High Court Of Delhi
B.L.GROVER - Appellant
Versus
UNION OF INDIA - Respondent
Suit 48A of 1978
Decided On : 09/20/1979
{'KEYWORD': 'Arbitration', 'SUBJECT': 'Appointment of Arbitrator and Reference of Disputes', 'ACT SECTION LIST': 'Arbitration Act, Section 20, Section 5, Article 137'}
Fact of the Case:
Plaintiff and defendants entered into a contract for construction work, with an arbitration clause providing for disputes to be referred to the Chief Engineer or a sole arbitrator appointed by him. Disputes arose, and the plaintiff invoked the arbitration clause, but the Chief Engineer appointed an arbitrator only for some of the disputes. The plaintiff sought the appointment of an arbitrator for the remaining disputes and also for additional disputes that arose later.
Finding of the Court:
The court held that the plaintiff's petition under Section 20 of the Arbitration Act was maintainable, as the disputes had not been referred to an arbitrator without the intervention of the court. The court also held that the plaintiff's delay in filing the petition was excusable under Section 5 of the Limitation Act, as the plaintiff had a bona fide belief that there was no limitation period for such petitions.
Issues: 1. Whether the disputes mentioned in the plaintiff's letter dated 24th August 1976 were referable to the arbitrator already appointed by the defendants. 2. Whether the plaintiff's petition under Section 20 of the Arbitration Act was maintainable.
Ratio Decidendi: 1. The court held that the disputes were referable to arbitration, as they were covered by the arbitration clause in the contract. 2. The court held that the plaintiff's petition was maintainable, as the disputes had not been referred to an arbitrator without the intervention of the court.
Final Decision: The court directed the Chief Engineer to appoint an arbitrator within two months to decide the disputes mentioned in the plaintiff's letter dated 24th August 1976, excluding the disputes already referred to the arbitrator.
( 1 ) THIS is a petition under Section 20 of the Arbitration Act for filing of arbitration agreement and appointment of an arbitrator. The Plaintiff entered into contract with the defendants for the execution of the work of "construction of Delhi Side approach on Mai Mathura Road near Bhogal" and agreement No. SEDS/64 of 1956-57 was executed between the parties. The contract contained arbitration clause No. 25 under which it is provided that the disputes shall be referred to the Chief Engineer, Central Public Works Department and if he is unable or unwilling to act, to the sole arbitration of some other person to be apointed by him. Disputes arose between the parties and the plaintiff vide his letter dated 14th June, 1961 invoked the arbitration clause and required the defendants to appoint an arbitrator for adjudication of thirteen disputes detailed therein (Annexure B) to the petition. The Chief Engineer, vide letter dated 26th October, 1961 (Annexure-C) appointed an arbitrator to decide the disputes mentioned by the plaintiff except the disputes at items Nos, 10, 11, 12 (a), 12 (b), 12 (c) and 13 of Annexure-B, There was prose cution of the plaintiff and some officers of the department. The plaintiff was acquitted finally by this court on or about 30th May, 1975 as per judgment of V. D, Misra J. The arbitrator in the meantime had resigned, and no progress could be made in the proceeding before the arbitrator as all records of the case were lying with police. After his acquittal the plaintiff sought the appointment of an arbitrator and also the reference of other disputes which came to his light subsequently. He submitted 19 disputes as per his letter dated 24th August, 1976 (Annexure-L) including the disputes already submitted previously. The Chief Engineer, by letter dated 29th October, 1977 (Annexure-N) appointed Km. K. P. Sarojini Arbitrator, Ministry of Works and Housing, New Delhi, as sole arbitrator to decide and make award with reapect to nine claims only. The plaintiff by this petition prays that the defendants be directed to file the arbitration agreement and that the Chief Engineer defendant No. 4 be directed to refer all the 19 disputes as detailed in the plaintiff s letter dated 24th August, 1976 (Annexure-L) to the petition superseding the statement which he has sent to the arbitrator with his letter dated 29th October, 1977 (Annexure-N ).
( 2 ) THE defendants in their reply plead that the arbitrator had already entered on the reference and, therefore, the application under Section 20 of the Arbitration Act is not maintainable, that additional disputes raised by the plaintiff are barred by time and that thus the disputes are not referable to the arbitrator. The following issues were framed on 6th of November, 1978:
(1) Whether the disputes mentioned in Annexure to the plaintiff s letter dated 24th August, 1976 to the Chief Engineer, P. W. D, New Delhi, are not referable to the arbitrator Miss. K, P. Sarojini, already appointed by the defendants (2) Relief.
( 3 ) THE Plaintiff on 12-3-IS79 filed an application (I. A. No. 805 of 1979) under Section 5 of the Limitation Act for condonation of delay in filing the petition under Section 20 of the Arbitration Act. The allegations are that certain disputes were referred to the arbitrator while the others were not referred by the Chief Engineer, that prosecution of the plaintiff ended and after his acquittal on 30-5-75 the plaintiff on 30-5-75 requested the defendants to appoint an arbitrator. The plaintiff prays that delay in filing petition under Section 20 of the Arbitration Act be condoned. The defendants in their reply plead that there is no sufficient cause for condonation. of delay in filing the petition.
( 4 ) THE learned counsel tor the plaintiff submits that there was no period of limitation prescribed for filing of a petition under Section 20 of the Arbitration Act within the meaning of Limitation Act, 1908. In Mohd. Usman v. Union of India, AIR 19
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