Section 14 of the Limitation Act, 1963 does not come to the rescue of litigant acting malafide

Supreme Court: Interpreting the provision under Section 14 of the Limitation Act, 1963, the Court said that despite liberal interpretation placed under the said provision, the matter in issue in the earlier proceeding and the latter proceeding has to be conferred requisite importance.  The words “in accordance with law” under the said provision allow an argument to be canvassed that the time spent in earlier proceeding deserved exclusion while computing the period of limitation. However, Section 14 of the 1963 Act lays down that the proceedings must relate to the same matter in issue.

In the matter where condonation of delay in filing an objection under Section 34 of the Arbitration and Conciliation Act, 1996 was in question, the respondent had earlier filed an application under Section 11 of the 1996 Act to appoint an arbitrator before the High Court of Madhya Pradesh after participating in the Arbitration proceeding as per the Arbitration Clause in the Contract where the Arbitrator had given the award in the favour of the appellant. The respondent had argued that the impugned Clause could not be treated as an arbitration clause and, therefore, the court should appoint an arbitrator.

The bench of Dipak Misra and R.F. Natiman, JJ, considering the facts of the case, said that filing of an application under Section 11 of the 1996 Act for an appointment of arbitrator is totally different than an objection to award filed under Section 34 of the 1996 Act as one is at the stage of initiation, and the other at the stage of culmination. Hence, by no stretch of imagination, it can be said that the proceedings relate to “same matter in issue”. Stating that Section 14 of the 1963 Act emphasizes on due diligence and good faith, the Court said that the respondent instead of participating in the arbitration proceedings, could have immediately taken steps for appointment of arbitrator as he thought appropriate or he could have filed his objections under Section 34(2) of the 1996 Act within permissible parameters. It was held that though liberal interpretation should be placed on Section 14 of the 1963 Act, but if the fact situation exposits absence of good faith of great magnitude, law should not come to the rescue of such a litigant. [Commissioner, M.P. Housing Board v. Mohanlal and Company, 2016 SCC OnLine SC 738, decided on 19.07.2016]

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