The Delhi High Court has rendered a decision on the applicability of Section 14 of the Limitation Act, ruling that it cannot be invoked by a petitioner who, due to a lack of diligence, allowed their Section 34 petition under the Arbitration and Conciliation Act to be dismissed twice for non-prosecution. The bench, comprising Justices Rajiv Shadkher and Tara Vitasta Ganju, emphasized that the repeated dismissal of the petition in default on two occasions reflected a complete absence of due diligence in its prosecution.
According to the court, the protection afforded by Section 14 of the Limitation Act, which excludes the period covered by litigious activity and shields a litigant from the limitation bar when a proceeding is dismissed due to a technical defect rather than being decided on its merits, would not be extended to a party failing to diligently pursue a matter.
The origin of the dispute lay in a contract for the execution of Power House Electrical equipment at District Saharanpur, awarded to the Respondent by the Appellant through a contract dated 28.09.1988. Subsequently, disputes between the parties led to arbitration, resulting in an Arbitral Award dated 15.03.2001 in favor of the Respondent. Unhappy with the award, the appellant contested it under Section 34 of the A&C Act.
The Section 34 Petition encountered procedural challenges, involving transfers between different courts (Saharanpur and Patiala House Courts, New Delhi) and dismissals in default on two occasions. Seeking legal advice, the Appellant withdrew the case from the District Judge at Saharanpur and refiled it before the District Courts in Delhi.
However, jurisdictional issues plagued the Section 34 Petition, eventually prompting its filing before a Single Judge of the Court on 25.08.2018. The court observed that the proceedings took an unusual 17 years to reach adjudication and dismissed the petition as barred by limitation.
In response, the appellant filed an appeal under Section 37 of the A&C Act against the dismissal of the application under Section 14 of the Limitation Act, seeking to condone a substantial delay of 6263 days in filing a petition under Section 34 of the Act, which led to the dismissal of the petition.
The court conducted a thorough analysis of the conditions stipulated in Section 14 of the Limitation Act, highlighting the significance of due diligence, good faith, defect of jurisdiction, and consistency in the matter at hand.
Critically, the court found the conduct of the Appellant lacking in due diligence, citing dismissals in default, delays, and filings in courts lacking jurisdiction. The Court noted the petition's dismissal in default on two occasions, indicating a complete absence of due diligence in its prosecution.
The lack of a satisfactory explanation for the repeated dismissals was also underscored by the court. It observed that the appellant failed to provide a reasonable justification for filing in the wrong court, indicative of a lack of due diligence and care in handling the legal proceedings.
Ultimately, the Court concluded that the prerequisites for the application under Section 14 were not satisfied, leading to the dismissal of the appeal. This case serves as a reminder of the courts' insistence on due diligence and proper conduct in legal proceedings, emphasizing the consequences of non-compliance with procedural requirements.
TAGS: Delhi High Court Section 14 of Limitation Act Section 34 Petition Arbitration and Conciliation Act lack of diligence
