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2000 Supreme(Del) 668

High Court Of Delhi
PANDIT MUNSHI RAM AND ASSOCIATES PRIVATE LIMITED - Appellant
Versus
DELHI DEVELOPMENT AUTHORITY - Respondent
A.A. 278 of 1999
Decided On : 08/11/2000

Advocates Appeared:
ANUSUYA SALWAN, D.Maitra

The main legal point established in the judgment is the application of the principles of limitation under Article 137 of the Limitation Act, 1963 to petitions filed under the Arbitration and Conciliation Act, 1996.

Headnote:

Arbitration and Conciliation Act - Limitation - Article 137 of the Limitation Act, 1963 - Kerala SEB v. I. P. Kunhaliamma, (1976) 4 SCC 634 - Major (Retd) Inder Singh Rekhi v. Delhi Development Authority, (1988) 2 SCC 338 - Union of India v. Momin Construction Company, (1997) 9 SCC 97 - Neginbhai C. Patel v. Union of India, 1999 (2) Arb. LR 343 (Bombay) - B. T. Patil and Sons Belgaum (Construction) Pvt. Ltd. v. Konkan Railway Corporation Ltd and Another, 1998 (Suppl) Arb. LR 189 - Larsen and Toubro Limited v. Konkan Railway Corporation Limited, 1999 (2) Arb. LR 354 (Bombay) - Jai Chand Bhasin v. Union of India and Another, AIR 1983 Delhi 508 - Prafulla Kumar Singh Deo v. State of Orissa and Others, AIR 1989 Orissa 107 - Major (Retd) Inder Singh Rekhi v. Delhi Development Authority, AIR 1988 SC 1007 - Union of India and Another v. M/s. L. K. Ahuja and Co. , AIR 1988 SC 1172 - G. Ramachandra Reddy and Co. v. Chief Engineer, Military Engineering Service, AIR 1994 SC 2381

Fact of the Case:

The petitioner filed a petition under Section 11 (6) of the Arbitration and Conciliation Act, 1996, alleging that the respondent refused to appoint an arbitrator for adjudication of the claims of the petitioner.

Finding of the Court:

The court found that the petition was barred by limitation as the limitation for filing the petition had started running from the date the final bill was accepted, and the petition filed was beyond the prescribed period of limitation.

Issues: The main issue was whether the petition filed under Section 11 (6) of the Arbitration and Conciliation Act, 1996 was barred by limitation.

Ratio Decidendi: The court applied the principles of limitation under Article 137 of the Limitation Act, 1963 and relied on various precedents to determine the starting point of limitation for filing the petition.

Final Decision: The petition was dismissed as being barred by limitation.

K. S. Gupta

( 1 ) THIS Petition under Section 11 (6) of the Arbitration and Counciliation Act, 1996 was filed by M/s. Pandit Munshi Ram and Associates Pvt. Ltd, interalia, alleging that it was awarded the work of construction of 288, Janta Flats for Harijans at Vasant Gaon, New Delhi and a formal agreement being No. 88/ee/s. W. D-7/d. D. A. /a/89-90 executed between the parties also contained an arbitration clause No. 25. The petitioner sent a letter dated 6th December 1997 to the Engineer Member of DDA who is the persona-designata for appointment of arbitrator in terms of the said arbitration clause, to appoint an arbitrator to decide the disputes and differences which had arisen be- tween the parties. Respondent-DDA in reply to the said letter demanded an applica- tion in requisite proforma vide their letter dated 24th February 1998. Vide its letter dated 3/6th April 1998 the petitioner sent the requisite proforma to the Engineer- Member for appointing an arbitrator. It is further alleged that the petitioner received letter CE (SWZ)/fo/18 (46)98/arbn. /2209 dated 22nd September 1-998 from the respondent-DDA whereby it refused to appoint an arbitrator on the ground of claims deemed to have been waived and barred under said clause 25. In reply to this letter the petitioner sent letter dated 21st October 1998 to the Executive Engineer pointing out that at no point of time any final bill had been given. Respondent-DDA neither sent any reply to this letter nor appointed an arbitrator for adjudication of the claims of the petitioner. . It was prayed that an independent arbitrator be appointed by the court and the disputes be referred to him for arbitration.

( 2 ) RESPONDENT-DDA has contested the petition by filing reply. Since the petition is being contested mainly on the ground of limitation, reference to that part of the averments made in the reply need be referred here. It is pleaded that the final bill and measurements were accepted by the petitioner on 2nd February 1994 and petition filed after expiry of period of three years reckoned from that date, is barred by limitation.

( 3 ) IT was urged by Ms. Anusuya Salwan on behalf of respondent-DDA that in Kerala SEB v. I. P. Kunhaliamma, (1976) 4 SCC 634 the Supreme Court held that Article 137 of the Limitation Act, 1963 would apply to a petition filed under the Arbitration Act, 1940 (for Short the Act ) and this decision was followed in a later decision in Major (Retd) Inder Singh Rekhi v. Delhi Development Authority, (1988) 2 SCC 338. According to her, as the final bill and measurements were accepted by the petitioner on 2nd February 1994 the present petition which was filed on 30th July 1999, is hopelessly barred by time and thus deserves to be dismissed on that count. Reliance was placed on the decision in Union of India v. Momin Construction Company, (1997) 9 SCC 97 and an unreported decision of a Division Bench of this court in FAO (OS)364/96 R. K. Aneja v. Delhi Development Authority and Ors. decided on 12th October 1999. On the other hand, it was urged by Sh. D. Moitra for petitioner that the cause of action for a petition under Section 11 (6) of the Arbitration and Reconciliation Act, 1996 would arise only when a claim to refer disputes to arbitration is made and it is rejected and as refusal to appoint an arbitrator was communicated by respondent-DDA by the letter dated 22nd September 1999 the petition is well within limitation, that the question whether claim is barred by limitation or not can be gone into only by the arbitrator and not the court. In support of the submission, reliance was placed on the decisions in Neginbhai C. Patel v. Union of India, 1999 (2) Arb. LR 343 (Bombay); B. T. Patil and Sons Belgaum (Construction) Pvt. Ltd. v. Konkan Railway Corporation Ltd and Another, 1998 (Suppl) Arb. LR 189; Larsen and Toubro Limited v. Konkan Railway Corporation Limited, 1999 (2) Arb. LR 354 (Bombay); Jai Chand Bhasin v. Union of India and Another, AIR 1983 Delhi 508;











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