Delhi High Court
Kalanithi Maran vs Spicejet Limited & Anr on 23 May, 2025
Author: C. Hari Shankar
Bench: C. Hari Shankar
$~
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Reserved on: 19 May 2025
Pronounced on: 23 May 2025
+ FAO(OS) (COMM) 173/2024, CM APPL. 45539/2024, CM
APPL. 45540/2024 & CM APPL. 45541/2024
KAL AIRWAYS PRIVATE LIMITED .....Appellant
Through: Mr. Gaurav Pachnanda, Sr.
Adv., Ms. Nandini Gore, Ms. Sonia Nigam,
Ms. Swati Bhardwaj, Mr. Akarsh Sharma,
Mr. Akhil Abraham Roy, Mr. Gauhar Mirza,
Ms. Hiral Gupta, Ms. Sukanya Singh, and
Ms. Shreya Bansal, Advs.
versus
SPICEJET LIMITED & ANR. .....Respondents
Through: Mr. Amit Sibal, Sr. Adv.,
Mr. K.R. Sasiprabhu, Mr. Goutham
Shivshankar, Ms. Chinmayi Chatterjee and
Mr. Darpan Sachdeva, Advs.
+ FAO(OS) (COMM) 171/2024, CM APPL. 45530/2024, CM
APPL. 45531/2024 & CM APPL. 45532/2024
KALANITHI MARAN .....Appellant
Through: Mr. Gaurav Pachnanda, Sr.
Adv., Ms. Nandini Gore, Ms. Sonia Nigam,
Ms. Swati Bhardwaj, Mr. Akarsh Sharma,
Mr. Akhil Abraham Roy, Mr. Gauhar Mirza,
Ms. Hiral Gupta, Ms. Sukanya Singh, and
Ms. Shreya Bansal, Advs.
versus
SPICEJET LIMITED & ANR. .....Respondents
Through: Mr. Amit Sibal, Sr. Adv.,
Signature Not Verified
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Mr. K.R. Sasiprabhu, Mr. Goutham
Shivshankar, Ms. Chinmayi Chatterjee and
Mr. Darpan Sachdeva, Advs.
CORAM:
HON'BLE MR. JUSTICE C. HARI SHANKAR
HON'BLE MR. JUSTICE AJAY DIGPAUL
JUDGMENT
% 23.05.2025
per C. HARI SHANKAR, J.
1. We have heard Mr. Gaurav Pachnanda, learned Senior Counsel
for Kalanithi Maran1 and Kal Airways Pvt. Ltd.2 3, the appellants in
these appeals and Mr. Amit Sibal, learned Senior Counsel for Spicejet
Limited and Ajay Singh4, the respondents in these appeals.
2. Arguments were heard on CM Appl. 45531/2024 in FAO (OS)
(Comm) 171/2024 and CM Appl. 45540/2024 in FAO (OS) (Comm)
173/2024, which seek condonation of delay of 55 days in filing the
appeals and on CM Appl. 45532/2024 in FAO (OS) (Comm)
171/2024 and CM Appl. 45541/2024 in FAO (OS) (Comm) 173/2024,
which seek condonation of delay of 226 days in re-filing the appeals.
3. For reasons which would presently become apparent, we find
no merit in CM Appl. 45532/2024 and CM Appl. 45541/2024 which
seek condonation of delay of 226 days in re-filing the appeals.
Resultantly, the appeals themselves are liable to be dismissed.
1 “Kalanithi”, hereinafter
2 “KAPL”, hereinafter
3 “the appellants” collectively hereinafter
4 “the respondents”, collectively hereinafter
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Facts
4. Disputes arose between the appellants, on the one hand, and the
respondents, on the other, which were referred to an arbitral tribunal
comprising three Hon’ble Retired Judges of the Supreme Court. The
arbitral tribunal rendered its award on 20 July 2018.
5. The arbitral award was challenged both by the appellants, as
well as by the respondents in these appeals by preferring petitions
under Section 34 of the Arbitration and Conciliation Act, 1996 5. The
appellants challenged the award by way of OMP (Comm) 450/20186
and OMP (Comm) 451/20187 whereas the respondents challenged the
award by way of OMP (Comm) 42/20198 and OMP (Comm)
43/20199, respectively.
6. All the Section 34 petitions were dismissed by a learned Single
Judge of this Court by two separate judgments, rendered on 31 July
2023.
7. The judgment dated 31 July 2023, in OMP (Comm) 42/2019
and OMP (Comm) 43/2019, was assailed by Ajay Singh by way of
FAO (OS) (Comm) 179/2023 and by Spicejet by way of FAO (OS)
(Comm) 180/2023. Both the appeals were filed on 22 August 2023,
within the statutory period of 60 days available in that regard, under
5 the 1996 Act, hereinafter
6 Kal Airways Pvt. Ltd v Spicejet Ltd & Anr
7 Kalanithi Maran v Spicejet Ltd & Anr
8 Spicejet Ltd v Kal Airways Pvt Ltd & Ors
9 Ajay Singh v Kal Airways Pvt Ltd & Ors
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Section 13(1-A)10 of the Commercial Courts Act.
8. We may note the admitted position, at the Bar, that the statutory
period for filing the appeal, as it emanates from an order of the
Commercial Court, has to be determined in accordance with Section
13 of the Commercial Courts Act, as held by the Supreme Court in
Government of Maharashtra v Borse Brothers Engineers and
Contractors Pvt Ltd.11 The said Section provides for 60 days for
preferring the appeal against the judgment or order of the Commercial
Division of this Court to the Commercial Appellate Division of this
Court. It does not provide for condonation of delay. Accordingly,
Section 512 of the Limitation Act, 1963 would apply, whereunder
delay can be condoned on sufficient cause being shown.
9. The FAOs preferred by the respondents were listed before the
Division Bench on 23 August 2023, 24 August 2023, 31 October
2023, 09 November 2023, 17 November 2023, 30 November 2023, 8
December 2023, 14 December 2023, 8 January 2024, 15 January
2024, 29 January 2024 and 7 February 2024, before they were finally
disposed of by judgment dated 17 May 2024. The Division Bench
10 (1-A) Any person aggrieved by the judgment or order of a Commercial Court at the level of District Judge
exercising original civil jurisdiction or, as the case may be, Commercial Division of a High Court may appeal
to the Commercial Appellate Division of that High Court within a period of sixty days from the date of the
judgment or order:
Provided that an appeal shall lie from such orders passed by a Commercial Division or a
Commercial Court that are specifically enumerated under Order XLIII of the Code of Civil Procedure, 1908
(5 of 1908) as amended by this Act and Section 37 of the Arbitration and Conciliation Act, 1996 (26 of 1996).
11 (2021) 6 SCC 460
12 5. Extension of prescribed period in certain cases. – Any appeal or any application, other than an
application under any of the provisions of Order XXI of the Code of Civil Procedure, 1908 (5 of 1908), may
be admitted after the prescribed period if the appellant or the applicant satisfies the court that he had sufficient
cause for not preferring the appeal or making the application within such period.
Explanation. – The fact that the appellant or the applicant was misled by any order, practice or
judgment of the High Court in ascertaining or computing the prescribed period may be sufficient cause within
the meaning of this section.
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held that the learned Single Judge had erred in dismissing the Section
34 petitions filed by the respondents without due consideration to the
challenge raised by them and an apparent absence of reasoning to
support the decision at which the learned Single Judge arrived. The
Division Bench, therefore, restored the OMPs of the respondents to
the Board of the learned Single Judge for consideration afresh.
10. The said OMPs filed by the respondents are presently pending
before the learned Single Judge.
11. While the FAOs of the respondents were being heard by the
Division Bench, in which the appellants also participated, the
appellants proceeded to file the present appeals, FAO (OS) (Comm)
171/2024 and FAO (OS) (Comm) 173/2024, also challenging the
judgment of the learned Single Judge dated 31 July 2023, insofar as it
dismissed the appellant’s OMPs, on 23 November 2023 and 24
November 2023. These appeals were admittedly filed after a delay of
55 days beyond the period of 60 days provided in Section 13 of the
Commercial Courts Act.
12. It is significant that, even prior to the filing of these appeals, the
FAOs of the respondents had already been heard by the Division
Bench on five occasions, that is, 23 August 2023, 24 August 2023, 31
October 2023, 9 November 2023 and 17 November 2023.
13. Admittedly, the appellants did not effect any advance service of
the present FAOs, filed by them on 23 and 24 November 2023, on the
respondents. Service of the FAOs was effected, on the respondents, at
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a highly belated stage. The reasons for this would become presently
apparent.
14. Also, the Division Bench, which was hearing the respondents’
FAOs, was never apprised by the appellants of the filing of the present
appeals, or that they were pending with the Registry for removal of
defects, despite the appellants having continuously participated in the
hearing of the FAOs.
15. The defects noted by the Registry in the present FAOs filed by
the appellants were allowed to remain uncured, till 30 July 2024, when
they were removed and the FAOs refiled after 226 days delay.
16. After the filing of the present FAOs by the appellants under
defects on 23 and 24 November 2023, the FAOs filed by the
respondents had been heard on seven more occasions, i.e., 30
November 2023, 8 December 2023, 14 December 2023, 8 January
2024, 15 January 2024, 29 January 2024 and 7 February 2024, and
had finally been disposed of on 17 May 2024. As already noted
earlier, the Division Bench allowed the FAOs of the respondents and
restored their OMPs to the file of the learned Single Judge for decision
afresh.
17. Even at this stage, the appellants did not cure the defects in the
present FAOs and refile them. Instead, they chose to challenge the
judgment dated 17 May 2024 of the Division Bench in the
respondents’ FAOs before the Supreme Court, by way of SLP (C)
14936/2024 and SLP (C) 14741/2024.
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18. The Supreme Court dismissed the SLPs of the appellants, by the
following order dated 26 July 2024:
“1. We are in agreement with the reasoning which led the
Division Bench of the Delhi High Court to remand the proceedings
back to the Single judge for reconsidering the petition under
Section 34 of the Arbitration and Conciliation Act 1996.
2. Interference with an arbitral award under Section 34 must
be confined to the grounds which are permissible under the statute.
But equally, the judge hearing an application under Section 34
must apply their mind to the grounds of challenge and then deduce
as to whether a case for interference within the parameters of
Section 34 has been made out. Reading the order of the Single
judge, we find no discernible reason which has weighed with the
Single judge. There has been no consideration of the arguments
which were urged before the Single judge.
3. In paragraphs 121 of the impugned judgment, the Division
Bench has observed as follows:
“We, additionally and out of abundant caution, deem it
appropriate to observe that the discussion appearing in the
preceding parts of this judgment and concerning the
validity of the award of refund and the grant of interest,
appears in the context of examining the correctness of the
judgment rendered by the learned Single judge alone. None
of those are liable to be viewed or accepted as being
determinative of some of the submissions which were
addressed on this appeal.”
4. In this view of the matter, the Division Bench did not err in
remitting the proceedings back to the Single judge.
5. In the facts and circumstances, we request the learned Chief
justice of the Delhi High Court to assign the hearing of the petition
under Section 34 to a judge other than the judge who heard and
passed the impugned order.
6 Since the Division Bench of the High Court has remanded
the proceedings back to the Single judge for reconsidering the
petition under Section 34 which order has been affirmed by this
Court, it needs to be clarified that all the rights and contentions of
the parties are kept open.
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7. The Special Leave Petitions are accordingly disposed of.
8. Pending applications, if any, stand disposed of.
19. This constitutes the factual and litigative background, in which
we have to consider the appellants’ prayer for condonation of delay of
55 days in filing, and 226 days in refiling, the present appeals.
Rival Contentions
Submissions of Mr. Gaurav Pachnanda
20. Mr. Pachnanda submits that the Court has classically to adopt
an expansive approach while dealing with prayers for condonation of
delay in refiling proceedings. He has also candidly drawn our
attention to Rule 5 of Part A of Chapter 1 Volume V of the Delhi
High Court Rules and Orders13, which reads:
“5(1) The Deputy Registrar/Assistant Registrar, In-charge of the
Filing Counter, may specify the objections (a copy of which will
be kept for the Court Record) and return for amendment and re-
filing within a time not exceeding 7 days at a time and 30 days in
the aggregate to be fixed by him, any memorandum of appeal, for
the reason specified in Order XLI, Rule 3, Civil Procedure Code.
(2) If the memorandum of appeal is not taken back, for
amendment within the time allowed by the Deputy
Registrar/Assistant Registrar, in charge of the Filing Counter under
sub-rule (1), it shall be registered and listed before the Court for its
dismissal for non-prosecution.
(3) If the memorandum of appeal is filed beyond the time
allowed by the Deputy Registrar/Assistant Registrar, in charge of
the Filing Counter, under sub-rule (1) it shall be considered as
fresh institution.
13 “the DHC Rules” hereinafter
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Explanation : The period of seven days or thirty days mentioned
above shall commence from the date, the objections are put on the
notice board.
Note: The provisions contained in Rule 5(1), 5(2) and 5(3) shall
mutatis mutandis apply to all matters, whether Civil or Criminal.”
Mr. Pachnanda submits that the respondents’ contention is that, under
Rule 5(3) in Part A of Chapter 1 Volume V of the DHC Rules supra,
the re-filing of the present appeals by the appellants on 30 July 2024
had to be treated as a fresh filing, by which reckoning the delay in
filing the appeal would be of 281 days. The rigour of Rule 5(3),
submits Mr. Pachnanda, has been practically effaced by the following
paragraphs from the judgment of the Supreme Court in Northern
Railway v Pioneer Publicity Corporation Ltd14:
“4. We find that said Section 34(3) has no application in re-
filing the petition but only applies to the initial filing of the
objections under Section 34 of the Act. It was submitted on behalf
of the respondent that Rule 5(3) of the Delhi High Court Rules
states that if the memorandum of appeal is filed and particular time
is granted by the Deputy Registrar, it shall be considered as fresh
institution. If this Rule is strictly applied in this case, it would
mean that any re-filing beyond 7 days would be a fresh institution.
However, it is a matter of record that 5 extensions were given
beyond 7 days. Undoubtedly, at the end of the extensions, it would
amount to re-filing.
5. We are not inclined to accept this contention, particularly
since the petitioner has offered an explanation for the delay for the
period after the extensions.”
Mr. Pachnanda also relies on the following paragraphs from the
judgment of a learned Single Judge of this Court in Dr Narender
Kumar Sharma v Maharana Pratap Educational Center15, in which
14 (2017) 11 SCC 234
15 2018 SCC OnLine Del 13146
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reliance had been sought to be placed on the judgment of the Division
Bench in Northern Railway v Pioneer Publicity Corporation Pvt
Ltd16, which was reversed by the judgment of the Supreme Court in
Pioneer Publicity (supra):
“6. Learned counsel appearing for the appellant has opposed
the appeal. He submits that re-filing tentamounts to fresh filing. He
relies upon the judgment of the Division Bench of this court
in Northern Railway v Pioneer Publicity Corporation Pvt. Ltd., to
contend that re-filing would tentamount to fresh filing and delay
cannot be condoned.
7. It is admitted fact that the defendants have filed the written
statement on 07.05.2018 after being served on 08.01.2018.
8. It is settled legal position that delay in re-filing has to be
considered on a different footing. Reference in this context may be
had to the judgment of the Division Bench of this court in S.R.
Kulkarni v Birla VXL Ltd.17, where the court held as follows:–
“8. Notwithstanding which of the aforesaid Rules are
applicable, the question of condensation of delay in refiling
of an application has to be considered from a different
angle and viewpoint as compared to consideration of
condensation of delay in initial filing. The delay in refiling
is not subject to the rigorous tests which are usually applied
in excusing the delay in a petition filed under Section 5 of
the Limitation Act (See Indian Statistical
Institute v Associated Builders18). In the present case, the
initial delay of 7 days in filing the application for leave to
defend stood condoned and that has not been challenged by
any of the parties. It is no doubt true that the counsel for the
appellant had not been very diligent after filing of
application for leave to defend on 19th August, 1995 as
counsel did not check whether the application was lying in
the Registry with any objection or not. Considering
however, the nature of the objections, it was a matter of
removal of the objections by the counsel and on the facts of
the present case, it is difficult in this case to attribute any
negligence to the party. On the facts of the case, the effect
of negligence or ‘casual approach’, which would be
16 2015 SCC OnLine Del 11646
17 1998 SCC OnLine Del 1018
18 (1978) 1 SCC 483
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appropriate term to be used here, of the counsel on his
client, does not deserve to be so rigorous so as to deny
condensation of delay in refiling the application. The casual
approach of the counsel is evident as no timely efforts were
made firstly to find out after filing application on
19th August, 1995 as to whether the Registry had raised any
objection or not. Secondly, despite order of the Joint
Registrar dated 9th January, 1996, the objection was
removed only on 4th March, 1996 i.e. after the date which
the Joint Registrar had fixed for the application being
posted for hearing before the Court. When the application
was refiled on 4th March, 1996, one would expect the
person filing to be more careful thereby not giving an
opportunity to the Registry to raise any other objection. But
that was no so. The result was that the second objection
was raised which, as noticed above, was removed on
21st March, 1996 but application was refiled only on
27th March, 1996. Apart from this casual approach, we do
not find any mala fide intention on the part of the appellant
to delay the proceedings. When there is negligence or
causal approach in a matter like this in refiling of an
application, though the court may not be powerless to reject
an application seeking condensation and may decline to
condone the delay but at the same time, passing of any
other appropriate order including imposition of cost can be
considered by the court to compensate the other party from
delay which may occur on account of refiling of the
application.”
9. Similarly, the Supreme Court in Indian Statistical
Institute v Associate Builders held as follows:-
“10. The High Court was in error in holding that there
was any delay in filing the objections for setting aside the
award. The time prescribed by the Limitation Act for filing
of the objections is one month from the date of the service
of the notice. It is common ground that the objections were
filed within the period prescribed by the Limitation Act
though defectively. The delay, if any, was in representation
of the objection petition after rectifying the defects. Section
5 of the Limitation Act provides for extension of the
prescribed period of limitation. If the petitioner satisfies the
court that he had sufficient cause for not preferring the
objections within that period. When there is no delay in
presenting the objection petition Section 5 of the Limitation
Act has no application and the delay in representation is not
subject to the rigorous tests which are usually applied in
excusing the delay in a petition under Section 5 of the
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Limitation Act. The application filed before the High Court
for condonation of the delay in preferring the objections
and the order of the court declining to condone the delay
are all due to misunderstanding of the provisions of
the Civil Procedure Code. As we have already pointed out
in the return the Registrar did not even specify the time
within which the petition will have to be re-presented.”
10. I may now note that the judgment of the Division Bench of
this court, relied by the learned counsel for the appellant
in Northern Railway v Pioneer Publicity Corporation Pvt.
Ltd. (supra) was set aside by the Supreme Court in Northern
Railway v Pioneer Publicity Corporation Pvt. Ltd., wherein it has
held as follows:
“4. We find that said Section 34(3) has no application
in refiling the petition but only applies to the initial filing of
the objections under Section 34 of the Act. It was submitted
on behalf of the respondent that Rule 5(3) of the Delhi
High Court Rules states that if the memorandum of appeal
is filed and particular time is granted by the Deputy
Registrar, it shall be considered as fresh institution. If this
Rule is strictly applied in this case, it would mean that any
re-filing beyond 7 days would be a fresh institution.
However, it is a matter of record that 5 extensions were
given beyond 7 days. Undoubtedly, at the end of the
extensions, it would amount to re-filing.” ”
21. Apropos the delay between the filing of the present FAOs on 23
November 2023 and their refiling on 30 July 2024, Mr. Pachnanda
submits that the delay was inadvertent, and that it was only
occasioned because the appellants were simultaneously negotiating
the FAOs filed by the respondents.
22. Responding to Mr. Pachnanda, Mr. Sibal emphasizes the
egregiousness of the attitude of the appellants, and submits that the
delay between the filing of the present FAOs and their refiling cannot
be said to be attributable either to inadvertence or even negligence.
He submits that the appellants are fence sitters, who were taking a
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chance, complacent in the belief that, as interim relief had initially
been delayed to the respondents in their FAOs, the appeals themselves
would ultimately fail. When the appeals succeeded, and the SLPs
preferred thereagainst by the appellants were dismissed, they decided
to revitalize the present FAOs. No courtesy of any condonation of
delay can, in such circumstances, be extended to the appellants.
23. Not only were the appellants fence sitters, points out Mr Sibal,
they had also studiedly concealed, both from the Division Bench as
well as from the respondents, the fact of filing of the present FAOs,
throughout the entire period when they continued to appear in, and
contest, the FAOs filed by the respondents. They even concealed the
fact of the filing of the present FAOs, and their languishing under
objections, from the Supreme Court. They cannot, therefore, be
entitled to any leniency in the matter of condonation of delay. This,
therefore, is, he submits, an exceptional case in which the present
FAOs have to be dismissed on the ground of delay both in filing and
in re-filing.
Analysis
24. From the judgments noted hereinabove, it is clear that, while
the Court has ordinarily to be expansive in its approach while dealing
with applications for condonation of delay in refiling, the principle is
not inelastic. The prevailing philosophy behind the theory that delay
in refiling is to be treated with a lighter hand than delay in filing is
essentially premised on the presumption that, if a party has
approached the Court in time or without any unreasonable delay, the
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delay in removing objections is essentially attributable to the counsel
or, even if the litigant has filed the proceedings in person, the delay is
removing objections is essentially a ministerial act. The delay in
refiling, therefore, does not represent delay in approaching the Court
for seeking legal redress. If a party has approached the Court within a
reasonable period of time, the delay in curing objections and refiling
the proceedings is, therefore, treated as more liberally condonable
than delay in filing.
25. One of the primary reasons for incorporating a provision of
limitation is to avoid divesting of rights which may have crystallized
in favour of the opposite party in the interregnum. Where a successful
party in a litigation is not placed on notice regarding any challenge, to
the order or judgement in his favour, by the opposite party, within the
period of limitation prescribed therefor, he is entitled to believe that
the rights, that enure to his benefit as the successful litigant, stand
crystallized. Belated divesting of this right is, therefore, permissible
only where the party who challenges the decision beyond the
prescribed limitation period is able to demonstrate sufficient cause for
doing so.
26. Where, however, the successful litigant is placed on notice
regarding the challenge to the decision in his favour by the opposite
party, there is a radical change in the equity balance. If the opposite
party has raised the challenge within time, or with delay, if at all,
which is reasonable and condonable, the successful litigant is shaken
out of his complacency and placed on notice regarding the challenge.
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Delay in removal of objections, thereafter, cannot retore the equity
balance, unless it is gross and inordinate. It is for this reason that delay
in removing objections, i.e., delay in refiling, is not accorded as strict
a treatment as delay in filing.
27. Where, however, the delay in refiling is completely lacking in
bona fides, and represents a gamble by the unsuccessful litigant
keeping all, including the successful litigant before the Court below,
in the dark, the entire paradigm changes. Limitation is a statute of
equity and repose, and if the delay, whether in filing or refiling, is
found to be lacking in bona fides, it has to be sternly dealt with.
28. We may profitably refer, in this context, to the following
passages from the recent decision of the Supreme Court in
Thirunagalingam v Lingeswaran19:
“31. It is a well-settled law that while considering the plea for
condonation of delay, the first and foremost duty of the court is to
first ascertain the bona fides of the explanation offered by the
party seeking condonation rather than starting with the merits of
the main matter. Only when sufficient cause or reasons given for
the delay by the litigant and the opposition of the other side is
equally balanced or stand on equal footing, the court may consider
the merits of the main matter for the purpose of condoning the
delay.
32. Further, this Court has repeatedly emphasised in several
cases that delay should not be condoned merely as an act of
generosity. The pursuit of substantial justice must not come at the
cost of causing prejudice to the opposing party. In the present case,
the respondents/defendants have failed to demonstrate reasonable
grounds of delay in pursuing the matter, and this crucial
requirement for condoning the delay remains unmet.”
19 2025 SCC OnLine SC 1093
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The most crucial element in assessing whether the delay in moving
the Court is, or is not, explained by sufficient cause is, therefore, the
bona fides of the party concerned. Where there are no bona fides, no
cause is sufficient. This may be regarded in a sense as axiomatic, but
the words of the Supreme Court, nonetheless, enlighten.
29. Apropos condonation of delay in commercial disputes, the
Supreme Court has held thus, in Borse Brothers, incidentally in the
context of an appeal under Section 37 of the 1996 Act:
“58. Given the object sought to be achieved under both the
Arbitration Act and the Commercial Courts Act, that is, the speedy
resolution of disputes, the expression “sufficient cause” is not
elastic enough to cover long delays beyond the period provided by
the appeal provision itself. Besides, the expression “sufficient
cause” is not itself a loose panacea for the ill of pressing negligent
and stale claims. This Court, in Basawaraj v LAO20, has held:
“9. Sufficient cause is the cause for which the
defendant could not be blamed for his absence. The
meaning of the word “sufficient” is “adequate” or
“enough”, inasmuch as may be necessary to answer the
purpose intended. Therefore, the word “sufficient”
embraces no more than that which provides a platitude,
which when the act done suffices to accomplish the
purpose intended in the facts and circumstances existing in
a case, duly examined from the viewpoint of a reasonable
standard of a cautious man. In this context, “sufficient
cause” means that the party should not have acted in a
negligent manner or there was a want of bona fide on its
part in view of the facts and circumstances of a case or it
cannot be alleged that the party has “not acted diligently”
or “remained inactive”. However, the facts and
circumstances of each case must afford sufficient ground to
enable the court concerned to exercise discretion for the
reason that whenever the court exercises discretion, it has
to be exercised judiciously. … The court has to examine
whether the mistake is bona fide or was merely a device to20 (2013) 14 SCC 81
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cover an ulterior purpose. (See Manindra Land &
Building Corpn. v Bhutnath Banerjee21, Mata Din v A.
Narayanan22, Parimal v Veena23 and Maniben Devraj
Shah v Municipal Corpn. of Brihan Mumbai24.)*****
11. The expression “sufficient cause” should be given a
liberal interpretation to ensure that substantial justice is
done, but only so long as negligence, inaction or lack of
bona fides cannot be imputed to the party concerned,
whether or not sufficient cause has been furnished, can be
decided on the facts of a particular case and no straitjacket
formula is possible. (Vide Madanlal v Shyamlal25 and Ram
Nath Sao v Gobardhan Sao26.)*****
15. The law on the issue can be summarised to the
effect that where a case has been presented in the court
beyond limitation, the applicant has to explain the court as
to what was the “sufficient cause” which means an
adequate and enough reason which prevented him to
approach the court within limitation. In case a party is
found to be negligent, or for want of bona fide on his part
in the facts and circumstances of the case, or found to have
not acted diligently or remained inactive, there cannot be a
justified ground to condone the delay. No court could be
justified in condoning such an inordinate delay by imposing
any condition whatsoever. The application is to be decided
only within the parameters laid down by this Court in
regard to the condonation of delay. In case there was no
sufficient cause to prevent a litigant to approach the court
on time condoning the delay without any justification,
putting any condition whatsoever, amounts to passing an
order in violation of the statutory provisions and it
tantamounts to showing utter disregard to the legislature.”
(emphasis supplied)
*****
21 AIR 1964 SC 1336
22 (1969) 2 SCC 770
23 (2011) 3 SCC 545
24 (2012) 5 SCC 157
25 (2002) 1 SCC 535
26 (2002) 3 SCC 195
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63. Given the aforesaid and the object of speedy disposal
sought to be achieved both under the Arbitration Act and the
Commercial Courts Act, for appeals filed under Section 37 of the
Arbitration Act that are governed by Articles 116 and 117 of the
Limitation Act or Section 13(1-A) of the Commercial Courts Act,
a delay beyond 90 days, 30 days or 60 days, respectively, is to be
condoned by way of exception and not by way of rule. In a fit case
in which a party has otherwise acted bona fide and not in a
negligent manner, a short delay beyond such period can, in the
discretion of the court, be condoned, always bearing in mind that
the other side of the picture is that the opposite party may have
acquired both in equity and justice, what may now be lost by the
first party’s inaction, negligence or laches.”
(Italics in original; underscoring supplied)
30. Albeit in the context of an application under Section 11 of the
1996 Act for appointment of an arbitrator, the Supreme Court has thus
distilled the prevailing philosophy of Section 5 of the Limitation Act,
in HPCL Bio-Fuels Ltd v Shahaji Bhanudas Bhad27:
“123. The primary intent behind Section 5 of the Limitation Act is
not to permit litigants to exploit procedural loopholes and continue
with the legal proceedings in multiple forums. Rather, it aims to
provide a safeguard for genuinely deserving applicants who might
have missed a deadline due to unavoidable circumstances. This
provision reflects the intent of the legislature to balance the
principles of justice and fairness, ensuring that procedural delays
do not hinder the pursuit of substantive justice. Section 5 of the
Limitation Act embodies the principle that genuine delay should
not be a bar access to justice, thus allowing flexibility in the
interest of equity, while simultaneously deterring abuse of this
leniency to prolong litigation unnecessarily.
124. The legislative intent of expeditious dispute resolution
under the Act, 1996 must also be kept in mind by the courts while
considering an application for condonation of delay in the filing of
an application for appointment of arbitrator under Section 11(6).
Thus, the court should exercise its discretion under Section 5 of the
Limitation Act only in exceptional cases where a very strong case
is made by the applicant for the condonation of delay in filing a
Section 11(6) application.”
27 2024 SCC OnLine SC 3190
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31. Adverting to the facts of the present case, the undisputed
position is that the appellants filed the present appeals, challenging the
order dated 31 July 2023, after 55 days’ delay on 23 November 2023
and 24 November 2023, by which time the FAOs filed by the
respondents, within time, had already been heard by the Division
Bench on five occasions. It was between the fifth and sixth dates of
hearing in the FAOs of the respondents, that the appellants filed the
present FAOs in defects, without serving any copy thereof on the
respondents. The appellants never informed the Division Bench, which
was hearing the FAOs filed by the respondents, of the fact that they
had also filed FAOs challenging the order passed by the learned
Single Judge on 31 July 2023 in their OMPs, though all arose out of a
common arbitral award. Neither did the appellants choose to remove
the objections in the present FAOs filed by them, so that they could be
taken up and heard along with the FAOs of the respondents. Instead,
they allowed the present FAOs to remain under objections for 226
days till 30 July 2024. In the interregnum, the FAOs of the
respondents were allowed by way of remand, to the learned Single
Judge, by judgment dated 17 May 2024 passed by the Division Bench,
and the SLPs preferred by the appellants thereagainst were also
dismissed by the Supreme Court on 26 July 2024. The appellants, all
along, kept the Division Bench of this Court, and even the Supreme
Court, in the dark regarding the fact that they had filed the present
FAOs, which were languishing without removal of objections. It was
only after the Supreme Court also dismissed the SLPs filed by the
appellants on 26 July 2024, that the appellants, within 4 days of the
dismissal, served the copies of the present FAOs to the respondents,
removed the objections in the present FAOs and refiled them.
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32. It is impossible for the Court to believe, in such circumstances,
that the delay in removing objections raised by the Registry and
refiling of the present FAOs was bona fide. The case presents a
classic example of fence sitting, keeping, in the process, the
respondents, the Division Bench of this Court, as well as the Supreme
Court, completely in the dark regarding the filing of the present FAOs,
and of their languishing under objections. It is impossible to believe
the appellants’ plea of “inadvertence”, given the fact that, after
waiting for the respondents’ FAOs to be listed on 23 August 2023, 24
August 2023, 31 October 2023, 9 November 2023 and 17 November
2023, the appellants filed the present FAOs on 23 and 24 November
2023 and again proceeded to participate in the remaining hearings in
the respondents’ FAOs on 30 November 2023, 8 December 2023, 14
December 2023, 8 January 2024, 15 January 2024, 29 January 2024
and 7 February 2024 as though nothing on earth had happened
between 17 and 30 November 2023. The matter in which the
appellants acted in the present case is frankly disquieting to the
conscience of the court.
33. Perhaps as a Freudian slip, the appellants have acknowledged as
much, in para 5(e) of CM Appl 45532/2024 filed by them for
condonation of delay in refiling the present appeals, which reads:
“e) It is submitted that the Judgment dated 17.05.2024 passed
by the Hon’ble Division Bench of this Hon’ble Court, in the
understanding and humble submission of the Applicant herein, was
not in accordance and in conformity with the principles of law laid
down by the Hon’ble Supreme Court in relation to Section 34 and
Section 37 of the Act. Aggrieved by the Judgment dated
17.05.2024, the management of the Applicant decided to challenge
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the said judgment before the Hon’ble Supreme Court as well as
refile the captioned Appeal. However, due to the summer
vacations, the Special Leave Petition and the refiling of the subject
Appeal was further delayed.”
(Emphasis supplied)
As one may say, Q.E.D.
34. In the above paragraph, the appellants have candidly, albeit
perhaps unwittingly, admitted that the delay in refiling the present
appeals was not because of oversight or inadvertence, as they so
assiduously seek to contend even at the Bar, but because the FAOs
filed by the respondents were decided in their favour. The only
inaccuracy in this admission is that the appellants did not decide to
revitalize the present appeals, by removing the objections therein,
even after the judgment dated 17 May 2024 passed by the Division
Bench, but only after the SLPs filed by the appellants before the
Supreme Court, thereagainst, were also dismissed.
35. The inaction in removing the objections in the present FAOs
and have them relisted, therefore, does not admit even of a scintilla of
bona fides.
36. The facts of the present case, therefore, do not attract the
general principles regarding leniency in the matter of condonation of
delay in refiling. This is not a case in which the appellants bona fide
filed the present FAOs in time and were merely indolent or even
negligent in removing objections in refiling the FAOs. This is a case
in which the appellants took a calculated gamble, of which the delay
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in refiling, and allowing the FAOs to languish in objections,
constitutes the fundamental modus operandi.
37. The respondents had already filed their FAOs on 22 August
2023. There was no reason why the appellants did not do so likewise.
They waited for five dates of hearing to be over in the FAOs filed by
the respondents before filing the present FAOs on 23 November 2023
and 24 November 2023 with 55 days’ delay. Obviously in order to
conceal the fact that they had filed the FAOs, no advance copy of the
FAOs was served on the respondents. The Registry pointed out
objections in the FAOs on 24 November 2023 itself, one of the
primary objections being that no advance service had been effected on
the respondents. The present appellants did not, however, choose to
remove the objections and allowed the FAOs to languish under
objections. This position continued throughout the pendency of the
FAOs filed by the respondents before the Division Bench and even
thereafter till the SLPs against that decision were dismissed by the
Supreme Court. At no stage did the appellants ever make the Court
wise about the fact that they had filed FAOs on 23 and 24 November
2023 and had chosen not to remove objections or even serve a copy
thereof on the respondents. It was only after the Supreme Court
dismissed the present appellants’ SLPs against the judgment dated 17
May 2024 of the Division Bench in the FAOs against the respondents
that the present appellants chose to serve a copy of the present FAOs
on the respondents and, thereafter, refile the FAOs on 30 July 2024.
The alacrity with which the appellants effected service of the present
FAOs on the respondents, removed the objections in the FAOs and
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refile the FAOs within four days of the Supreme Court order on 26
July 2024, indicates that the entire exercise was carefully orchestrated.
38. This, therefore, we reiterate, is not a simple case of delay in
removing objections in refiling the appeals. It is a case of deliberate
and wilful concealment of facts both from the Division Bench as well
as from the respondents and a calculated gamble taken by the
appellants.
39. As we have already noted earlier in this judgment, the
appellants have, perhaps unwittingly, acknowledged this fact in para
5(e) of CM Appl 45532/2024, which admits, in so many words, that
their decision to refile the present appeals was prompted by their
grievance at the judgment dated 17 May 2024 passed by the Division
Bench in the FAOs of the respondents. In actual fact, the appellants
waited till the SLPs preferred by them against the said judgment dated
17 May 2024 of the Division Bench were also dismissed by the
Supreme Court.
40. The Court cannot, in any circumstance, condone the delay
which is attributable to such factors. In such circumstance, it hardly
matters whether the delay is in filing or in refiling of the appeals.
41. We do not, in the circumstances, deem it necessary to enter into
the rival contentions with respect to Rule 5(3) in Part A of Chapter 1
Volume V of the DHC Rules.
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42. Accordingly, we decline to condone the delay of 55 days in
filing and 226 days in re-filing the present appeals. The applications
for condonation of delay in filing and re-filing are, accordingly,
dismissed.
FAO(OS) (COMM) 173/2024 and FAO(OS) (COMM) 171/2024
43. As the applications for condonation of delay in filing and re-
filing have been dismissed, the appeals also stand dismissed on the
ground of delay without going into merits.
C. HARI SHANKAR, J.
AJAY DIGPAUL, J.
MAY 23, 2025
yg/aky
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