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Appropriate limitation period for appeals filed under section 37 of the arbitration and conciliation act.
Appropriate limitation period for appeals filed under section 37 of the arbitration and conciliation act.
The Supreme Court within the case of Executive Engineer v. M/s Borse Brothers Engineers & Contractors Pvt. Ltd.[1]has set right the law regarding the amount of limitation for filing appeals under Section 37[2] of the Arbitration and Conciliation Act, 1996[2]. The apex court overruled one of its earlier decision that it gave in the case of N.V. International v. the State of Assam[3] and emphasizing the objective for speedy disposal of disputes that sought to be achieved by the Arbitration Act and therefore the Commercial Courts Act, 2015, the Court has allowed condonation of only ‘short delays’, beginning strict parameters for allowing an equivalent.
Under the Arbitration Act, a party to arbitration could file an application under Section 34 for setting aside an arbitral within a period of three months from the date of the receipt of the award which an extension of 30 days and nothing further might be granted if the applicant established sufficient cause for delay in filing the application. Pertaining to Section 37 of the Arbitration Act, the Court noted that the said section allowed parties to file an appeal against an order passed during a Section 34 application which is an application for setting aside an arbitral award. It further noted that Section 37 also allowed parties to file an appeal against the subsequent orders: (i) Court refusing to refer the disputing parties to arbitration under Section 8.
Section 37 neither provided for a period of limitation within which an appeal might be filed thereunder nor did it prescribe a period of condonation of delay, beyond which delay couldn't be condoned. Section 43 of the Arbitration Act provides that the Limitation Act applies to arbitrations because it applies to court proceedings.
The appliance of Section 5 of the Limitation Act to Section 37 appeals governed by a consistent 60-day period of limitation, the Court noted that reading the Arbitration Act and therefore the Commercial Courts Act as an entire, it had been clear that when Section 37 of the Arbitration Act is read with either Article 116 or 117 of the Limitation Act or Section 13(1A) of the Commercial Courts Act, the thing and context provided by the aforesaid statutes is that the speedy disposal of appeals filed under Section 37 of the Arbitration Act.
In conclusion, the Court has provided necessary clarification on the limitation period for filing appeals under Section 37 of the Arbitration Act, as also the condonation of delays in filing such appeals. The Court has made detailed observations regarding an equivalent, taking into consideration the relevant provisions of the law and therefore the need for adherence to timelines, especially in commercial disputes.
[1] CIVIL APPEAL NO. 999 OF 2021 SLP (CIVIL) No.15278 of 2020)
[2] https://legislative.gov.in/sites/default/files/A1996-26.pdf
[3] CIVIL APPEAL NO. 9244 OF 2019
(This Article Does Not Intend To Hurt The Sentiments Of Any Individual Community, Sect, or Religion, Etcetera. This Article Is Based Purely On The Authors Personal Views And Opinions In The Exercise Of The Fundamental Right Guaranteed Under Article 19(1)(A) And Other Related Laws Being Force In India, For The Time Being. Further, despite all efforts made to ensure the accuracy and correctness of the information published, White Code VIA Mediation and Arbitration Centre Foundation shall not be responsible for any errors caused due to human error or otherwise.)
- The Supreme Court has set right the law regarding the amount of limitation for filing appeals under Section 37[2] of the Arbitration and Conciliation Act, 1996.
- Section 37 neither provided for a period of limitation within which an appeal might be filed thereunder nor did it prescribe a period of condonation of delay.
- The appliance of Section 5 of the Limitation Act to Section 37 appeals governed by a consistent 60-day period of limitation.
