The Supreme Court has held that where a party has formally invoked the arbitral tribunal’s jurisdiction under Section 33 for correction, interpretation, or an additional award, the limitation period for filing a challenge under Section 34 begins only from the date on which the Section 33 application is disposed of.

The Bench of Justice Pamidighantam Sri Narasimha and Justice Alok Aradhe in an appeal filed by the National Highway Authority of India (NHAI) against a Karnataka High Court decision that had declared its challenge to an arbitral award as time-barred.

The dispute arose from land acquisition proceedings initiated for a national highway project in Bellary District, Karnataka. In December 2009, the Ministry of Shipping, Road Transport and Highways issued a notification for acquisition of land under the National Highways Act, 1956. The acquired land included property owned by respondent T. Younis.

Following acquisition, compensation was initially determined by the competent authority in December 2011. Subsequently, NHAI invoked arbitration under Section 3G(5) of the National Highways Act. In February 2013, the Arbitrator re-determined the compensation payable for the acquired land.

The Karnataka High Court later set aside that arbitral award in 2019 and remanded the matter to the Arbitrator for fresh consideration. Upon reconsideration, the Arbitrator passed a fresh award on 3 February 2022, granting additional statutory benefits under the Land Acquisition Act, 1894.

After the fresh award, NHAI filed an application under Section 33(1)(a) of the Arbitration and Conciliation Act seeking correction of the award, contending that the grant of additional market value and interest under the Land Acquisition Act was legally unsustainable.

The landowner also filed an application under Section 33(4) seeking an additional award, claiming that a request for 50% additional compensation had not been considered.

Both applications were dismissed by the Arbitrator through a common order dated 4 July 2022. NHAI received the certified copy of that order on 15 September 2022 and thereafter filed applications under Section 34 challenging the arbitral award.

The Principal District and Sessions Judge, Bellary, condoned the delay in filing the Section 34 applications. However, the Karnataka High Court later set aside that order.

The High Court held that NHAI’s application under Section 33(1)(a) was not maintainable because it sought substantive modification of the award rather than correction of clerical or typographical errors. Consequently, it ruled that the benefit of limitation extension under Section 34(3) was unavailable and that the challenge petition had been filed beyond the statutory period.

Aggrieved by the decision, NHAI approached the Supreme Court.

The Supreme Court examined Sections 33 and 34 of the Arbitration and Conciliation Act and observed that Section 34(3) expressly provides that where a request under Section 33 has been made, limitation for filing an application under Section 34 begins from the date on which that request is disposed of by the arbitral tribunal.

The Court emphasized that the statute does not distinguish between applications that are ultimately allowed and those that are dismissed. Nor does it state that only a “maintainable” application under Section 33 can defer the commencement of limitation.

According to the Court, introducing such a restriction would amount to reading words into the statute that Parliament deliberately chose not to include.

The Bench observed that once Section 33 proceedings are initiated and entertained by the arbitral tribunal, the award remains subject to the tribunal’s limited jurisdiction for correction, interpretation, or supplementation. During this period, parties cannot be compelled to initiate Section 34 proceedings merely as a precautionary measure.

The Court rejected reliance on the earlier decision in State of Arunachal Pradesh v. Damani Construction Co., noting that the facts of that case were entirely different.

In Damani Construction, there was no formal application under Section 33. Instead, a party had merely sent a letter effectively seeking review of the award. The Supreme Court held that such a communication could not extend limitation.

In contrast, the present case involved formal applications under Section 33 filed by both parties within the prescribed statutory period, which were entertained and adjudicated by the Arbitrator.

While ruling in favour of NHAI, the Supreme Court clarified that courts retain the power to deal with abuse of process. It observed that where Section 33 applications are found to be sham, frivolous, mala fide, or filed solely to circumvent limitation requirements, courts may impose exemplary and punitive costs.

The Court stressed the need to balance preservation of legitimate remedies with prevention of procedural abuse.

Applying these principles, the Supreme Court noted that NHAI received the order disposing of the Section 33 applications on 15 September 2022 and filed its Section 34 challenge within the period prescribed by law.

The Court therefore held that the challenge was not barred by limitation. It set aside the Karnataka High Court’s judgment dated 22 January 2024 and restored the order of the Principal District and Sessions Judge condoning the delay.

The Section 34 applications challenging the arbitral award will now be decided on their merits in accordance with law.

Case Details

Case Title: NHAI Versus T. Younis & Anr. 

Citation: JURISHOUR-1513-SC-2026

Case No.:  SLP (C) NO. 7570 OF 2024

Date: 02/05/2026

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