Orissa High Court
M/S. Chhabra Coal Beneficiaries & vs M/S. Rexon Strips Ltd. & Another on 17 December, 2024
IN THE HIGH COURT OF ORISSA, CUTTACK
W.P.(C) No.42509 of 2023
M/s. Chhabra Coal Beneficiaries &
Energy (P) Ltd. ....... Petitioner
-Versus-
M/s. Rexon Strips Ltd. & another
....... Opp. Parties
Advocates for the parties:
For Petitioner : Mr. J.S. Chhabra,
Advocate
For Opp. Parties : Mr. P.P. Mohanty, Adv.
(For Opp. Party No.1)
----------------------------
CORAM: JUSTICE SANJAY KUMAR MISHRA
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Date of Hearing: 29.08.2024 Date of Judgment: 17.12.2024
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S.K. Mishra, J. This Writ Petition has been preferred for quashing of
the order dated 30.10.2023 passed by the District Judge,
Sundargarh in Arbitration Case No.03 of 2022, vide which the
Court below condoned the delay in filing an application by the
Opposite Party No.1 under Section 34 of the Arbitration and
Conciliation Act, 1996, shortly, hereinafter, 'the Act,1996'.
W.P.(C) No.42509 of 2023 Page 1 of 30
2. The factual matrix of the case, as detailed in the Writ
Petition, is that the Petitioner, which is an industrial unit,
registered under the Micro Small Medium Enterprises
Development Act, in short, 'MSMED Act', supplied iron ore to the
Opposite Party No.1. On 30.03.2016, the Petitioner-Company filed
a claim/reference for passing of award under section 18(1) of the
MSMED Act before the Micro and Small Enterprises Facilitation
Council, Cuttack, in short, 'MSEFC', for recovery of an amount of
Rs.3,68,342/- so also interest for delayed payment under sections
15, 16 & 17 of the MSMED Act amounting to Rs.4,94,305/- (in
total Rs.8,62,647/-). After hearing both the parties, the MSEFC
passed an award on 26.02.2019 directing the Opposite Party No.1
to pay the principal amount along with the interest within 30
days.
However, the Opposite Party No.1 failed to pay the
awarded sum. Instead of preferring an application under section
34 the Act, 1996, it approached this Court in W.P.(C) No.10261 of
2019, which was dismissed as withdrawn by the Opposite Party
No.1 on 08.03.2022. Pursuant to the same, the Opposite Party
No.1 preferred an application before the District Judge,
Sundargarh under section 34 of the Act, 1996 challenging the said
award passed by the MSEFC, Cuttack dated 26.02.2019 along
W.P.(C) No.42509 of 2023 Page 2 of 30
with an I.A. under section 5 of the Limitation Act, 1963, in short,
'the Act, 1963', for condonation of delay, which was allowed by the
District Judge, Sundargarh vide the impugned order dated
30.10.2023.
3. The said order has been challenged on the ground that
though the impugned award was passed by the MSEFC, Cuttack
on 26.02.2019, which was received by the Opposite Party No.1 on
24.05.2019, the Appeal was preferred on 31.03.2022 i.e. after
about two years and ten months. As per sub-section (3) of section
34 of the Act, 1996, no application for setting aside the award be
made after three months have elapsed from the date on which the
party making the application has received the arbitral award.
However, if the applicant satisfies the Court that he was prevented
by sufficient cause for not making the application within three
months of the receipt of the award, the application could be
entertained only for a period of 30 days beyond the period of three
months and not beyond that. Thus, the Act, 1996, being a special
law embodying its own provision for limitation, shall prevail over
the general law of Limitation Act, 1963.
A ground has also been urged in the Writ Petition that
the period of contest in the Writ Petition preferred by the Opposite
Party vide W.P.(C) No.10261 of 2019, challenging the impugned
W.P.(C) No.42509 of 2023 Page 3 of 30
award dated 26.02.2019, cannot be excluded under section 5
and/or section 14 of the Act, 1963. Thus, the Court below
condoned the delay in preferring appeal under section 34 of the
Act, 1996 in violation of the established precedents.
4. Being noticed, a Counter Affidavit has been filed by the
Opposite Party No.1 taking a stand therein that it is a registered
company which is engaged in the process of manufacturing
sponge iron using iron ore as its raw material. In course of
business, the Opposite Party No.1 purchased some quantity of
coal from the Petitioner. Though the Opposite Party No.1 duly paid
the consideration amount, still the Petitioner issued a legal notice
to the Opposite Party No.1 demanding certain amount. Despite
reply given by the Opposite Party No.1, the Petitioner filed MSEFC
Case No.13 of 2016 before the Opposite Party No.2. During course
of hearing, the Petitioner conceded the objection of the Opposite
Party No.1 and submitted a memo stating therein that the value of
material of the alleged truck amounting to Rs.42,120/- so also
Rs.10,920/- towards transportation charges may be deducted
from the claim amount. The MSEFC, vide order dated 19.01.2019,
directed both the parties to settle the matter amicably on or before
26.02.2019, pursuant to which, the Opposite Party No.1 agreed to
pay a sum of Rs.1,00,000/- towards full and final settlement of
W.P.(C) No.42509 of 2023 Page 4 of 30
the dispute. However, on 26.02.2019, the MSEFC passed an
award directing the Opposite Party No.1 to pay a sum of
Rs.8,62,647/-(Rs.3,68,342/- towards principal and Rs.4,94,305/-
towards interest) so also compound interest, with monthly rests,
payable @ 3 times of the bank rate, as notified by Reserve Bank of
India, within a period of 30 days. The said award was
communicated to the Opposite Party No.1 on 14.05.2019 by the
Office of Director of Industries, Orissa, Cuttack and was received
by it on 24.05.2019.
It is the case of the Opposite Party No.1 that on
24.05.2019, the Counsel for the Petitioner wrote a letter to the
Opposite Party No.1 directing to pay the amount. In reply to the
said letter, the Opposite Party No.1 also wrote a letter on
24.06.2019 informing the Petitioner about challenging the award
dated 26.02.2019 of MSEFC before this Court in W.P.(C) No.10261
of 2019 enclosing thereto a demand draft of Rs.8,62,647/-.
While the matter stood thus, on 02.01.2020, the
Petitioner filed an execution case, which was registered as
Execution Case No.04 of 2020 before the District Judge,
Sundargarh and notice for appearance on 19.03.2020 was issued
to the Opposite Party No.1. Thereafter, on 14.09.2020, the
Opposite Party No.1 filed an amendment application in W.P.(C)
W.P.(C) No.42509 of 2023 Page 5 of 30
No.10261 of 2019. However, on 08.03.2022, this Court dismissed
the Writ Petition as withdrawn, granting liberty to the Opposite
Party No.1 (Petitioner in W.P.(C) No.10261 of 2019) to file an
Appeal under section 34 of the Act, 1996.
Pursuant to the order dated 08.03.2022 of this Court, the
Opposite Party No.1 filed Arbitration Case No.03 of 2022 under
section 34 of the Act, 1996 along with an application for
condonation of delay. After hearing both the parties, the delay was
condoned by the District Judge, Sundargarh on 30.10.2023.
It is the stand of the Opposite Party No.1 that since it
filed W.P.(C) No.10261 of 2019 before this Court within a period of
18 days from the date of receipt of the award/order of MSEFC so
also filed application under section 34 of the Act, 1996 before the
District Judge, Sundargarh within a period of 24 days from the
date of order dated 08.03.2022 passed by this Court in W.P.(C)
No.10261 of 2019, in fact, there is no delay in filing the
application under section 34 of the Act, 1996 before the District
Judge, Sundargarh.
5. In response to the Counter filed by the Opposite Party
No.1, the Petitioner has filed a Rejoinder denying the stand of the
Opposite Party No.1 as to the legality of the impugned order dated
30.10.2023 passed by the District Judge, Sundargarh condoning
W.P.(C) No.42509 of 2023 Page 6 of 30
the delay in filing the application under section 34 of the Act,
1996 stating therein that the Petitioner has already cited the
judgment of the Supreme Court reported in (2022) 4 SCC 162,
(Mahindra and Mahindra Financial Services Limited Vs.
Maheshbhai Tinabhai Rathod and others) as to inapplicability
of section 5 of the Act, 1963 to condone the delay beyond three
months as prescribed under section 34(3) of the Act, 1996, so also
condonation of delay beyond 120 days in terms of the Proviso to
section 34(3) of the Act, 1996. Admittedly, the application under
section 34 of the Act, 1996 was filed on 31.03.2022 i.e. after 2
years and 10 months of the receipt of the award on 24.05.2019
(wrongly typed as 24.09.2019). Hence, the Court below was not
justified to condone the delay.
6. Learned Counsel for the Petitioner submitted that section
14 of the Limitation Act, 1963 would have been made applicable to
the present case, had the Opposite Party No.1 presented an
application under section 34 of the Act, 1996 within the period of
limitation before a wrong Court. But in the present case, the
Opposite Party No.1, instead of preferring an application under
section 34 of the Act, 1996, preferred a Writ Petition before this
Court. Hence, section 14 of the Limitation Act, 1963 is not
W.P.(C) No.42509 of 2023 Page 7 of 30
applicable to the present case to condone/exclude the period of
delay on the ground of pendency of the Writ Petition.
Learned Counsel for the Petitioner, drawing attention of
this Court to the Petition filed by the Opposite Party No.1 dated
31.03.2022, so also the impugned order dated 30.10.2023 passed
in Arbitration Case No.03 of 2022, submitted that the Opposite
Party No.1 moved such application invoking section 5 of the Act,
1963 and the Court below, exercising its power under section 5 of
the Act, 1963, allowed the said petition of the Opposite Party No.1
and condoned the delay in preferring the application under section
34 of the Act, 1996 despite citing the judgment of the Supreme
Court.
Mr. Chhabra, learned Counsel for the Petitioner further
submitted that law is well settled that section 5 of the Act, 1963 is
not applicable to the proceeding under the Act, 1996. Hence, the
impugned order dated 30.10.2023 passed in Arbitration Case
No.03 of 2022, being contrary to the statute so also settled
position of law, deserves interference and the Arbitration Case
No.03 of 2022, being filed beyond the statutory period of
limitation, deserves to be dismissed.
7. Learned Counsel for the Petitioner, to substantiate his
submission, relied upon the judgments of the Supreme Court in
W.P.(C) No.42509 of 2023 Page 8 of 30
Mahindra & Mahindra Financial Services Ltd. (supra) and
Oriental Insurance Co. Ltd. Vs. Tejparas Associates &
Exports (P) Ltd., reported in (2019) 9 SCC 435.
8. Per contra, learned Counsel for the Opposite Party No.1,
reiterating the facts detailed in the Counter, submitted that the
Opposite Party No.1 intimated the Petitioner regarding his filing of
W.P.(C) No.10261 of 2019 and further enclosed a demand draft of
Rs.8,62,647/- towards principal and interest, without prejudice to
the rights and contentions made in the Writ Petition. Learned
Counsel for the Opposite Party No.1 further submitted that
though there is a delay of 2 years and 10 months i.e. from the
date of receipt of award on 24.05.2019 till the date of filing of
arbitration case on 31.03.2022 under section 34 of the Act, 1996,
the Opposite Party No.1 filed an application in terms of section 14
of the Act, 1963 for excluding the period for which the Writ
Petition was pending before the Court, liberty being granted by
this Court to move an application under section 34 of the Act,
1996. In fact, there was no delay beyond the statutory period,
after exclusion of the period, for which the Writ Petition was
pending before this Court. The petition was rightly allowed by the
learned District Judge. In the cause title of the petition, the
learned Counsel for the Opposite Party No.1, by mistake,
W.P.(C) No.42509 of 2023 Page 9 of 30
mentioned the legal provision as section 5, instead of section 14 of
the Act, 1963, though in the body of the said petition it has been
rightly mentioned about invocation of section 14 of the Act, 1963.
9. Learned Counsel for the Opposite Party No.1 further
submitted that MSEFC passed the award on 26.02.2019, which
was communicated to the Opposite Party No.1 on 14.05.2019 by
the Office of the Director of Industries. But the same was received
by the Opposite Party No.1 on 24.05.2019. On 10.06.2019 the
Opposite Party No.1 filed W.P.(C) No.10261 of 2019 before this
Court which was dismissed on 08.03.2022 granting liberty to the
Opposite Party No.1 to file an application under section 34 of the
Act, 1996 in presence of the learned Counsel for the Petitioner,
who was Opposite Party No.2 in the said Writ Petition. The
Opposite Party No.1 obtained the certified copy of the said order
on 11.03.2022 and in terms of the said order, the arbitration case
was filed by the Opposite Party No.1 before the District Judge,
Sundargarh, within 24 days from the date of the said order.
10. Learned Counsel for the Opposite Party No.1, drawing
attention of this Court to paragraph Nos.4 & 5 of the application
dated 31.03.2022, as at Annexure-1, submitted that though in the
cause title of the I.A., by mistake, it was indicated that such
application for condonation of delay in filing the petition is under
W.P.(C) No.42509 of 2023 Page 10 of 30
section 5 of the Act, 1963, but in the body of the said application
it was rightly indicated about liberty granted by this Court to move
an application under Section 34 of the Act, 1996 so also to
condone the delay, if any, by excluding the period in terms of
section 14 of the Act, 1963, for which the Writ Petition was
pending before this Court. No written objection was filed by the
Petitioner opposing to such application excepting filing the
judgments of the Supreme Court. The Court below, while passing
the impugned order, took note of such submission made by the
learned Counsel for the Petitioner (Opposite Party No.2 before the
Court below) so also judgments cited by it and passed a reasoned
order, clearly indicating therein that since the Writ Petition was
preferred before this Court well within the period of limitation,
prescribed under Section 34 of the Act, 1996 in fact there is no
delay. The said application preferred by the present Opposite Party
for condonation of delay was rightly allowed by the Court below
giving a detailed reason for allowing such application and the Writ
Petition, being devoid of any merit, deserves to be dismissed.
Learned Counsel for the Opposite Party No.1, relying on
the judgments of the Supreme Court in Sree Hari Chemicals
Export Ltd. Vs. Union of India and another, reported in (2006)
1 SCC 396 so also in P.K. Palanisamy Vs. N. Arumugham and
W.P.(C) No.42509 of 2023 Page 11 of 30
another, reported in (2009) 9 SCC 173 further submitted that law
is well settled that wrong mentioning of legal provision would not
be a ground to refuse relief to a party, if he is otherwise entitled
thereto. Relying on the judgment of the Supreme Court in P.
Sarathy Vs. State Bank of India, reported in (2000) 5 SCC 355,
learned Counsel for the Opposite Party No.1 further submitted
that, section 14 of the Limitation Act is applicable to an
application submitted under section 34 of the Act, 1996 for
exclusion of certain period, if such application, at the first
instance, is filed within the limitation period prescribed under
section 34(3) of the Act, 1996. The plea of the Petitioner Company
to set aside the impugned order passed by the Court below on
technical ground as to wrong mentioning of legal provision in the
cause title of the Petition is ill-motivated to harass the Opposite
Party No.1.
Mr. Mohanty, drawing attention of this Court to the
judgment of the Supreme Court in Consolidated Engineering
Enterprises Vs. Principal Secretary, Irrigation Department
and others reported in (2008) 7 SCC 169, which is a three Judge
Bench judgment, further submitted that the Opposite Party No.1
preferred the Writ Petition wrongly before this Court bona fide and
with due diligence against the award passed by the MSEFC. The
W.P.(C) No.42509 of 2023 Page 12 of 30
same was also duly intimated to the Petitioner while making
payment in terms of the said award under protest. Though the
Court below has not specifically mentioned about applying the
provisions under section 14 of the Limitation Act to exclude the
said period during which the Writ Petition was pending before this
Court, but it is well implied from the said order that the Court
below was conscious to take note of various dates, as pleaded in
the said Petition, while allowing the application of the Opposite
Party No.1 to condone the so called delay.
11. To substantiate his submissions, learned Counsel for the
Opposite Party No.1 relied on the judgments of the Supreme Court
in Shree Hari Chemicals (supra) so also in Oriental Insurance
Co. Ltd. (supra) and State of Goa Vs. Western Builders,
reported in (2006) 6 SCC 239.
12. In view of the said submissions made so also judgments
cited by the learned Counsel for the parties, the following points
emerge, to be answered in the present Writ Petition:
i) Whether the impugned order dated 30.10.2023
passed in Arbitration Case No.03 of 2022
deserves interference on the ground of wrong/
incorrect mentioning of the provisions of law i.e.
section 5, instead of section 14 of the Limitation
W.P.(C) No.42509 of 2023 Page 13 of 30
Act, 1963, so also incorrectly mentioning so in
the impugned order passed by the Court below?
ii) Whether, because of filing of Writ Petition before
this Court, instead of filing of section 34
application before a wrong Court, will preclude
the Opposite Party No.1 to seek for exclusion of
the said period, for which the Writ Petition was
pending before this Court, in terms of the Section
14 of the Limitation Act?
Since both the points are interrelated, for the sake of
brevity and clarity, the same are dealt with and answered
together.
13. Admittedly the Opposite Party No.1, after receiving the
award dated 26.02.2019 passed by the MSEFC on 24.05.2019,
preferred W.P.(C) No.10261 of 2019 on 10.06.2019 i.e. after 18
days from the date of receipt of the award/order of the MSEFC.
The said Writ Petition was pending till dismissal of the same on
08.03.2022 giving liberty to the Petitioner to prefer an application
under section 34 of the Act, 1996. The said order passed by this
Court in W.P.(C) No.10261 of 2019 is reproduced below for ready
reference.
W.P.(C) No.42509 of 2023 Page 14 of 30
"ORDER
08.03.2022
1. Learned counsel appearing for the petitioner has filed
a memo for withdrawal of this writ petition with liberty
to the petitioner to file appeal under Section 34 of
the Arbitration & Conciliation Act, 1996.
Consequently, the writ petition stands dismissed as
withdrawn but, however with liberty as prayed for".
(Emphasis Supplied)
After passing of the said order by this Court giving liberty
to the Opposite Party No.1, admittedly the section 34 application
under the Act, 1996 was presented before the District Judge,
Sundargarh after 24 days from the date of the said order along
with an application to condone the delay in view of the liberty
granted by this Court. However, while filing such application for
exclusion/condonation of delay, a wrong mention was made in the
cause title that such application is being moved in terms of
section 5 of the Limitation Act, though in para 5 of the said
petition there is a reference to section 14 of the Limitation Act.
Paragraph Nos.1 to 6 of the said petition, being relevant, are
extracted below for ready reference.
"1. That by means of the accompanied petition, the
Petitioner inter- alia challenges the Impugned
order/award dated 26.02.2019 passed by MSEFC,
Opposite Party No.1 in MSEFC Case No.13 of 2016,
which was communicated by the Office of Director of
W.P.(C) No.42509 of 2023 Page 15 of 30
Industries, Odisha on 14.05.2019 and the Petitioner
had received the same award/order on 24.05.2019.
2. That on 10.06.2019, the Petitioner being
aggrieved by the order/award dated 26.02.2019
passed by MSEFC, Opposite Party No.1 in MSEFC Case
No.13 of 2016 had filed a writ application in the Hon'ble
High Court of Orissa, which was registered as W.P. (C)
No.10261 of 2019.
3. That on 27.06.2019, the Hon'ble High Court of
Orissa was pleased to issue notice to the Opposite
Parties and the notices were issued to the Opposite
Parties fixing the appearance on 06.08.2019. After
receipt of notice from Hon'ble High Court of Orissa, the
Opposite parties had entered his appearance.
4. That while the matter stood thus, on 08.03.2022,
the Hon'ble High Court of Orissa was pleased to pass
the following order in W.P.(C) No.10261 of 2019:
"Learned counsel appearing for the Petitioner has
filed a memo for withdrawal of this writ petition
with liberty to the petitioner to file appeal under
Section 34 of the Arbitration & Conciliation Act,
1996. Consequently, the writ petition stands
dismissed as withdrawn but however with
liberty's as prayed for."
It may be noted that on 11.03.2022, the
Petitioner has received the certified copy of the
aforesaid order.
5. That in the aforesaid facts and
circumstances, the Petitioner has filed the present
petition in this Hon'ble Court with a prayer to
condone the delay taking into consideration of
provisions of Section 14 of the Limitation Act,
1963, as well as the other provisions of the
Limitation Act, 1963.
6. That delay in filing the present petition in this
Hon'ble Court is not deliberate nor intentional on part of
the Petitioner".
(Emphasis Supplied)
W.P.(C) No.42509 of 2023 Page 16 of 30
Admittedly, the present Petitioner (Opposite Party in
Arbitration Case No.03 of 2022) did not file any written objection
in response to the said application. Simply it chose to file two
judgments of the Supreme Court to oppose the said prayer for
condonation of delay on the ground that delay beyond the
statutory period cannot be condoned in a proceeding initiated
under section 34 of the Act, 1996. At this juncture, it would be apt
to deal with the judgments cited by the learned Counsel for the
Petitioner to substantiate his submission.
14. In Mahindra & Mahindra Financial Services Ltd.
(supra), the issue before the Supreme Court was whether section
34 application was well within the period of limitation, as
prescribed under the Act, 1996. If not, whether the delay is
condonable by exercise of power under section 5 of the Limitation
Act? Whether the learned Division Bench of High Court of
judicature at Bombay was justified to condone the delay by
applying section 5 of the Limitation Act to a proceeding under
section 34(3) of the Act, 1996?
While dealing with the said points, the Supreme Court,
referring to its various judgments, held that section 5 of the
Limitation Act to condone the delay beyond the statutory period
prescribed under section 34(3) of the Act, 1996 is not applicable.
W.P.(C) No.42509 of 2023 Page 17 of 30
While deciding so the Supreme Court took note of the fact that the
envelopes containing the arbitral award forwarded by the learned
Arbitrator to the Petitioners were returned by the Postal Authority
to the Arbitrator with a remark that the Petitioners refused to
accept service of the same, which were opened in the Court and it
was noted that the learned Arbitrator had forwarded signed copy
of the award to the Petitioners. In the said case, the Petitioners
also admitted the fact that they refused to accept service of the
envelopes containing copies of arbitral award. Hence, it was held
by the Supreme Court that the learned Division Bench was not
justified to condone the delay in a casual manner beyond the
statutory period because of the admitted facts on record that the
Petitioners refused to receive the award sent by the learned
Arbitrator and the limitation has to be counted from the date of
the said refusal to receive the award.
So far as Oriental Insurance Company Ltd. (supra), the
Supreme Court, though held that section 5 of the Limitation Act
has no application to a petition challenging the arbitral award
under section 34 of the Act, 1996, but held that section 14 of the
Limitation Act is applicable to an application submitted under
section 34 of the Act, 1996 seeking for exclusion of certain period,
if the application under section 34 of the Act, 1996 is at the first
W.P.(C) No.42509 of 2023 Page 18 of 30
instance filed within the limitation period prescribed under section
34(3) of the Act, 1996 before a wrong Court.
15. So far as judgment cited by the Opposite Party No.1 in
Shree Hari Chemicals Export Ltd. (supra), it was held that a
wrong mentioning of a section/legal provision would not be a
ground to refuse the relief to a party, if he is otherwise entitled
thereto. A similar view was also taken by the Supreme Court in
P.K. Palaniswamy (supra). Paragraph Nos.26 & 27 of the said
judgment, being relevant, are reproduced below:
"26. A contention has been raised that the
applications filed by the appellant herein having regard
to the decisions of the Madras High Court could not
have been entertained which were filed under Section
148 of the Code.
27. Section 148 of the Code is a general provision
and Section 149 thereof is special. The first application
should have been filed in terms of Section 149 of the
Code. Once the court granted time for payment of deficit
court fee within the period specified therefor, it would
have been possible to extend the same by the court in
exercise of its power under Section 148 of the Code.
Only because a wrong provision was mentioned by
the appellant, the same, in our opinion, by itself
would not be a ground to hold that the
application was not maintainable or that the
order passed thereon would be a nullity. It is a
well-settled principle of law that mentioning of a
wrong provision or non-mentioning of a provision
does not invalidate an order if the court and/or
statutory authority had the requisite jurisdiction
therefor".
(Emphasis Supplied)
W.P.(C) No.42509 of 2023 Page 19 of 30
So far as judgment of the Supreme Court in P. Sarathy
(supra), it was held that section 14 of the Limitation Act does not
speak of a "civil court", but speaks only of a "court". It is not
necessary that the court spoken of in Section 14 should be a "civil
court". Any authority or tribunal, having the trappings of a Court,
would be a "court" within the meaning of the said Section.
Paragraph Nos.12, 13 & 15 of the said judgment, being relevant,
are reproduced below.
"12. It will be noticed that Section 14 of the
Limitation Act does not speak of a civil court" but
speaks only of a "court". It is not necessary that
the court spoken of in Section 14 should be a
"civil court". Any authority or tribunal having the
trappings of a court would be a "court" within the
meaning of this section.
13. In Thakur Jugal Kishore Sinha v. Sitamarhi Central
Coop. Bank Ltd.³ this Court, while considering the
question under the Contempt of Courts Act, held that the
Registrar under the Bihar and Orissa Cooperative
Societies Act was a court. It was held that the Registrar
had not merely the trappings of a court but in many
respects he was given the same powers as was given to
an ordinary civil court by the Code of Civil Procedure
including the powers to summon and examine
witnesses on oath, the power to order inspection of
documents and to hear the parties. The Court referred
to the earlier decisions in Bharat Bank Ltd. v.
Employees; Maqbool Hussain v. State of Bombays and
Brajnandan Sinha v. Jyoti Narain. The Court
approved the rule laid down in these cases that in
order to constitute a court in the strict sense of
the term, an essential condition is that the court
should have, apart from having some of the
trappings of a judicial tribunal, power to give a
decision or a definitive judgment which has
W.P.(C) No.42509 of 2023 Page 20 of 30
FINALITY and AUTHORITATIVENESS which are the
essential tests of a judicial pronouncement.
15. Applying the above principles in the instant case,
we are of the opinion that the Deputy Commissioner of
Labour (Appeals), which was an authority constituted
under Section 41(2) of the Tamil Nadu Shops and
Establishments Act, 1947 to hear and decide appeals,
was a "court" within the meaning of Section 14 of the
Limitation Act and the proceedings pending before him
were civil proceedings. It is not disputed that the
appellant could file an appeal before the Local
Board of the Bank, which was purely a
departmental appeal. In this view of the matter,
the entire period of time from the date of
institution of the departmental appeal as also the
period from the date of institution of the appeal
under Section 41(2) before the Deputy
Commissioner of Labour (Appeals) till it was
dismissed will, therefore, have to be excluded for
computing the period of limitation for filing the
suit in question. If the entire period is excluded,
the suit, it is not disputed, would be within time".
(Emphasis Supplied)
So far as applicability of section 14 of the Limitation Act
to a proceeding/application under section 34 (3) of the Act, 1996,
the Supreme Court in Consolidated Engineering Enterprises
(supra), held as follows:
"53. Sub-section (3) of Section 34 of the AC Act
prescribes the period of limitation for filing an
application for setting aside an award as three months
from the date on which the applicant has received the
arbitral award. The proviso thereto vests in the court
discretion to extend the period of limitation by a further
period not exceeding thirty days if the court is satisfied
that the applicant was prevented by sufficient cause for
not making the application within three months. The use
of the words "but not thereafter" in the proviso makes it
W.P.(C) No.42509 of 2023 Page 21 of 30
clear that even if a sufficient cause is made out for a
longer extension, the extension cannot be beyond thirty
days. The purpose of proviso to Section 34(3) of the AC
Act is similar to that of Section 5 of the Limitation Act
which also relates to extension of the period of limitation
prescribed for any application or appeal. It vests a
discretion in a court to extend the prescribed period of
limitation if the applicant satisfies the court that he had
sufficient cause for not making the application within
the prescribed period. Section 5 of the Limitation Act
does not place any outer limit in regard to the period of
extension, whereas the proviso to sub-section (3) of
Section 34 of the AC Act places a limit on the period of
extension of the period of limitation. Thus the proviso to
Section 34(3) of the AC Act is also a provision relating to
extension of period of limitation, but differs from Section
5 of the Limitation Act, in regard to period of extension,
and has the effect of excluding Section 5 alone of the
Limitation Act.
54. On the other hand, Section 14 contained in
Part III of the Limitation Act does not relate to
extension of the period of limitation, but relates to
exclusion of certain period while computing the
period of limitation. Neither sub-section (3) of
Section 34 of the AC Act nor any other provision of
the AC Act exclude the applicability of Section 14
of the Limitation Act to applications under
Section 34(1) of the AC Act. Nor will the proviso to
Section 34(3) exclude the application of Section
14, as Section 14 is not a provision for extension
of period of limitation, but for exclusion of certain
period while computing the period of limitation.
Having regard to Section 29(2) of the Limitation Act,
Section 14 of that Act will be applicable to an
application under Section 34(1) of the AC Act. Even
when there is cause to apply Section 14, the limitation
period continues to be three months and not more, but
in computing the limitation period of three
months for the application under Section 34(1) of
the AC Act, the time during which the applicant
W.P.(C) No.42509 of 2023 Page 22 of 30
was prosecuting such application before the
wrong court is excluded, provided the proceeding
in the wrong court was prosecuted bona fide, with
due diligence. Western Builders therefore lays
down the correct legal position."
(Emphasis Supplied)
In Baid Power Services Private Limited Vs. The Bihar
Medical Services and Infrastructure Corporation Limited
reported in MANU/WB/1857/2024 : 2024 LiveLaw (Cal) 208, the
Calcutta High Court, relying on the judgment of the Supreme
Court in Consolidated Engineering Enterprises (supra), held
that the Petitioner's approach at the first instance before the Writ
Court, instead of moving a challenge under section 34 of the Act,
1996, comes squarely within the benefit accorded under section
14 of the Limitation Act. Paragraph Nos.27 to 33 & 41 of the said
judgment, being relevant, are extracted below.
"27. In Himmatlal Harilal Mehta's case, the Supreme
Court observed that if the remedy provided by an Act is
of an onerous and burdensome character, a writ petition
may be maintained under Article 226 of the
Constitution.
28. The rigour of Section 19 of the MSME Act,
mandating a prior deposit of 75 per cent of the awarded
amount, in the teeth of the petitioner's contention that
the award was a nullity, might very well have been
construed as onerous by the petitioner. We cannot lose
sight of the fact that the writ petition of the petitioner
was entertained in the first place by this Court and in
fact, the benefit of Section 14 was extended to the
petitioner by the learned Single Judge at the first
W.P.(C) No.42509 of 2023 Page 23 of 30
instance. It was only upon the appeal against the same
being allowed that the petitioner conclusively came to
know that the automatic extension of benefit under
Section 14 of the Limitation Act by the writ court was
bad in law, having been set aside by the Division
Bench.
29. The very fact that the writ petition was entertained
and the parties had to wait till the final disposal of the
appeal to learn that the benefit of Section 14 of the
Limitation Act could not be automatically extended by
the writ court shows that sufficient bona fides could be
attributed to the petitioner in preferring the writ petition.
30. Before the learned Single Judge dismissed the
writ petition, the writ petition was entertained
and thus the petitioner could not have anticipated
that the same was not maintainable.
31. In fact, there are a plethora of judgments of
the Supreme Court which lay down that in case of
gross jurisdictional error, the writ jurisdiction
cannot be completely shut out despite availability
of an alternative remedy. The writ petitioner pleaded
in its application (CAN 1 of 2022) filed in connection with
the writ petition that the award itself was a nullity since
the dispute did not come within the purview of the
MSME Act as well as the respondent was registered as
an MSME Unit only subsequent to the contract being
entered into between the parties. Such perceived
jurisdictional error, as pleaded by the petitioner, would
be sufficient justification for the petitioner to approach
the writ court.
32. Hence, the bona fides of the petitioner could not
have been doubted at any stage, as it was sufficiently
arguable as to whether a writ petition under Article 226
of the Constitution could be maintained.
33. In Consolidated Engineering Enterprises
(supra) and Kalpraj Dharamshi (supra), the benefit
of Section 14 was extended to challenges under
Section 34 of the 1996 Act.
41. In view of the above, this Court is of the opinion
that the petitioner's approach at the first instance
W.P.(C) No.42509 of 2023 Page 24 of 30
before the writ court instead of moving a
challenge under Section 34 of the 1996 Act comes
squarely within the benefit afforded by Section 14
of the Limitation Act, 1963, since it proceeded before
the writ court bona fide, which is borne out by the facts
and circumstances of the present case. The petitioner
is accordingly entitled to exclusion of the time
spent in pursuing its remedy before the writ
court".
(Emphasis supplied)
16. From the admitted facts on record, it is amply clear that
the Award being passed in MSEFC Case No.13 of 2016 by the
MSEF Council, the Opposite Party No.1 incorrectly approached
this Court in a Writ Petition. This Court also entertained such
application and vide order dated 27.06.2019 had been pleased to
issue notice to the present Petitioner (Opposite Party No.2 in the
said Writ Petition) fixing the date of appearance to 06.08.2019.
The said Writ Petition was pending till 08.03.2022, on which date
it was dismissed as withdrawn, with liberty to file an application
under section 34 of the Act, 1996. After receiving the certified copy
of the order on 11.03.2022, the Opposite Party No.1 preferred the
application under section 34 of the Act, 1996 on 31.03.2022
before the District Judge, Sundargarh, which was registered as
Arbitration Case No.03 of 2022, along with an application for
condonation of delay. Though in the petition for condonation of
delay it should have been worded for exclusion of the period for
W.P.(C) No.42509 of 2023 Page 25 of 30
which the Writ Petition was pending before this Court, while
calculating the period of limitation in terms of section 34 (3) of the
Act, 1996, in the cause title of the petition, instead of making a
mention regarding section 14 of the Limitation Act, 1963,
incorrectly it was mentioned that such application is under
section 5 of the Limitation Act, 1963. However, in the body of the
petition, in Para-5, there is a mention regarding invocation of
section 14 of the Limitation Act.
17. Admittedly, section 14 of the Limitation Act is applicable
to a proceeding under section 34 of the Act, 1996, which
mandates for exclusion of certain period while computing the
period of limitation, not for extension of period of limitation.
However, because of wrong wordings in the application for
condonation of delay so also indication of the legal provision
incorrectly in the said application and in the impugned order, the
Petitioner, taking advantage of such mistake committed by the
learned Counsel for the Opposite Party No.1 so also the Court
below, has preferred the present Writ Petition challenging the
order passed by the Court below on the ground of applicability of
section 5 of the Limitation Act. Law is well settled that mentioning
of a legal provision incorrectly or non-mentioning of a legal
provision does not invalidate an order if the Court or the statutory
W.P.(C) No.42509 of 2023 Page 26 of 30
authority had a requisite jurisdiction thereof. The Court below, in
the impugned order, though incorrectly mentioned that
application under section 5 of the Limitation Act is allowed, but
clearly indicated that there is no delay in presenting the
application under section 34 of the Act, 1996. The operative
portion of the impugned order, being relevant, is reproduced
below.
"ARBITRATION CASE NO.03 OF 2022
30.10.2023
xxxxx xxxxxx xxxxxx xxxxxx
Heard both the sides at length. It is admitted that
the award was passed by the MSEFC on
26.02.2019 and thereafter the petitioner being
aggrieved with the said order preferred appeal
before the Hon'ble Court on 10.06.2019 i.e. well
within a period of 120 days. However, the Hon'ble
Court passed order on 08.03.2022 directing the
petitioner to file an application under section 34
of the Arbitration and Conciliation Act 1996
before the proper forum to quash the award and
soon thereafter, on 31.03.2022 the petitioner filed
this case before this Court. Therefore, in the fact
situation, when there is no delay arises by the
petitioner as he has filed a Writ Petition before
the Hon'ble Court well within 120 days of the
award passed by the MSEFC and soon after the
direction of the Hon'ble Court, he filed this case.
Hence, the petitioner has not filed his application
before this Court after 120 days and the case is
filed well within the period of limitation at the
first instance. Accordingly, the petition under section 5
of the Limitation Act is allowed and the delay is
condoned. The case is accordingly admitted. Call for the
LCR and since the OP has already appeared put up on
29.11.2023 awaiting LCR. B.C. to comply".
(Emphasis Supplied)
W.P.(C) No.42509 of 2023 Page 27 of 30
Apart from the same, this Court, after noticing the
present Petitioner in W.P.(C) No.10261 of 2019 and in presence of
its Counsel, granted liberty to the present Opposite Party to prefer
an application under section 34 of the Act, 1996. The Opposite
Party No.2 in W.P.(C) No.10261 of 2019 (the present Writ
Petitioner), neither opposed to such leave granted by the
coordinate Bench nor challenged the said order, which has
attained finality.
18. Hence, this Court is of the view that liberty being granted
by this Court, the Opposite Party No.1 rightly approached the
concerned Court under section 34 of the Act challenging the
award passed by the MSEFC along with an application to condone
the delay by excluding the period for which the matter was sub-
judice before this Court. The Court below also, exercising its
power, as contemplated under section 14 of the Limitation Act,
came to a conclusion that there is no delay in preferring the said
application under section 34 of the Act, 1996 and the so called
delay was condoned referring to the judgment of the Supreme
Court in Oriental Insurance Company Ltd. (supra), though in
the concluding para of the impugned order, the legal provision to
allow such application to condone the delay has been incorrectly
indicated.
W.P.(C) No.42509 of 2023 Page 28 of 30
19. In view of the detailed discussion and observations made
above, so also settled position of law, this Court is of further view
that there is no illegality or infirmity in the impugned order passed
by the Court below as liberty was granted by this Court vide order
dated 08.03.2022 passed in W.P.(C) No.10261 of 2019 to prefer an
application under section 34 of the Act, 1996 and such
application was also filed within a period of 24 days from the date
of the said order dated 08.03.2022. In view of the admitted facts
on record, the said Writ Petition was also filed within a period of
18 days from the date of receipt of the Award passed by the
MSEFC.
20. In view of the settled position of law, as detailed above,
this Court is of the view that the impugned order dated
30.10.2023 passed in Arbitration Case No.03 of 2022 should not
be interfered with on the ground of wrong/ incorrect mentioning
of the provisions of law. Point No.1 is accordingly answered
against the Petitioner.
So far as point No.2, the same is also answered against
the Petitioner, as the period for which the Writ Petition was
pending before this Court had to be excluded from the period i.e.
from the date of award of MSEFC till the date of dismissal of the
said Writ Petition in terms of section 14 of the Limitation Act.
W.P.(C) No.42509 of 2023 Page 29 of 30
21. Accordingly, the Writ Petition stands dismissed. No order
as to cost.
................................
S.K. MISHRA, J.
Orissa High Court, Cuttack The 17th of December, 2024/Kanhu Signature Not Verified Digitally Signed Signed by: KANHU BEHERA Designation: Junior Stenographer Reason: Authentication Location: High Court of Orissa, Cuttack. Date: 19-Dec-2024 20:08:46 W.P.(C) No.42509 of 2023 Page 30 of 30