Mr. Lalit Kumar Vs M/s Indiabulls Securities Ltd. and anr.

2. The facts of the case are that the present appellant was a customer of the respondent No. 1/broking firm. Since the disputes and differences arose between the parties with respect to transactions entered into, and which were denied by the present appellant, the appellant invoked arbitration proceedings under the aegis of the National Stock Exchange. Arbitration proceedings culminated in passing of the Award dated 29.6.2013 whereby the Arbitrator Sh. S.S. Agarwal passed his Award dated 29.6.2013 awarding a sum of Rs.6,34,579.23/- to the respondent No. 1 in the counter claim filed by the respondent No. 1 in the arbitration proceedings and the claim petition of the present appellant was dismissed as being not substantiated. The Award dated 29.6.2013 was admittedly posted by the Arbitration Tribunal to the parties along with the covering letter dated 12.7.2013 and there is no dispute that the present appellant would have received the same by 14th or 15th July, 2013.

3. In law the limitation period of 90 days for filing objections to the Award therefore begins from 14th or 15th July, 2013 with the further fact that there can be condonation of delay of 30 days after 90 days in filing of the objections i.e objections can be filed under Section 34 to the Award within 120 days. After a period of 120 days, there cannot be condonation of delay in view of the judgment of the Supreme Court in the case of Union of India v. M/s Popular Construction Co. (2001) 8 SCC 470. I also note that though delay cannot be condoned beyond a period of 120 days, however, Supreme Court has held in the judgment in the case of Consolidated Engineering Enterprises v. Principal Secretary, Irrigation Department and Others (2008) 7 SCC 169 that the provision of Section 14 of the Limitation Act, 1963 will apply for the benefit of the person who has filed objections in case the objections are filed in a Court which does not have jurisdiction to try the objections.

4. In the present case the appellant after receiving the copy of the Award filed a complaint with the Consumer Forum on 13.8.2013. The contention of the appellant is that the period spent in pursuing of this complaint before the Consumer Forum from 13.8.2013 till 21.7.2015 be excluded under Section 14 of the Limitation Act as per the ratio of the judgment of the Supreme Court in the case of Consolidated Engineering Enterprises (supra).

5. On behalf of the respondent No. 1 however it is argued that the appellant cannot be granted the benefit of Section 14 of the Limitation Act because the complaint filed before the Consumer Forum was an independent proceeding which was not in the nature of objections under Section 34 of the Act and which becomes clear from the averments of the complaint filed, and that if at all there remains any doubt whatsoever the same is resolved from the fact that the respondent No. 1 in its written statement before the Consumer Forum clearly pleaded that the appellant was prohibited by the doctrine of res judicata in filing of the complaint before the Consumer Forum inasmuch as the disputes between the parties stood settled in terms of the Award of the Arbitrator dated 29.6.2013 and in response to the written statement of the present respondent No. 1 in the Consumer Forum all that the appellant in his replication pleaded was that the Award is illegal on account of collusion of the respondent No. 1 herein with the Arbitrator.

6. The issue before this Court is whether the appellant is entitled to the benefit of Section 14 of the Limitation Act for the period spent of pendency of the consumer case filed by the appellant before the Consumer Forum. Benefit of Section 14 of the Limitation Act can only be given if the requirements of Section 14 are complied with and which provides that a person seeking benefit of Section 14 has pursued the alternative remedy bonafidely and in good faith and that the alternative proceedings in a Court which lacked jurisdiction should be pursued with due diligence. Section 14 of the Limitation Act reads as under:-

"Section 14. Exclusion of time of proceeding bona fide in court without jurisdiction. - (1) In computing the period of limitation for any suit the time during which the plaintiff has been prosecuting with due diligence another civil proceeding, whether in a court of first instance or of appeal or revision, against the defendant shall be excluded, where the proceeding relates to the same matter in issue and is prosecuted in good faith in a court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it.

(2) In computing the period of limitation for any application, the time during which the applicant has been prosecuting with due diligence another civil proceeding, whether in a court of first instance or of appeal or revision, against the same party for the same relief shall be excluded, where such proceeding is prosecuted in good faith in a court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it.

(3) Notwithstanding anything contained in rule 2 of Order 23 of the Code of Civil Procedure, 1908 (5 of 1908), the provisions of sub-section (1) shall apply in relation to a fresh suit instituted on permission granted by the court under rule 1 of that Order, where such permission is granted on the ground that the first suit must fail by reason of a defect in the jurisdiction of the court or other cause of a like nature.

Explanation. - For the purposes of this section-

(a) in excluding the time during which a former civil proceeding was pending, the day on which that proceeding was instituted and the day on which it ended shall both be counted;

(b) a plaintiff or an applicant resisting an appeal shall be deemed to be prosecuting a proceeding;

(c) misjoinder of parties or of causes of action shall be deemed to be a cause of a like nature with defect of jurisdiction."

(ii) We have therefore to examine the facts of the present case as to whether the proceedings filed by the present appellant before the Consumer Forum satisfies the ingredients of Section 14 of the Limitation Act as stated above.

(iii) In my opinion, the benefit of Section 14 of the Limitation Act can be available to the appellant only if proceedings filed before the Consumer Forum were in the nature of objections under Section 34 of the Act whereby the present appellant would have challenged the Award as illegal on various grounds as per Section 34 of the Act, however, it is seen that there is not even a whisper of any averment whatsoever in the complaint filed before the Consumer Forum of any arbitration proceedings having taken place or of passing of the Award or of the fact that Award is illegal on various grounds as stated in the complaint before the Consumer Forum. Therefore the proceedings initiated by the present appellant before the Consumer Forum were independent proceedings and were not in the nature of objections under Section 34 of the Act. For this reason itself, the appellant cannot claim that period spent in the proceedings before the Consumer Forum can be said to be alternative proceedings filed in a Court which did not have jurisdiction because the proceedings filed before the Consumer Forum were not in the nature of objections to the Award but were independent proceedings as per facts pleaded in the Consumer Forum complaint and which facts were more or less identical to the claim petition filed by the present appellant in the arbitration proceedings.

9. Learned counsel for the appellant has sought to place reliance upon the order passed in Lok Adalat proceedings before the Consumer District Forum on 11.7.2015 and it was argued that since the present respondent No. 1 was represented in the proceedings in the Lok Adalat which allowed withdrawal of the complaint with entitlement of the appellant to file fresh proceedings and pendency of the case in Consumer Forum will be excluded for the purpose of limitation, and accordingly it is argued that the objections under Section 34 of the Act were within limitation as the period before the Consumer Forum had to be excluded because of Section 14 of the Limitation Act when read with the order passed in the Lok Adalat proceedings of 11.7.2015.

10. In order to appreciate the argument of the appellant, let me reproduce the order dated 11.7.2015 of the Lok Adalat in the consumer disputes case and which order reads as under:-

"ORDER

11/07/2015

Matter taken up in Lok Adalat.

Present: Advocate Hemant Sharma for complainant along with complainant in person and present Advocate Anju Mathur for OP.

It is a matter pertaining to share and securities. Complainant is allowed to withdraw the matter with the liberty to file a fresh complaint/proceedings in appropriate Forum and period of pendency of this case is to be deducted from any other complaints made by him for purpose of limitation. Signature of complainant obtained on record. File consigned to R/R. Order may be given dasti.

I withdraw my complaint and approach the appropriate Forum.

Sd/- (Illegible) Complaint. 11.7.2015

11. In my opinion, first of all Lok Adalat is not a Court and Lok Adalat had no powers like a Court to direct that benefit of Section 14 of the Limitation Act could be given to the present appellant. Further whether or not benefit under Section 14 of the Limitation Act has to be given has to be decided by the Court in which the application under Section 14 of the Limitation Act is filed and not by the Court which allows proceedings to be withdrawn for being filed in the competent court. No doubt, courts do make observations while allowing the litigant to withdraw a case that when a case is filed before an appropriate forum the competent court will liberally look at the provision of the exclusion of time as per Section 14 of the Limitation Act, however, such observations which are made are only in the nature of observations and are not binding directions for the competent court which decides the application under Section 14 of the Limitation Act. Therefore for both the reasons that Lok Adalat was not a Court which was entitled to pass an order giving benefit of exclusion of time under Section 14 of the Limitation Act and also the fact that it is only the Court before which an application is filed under Section 14 of the Limitation Act which has the power to allow exclusion of time, therefore the appellant cannot derive any benefit of the order dated 11.7.2015 passed in the Lok Adalat proceedings, and which benefit cannot be given to the appellant even if the respondent No. 1 was represented in the Lok Adalat proceedings.

12. I may also note that the present appellant when he filed objections under Section 34 of the Act in the court below did not file an application under Section 14 of the Limitation Act for exclusion of time spent in the proceedings before the Consumer Forum, yet the court below has acted liberally in treating the averments made in Section 34 petition as grounds for exclusion of time under Section 14 of the Limitation Act.

13. In view of the above it is clear that objections filed by the present appellant under Section 34 of the Act were grossly barred by time. Appellant was not entitled to benefit of exclusion of time under Section 14 of the Limitation Act for the period spent by the appellant in the Consumer Forum. The court below has rightly dismissed the objections as time barred though the court below has not discussed the issue of Section 14 of the Limitation Act, however, this Court has done so in exercise of powers underlying Order 41, Rule 24 CPC read with the ratio of the recent judgment of the Supreme Court in the case of Lisamma Antony and Another v. Karthiyayani and Another (2015) 11 SCC 782.

14. Dismissed.

.