The Supreme Court in its judgment dated March 19, 2021 in Govt. of Mahrashtra v. M/s Borse Brothers Engineers and Contractors Pvt. Ltd. [Civil Appeal No. 995 of 2021], held that the application of section 5 of the Limitation Act is not excluded by the scheme of Commercial Courts Act.

This means that delay for filing appeals under Section 13 of the Commercial Courts Act can be condoned by showing sufficient cause as per Section 5 of the Limitation Act.

One of the issues considered by the bench, comprising Justices RF Nariman, BR Gavai and Hrishikesh Roy, was whether the application of section 5 of the Limitation Act is excluded by the scheme of the Commercial Courts Act.

The bench overruled the decision in M/s NV International vs State of Assam (2-Judges), which had strictly held that a delay of more than 120 days in filing of appeals under Section 37 of the Arbitration and Conciliation Act 1996 cannot be condoned.

The court noted that section 13(1A) of the Commercial Courts Act does not contain any provision akin to section 34(3) of the Arbitration Act. Section 13(1A) of the Commercial Courts Act only provides for a limitation period of 60 days from the date of the judgment or order appealed against, without further going into whether delay beyond this period can or cannot be condoned, the bench said.

The Court noted that the non-obstante clause contained in the Commercial Courts Act would not override the Limitation Act, as a result of which, the applicability of section 5 thereof would not be excluded. The court referred to B.K. Educational Services (P) Ltd. v. Parag Gupta & Associates, (2019) 11 SCC 633 to arrive at the aforesaid conclusion.

However, the bench clarified that the expression "sufficient cause" is not elastic enough to cover long delays beyond the period provided by the appeal provision itself.

Given that the object of speedy disposal sought to be achieved under the Commercial Courts Act, for appeals filed under section 13(1A) of the Commercial Courts Act, a delay 60 days, 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.

By - George Thomas
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