period, if the Court
or office is closed on that certain day, or the
last day of the prescribed period, it may be
done or taken on the next working day.
Accordingly, if
Section 10
of the General
Clauses Act, 1897 was to be applicable, the
term “prescribed period” must be given the
same meaning as that in the
Limitation Act
.
Thus,
Section 10
of the General Clauses Act,

Civil Appeal No. 6810 of 2022 Page 29 of 44

1897 will also only then apply for the
prescribed period of three months under

Section 34(3)
of the Arbitration Act and not to
the discretionary period of 30 days under the
proviso to
Section 34(3)
of the Arbitration Act.

Making above submissions and relying
upon the decision of this Court in the case of

Assam Urban
(Supra) and
Sagufa Ahmed

(Supra), it is prayed to dismiss the present
appeal.

6. Having heard learned Counsel appearing for
the respective parties, a short question which
is posed for consideration of this Court is
whether in the facts and circumstances of the
case, the learned trial Court was justified in
not condoning the delay in preferring the
application under
Section 34(3)
of the
Arbitration Act, which was filed after the expiry
of 120 days but filed on the first day of
reopening after the winter / Christmas
vacation and in a case where the condonable
period of 30 days under Section 34(3) of the

Civil Appeal No. 6810 of 2022 Page 30 of 44

Arbitration Act
had fallen during the winter /
Christmas vacation ? The question is with
respect to applicability of
Section 4
of the
Limitation and
Section 10
of the General
Clauses Act, 1897 in the facts and
circumstances of the case.

Therefore, the central question in the
present appeal is whether when the last day of
condonable period of 30 days (under
Section
34(3)
of the Arbitration Act) falls on holiday or
during the Court vacation, would the benefit of

Section 10
of the General Clauses Act, 1897 be
available?

7. While considering the aforesaid issues/
questions,
Section 34
of the Arbitration Act is
required to be referred to, which reads as
under:

“34. Application for setting aside
arbitral award.­ (3) An application for
setting aside may not be made after
three months have elapsed from the
date on which the party making that

Civil Appeal No. 6810 of 2022 Page 31 of 44

application had received the arbitral
award or, if a request had been made
under section 33, from the date on
which that request had been disposed
of by the arbitral Tribunal:

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

The relevant provisions of the
Indian
Limitation Act and the General Clauses Act,
are also required to be referred to which
are as under:

“2.(j) ‘period of limitation’ (which)
means the period of limitation
prescribed for any suit, appeal or
application by the Schedule, and
‘prescribed period’ means the period of
limitation computed in accordance with
the provisions of this Act;”

“4. Expiry of prescribed period
when court is closed.­ Where the
prescribed period for any suit, appeal
or application expires on a day when
the court is closed, the suit, appeal or
application may be instituted,

Civil Appeal No. 6810 of 2022 Page 32 of 44

preferred or made on the day when the
court reopens.

Explanation.­ A court shall be
deemed to be closed on any day within
the meaning of this section if during
any part of its normal working hours it
remains closed on that day.”

“
Section 10
of the General Clauses Act,
10. Computation of time.­ (1) Where,
by any 47 (Central Act) or Regulation
made after the commencement of this
Act, any act or proceeding is directed
or allowed to be done or taken in any
Court or office on a certain day or
within a prescribed period, then, if the
Court or office is closed on that day or
the last day of the prescribed period,
the act or proceeding shall be
considered as done or taken in due
time if it is done or taken on the next
day afterwards on which the Court or
office is open:

Provided that nothing in this
section shall apply to any act or
proceeding to which the Indian
Limitation Act, 1877, 48 applies.

(2) This section applies also to
all 49 (Central Acts) and Regulations
made on or after the fourteenth day of
January, 1887.”
(emphasis supplied)”

Civil Appeal No. 6810 of 2022 Page 33 of 44

7.1
Section 34(3)
of the Arbitration Act and

Sections 2(j)
and
of the Limitation Act, 1963
fell for consideration before this Court in the
case of
Assam Urban
(Supra).

Even the very
issue raised in the present appeal fell for
consideration before this Court in the case of

Assam Urban
(Supra). In the aforesaid
decision, this Court interpreted the aforesaid
provisions and has specifically observed and
held that the benefit of exclusion of period
during which Court is closed is available only
when application for setting aside the award is
filed within ‘prescribed period of limitation’ and
it is not available in respect of period
extendable by the Court in exercise of its
discretion.

By holding so, this Court
considered the earlier decisions in the case of

Popular Construction Co.
(Supra) and
State
of Maharashtra vs. Hindustan Construction
Co. Ltd.
reported in (2010) 4 SCC 518 and
has observed and held in paragraphs 6 to 9 as
under:

Civil Appeal No. 6810 of 2022 Page 34 of 44

“6. Section 34(3) of the 1996 Act provides
that an application for setting aside an award
may be made within three months of the
receipt of the arbitral award. The proviso that
follows sub­section (3) of Section 34 provides
that on sufficient cause being shown, the
court may entertain the application for
setting aside the award after the period of
three months and within a further period of
30 days but not thereafter.

7. In Popular Construction Co.1, this Court has
held that an application for setting aside an
award filed beyond the period mentioned in
Section 34(3) would not be an application "in
accordance with sub­section (3) as required
under Section 34(1) of the 1996 Act" and

Section 5
of the 1963 Act has no application
to such application. In para 12 of the Report,
it was held in Popular Construction Co.1
thus: (SCC pp.474­75)
"12. As far as the language of Section 34
of the 1996 Act is concerned, the crucial
words are "but not thereafter" used in
the proviso to sub­section (3). In our
opinion, this phrase would amount to an
express exclusion within the meaning of

Section 29(2)
of the Limitation Act, and
would therefore bar the application of

Section 5
of that Act. Parliament did not
need to go further. To hold that the court
could entertain an application to set
aside the award beyond the extended
period under the proviso, would render
the phrase "but not thereafter" wholly
otiose. No principle of interpretation
would justify such a result".

Civil Appeal No. 6810 of 2022 Page 35 of 44

8. Recently, in State of Maharashtra v.

Hindustan Construction Company Limited2, a
two­Judge Bench of this Court speaking
through one of us (R.M. Lodha, J.)
emphasised the mandatory nature of the limit
to the extension of the period provided in
proviso to Section 34(3) and held that an
application for setting aside arbitral award
under Section 34 of the 1996 Act has to be
made within the time prescribed under sub­
section (3) of Section 34 i.e., within three
months and a further period of 30 days on
sufficient cause being shown and not
thereafter.

9. Section 43(1) of the 1996 Act provides that
the 1963 Act shall apply to arbitrations as it
applies to proceedings in court. The 1963 Act
is thus applicable to the matters of
arbitration covered by the 1996 Act save and
except to the extent its applicability has been
excluded by virtue of the express provision
contained in Section 34(3) of the 1996 Act.”

Before this Court there existed, similar facts
like in the present case. In the case before this
Court, the arbitral awards were received by the
appellants on 26.08.2003. No application for
setting aside the arbitral award was made
before elapse of three months from the receipt
thereof. Three months from the date of receipt
of the award expired on 26.11.2003. The

Civil Appeal No. 6810 of 2022 Page 36 of 44

District Court had Christmas vacation for the
period from 25.12.2003 to 01.01.2004. On
reopening of the Court i.e. on 02.01.2004, the
appellants made application for setting aside
the award under
Section 34
of the Arbitration
Act. Considering the aforesaid facts and
thereafter considering
Sections 2(j)
and
of the
Indian Limitation Act, 1963, this Court
observed and held and concluded in
paragraphs 11 to 15 as under:

“11. The question, therefore, that falls for
our determination is ­ whether the
appellants are entitled to extension of time
under
Section 4
of the 1963 Act in the
above facts?

12.
Section 4
of the 1963 Act reads as
under :­
"4. Expiry of prescribed period
when court is closed.­ Where the
prescribed period for any suit,
appeal or application expires on a
day when the court is closed, the
suit, appeal or application may be
instituted, preferred or made on the
day when the court reopens.

Explanation.­ A court shall be
deemed to be closed on any day

Civil Appeal No. 6810 of 2022 Page 37 of 44

within the meaning of this section
if during any part of its normal
working hours it remains closed on
that day."

The above Section enables a party to
institute a suit, prefer an appeal or make an
application on the day court reopens where
the prescribed period for any suit, appeal or
application expires on the day when the
court is closed.

13. The crucial words in
Section 4
of the
1963 Act are “prescribed period”. What is
the meaning of these words?

14.
Section 2(j)
of the 1963 Act defines:

“2(j) ‘period of limitation' [which] means the
period of limitation prescribed for any suit,
appeal or application by the Schedule, and
'prescribed period' means the period of
limitation computed in accordance with the
provisions of this Act.”

Section 2(j)
of the 1963 Act when read in
the context of Section 34(3) of the 1996 Act,
it becomes amply clear that the prescribed
period for making an application for setting
aside an arbitral award is three months.
The period of 30 days mentioned in proviso
that follows sub­section (3) of Section 34 of
the 1996 Act is not the “period of limitation”
and, therefore, not the “prescribed period”

Civil Appeal No. 6810 of 2022 Page 38 of 44

for the purposes of making the application
for setting aside the arbitral award. The
period of 30 days beyond three months
which the court may extend on sufficient
cause being shown under the proviso
appended to sub­section (3) of Section 34 of
the 1996 Act being not the “period of
limitation” or, in other words, the
“prescribed period”, in our opinion,
Section
of the 1963 Act is not, at all, attracted to
the facts of the present case.

15. Seen thus, the applications made by the
appellants on 2­1­2004 for setting aside the
arbitral award dated 26­8­2003 were liable
to be dismissed and have rightly been
dismissed by the District Judge, Kamrup,
Guwahati, as time­barred.”

Therefore, as such the question involved
in the present appeal is squarely answered
against the appellant and the said issue is as
such not res integra.

8. Now, so far as the submission on behalf of the
appellant that the
Limitation Act
shall not be
applicable to the proceedings under the

Arbitration Act
is concerned, the aforesaid has
no substance.
Section 43(1)
of the Arbitration
Act specifically provides that
Limitation Act
,

Civil Appeal No. 6810 of 2022 Page 39 of 44

1963 shall apply to arbitrations as it applies to
proceeding in Court. However, as observed and
held by this Court in the case of
Assam Urban

(Supra),
Limitation Act, 1963
shall be
applicable to the matters of arbitration covered
by 1996 Act save and except to the extent its
applicability has been excluded by virtue of
express provision contained in
Section 34(3)
of
the Arbitration Act.

8.1 In the case of Popular Construction Co.

(Supra), when
section 5
of the Limitation Act
was pressed into service to proceedings under

Section 34
of the Arbitration Act for setting
aside the arbitral award, this Court has
observed that the
Arbitration Act
being a
special law and provides a period of limitation
different from that prescribed under the

Limitation Act
, the period of limitation
prescribed under the
Arbitration Act
shall
prevail and shall be applicable and to that
extent the
Limitation Act
shall be excluded.
That, thereafter, it is observed and held that

Civil Appeal No. 6810 of 2022 Page 40 of 44

application challenging an award filed beyond
period mentioned in
Section 34(3)
of the
Arbitration Act would not be an application “in
accordance with” sub­section (3) as required
under
Section 34(1)
of the Arbitration Act.

8.2 In the case of
Hindustan Construction
Company Ltd.
(Supra), in fact this Court has
emphasized the mandatory nature of limit to
the extension of period provided in proviso to
Section 34(3) and has held that an application
for setting aside an arbitral award under

Section 34
of the Arbitration Act has to be
made within time prescribed under sub­section
(3) of Section 34 i.e. within three months and a
further period of 30 days on sufficient cause
being shown and not thereafter.

9. Now, so far as reliance placed upon
Section 10

of the General Clauses Act, 1897 on behalf of
the appellant is concerned, at the outset it is
required to be noted that such a contention is
untenable in light of the proviso to
Section 10

Civil Appeal No. 6810 of 2022 Page 41 of 44

of the
General Clauses Act, 1897
, which
specifically excludes the application of
Section
of the General Clauses Act, 1897 to any act
or proceeding to which the Indian Limitation
Act, 1877 applies. Reference to 1877 Act will
now have to be read as reference to
Limitation
Act, 1963
in view of
Section 8
of the General
Clauses Act, 1897. Therefore, in light of the
application of
Limitation Act, 1963
to the
proceedings under the
Arbitration Act
and
when
Section 10
of the General Clauses Act,
1897 specifically excludes the applicability of

Section 10
to any act or proceeding to which

Indian Limitation Act, 1963
applies and in
light of the definition of “period of limitation” as
defined under
Section 2(j)
read with
Section 4

of the Limitation Act and as observed and held
by this Court in the case of
Assam Urban

(Supra), benefit of exclusion of period during
which the Court is closed shall be available
when the application for setting aside award is
filed within “prescribed period of limitation”
and shall not be available in respect of period

Civil Appeal No. 6810 of 2022 Page 42 of 44

extendable by Court in exercise of its
discretion.

10. Now, so far as the reliance placed upon
the decision of this Court in the case of
Sridevi
Datla vs. Union of India
reported in (2021) 5
SCC 321 relied upon on behalf of the appellant
is concerned, at the outset it is required to be
noted that in
the said decision
, this Court has
not noticed the decision in the case of
Assam
Urban
(Supra) and there is no discussion on
distinction between “prescribed period” and the
“discretionary condonable period”.

On the
other hand, the binding decision of this Court
in the case of
Assam Urban
(Supra) is directly
on point.

11.
In view of the above and for the reasons stated
above, applying the law
laid down by
this
Court in the case of
Assam Urban
(Supra), it
cannot be said that the High Court and the
learned III Additional District & Sessions
Judge, Vijaypur have committed any error in

Civil Appeal No. 6810 of 2022 Page 43 of 44

refusing to condone the delay caused in
preferring application under
Section 34
of the
Arbitration and Conciliation Act, 1996 which
was beyond the period prescribed under

Section 34(3)
of the Arbitration and
Conciliation Act, 1996. Under the
circumstances, the present Appeal deserves to
be dismissed and is, accordingly, dismissed. In
the facts and circumstances of the case, there
shall be no order as to costs.

…………………………………J.
(M. R. SHAH)

…………………………………J.
(KRISHNA MURARI)
New Delhi,
April 10, 2023

Civil Appeal No. 6810 of 2022 Page 44 of 44