The Hon’ble Supreme Court of India reiterated and emboldened the object with which the Arbitration and Conciliation Act, 1996 (hereinafter referred as ‘the Act’) was enacted. The Apex Court held that the Act envisaged quick disposal of disputes and that gets violated if a delay, which happens to be of more than 1,000 (One Thousand) days in the present matter of R. Sathyamurthy v. R. Krishnamurthy an Ors.

In this matter the single bench of High Court of Madras did not allow the application for delay condonation in re-filing for more than 1,040 days opining that the very purpose of the Act will get frustrated if such a delay is condoned. But, the Division Bench of Hon’ble Madras High Court allowed the application for delay condonation by observing that section 34(3) of the Act does not prescribe any time limit for re-filing.

Aggrieved by this judgement and final order, a Special Leave Petition was preferred in the Hon’ble Supreme Court, which while allowing the petition a bench comprising of Hon’ble Chief Justice Dipak Misra, Justice D. Y. Chandrachud and Justice A. M. Khanwilkar held the following-

“. . . we are of the considered opinion that the High Court should have imposed heavy costs for condoning the delay. In our considered opinion, the costs should be assessed at Rs. 75,00,000/- (Rupees Seventy-Five Lakhs Only), to be paid by the respondent to the petitioner within a week hence. After the costs is paid, the learned Single Judge shall take up the application filed under section 34 of the Arbitration and Conciliation Act, 1996. If the cost is not paid within the stipulated time, needless to say, the order passed by the learned Single Judge rejecting the condonation of delay shall stand revived. Needless to say, if costs is paid, the learned Single Judge shall proceed and finalize the matter within a span of one month from the date of deposit of the costs.”


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Order: R Sathyamurthy Versus R Krishnamurthy and Others