Source: Himachal Pradesh High Court 

Why in News? 

Recently, Justice Jyotsna Rewal Dua  has held that Section 5 of the Limitation Act does not apply to Section 34 petitions under the Arbitration Act, and delay beyond the prescribed period cannot be condoned. 

• The Himachal Pradesh High Court held this in the matter of National Highway Authority of India. v. Jagroop Singh & Ors. (2025). 

What was the Background of National Highway Authority of India. v. Jagroop Singh & Ors Case ? 

• The National Highway Authority of India received an arbitral award against them on 3rd January, 2022, and received a copy of this award on 20th August, 2022. 
• The National Highway Authority of India filed a petition under Section 34 of the Arbitration and Conciliation Act, 1996, to challenge the award. 
• The petition was filed on 19th January, 2023, which was approximately 33 days beyond the maximum prescribed period of 120 days (3 months plus 30 days) allowed under Section 34(3) of the Arbitration Act. 
• The District Judge dismissed the petition on 13th June, 2024, ruling that it was filed beyond the prescribed limitation period. 
• The National Highway Authority of India then filed an appeal under Section 37 of the Arbitration Act to the Himachal Pradesh High Court. 
• This appeal itself was filed with a delay of 258 days, for which they moved an application to condone the delay. 
• The offence in question related to matters between the National Highway Authority of India and Jagroop Singh & Others, though specific details of the underlying dispute were not mentioned in the case summary. 

What were the Court’s Observations? 

• The Himachal Pradesh High Court observed that under Section 34(3) of the Arbitration and Conciliation Act 1996 Act ,(A&C) , an application for setting aside an arbitral award must be made within three months, extendable by only thirty days upon showing sufficient cause, and "not thereafter." 
• The Court held that Section 5 of the Limitation Act, 1963, which generally allows courts to condone delay beyond the prescribed limitation period, does not apply to petitions filed under Section 34 of the Arbitration Act. 
• The Court noted that the phrase "but not thereafter" in the proviso to Section 34 makes it clear that extension cannot be granted beyond the additional thirty days, as established in precedent cases including the Supreme Court's ruling in My Preferred Transformation & Hospitality Pvt. Ltd. & Anr. vs. M/s. Faridabad Implements Pvt. Ltd (2025).  
• The Court determined that the District Judge correctly dismissed the original petition as it was filed approximately 33 days beyond the maximum allowable period of 120 days. 
• The Court further observed that the appellant had also failed to justify the 258-day delay in filing the appeal under Section 37 of the Arbitration Act. 
• Based on these observations regarding the statutory limitation periods for challenging an arbitral award and the specific provisions dealing with offences under the Arbitration Act, the Court dismissed both the application to condone delay and the appeal. 

What are the Legal Provisions Referred? 

About : 

• Section 34 of the Arbitration Act, 1996 - This provision deals with applications for setting aside arbitral awards. 
• Section 34(3) of the Arbitration Act - This specific subsection establishes the limitation period for challenging an arbitral award, stipulating that it must be filed within three months, extendable by only 30 days upon showing sufficient cause, and "not thereafter." 
• Section 37 of the Arbitration Act - This section provides for appeals from certain orders, which was the provision under which the appellant filed their appeal to the High Court. 
• Section 5 of the Limitation Act, 1963 - This provision generally allows courts to condone delays beyond prescribed limitation periods if sufficient cause is shown. The court held that this provision does not apply to Section 34 petitions under the Arbitration Act. 

Section 34 of the Arbitration Act, 1996 

• Section 34(1) establishes that the only recourse against an arbitral award is through an application for setting it aside under the procedures outlined in subsections (2) and (3). 
• Section 34(3) imposes a strict time limitation of three months from the date of receipt of the arbitral award for filing an application to set it aside. 
• The proviso to Section 34(3) allows the Court to entertain such applications for an additional period of thirty days (but not thereafter) if satisfied that the applicant was prevented by sufficient cause from making the application within the initial three-month period. 
• Section 37(1)(c) specifically provides that an appeal shall lie to the Court from an order "setting aside or refusing to set aside an arbitral award under section 34." 
• Section 37(3) prohibits a second appeal from an order passed in appeal under Section 37, though it preserves the right to appeal to the Supreme Court. 
• The phrase "but not thereafter" in the proviso to Section 34(3) creates an absolute bar on the Court's power to entertain applications beyond the extended period of 30 days, which was the critical legal point in this case. 
• The combined effect of these provisions establishes a strict limitation regime for challenging arbitral awards, with courts having no discretion to condone delays beyond the maximum period of 120 days (3 months plus 30 days). 

Section 5 of the Limitation Act, 1963  

• Section 5 of the Limitation Act, 1963 provides a general power to courts to admit appeals or applications after the prescribed limitation period has expired. 
• For this provision to apply, the appellant or applicant must satisfy the court that they had "sufficient cause" for not filing within the prescribed period. 
• The provision explicitly excludes applications under Order XXI of the Code of Civil Procedure, 1908 from its scope. 
• The Explanation to Section 5 clarifies that being misled by any order, practice, or judgment of the High Court in determining the limitation period may constitute "sufficient cause." 
• This section creates a discretionary power for courts to condone delays beyond statutory limitation periods in the interest of justice. 
• However, as held by the Himachal Pradesh High Court in this case, Section 5 of the Limitation Act does not apply to applications under Section 34 of the Arbitration Act due to the specific language "but not thereafter" in Section 34(3).