High Court Of Delhi
DIPAK ELECTRIC AND TRADING COMPANY - Appellant
Versus
UNION OF INDIA - Respondent
Suit 1673A of 1996
Decided On : 09/28/2001
Arbitration - Construction Contract - Arbitration Act, 1940, Section 14, 17
Fact of the Case:
The petitioner filed a petition under Section 14 and 17 of the Arbitration Act, 1940 for filing the award of a construction contract with the Union of India for a PMT Complex for NSG at Manesar and for making it a rule of the court.
Finding of the Court:
The court found that the objections filed by the Union of India were time-barred and lacked sufficient cause for condonation of delay. As a result, the award was made a rule of the court and a decree in terms of the award was passed with future interest at 12% p.a. on the principal amount.
Issues: The main issue was whether the objections filed by the Union of India were time-barred and whether there was sufficient cause for condonation of delay.
Ratio Decidendi: The court held that there was no application filed for condonation of delay and no sufficient cause was presented for the inordinate delay, thus the objections were time-barred.
Final Decision: The award was made a rule of the court and a decree in terms of the award was passed with future interest at 12% p.a. on the principal amount.
( 1 ) M/s Deepak Electric and Trading Company, through its proprietor J. K. Jain have filed the present petition under Section 14 and 17 of the Arbitration Act, 1940 for filing of the award of 7/6/1996 and for making it a rule of the court besides passing a decree in terms of the award.
( 2 ). It has been asserted that the petitioner had entered into a contract agreement with respondent no. 1 Union of India for construction of PMT Complex for NSG at Manesar. The agreement contained an arbitrator clause. Disputes had arisen between the parties as a result thereto the petitioner had invoked the arbitration clause. Respondent no. 3 was appointed as the sole arbitrator. Respondent no. 3 has published his award of 17/1/1996 and accordingly it is prayed that the award should be made a rule of the court and decree in terms of the award may be passed.
( 3 ). In pursuance of the notice having been issued Union of India has filed the objections. It is not disputed that the parties had entered into an agreement which contained an arbiltration clause. It is asserted that the arbitrator has not considered the facts that were placed before him. He has ignored the relevant provisions and travelled beyond the provisions of the contract. As a result of which he has favoured the petitioner. As regards claim no. 1 it has been alleged by the objector Union of India that the arbitrator has systematically ignored important omissions and the Union of India in comparison to the omissions of the petitioner. In this process he has misconceived himself. So far as counter claim of the objector nos. 1, 3 and 4 are concerned, once again the plea offered is that the arbitrator has misconducted the proceedings and has failed to apply the correct proposition of law in view of the rescission of the contract. The objector was within its right to rescind the work. Rs. 21,217. 00 has been awarded to the petitioner for sub-standard work and that the award suffers from an error apparent on the face of the record. The arbitrator has ignored vital documents.
( 4 ). So far as counter-claim no. 2 is concerned, once again it is pleaded that he had no Jurisdiction to go into this claim even if referred to him. As regards claim no. 5 it i asserted that the arbitrator has not applied his mind and has misconducted himself.
( 5 ). Reply has been filed by the petitioner. It is alleged that the objector has not stated as to when the notice of filing of the award was received. In fact plea was raised that the objections are barred by time. It is denied that the arbitrator has misconducted himself or has travelled beyond the provisions of the contract or that he has not applied his mind or has conducted the proceedings while making the award.
( 6 ). During the course of submissions preliminary objection has been raised on behalf of the petitioners that the objections are barred by time and therefore the same should be dismissed.
( 7 ). Learned counsel for the petitioner highlighted the fact that the objector had been served but the objections as such are not within tune while the objectors claim was that even if Union of India was served still the Executive Engineer, CPWD had not been served as alleged by the petitioners and therefore objections cannot be termed to be barred by time.
( 8 ). To set this controversy at rest, reference can be made to certain basic facts in this regard. The objections by Union of India has been filed some time on 23/7/1997. Perusal of the record reveals that on 13/1/1997 notice was issued to the parties regarding filing of the award. On 1/4/1997 it was indicated that notice has been served on Union of India. On 4/11/1996 as well as on 29/1/1997 it was directed to be issued afresh to respondent no. 2. This fact is apparent from the record also because Union of India had been served in November 1996 and in that view of the matter it is patent that objections so filed are beyond the limitation prescribed qua objector-Union of India.
( 9 )
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