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SUPREME COURT OF INDIA
Dipak Misra, Rohinton Fali Nariman, JJ.
Commissioner, M.P. Housing Board and Others – Appellants
Versus
M/s. Mohanlal and Company – Respondents
CIVIL APPEAL NO.6573 OF 2016 (Arising out of S.L.P.(C) No.39511 of 2013)
Decided On : 19-07-2016
(2001) 8 SCC 470; (2006) 6 SCC 239; (2008) 7 SCC 169 – Relied upon
(2008) 2 M.P.L.J. 103 – Referred
(b) Limitation Act, 1963 – Section 14 – Applicability – “Matter in issue” – Connotes matter which is directly and substantially in issue – Section 11, Code of Civil Procedure, 1908. (Para 17)
(2005) 13 SCC 1 – Relied upon
(c) Limitation Act, 1963 – Section 14 – Applicability – “Same matter in issue” – Respondent appearing before arbitrator – Not filing any objection to the award immediately – Instead pursuing application u/s 11 – Application held not maintainable but granted liberty to file an objection “in accordance with law” – Respondent filing objection seeking exclusion of time spent in pursuing section 11 application invoking section 14 – An application under Section 11, 1996 Act for an appointment of arbitrator and an objection to award filed under Section 34, 1996 Act – Totally different – Not “same matter in issue” – Absence of diligence and good faith both – Section 14 not applicable. (Para 18)
(2008) 7SCC 169 – Relied upon
Facts of the case:
The respondent had entered into a contract for construction of a commercial complex at Bittan Market, E-5, Arera Colony, Bhopal on 29th June, 2009. During the subsistence of the contract, certain disputes arose between the parties and the matter was arbitrated upon.
the matter was referred to the Additional Housing Commissioner, the sole arbitrator, who passed an award on 11th November, 2010. Be it stated, both the parties appeared before the learned arbitrator and on the basis of the materials brought on record, the learned arbitrator passed the award. As is manifest from record, the arbitrator did not find any justification to allow any of the claims of the respondent-contractor.
The respondent filed an application under Section 11 of the 1996 Act before the High Court of Madhya Pradesh, for seeking appointment of an arbitrator to adjudicate the disputes. The Court refused to appoint an arbitrator as the matter was already adjudicated as per the arbitration clause.
This order has attained finality.
Respondent then filed an objection under Section 34(2) of the 1996 Act to challenge the award. The said application was filed on 26th September, 2011 while the award was passed on 11th November, 2010.
The respondent, along with his objection, filed an application under Section 14 of the Act seeking exclusion of the time consumed in the proceedings asserting that he was bonafidely prosecuting the case in the court having no jurisdiction. The learned Additional District Judge, allowed the application on the foundation that the respondent was entitled to exclusion of time under Section 14 of the Act.
The High Court did not find any infirmity in the order passed by the learned Additional District Judge.
Finding of the Court:
Impugned order deserves to be lancinated.
Result: Appeal allowed.
JUDGMENT
Dipak Misra, J.
Leave granted.
2. The present appeal, by special leave, is directed against the order dated 12th August, 2013, passed by the High Court of Madhya Pradesh, Principal Seat at Jabalpur, in Civil Revision No.332 of 2012, whereby the High Court has affirmed the view expressed by the learned Additional District Judge, Bhopal, that the objection preferred by the respondent under Section 34(2) of the Arbitration & Conciliation Act, 1996 (for short, 'the 1996 Act') was condonable in aid of Section 14 of the Limitation Act, 1963 (for brevity, 'the Act').
3. The present litigation has a history. The respondent had entered into a contract for construction of a commercial complex at Bittan Market, E-5, Arera Colony, Bhopal on 29th June, 2009. During the subsistence of the contract, certain disputes arose between the parties and the matter was arbitrated upon. Clause 29 of the contract, on the basis of which the matter was referred to arbitration, reads as follows:
“29 – Except as otherwise provided in this contract all questions and disputes relating to the meaning of the specifications, designs, drawings and instructions, herein before mentioned and as to thing whatsoever, in any way, arising out of or relating to the contracts, designs, drawings, specifications, estimates, concerning the work, or the execution or failure to execute the same, whether arising during the progress of the work or after the completion or abandonment thereof, shall be referred to the Dy. Housing Commissioner in writing for his decision within a period of thirty days of such occurrence. Thereupon, the Dy. Housing shall give his written instructions and/or decision within a period of sixty days of such written request. This period can be extended by mutual consent of the parties. If decided amount is more than Rs.25,000/-the same shall be referred to the Housing Commissioner for his perusal.
Upon receipt of written instructions, or decision, the parties shall promptly proceed without delay to comply such decision or instructions. If the Dy. Housing Commissioner fails to give his instructions or decision in writing within a period of sixty days or mutually agreed time after being requested, if the parties are aggrieved against the decision of the Dy. Housing Commissioner the parties may within thirty days prefer such dispute/disputes for arbitration to the Addl. Housing Commissioner subject to the jurisdiction and limitations in accordance with the provisions of Madhyastham Adhikaran Adhiniyam, 1995. In case the dispute is within the jurisdiction of Addl. Housing Commissioner he shall then act as sole arbitrator, and he shall pass an award after hearing both the parties, strictly in accordance with the provisions of the Arbitration Act, 1940 and the rules made thereunder for the time being in force.
If the contractor does not make any demand for arbitration in respect of claim(s) in writing within ninety days on receiving information from the Executive Engineer that the final bill is ready for payment, the claim of the contractor shall be deemed to have been waived and shall be absolutely barred and the Board shall be discharged or released of all the liabilities under the contract in respect of such claim(s).
A reference to the Arbitration shall be no ground for not continuing the work on the part of the contractor and payment as per terms and conditions of the agreement shall be continued by the Board.”
4. Relying on the said clause, the matter was referred to the Additional Housing Commissioner, the sole arbitrator, who passed an award on 11th November, 2010. Be it stated, both the parties appeared before the learned arbitrator and on the basis of the materials brought on record, the learned arbitrator passed the award. As is manifest from record, the arbitrator did not find any justification to allow any of the claims of the respondent-contractor.
5. When the matter stood thus, as it appears, wisdom dawned upon the respondent and he th
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