The Supreme Court has held that where a party files an application under Section 33 of the Arbitration and Conciliation Act, 1996 seeking correction, interpretation or an additional award, the three-month limitation period under Section 34(3) for challenging the award is reckoned from the date the arbitral tribunal disposes of that Section 33 application — regardless of whether the application is allowed or dismissed.
The Court clarified that Section 34(3) does not distinguish between successful and unsuccessful Section 33 applications for limitation purposes, but cautioned that where a Section 33 application is shown to be sham, frivolous or filed only to defeat limitation, courts may impose exemplary and punitive costs on the party that filed it.
The ruling gives parties and counsel clear Supreme Court authority for computing the limitation period for a Section 34 challenge following an unsuccessful Section 33 correction or clarification application — the clock still runs from the Section 33 disposal date, not the original award date, removing a recurring source of limitation disputes in arbitration challenges.