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High Court Of Delhi
RADHEY SHYAM GUPTA - Appellant
Versus
MUNICIPAL CORPORATION OF DELHI - Respondent
Suit 1698A of 1986
Decided On : 07/26/1988
ARBITRATION - APPOINTMENT OF ARBITRATOR - LIMITATION - WAIVER OF CLAIMS - INTIMATION OF PREPARATION OF FINAL BILL - JOINDER OF CAUSES OF ACTION - ORDER 2 RULE 3 OF THE CODE OF CIVIL PROCEDURE.
Fact of the Case:
Petitioner filed a petition under Section 20 of the Arbitration Act, 1940, for the appointment of an Arbitrator in terms of the arbitration agreements contained in five distinct contracts between the parties. The arbitration clause in all these contracts was identical, and disputes and differences between the parties arising under these contracts had to be referred to the Commissioner of Municipal Corporation of Delhi for arbitration. The petitioner claimed that the arbitration clause had to be invoked within 90 days of the intimation by the respondents that the final bill was ready for payment, and that no such intimation had been received by the petitioner.
Finding of the Court:
The court found that the respondents had only pointed out the date of the preparation of the final bill, but had not hinted about the intimation of the preparation of the final bill to the petitioner nor the date of any such intimation. Therefore, the plea of the respondents on the question of limitation was incomplete and the petitioner's rebuttal of that plea was correct.
Issues: 1. Whether the petition was barred by time as the arbitration clause had to be invoked within 90 days of the preparation of the final bill? 2. Whether the petitioner could join in this one petition all the five contracts?
Ratio Decidendi: 1. The court held that the limitation period for invoking the arbitration clause started from the date of intimation by the respondents to the petitioner that the final bill was ready for payment, and not from the date of preparation of the final bill. Since the respondents had not provided any evidence of such intimation, the plea of limitation was not tenable. 2. The court held that Order 2 Rule 3 of the Code of Civil Procedure allowed the petitioner to unite in the same suit several causes of action against the same respondents jointly. Since all the five contracts were between the same parties and pertained to distinct causes of action, they could be united in one petition under Section 20 of the Arbitration Act, 1940.
Final Decision: The court accepted the petition and directed that the Arbitration Agreement be filed in court and the various disputes and differences between the parties be referred to the sole arbitration of the Commissioner of the Municipal Corporation of Delhi or any person nominated by him on his behalf.
( 1 ) THIS is a petition under Section 20 of the Arbitration Act, 1940, moved by the Petitioner Shri Radhey Shayam Gupta against the respondents. Municipal Corporation of Delhi and its Commissioner for the appointment of an Arbitrator in terms of the arbitration agreements contained in as many as five distinct contracts between the parties. The arbitration clause in all these contracts is clause 25 and the arbitration clauses are identical in all these contracts. All these 5 contracts have been referred to in para 1 of the petition. As per the arbitration clause which is the same in all these contracts the disputes and differences between the parties arising under these contracts have to be referred to the Commissioner of Municipal Corporation of Delhi for arbitration. Claims have been set out in para 6 of the petition. It is asserted that the petitioner has been obliged to file this petition since after invoking of the arbitration clause a period of more than 4 months has expired and the Arbitrator has not been appointed.
( 2 ) IN the written statement the respondents have taken up a preliminary objection to the effect that the petition is barred by time as the arbitration clause had to be invoked within a period of 90 days of the preparation of the final bill as per the conditions of the contracts and that the final bills have been prepared on 26th February, 1981. The claims set out in the petition have been controverted in the written statement by the respondents. In the prayer clause the respondents pray for the dismissal of this petition only on the ground of its being time barred.
( 3 ) IN the Rajoinder the petitioner has controverted the plea of limitation raised in the written statement of the respondents by asserting that as per conditions of the contracts the arbitration is to be invoked within 90 days of the intimation by the respondents that the final bill is ready for payment and, that no such intimation had been received by the petitioner.
( 4 ) THE only dispute between the parties as per their grievance is regarding the limitation point. The contracts provide as follows on this point:
"it is also a term of the contract that if the Contractor (s) do/does not make any demand for Arbitration in respect of any demand daim (s) (V) writing within 90 days of receiving the intimation from the Corporation or any officer authorised in this behalf that the bill is ready for payment, the claims of Contractor (s) will be deemed to have been waived and absolutely barred and the Corporation shall be discharged and released of all liabilities under the contract in respect of these claims". So from the perusal of this condition of the contracts it is not only the preparation of the final bill by the respondents which is material but also another factor viz. , the intimation by the respondents to the plaintiff that the final bill is ready. In the written statement the defendants have only pointed out the date of the preparation of the final bill, i. e. , 26th February, 1981 and have not hinted about the intimation of the preparation of the final bill to the petitioner nor the date of any such intimation and so the plea of the respondents on the question of limitation is obviously incomplete and the petitioner s rebuttal of that plea by stating in the rejoinder that no intimation of the preparation of the final bill was given by the respondents to the petitioner is correct and there is thus no question of the application of the limitation to this case.
( 5 ) THERE is no other plea taken by the respondents in the written statement. Learned counsel for the respondents has now contended that the petitioner could not join in this one petition all the five contracts. Order 2 Rule 3 of the Code of Civil Procedure talks of the joinder of causes of action. This is a legal question and can be taken up without there being pleadings in the written statement on this point. Under Order 2 Rule 3 of the Code of Civil Procedure the
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