Time Spent Before 'Wrong' Court Excluded U/S 14 Of Limitation Act While Calculating Limitation Period U/S 34 Of Arbitration Act: Delhi High Court

The Delhi High Court Bench of Justice Dharmesh Sharma has held that during the calculation of the limitation period of three months for the application under Section 34(1) of the Act, the time during which the applicant was prosecuting such application before the wrong court is excluded. Court noted that the proceedings in the wrong court should be bona fide, with due diligence. Brief Facts of the case: The appellant has filed an appeal under Section 37 of the Arbitration & Conciliation Act, 1996, challenging the impugned order passed by the Tis Hazari Court, Delhi. After receiving the award, the appellant challenged the award under Section 34 of the Act before the Delhi High Court. Later, the appellant was informed that the decision does not lie with the High Court but instead with the District Judge. So, the appellant withdrew the appeal from the High Court and then filed the application before the District Judge. Then, the respondent contended that the appeal was time-barred under Section 34(3) of the Act. The District Judge dismissed the application and held the application was barred by limitation. Aggrieved by this, the appellant filed this appeal. Observation of the Court: The court observed that the District Judge had failed to consider the aspect of exclusion of time in accordance with Section 14 of the Limitation Act, 1963. Further, the court also relied on the judgment in Consolidated Engg. Enterprises v. Principal Secy. Irrigation Deptt., wherein the Supreme Court distinguished the scope and ambit of Section 5 vis-a-vis Section 14 of the Limitation Act, 1963. Additionally, the court also relied on the judgment in Kirpal Singh v. Government of India, wherein the proposition of law was reiterated that the relief can also be claimed under Section 14 of the Limitation Act, 1963, despite an appeal being barred by virtue of Section 34(3) of the Act. Thereafter, the court dismissed the impugned order passed by the District Judge and held that while computing the limitation period of three months for the application under Section 34(1) of the Act, the time during which the applicant was prosecuting such application before the wrong court is excluded, provided the proceeding in the wrong court was prosecuted bona fide, with due diligence. Case Title: INCITE HOMECARE PRODUCTS PVT LTD versus R K SWAMY PVT LTD ERSTWHILE RK SWAMY BBDO PVT LTDCitation: 2025 LiveLaw (Del) 279 Case Number: FAO 46/2025, CM APPL. 11874/2025 & CM APPL. 11875/2025 Counsel for the Appellant: Mr. Gaurav Mahajan, Adv. Counsel for the Respondent: Mr. Shikhar Garg & Mr. Ojasvi, Advs. Date of Judgment: 27.02.2025 Click Here To Read/Download The Order

Time Spent Before 'Wrong' Court Excluded U/S 14 Of Limitation Act While Calculating Limitation Period U/S 34 Of Arbitration Act: Delhi High Court

Soumya Chakrabarti

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