NEW DELHI: With high commercial value disputes getting regularly referred to arbitration in India, the Supreme Court has decided to sort out prevailing confusion over what is the limitation period for filing of appeal against arbitral award – 90 days or 120 days.
But, the attempt to clear the confusion saw parallel proceedings in the Supreme Court as two coordinate benches took up the matter and passed orders. The confusion over the limitation period for filing appeal against arbitral awards arose from judgements of the SC, one holding that it was 90 days while others stating that it was extendable to 120 days.
A bench headed by justices RF Nariman on January 10 took note of the confusion on limitation period and decided to hear the issue. However, on February 5, the same issue came up before a bench headed by justice Indu Malhotra, which passed a detailed order.
Justice Malhotra bench noted that the SC in its 2008 judgement in ‘Consolidated Engineering Enterprises’ case had ruled that the period of limitation for filing appeals under section 37 of the Arbitration and Conciliation Act, 1996 was governed by Article 116 of the Schedule to the Limitation Act, 1963, which prescribes 90 days limitation period for filing appeal before the high court.
However, in two judgments of the year 2020, the SC in ‘Varindera Constructions Ltd‘ and ‘NV International’ took the view that period of limitation for filing appeal under section 37 should be the same as under Section 34 of the Arbitration and Conciliation Act, that is 120 days. Justice Malhotra-led bench said enactment of Commercial Courts Act, 2015 added to the confusion.
“Thus, the conundrum to be answered is as to what would be the appropriate period of limitation applicable to appeals filed under section 37 of the Arbitration and Conciliation Act, 1996. We direct the matter to be listed for final hearing on February 16”, the bench ordered.
However, the earlier matter on the same issue came up for further hearing on February 10 before the bench headed Justice Nariman, who then ordered, “The registry is directed to apprise Justice Indu Malhotra that this bench is seized of the matter.’
When the case came up before Justice Malhotra-led bench on February 16, it ordered listing of the case before a bench headed by justice Nariman.