The Supreme Court has held that for the purpose of Section 34(3) of the Arbitration and Conciliation Act, 1996, once jurisdiction under Section 33 is formally invoked by filing a request and such proceedings are entertained by the arbitral tribunal, limitation for filing an application under Section 34 commences only from the date on which the Section 33 request is disposed of. It is immaterial, for this purpose, whether the Section 33 application is ultimately allowed, dismissed, or later found unmeritorious. What is material is that the tribunal’s jurisdiction under Section 33 was formally invoked and remained pending.
Applying this principle, the Supreme Court noted that the certified copy of the common order dated July 04, 2022 disposing of the Section 33 applications was received by the appellant on Sep 15, 2022, and the Section 34 applications were filed thereafter within the period contemplated by Section 34(3). The Court therefore rejected the respondent’s objection on limitation, set aside the High Court’s judgment, restored the orders of the Principal District and Sessions Judge, Ballari condoning the delay, and directed that the Section 34 applications be decided on their own merits in accordance with law.
A Two-Judge Bench comprising Justice Pamidighantam Sri Narasimha and Alok Aradhe observed that a careful reading of Section 34(3) makes it clear that where a request under Section 33 has been made, limitation for filing an application under Section 34 must be reckoned from the date on which such request is disposed of by the arbitral tribunal. The statute does not distinguish between Section 33 applications that are allowed and those that are dismissed, nor does it state that only a maintainable Section 33 application can defer commencement of limitation. The Bench expressly stated that it could not read into the provision a restriction that the legislature had not incorporated.
The Bench further observed that once proceedings under Section 33 are initiated and entertained, the award remains subject to the limited jurisdiction of the arbitral tribunal for correction, interpretation, or supplementation. As long as such proceedings remain pending, parties cannot be compelled to institute Section 34 proceedings merely as a matter of abundant caution. In the Court’s view, the right to effectively pursue a remedy under Section 34 arises only after the Section 33 proceedings conclude.
Rejecting the respondent’s central contention, the Bench held that the success or failure of the Section 33 application is not determinative for purposes of Section 34(3). What matters is whether jurisdiction under Section 33 was formally invoked and whether such proceedings remained pending before the tribunal. The Bench therefore refused to accept the proposition that only a “maintainable” application under Section 33 can defer limitation.
The Bench added that requiring parties to file Section 34 proceedings during the pendency of Section 33 proceedings would generate multiplicity of proceedings and procedural uncertainty. At the same time, it clarified that if Section 33 applications are sham, frivolous, mala fide, or filed solely to defeat limitation under Section 34(3), courts would be justified in imposing exemplary and punitive costs.
Briefly, the dispute arose out of land acquisition proceedings under the National Highways Act, 1956 relating to land in Bellary District, including land belonging to Respondent No. 1. A preliminary notification was issued on Dec 15, 2009, the land vested in the Central Government by declaration dated Dec 14, 2010, and compensation was initially determined by an award dated Dec 05, 2011 under Section 3G(1) of the National Highways Act, 1956.
The appellant invoked arbitration under Section 3G(5) of the National Highways Act, and the Deputy Commissioner-cum-Arbitrator passed an award dated 16.02.2013 redetermining the market value of the land. That award was later set aside by the High Court and the matter was remitted for de novo consideration.
Upon remand, the Arbitrator passed a fresh award granting benefits under Sections 23(1-A), 23(2), 28 and 34 of the Land Acquisition Act, 1894. Thereafter, the appellant filed an application under Section 33(1)(a) of the Arbitration and Conciliation Act seeking correction of the arbitral award, including on the ground that grant of additional market value and interest under the 1894 Act was legally unsustainable. Thereafter, Respondent No. 1 filed an application under Section 33(4) seeking an additional award. Both applications were dismissed by a common order.
The appellant then filed applications under Section 34 along with applications for condonation of delay. The trial court condoned the delay. The High Court, however, held that the appellant’s Section 33(1)(a) application did not fall within the permissible scope of that provision and therefore could not defer limitation under Section 34(3), resulting in dismissal of the Section 34 applications as time-barred.
Appearances:
Venkita Subramoniam T.r, AOR, Tarun Dua, Adv., Sumit Gupta, Adv., Saudamini Sharma, Adv., Akshay Kumar Tiwari, Adv., Samrat Pasriccha, Adv., Tanya Shrotriya, Adv., for Appellants
Rashi Bansal, AOR, Darpa KM., Adv., Amrita Sharma, Adv., Rajat Jonathan Shaw, Adv., Easha Chandhok, Adv., Mahima Sadawat, Adv., Prashant Upadhyay, Adv., for Respondents