Procedural Aspects of Section 34 of Arbitration and Conciliation Act, 1996 and Powers of Court Explained By Supreme Court

Procedural Aspects of Section 34 of Arbitration and Conciliation Act, 1996 and Powers of Court Explained By Supreme Court

Section 34 is an important provision of A & C Act, 1996. Delay in matters concerning S.34 of the Act needs to be curbed with heavy heads. A leading judgment would make it clear that whether Courts can adopt a liberal attitude in matters where delay has been caused under S.34 of the Act. This Judgment was passed before the Amendment Act of 2021 which had amended S.36 and S.43J of the A&C Act, 1996. 

The Supreme Court in the case of Simplex Infrastructure Ltd. V. Union of India (UOI), [2018] GCtR 2362 (SC) has rightly and clearly held that the Court has no power or discretion to condone the delay beyond the period of 120 days. Relevant portion of the judgment [page number 13] reads as under:- 

“A plain reading of sub-section (3) along with the proviso to Section 34 of the 1996 Act, shows that the application for setting aside the award on the grounds mentioned in sub-section (2) of Section 34 could be made within three months and the period can only be extended for a further period of thirty days on showing sufficient cause and not thereafter. The use of the words “but not thereafter” in the proviso makes it clear that the extension cannot be beyond thirty days. Even if the benefit of Section 14 of the Limitation Act is given to the respondent, there will still be a delay of 131 days in filing the application. That is beyond the strict timelines prescribed in sub-section (3) read along with the proviso to Section 34 of the 1996 Act. The delay of 131 days cannot be condoned. To do so, as the High Court did, is to breach a clear statutory mandate.”

In this judgment the arguments like bonafide delay because application was filed before some other forum, absence of wilful latches or that the delay was caused due to inevitable administrative difficulties, argument that office was located in City 1 but approval is to be obtained from Office located in City 2 was rightly rejected and delay was not condoned.