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2000 Supreme(Del) 974

High Court Of Delhi
MOHINDER NATH AND COMPANY - Appellant
Versus
DELHI DEVELOPMENT AUTHORITY - Respondent
Suit 2974A of 1996
Decided On : 11/16/2000

Advocates Appeared:
Rajesh Lakhanpal, Shailesh K.Kapur

Headnote:Arbitration Act, 1940 - Sections 30 & 33 — Objections to award — Reliance on exclusion clause unjustified — Objections found to be meritless, hence rejected — Award made rule of the Court.

Mukul Mudgal

( 1 ) THE petitioner is a Contractor and is carrying on the business of Construction work for the Delhi Development Authority. The petitioner was awarded Contract No. 15/pd-VIII/dda/81-82 by respondent-DDA for the construction of Velodrome at Indoor Stadium Complex, I. P. Estate, New Delhi. That certain differences and disputes had arisen between the parties and as per the Arbitration Clause in the agreement between the parties, Mr. Suresh Mehta, Superintending Engineer (Arbn.-I), DDA Office Complex, Motia Khan, Paharganj, New Delhi, respondent No. 2 herein, was appointed as Sole Arbitrator by the Engineer Member of respondent No. 1 /dda. The Arbitrator made and announced his Award by granting a sum of Rs. 1,51,539. 56 with interest out of the total claim of Rs. 5. 56. 649. 00 to the petitioner/claimant by his Award dated 25th October, 1996 after giving full opportunity of hearing to both the parties.

( 2 ) THE present objections in I. A. 6502/97 have been filed by the Delhi Development Authority/respondent No. 1, the objector herein, to set aside the Award dated 25th October, 1996.

( 3 ) THE respondent-DDA/objector has challenged all the claims wherever any amount has been awarded by the Arbitrator, raising an objection that all the claims are barred by limitation.

( 4 ) THE preliminary objection in respect of limitation raised on behalf of the respondent-DDA/objector is two-fold. Firstly since the work was completed on 5th of August, 1982, the limitation of 3 years is said to have expired in August, 1985 while the arbitration clause was invoked by the petitioner/claimant on 8th of July, 1993. The principal grievance of the respondent-DDA is that the impugned Award dated 25. 10. 1996 is liable to be set aside as the claims of the petitioner were clearly barred by limitation since the work was completed on 5. 8. 1982 and the arbitration was invoked on 8. 7. 1993 well beyond the prescribed period of limitation of three years. It is submitted that the Arbitrator has erroneously held that the limitation period would be reckoned from finalization of the accounts and intimation in respect of the final bill to the claimants as per Clause 25 of the agreement. The Arbitrator held that the respondent submitted the final bill during the hearing before the Arbitrator and consequently all the claims were found to be within the period of limitation.

( 5 ) THE learned Counsel for the respondent/objector has been unable to show how the aforesaid reasoning of the Arbitrator is wrong. The plea of the respondent- DDA is that the right of the claimant to receive the payment arose from the date of completion of the work and not from the finalization of the bill and this does not in any manner defer the commencement of the period of Limitation Act cannot be countenanced. The respondent themselves had not finalized the bill and cannot be heard to say that the limitation run de hors the finalization of the bill.

( 6 ) THE relevant portion of Clause 25 of the agreement which provides for arbitration reads as follows:

"it is also a term of the contract that if the contractors) does/do not make any demand for arbitration in respect of any claim (s) in writing within 90 days of receiving the intimation from the Engineer-in-Charge that the bill is ready for payment the claim (s) of the contractor (s), will be deemed to have been waived and absolutely barred and the Delhi Development Authority shall be dis- charged and released of all liabilities under the contract in respect of those claims. "

( 7 ) IN the light of the above provision it is very clear that the limitation would being to run only when the Engineer-in-Charge intimates to the claimant that the bill is ready for the payment. The Counsel for the DDA submitted that claimant/petitioner did not submit the final bill for payment as required under Clause 7 of the Agreement and therefore, the claim raised by the petitioner/claimant is not maintainable as the same did not constitute a dispu




























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