ASSAM URBAN WATER SUPPLY & SEW. BOARDversusSUBASH PROJECTS & MARKETING LTD.

                     [2012] 1 S.C.R. 403

    ASSAM URBAN WATER SUPPLY & SEW. BOARD                           A
                                v.
         SU BASH PROJECTS & MARKETING LTD.
             (Civil Appeal No(s). 2014 of 2006)
                     JANUARY 19, 2012.
                                                                    B
         [R.M. LODHA AND H.L. GOKHALE, JJ.)

    ARBITRATION AND CONCILIATION ACT, 1996:

      ss. 34(1), (3) and (4)of 1996 Act rlw ss. 2 (j) and 4 of c
Limitation Act - Applications u/s 34 for setting aside arbitration
awards filed after extended period of 30 days claiming benefit
of s. 4 of Limitation Act for the inteNening Christmas holidays
- Held: s. 2(j) of the 1963 Act when read in the context of s.
34(3) of the 1996 Act, makes it amply clearthatthe prescribed 0
period for making an application for setting aside arbitral
award is three months - The period of 30 days beyond three
months which the court may extend on sufficient cause being
shown under the proviso appended to sub-s (3) of s. 34 of the
1996 Act, being not the 'period of/imitation' or the 'prescribed E
period', s. 4 of the 1963 Act is not, at all, attracted to the facts
of the instant case - Thus, the applications made by the
appellants for setting aside the arbitral award have rightly
been dismissed by the District Judge as time barred -
Limitation Act, 1963 - ss. 2 (j) and 4.
                                                                     F
      The appellants filed two applications uls 34 of the
Arbitration and Conciliation Act, 1996 (1996 Act) on
2.1.2004 for setting aside the awards dated 22.8.2003,
copies whereof were received by them on 26.8.2003. The
District Judge dismissed the said applications on the G
ground of limitation. The High Court declined to interfere.

     In the instant appeal, the question for consideration
of the Court was: whether the appellants were entitled to
                              403                                   H
    404      SUPREME COURT REPORTS               (2012] 1 S.C.R.


A extension of time u/s 4 of the Limitation Act, 1963 Act
          Dismissing the appeal, the Court

     . HELD: 1.1. Section 4 of the Limitation Act, 1963
  enables a party to institute a suit, prefer an appeal or make
B an application on the day court reopens where the
  prescribed period for any suit, appeal or application
  expires on the day when the court is closed. The crucial
  words in s. 4 of the 1963 Act are 'prescribed period'.
  Section 2(j) of the 1963 Act defines 'period of limitation'
C which means the period of limitation prescribed for any
  suit, appeal or application by the Schedule, and
  'prescribed period' means the period of limitation
  computed in accordance with the provisions of this Act
  [para 13] [409-F-G]
D
       1.2. Section 2(j) of the 1963 Act when read in the
  context of s. 34(3) of the Arbitration and Conciliation Act,
  1996, makes it amply clear that the prescribed period for
  making an application for setting aside arbitral award is
  three months. The period of 30 days mentioned in the
E proviso that follows sub-s. (3) of s. 34 of the 1996 Act is
  not the 'period of limitation' and, therefore, not 'prescribed
  period' for the purposes of making the application for
  setting aside the arbitral award. The period of 30 days
  beyond three months which the court may extend on
F sufficient cause being shown under the proviso
  appended to sub-s (3) of s. 34 of the 1996 Act being not
  the 'period of limitation' or the 'presr.ribed period', s. 4 of
  the 1963 Act is not, at all, attracted to the facts of the
  instant case. [para 13] [409-H; 410-A-C]
G
      1.3. In the instant case, the arbitral awards were
  received by the appellants on 26-8-2003. No application
  for setting aside the arbitral awards was made by the
  appellants before elapse of three months from the receipt
H thereof. As a matter of fact, three months from the date
    ASSAM URBAN WATER SUPPLY & SEW. BOARD v.            405
        SUBASH PROJECTS & MARKETING LTD.

of the receipt of the arbitral award by the appellants A
expired on 26-11-2003. The District Court had Christmas
vacation for the period from 25-12-2003 to 1-1-2004. On
reopening of the court, i.e., on 2-1-2004, admittedly, the
appellants made applications for setting aside those
awards u/s 34 of the 1996 Act. Thus, the applications B
made by the appellants on 2-1-2004, for setting aside the
arbitral award dated 26-8-2003 have rightly been
dismissed by the District Judge as time barred. [para 11
and 14) [408-F-H; 409-A; 410-0]

    Union of India vs. Popular Construction Co. 2001 (3) C
Suppl. SCR 619      = (2001) 8 sec 470; and State of
Maharashtra vs. Hindustan Construction Company Limited
2010 (4) SCR 46 = (2010) 4 sec 518, relied on.

                    Case Law Reference:                        D
    2001 (3) Suppl. SCR 619       relied on       para 5
    2010 (4) SCR 46               relied on       para 9

    CIVIL APPELLATE JURISDICTION: Civil Appeal No.             E
2014 of 2006.

    From the Judgment and Order dated 15.02.2005 of the
High Court of Gauhati in Arbitration Appeal Nos. 6 and 7 of
2004.
                                                               F
   Bijendra Singh and Anupam Mishra (for Ambar
Qamaruddin) for the Appellant.

   Shyam Divan, Puneet Jain and Prade~p Gupta (for Sushil
Kumar Jain) for the Respondent.
                                                               G
    The Judgroent of the Court was delivered by

    R.M. LODHA, ·J. 1. Two contracts were entered into
between the appellants and the respondents - (i) for
construction of Tezpur Town Water Supply Scheme and (ii) for   H
    406      SUPREME COURT REPORTS                 [2012] 1 S.C.R ..

A construction of Tinsukia Town Water Supply Scheme. Certain
  disputes arose between the parties concerning these contracts
  and to resolve such disputes, sole arbitrator was appointed by
  the Chief Justice of Gauhati High Court on March 26, 2002
  under Section 11 of the Arbitration and Conciliation Act, 1996
B (for short, '1996 Act'). On .May 10, 2002 the appellants filed
  application under Section 16 of the 1996 Act questioning the
  jurisdiction of the sole arbitrator as according to the appellants
  there was no arbitration clause in the agreement. This
  application came to be rejected by the sole arbitrator.
c      2. Thereafter, the sole arbitrator proceeded with the
  arbitration and passed two awards in relation to the above
  contracts in favour of the respondents on August 22, 2003. The
  awards were received by the appellants on August 26, 2003.
D On January 2, 2004, the appellants made two applications for
  setting aside the awards dated August 22, 2003 under Section
  34 of the 1996 Act. These applications were accompanied by
  two separate applications for extension of time under Section
  34(3) of the 1996 Act.
E         3. The District Judge, Kamrup, Guwahati, dismissed the
    appellants' applications under Section 34 of the 1996 Act on
    June 1, 2004 and June 5, 2004 on the ground of limitation.

       4. The appellants challenged the above orders of the
F Districted Judge, Kamrup, Guwahati, in the Gauhati High Court
  in two separate Arbitration Appeals, being Arbitration Appeal
  Nos. 6 of 2004 and 7 of 2004. The Division Bench of that Court
  upheld the view of the District Judge, Kamrup, Guwahati and
  dismissed the above Arbitration Appeals.
G
          5. Mr. Bijender Singh, learned counsel for the appellants,
    submitted that the Division Bench gravely errect in applying the
    decision of this Court in Union of India Vs. Popular
    Construction Co. 1 to the facts of the present case. He submitted
H    1. c2001i s sec 410.
   ASSAM URBAN WATER SUPPLY & SEW. BOARD v.      407
 SUBASH PROJECTS &MARKETING LTD. [RM. LODHA, J.)

that the judgment of this Court in Popular Construction Co.         A
(supra) was rendered on the question of applicability of Section
5 of the Limitation Act, 1963 (for short, '1963 Act') and has no
application to the peculiar facts of the present case where
extension was sought by the appellants under Section 4 of the
1963 Act. lfl support of his argument, Mr. Bijender Singh,          B
learned counsel, referred to Section 20) of the 1963 Act that
defines 'period of limitation' and Section 43 of the 1996 Act
that makes the 1963 Act applicable to arbitration matters.

     6. Mr. Shyam Divan, learned senior counsel for the             c
respondents, on the other hand, submitted that the High Court
did not commit any error in upholding the view of the District
Judge, Kamarup, Guwahati. According to the learned senior
counsel, the High Court's view is consistent with Section 34(3)
of the 1996 Act, particularly proviso (3) thereof.
                                                                    0
     7. Section 34(3) of the 1996 Act provides that an
application for setting aside an award may be made within
three months of the receipt of the arbitral award. The proviso
that follows sub-section (3) of Section 34 provides that on
sufficient cause being shown, the court may entertain the           E
application for setting aside the award after the period of three
months and within a further period of 30 days but not thereafter.

     8. In Popular Construction Co. (supra), this Court has held
that an application for setting aside an award filed beyond the     F
period mentioned in Section 34(3) would not be an application
"in accordance with sub-section (3) as required under Section
34( 1) of the ~6 Act" and Section 5 of the 1963 Act has no
application fo such-application. In para 12 of the report, it was
held in Popular Construction Co. (supra) thus:-                     G
    "12. As far as the language of Section 34 of the 1996 Act-
    is concerned, the crucial words are "but not thereafter"
    used in the proviso to sub-section (3). In our opinion, this
    phrase would amount to an express exclusion within the H
    408       SUPREME COURT REPORTS                  [2012) 1 S.C.R.


A         meaning of Section 29(2) of the Limitation Act, and would
          therefore bar the application of Section 5 of the Act.
          Parliament did not need to go further. To hold that the court
          could entertain an application to set aside the award
          beyond the extended period under the proviso, would
B         render the phrase "but not thereafter" wholly otiose. No
          principle of interpretation would justify such a result".

       9. Recently, in the State of Maharashtra Vs. Hindustan
  Construction Company Limited2, a two Judge Bench of this
C Court speaking through one of us (R.M. Lodha, J.) emphasised
  the mandatory nature of the limit to the extension of the period
  provided in proviso to Section 34(3) and held that an application
  for setting aside arbitral award under Section 34 of the 1996
  Act has to be made within the time prescribed under sub-
D section (3) of Section 34, i.e., within three months and a further
  period of 30 days on sufficient cause being shown and not
  thereafter.

        10. Section 43(1) of the 1996 Act provides that the 1963
  Act shall apply to arbitrations as it applies to proceedings in
E court. The 1963 Act is thus applicable to the matters of
  arbitration covP.red by the 1996 Act save and except to the
  extent its applicability has been excluded by virtue of the
  express provision contained in Section 34(3) of the 1996 Act.

F      11. The facts in the present case are peculiar. The arbitral
  awards were received by the appellants on August 26, 2003.
  No application for setting aside the arbitral awards was made
  by the appellants before elapse of three months from the
  receipt thereof. As a matter of fact, three months from the date
G of the receipt of the arbitral award by the appellants expired
  on November 26, 2003. The District Court had Christmas
  vacation for the period from December 25, 2003 to January 1,
  2004. On reopening of the court, i.e., on January 2, 2004,
  admittedly, the appellants made applications for setting aside
H 2. (2010) 4 sec s1a.
   ASS/lM URBAN WATER SUPPLY & SEW. BOARD v.       409
 SUBASH PROJECTS & MARKETING LTD. [R.M. LODHA, J.]
those awards under Section 34 of the 1996 Act. If the period      A
during which the District Court, Kamrup, Guwahati, remained
closed during Christmas vacation, 2003 is extended and the
appellants get benefit of that period over and above the cap of
thirty days as provided in Section 34(3), then the view of the
High Court and the District Judge cannot be sustained. But this   B
would depend on the applicability of Section 4 of the 1963 Act.
The question, therefore, that falls for our determination is -
whether the appellants are entitled to extension of time under
Section 4 of the 1963 Act in the above facts.
                                                                  c
    12. Section 4 of the 1963 Act reads as under:-

    "4. Expiry of prescribed period when court is closed.-
    Where the prescribed period for any suit, appeal or
    application expires on a day when the court is closed, the
    suit, appeal or application may be instituted, preferred or D
    made on the day when the court reopens.
                                 I


          Expfanation.-A court shall be deemed to be closed
    on any day within the meaning of this section if during any
    part of its nonnal working hours it remains closed on that    E
    day."
    13. The above Section enables a party to institute a suit,
prefer an appeal or make an application on the day court
reopens where the prescribed period for any suit, appeal or F
application expires on the day when the court is closed. The
crucial words in Section 4 of the 1963 Act are 'prescribed
period'. What is the meaning of these words? Section 20) of
the 1963 Act defines 'period of limitation' which means the
period of limitation prescribed for any suit, appeal or G
application by the Schedule, and 'prescribed period' means the
period of limitation computed in accordance with the provisions
of this Act. Section 20) of the 1963 Act when read in the context
of Section 34(3) of the 1996 Act, it becomes amply clear that
the prescribed period for making an application for setting H
    410       SUPREME COURT REPORTS                [2012] 1 S.C.R.


A aside arbitral award is three months. The period of 30 days
  mentioned in proviso that follows sub-section (3) of Section 34
  of the 1996 Act is not the 'period of limitation' and, therefore,
  not 'prescribed period' for the purposes of making the
  application for setting aside the arbitral award. The period of
B 30 days beyond three months which the court may extend on
  sufficient cause being shown under the proviso appended to
  sub-section (3) of Section 34 of the 1996 Act being not the
  'period of limitation' or, in other words, 'prescribed period', in
  our opinion, Section 4 of the 1963 Act is not, at all, attracted
C to the facts of the present case.

        14. Seen thus, the applications made by the appellants on
    January 2, 2004, for setting aside the arbitral award dated
    August 26, 2003 were liable to be dismissed and have rightly
0 been dismissed by the District Judge, Kamrup, Guwahati, as
  time barred.
           15. The dismissal of the Arbitration Appeals (6 of 2004
    and 7 of 2004) by the High Court, thus, cannot be legally flawed
    for the reasons we have indicated above.
E
           16. The Appeal has no force and is dismissed with no
    order as to costs.

    R.P.                                        Appeal dismissed.