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2000 Supreme(Del) 858

High Court Of Delhi
GURUMAN CONSTRUCTION CORPORATION - Appellant
Versus
MUNICIPAL CORPORATION OF DELHI - Respondent
Interim Application 124645 of 1999
Decided On : 09/29/2000

Advocates Appeared:
JAGJIT SINGH CHAWLA, RAMAN DUGGAL

Headnote:Arbitration & Conciliation Act, 1996 - Section 11(6) — Petition seeking direction for filing of arbitration agreement and appointment of independent arbitrator — Request for appointment of arbitrator not acted upon by the respondent — Independent arbitrator appointed.

Vikramajit Sen

( 1 ) THE petitioner has approached the Court under Section 11 (6) of the Arbitration and Conciliation Act, 1996, for the issuance of a direction to Respondent No. 1 to file the original Arbitration Agreement and for the appointment of an independent Arbitrator for adjudicating the disputes between the parties. The allegations in the plaint are that the petitioner made arrangements for commencing the work for the which the contract was given to it. The land was low-lying and due to non-filling up of earth on all sides of the basement and insufficient space for stacking of material, the labour was hindered. It has also been alleged that the Respondent delayed supplies of cement and steel and although bills were cleared payments were not made due to non-availability of funds with the Respondent. The 14th running bill, for a sum of Rs. 7,08,384. 00 was not paid and, therefore, the petitioner was forced to cease work in January 1999. The Respondent had unilaterally granted an extension of time upto 31. 3. 1999 in Arms of its letter dated 30. 11. 1998. Demand for payments under clause 10-CC of the Agreement was also raised. Another unilateral extension of time was granted by the Respondent upto 30. 6. 1999 by its letter dated 31. 3. 1999 and thereafter upto 30. 9. 1999 by its letter dated 22. 7. 1999. Although no payments have been made the petitioner has been threatened with forcible removal of building material, tools, plant, machinery etc. and demolition of the huts of the staff. The allegation is that the Respondents have illegally taken possession of the First Floor which is still incomplete. In these circumstances a letter dated 26. 12. 1998 was issued by the petitioner to the Respondent, calling upon them to appoint an Arbitrator. This was followed by another notice dated 22. 6. 1999 giving brief details of the claim and reiterating the request for the appointment of an Arbitrator. When this was also ignored, the petitioner was, therefore, left with no alternative but to file the present petition. The plaintiff has also prayed for the appointment of a Local Commissioner.

( 2 ) IN opposition to the petition, a brief affidavit of the Executive Engineer, Municipal Corporation of Delhi has been filed. Various objections, of a preliminary nature have been raised. Firstly, it has been averred that the petition is barred by limitation. I am unable to appreciate any reason which would substantiate this objection. Admittedly, payments against even the 14th running bill, have till date not been made. The stage for the preparation of the Final Bill had not even arrived, as is evident from the Respondent s affidavit itself. The stipulation of ninety days, contained in clause 25, would not apply because it is not a case where the petitioner had failed to make any demand on behalf of the bill made ready for payment. The grievance of the petitioner is that payments against the 14th running bill have not been made. Reminders in this regard have been sent and work was halted when no payments were forthcoming.

( 3 ) SECONDLY, it has been submitted that since the 14th running bill was accepted on 22. 7. 1998 no cause of action for the present petition had arisen. This facile objection calls for summary rejection. It will be significant to note tt in paragraph four of the affidavit the Respondents have firstly stated that 14th bill had been prepared and in some paragraphs have called it as the finally bill. This confusion appears to have been deliberately caused in order to make out a semblance of a case for attracting the plea of limitation.

( 4 ) THIRDLY, it has been urged that the petition calls for rejection since the petition has not been accompanied by the Arbitration Agreement. Arbitration Agreement is, however, not in dispute nor is it denied that an Agreement containing this Arbitration Clause had been signed. No precedent has been shown which would mandate the rejection of the petition merely because of the non-filing of














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