Ms TAA Construction vs The Kalyan Agriculture Produce Marketing Committee 2026 BHC-AS 8136

Synopsis

This Bombay High Court judgment arises from a Writ Petition challenging an order dated 27th June 2006 passed by the Learned Civil Judge Senior Division, Kalyan, rejecting an Application filed by the Petitioner under Section 14 of the Arbitration Act, 1940 on the ground of limitation. The arbitral award was passed on 16th September 1997 and filed before the District Court in Thane on 23rd September 1997. The Thane Court returned the Application on 5th February 1999 on the ground of territorial jurisdiction, holding that the appropriate forum was the Kalyan Court which had been established on 1st September 1996. The Petitioner filed the Application before the Kalyan Court on 23rd February 1999, but the Kalyan Court rejected it on 27th June 2006 as barred by limitation under Article 119 of the Limitation Act, 1963. The High Court quashed the impugned order, holding that a hyper-technical approach should not be adopted and that the time spent bona fide in the Thane Court deserved to be excluded under Section 14 of the Limitation Act, thereby restoring the Application to the Kalyan Court for adjudication on merits.

1. Case Identification & Coram

Citation: 2026:BHC-AS:8136

Court: High Court of Judicature at Bombay

Jurisdiction: Civil Appellate Jurisdiction

Writ Petition No.: 6132 of 2024

Coram: Hon'ble Justice Somasekhar Sundaresan

Nature of Bench: Single Judge

Date of Judgment: 12th February 2026

2. Legal Framework & Relevant Provisions
The judgment engages with arbitration law, limitation law, and civil procedure:

• Arbitration Law:
  Section 14 of the Arbitration Act, 1940: Provision for filing of arbitral awards in court for confirmation.
  Section 14(2) of the Arbitration Act, 1940: Requirement for arbitrators to give notice to parties of filing of award.

• Limitation Law:
  Article 119 of the Schedule to the Limitation Act, 1963: Prescribes period of limitation for filing an arbitral award for enforcement (30 days from date of service of notice of filing).
  Section 14 of the Limitation Act, 1963: Exclusion of time of proceeding bona fide in court without jurisdiction.

• Civil Procedure:
  Order VII Rule 6 of the Code of Civil Procedure, 1908: Requirement to plead grounds for exemption from limitation.
  Order VII Rule 10(2) of the Code of Civil Procedure, 1908: Procedure when plaint is returned for presentation to proper court.

• Key Precedent Relied Upon:
  Krishna Devi v. Union of India & Ors., 2025 (1) S.C.R 81: Supreme Court cautioned against hyper-technical implementation of procedural rules which undermines expeditious dispute resolution under arbitration; interpreted Section 14(2) of 1940 Act as requiring mere awareness of filing, not formal notice.
  Bharat Coking Coal Ltd. v. C.K. Ahuja (1995) Supp. 1 SCC 744: Date of receiving copy of award not required under Section 14(2); mere awareness that award is accessible suffices.

3. Relevant Facts of the Case

• On 16th September 1997, a Learned Arbitral Tribunal published a unanimous award in favour of the Petitioner.

• District Courts in Kalyan had been established on 1st September 1996, over a year before the award was passed.

• The Petitioner filed the arbitral award under Section 14(2) of the Arbitration Act, 1940 before the District Court in Thane on 23rd September 1997, based on the premise that the agreement between parties conferred jurisdiction on Thane Courts.

• The Respondent objected on the ground of territorial jurisdiction, contending that the appropriate forum was the Kalyan Court which had been established prior to the award.

• On 5th February 1999, the Thane District Court returned the Application with liberty to file before the Kalyan Court, directing further steps under Order VII Rule 10(2) CPC.

• On 23rd February 1999 (within 18 days of the Thane Court's order), the Petitioner filed the Application before the District Court in Kalyan.

• On 27th June 2006, the Kalyan District Court rejected the Application as barred by limitation under Article 119 of the Limitation Act, 1963, holding that the filing was beyond the prescribed period.

• Civil Revision Application No.206 of 2006 was filed and disposed of on 4th January 2024 with liberty to file appropriate proceedings.

• The Petitioner thereafter filed the present Writ Petition challenging the impugned order.

4. Issues Before the High Court
The primary issues for determination were:

1. Whether the Kalyan District Court erred in rejecting the Petitioner's Application under Section 14 of the Arbitration Act, 1940 as barred by limitation?

2. Whether the time spent by the Petitioner in prosecuting the Application before the Thane Court (which lacked territorial jurisdiction) deserved to be excluded under Section 14 of the Limitation Act, 1963?

3. Whether the absence of specific pleading under Order VII Rule 6 CPC regarding the reason for delay was fatal to the Petitioner's case?

4. Whether a hyper-technical approach to procedural requirements should be adopted in matters arising under the Arbitration Act, 1940?

5. Ratio Decidendi & Court's Reasoning

The Court allowed the Writ Petition and quashed the impugned order. The ratio decidendi can be summarized as:

• Bona Fide Prosecution in Wrong Forum: The Petitioner approached the Thane Court within four days of the arbitral award (23rd September 1997). The choice of Thane was based on the jurisdiction clause in the agreement. This constituted bona fide prosecution in a forum that the Petitioner believed had jurisdiction. The time spent in Thane Court (23rd September 1997 to 5th February 1999) deserved to be excluded under Section 14 of the Limitation Act.

• Prompt Action After Return of Plaint: Once the Thane Court returned the Application on 5th February 1999, the Petitioner filed before the Kalyan Court within 18 days (23rd February 1999). This demonstrated diligence and absence of negligence.

• No Requirement of Specific Pleading When Facts are Clear: While Order VII Rule 6 CPC requires pleading of grounds for exemption from limitation, in this case, the Kalyan Court was fully aware of the proceedings before the Thane Court, as discussed in the impugned order itself. The Respondent was also left in no doubt about what had transpired. Therefore, the absence of a specific pleading did not prejudice anyone.

• Hyper-Technical Approach Deprecated: Following Krishna Devi v. Union of India, the Court held that a hyper-technical approach ought not to be adopted while examining application of principles of CPC, particularly in the context of arbitration law under the 1940 Act. Procedural rules should not be implemented in a manner that undermines the foundational basis of expeditious dispute resolution under arbitration.

• Substance Over Form: The Court emphasized that mortgaging substance to formal technicality has led to nearly three decades passing with no meaningful movement in the matter. The arbitral award from 1997 remained at the same stage due to procedural objections.

• Sufficient Cause Made Out: The Court was satisfied that sufficient cause had indeed been made out for condonation of delay, and the outright rejection at the threshold on the premise of limitation was unsustainable.

6. Legal Principles Established/Reinforced

While the judgment does not establish entirely new law, it reinforces and clarifies several principles:

• Exclusion of Time Under Section 14 of Limitation Act: Time spent bona fide in a court without jurisdiction must be excluded when computing limitation, provided the party acted diligently and promptly approached the correct court upon return of proceedings.

• Liberal Approach in Arbitration Matters: Courts should adopt a liberal approach in matters arising under arbitration law, avoiding hyper-technical interpretations that defeat the object of expeditious dispute resolution.

• Awareness, Not Formal Notice, Under Section 14(2) of 1940 Act: Following Krishna Devi and Bharat Coking Coal, the requirement under Section 14(2) is mere awareness of filing of award, not formal notice or receipt of copy.

• Order VII Rule 6 – Substance Over Form: While pleading of grounds for exemption from limitation is required, the absence of specific pleading is not fatal if the court and opposing party are clearly aware of the facts constituting sufficient cause.

• Writ Jurisdiction to Correct Procedural Injustices: High Courts can exercise extraordinary writ jurisdiction to correct orders that result in manifest injustice due to hyper-technical application of procedural law, especially when such orders have stalled proceedings for decades.

7. Judicial Analysis & Examination

The Court's analytical approach was structured:

• Chronological Analysis: The Court meticulously traced the timeline:
  16.09.1997: Arbitral award passed
  23.09.1997: Filed in Thane Court (within 4 days)
  05.02.1999: Thane Court returns application on jurisdiction ground
  23.02.1999: Filed in Kalyan Court (within 18 days)
  27.06.2006: Kalyan Court rejects as time-barred
  2024-2026: Proceedings in High Court

• Application of Section 14 Limitation Act: The Court implicitly applied the principles of Section 14, though the provision is not quoted in detail, by holding that the time spent in Thane Court deserved exclusion.

• Reliance on Supreme Court Precedent: The Court extensively quoted and relied on Krishna Devi, emphasizing the caution against hyper-technical approach and the interpretation of Section 14(2) requiring mere awareness.

• Finding of Sufficient Cause: The Court held that the Respondent and the Kalyan Court had clear notice of the proceedings before Thane Court, and therefore sufficient cause was established.

• Critique of Technical Approach: The Court observed that the stand adopted by the Respondent and the Kalyan Court fell "in the bracket of a hyper-technical approach, mortgaging the substance to formal technicality," which led to nearly three decades of delay.

8. Critical Analysis & Final Outcome

• Critical Analysis: The judgment is a classic illustration of how procedural technicalities can defeat substantive justice if not carefully examined. The Kalyan Court's rejection of the Application in 2006, based solely on limitation, without considering the exclusion of time under Section 14, was patently erroneous. The Petitioner had acted with remarkable diligence: filing in Thane within 4 days of the award, and refiling in Kalyan within 18 days of the Thane Court's order. The fact that the Kalyan Court took over 7 years (1999 to 2006) to decide the limitation issue, and then rejected it, adds to the injustice. The High Court's invocation of writ jurisdiction was appropriate given the gross miscarriage of justice. The reliance on Krishna Devi reinforces the modern judicial tendency to prioritize substance over form and to prevent arbitration from being bogged down by technicalities. However, one might note that the Petitioner could have specifically pleaded Section 14 in the Kalyan Application, though the Court rightly held that the facts were clear enough. The judgment also implicitly recognizes that the 1940 Act (now repealed) continues to govern old arbitrations, and courts must apply it with the same spirit of expeditious resolution that underpins modern arbitration law.

• Final Outcome:
  The Writ Petition was allowed.
  The Impugned Order dated 27th June 2006 passed by the Learned Civil Judge Senior Division, Kalyan, was quashed and set aside.
  The Application under Section 14 of the Arbitration Act, 1940 was restored to the Kalyan Court for adjudication on merits in accordance with law.
  The Kalyan Court was directed to examine the filing under Section 14 in accordance with the 1940 Act.
  The issue of adequacy of court fees (another ground raised before the Kalyan Court) was left open to be examined in accordance with law, with liberty to the Petitioner to rectify any defect.
  Rule was made returnable forthwith and the Petition was finally disposed of.
  The Respondent's request for stay of the order for eight weeks was declined considering the sheer passage of time.