Section 34 Arbitration Act: SC Says Delayed Plea Must Be Accompanied By Condonation Of Delay Application

The Supreme Court recently observed that an application under Section 34 of the Arbitration and Conciliation Act, 1996 to set aside an arbitral award, which is filed beyond the statutory period, must be accompanied by an application for condonation of delay. 

Court said that when an application under Section 34 of the Arbitration Act is filed after the statutory period, the court is required decide the question of limitation before examining the merits of the challenge to the arbitral award.

A Bench of Justices K V Vishwanathan and Arun Palli said that where a party seeks exclusion of time under Section 14 of the Limitation Act, 1963, the application seeking such exclusion must be heard and decided as a preliminary issue, after giving the opposite party an opportunity to file objections.

Why must limitation be decided before the Section 34 Arbitration Act challenge?

The Supreme Court said the court must first determine whether the Section 34 application was filed within time after considering the respondent's plea for exclusion of the period spent pursuing proceedings before a court lacking jurisdiction.

"We are of opinion that those are matters which should have been left to the Single Judge to decide first before hearing the Section 34 on merits," the Bench said regarding the case at hand.

It clarified that only if the court excludes the relevant period under principles analogous to Section 14 and finds the Section 34 application to be within limitation would the question of examining the challenge to the arbitral award on merits arise.

Section 14 of the Limitation Act permits exclusion of time spent by a party prosecuting a matter with due diligence and in good faith before a court that is unable to entertain it because of a jurisdictional defect or similar cause.

The Bench said such an application for exclusion of time must be adjudicated upon after giving the opposite party an opportunity to object.

The Jaipur Metro case

The ruling came on an appeal filed by Jaipur Metro Rail Corporation against an August 21, 2025 order of the Rajasthan High Court's division bench in a dispute with Continental Engineering Corporation Limited.

The arbitral award in the matter was passed on December 20, 2017 by a majority of 2:1. On March 16, 2018, Continental Engineering filed an application under Section 34 before the Rajasthan State Commercial Court, Jaipur, seeking to set aside the award.

Jaipur Metro subsequently objected that since the arbitration was an international commercial arbitration, the application was required to be filed before the Rajasthan High Court.

On November 22, 2018, the commercial court accepted the objection and returned the application under Order VII Rule 10 of the Code of Civil Procedure, 1908, holding that the Rajasthan High Court was the appropriate forum.

Continental Engineering thereafter approached the Rajasthan High Court. It first filed the application before the registry on December 10, 2018 and subsequently filed another set of the same application on February 14, 2019.

The respondent later filed written submissions along with an application under Section 14 of the Limitation Act on February 2, 2022, seeking exclusion of the period spent before the commercial court.

What had the single judge bench and division bench held?

On March 2, 2022, the single judge held that the Section 34 application was not maintainable before the high court in the manner in which it had been filed. The single judge further held that even if the application were treated as a Section 34 application, it was barred by limitation as no application for condonation of delay had been filed.

Continental Engineering challenged the order before the division bench.

The division bench held that the Section 34 application had been rightly filed before the high court and proceeded to apply Section 14 to exclude the period spent before the commercial court. It thereafter remitted the matter to the single judge for consideration of the Section 34 application on merits.

Jaipur Metro challenged this approach before the Supreme Court, arguing that the division bench ought to have left the question of exclusion of time under Section 14 to the single judge. It also argued that it should have been given an opportunity to object to the Section 14 application.

The Supreme Court found merit in the submission.

"We find merit in this submission," the Bench said, directing the single judge to first hear the Section 14 application after giving due notice to Jaipur Metro.

"Only in the event of finding that after excluding time, the Section 34 application of the respondent was within time," the Bench said, should the Single Judge proceed to hear the matter on merits.

The Supreme Court accordingly modified the division bench's order while maintaining the remand of the matter to the single judge.

Considering that the arbitral award dates back to 2017, the Bench requested the single judge to take up the matter early and dispose of it at the earliest possible.

Case Title: Jaipur Metro Rail Corporation Vs Continental Engineering Corporation Limited

Bench: Justices K V Vishwanathan and Arun Palli 

Date of Judgment: October 12, 2026