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2014 Supreme(Mad) 1621
HIGH COURT OF JUDICATURE AT MADRAS
G.M. AKBAR ALI, J.
P. Ramankutty
Versus
The Government of Tamilnadu & Another
C.S. No. 747 of 2003
Decided on: 26-06-2014
Advocate Appeared
For the Plaintiff:M.K. Kabir, Senior Counsel for A. Dhiraviyanathan, Advocate.
For the Defendants: M. Venugopal, Spl. Government Pleader (CS)
The court established the principle that the limitation for filing a suit claim starts from the finality of the arbitration proceedings and that the suit claim may be maintainable even if not made before the Arbitration Tribunal.
Headnote:
Order IV rule 1 - Civil Suit - Original Side Rules, Code of Civil Procedure - [Order IV Rule 1, Order VII Rule 1, Code of Civil Procedure] - The court discussed the maintainability of the suit, the limitation period for filing the suit claim, the liability of the defendants to pay the suit claim, and the entitlement of the plaintiff to interest. The court held that the suit was maintainable, not barred by limitation, and decreed the defendants to pay the suit claim with interest.
Fact of the Case:
The plaintiff entered into an agreement with the defendants for a construction project. Disputes arose, and the contract was terminated. The plaintiff filed a suit for payment of the final bill amount and the amount retained by the defendants.
Finding of the Court:
The court found the suit to be maintainable, not barred by limitation, and decreed the defendants to pay the suit claim with interest.
Issues: The issues included the maintainability of the suit, the limitation period for filing the suit claim, the liability of the defendants to pay the suit claim, and the entitlement of the plaintiff to interest.
Ratio Decidendi: The court held that the suit was maintainable, not barred by limitation, and decreed the defendants to pay the suit claim with interest.
Final Decision: The court decreed the defendants to pay a sum of Rs.22,90,655/- with 18% interest from 11.12.2000 till realization with costs.
1. The civil suit is filed under Order IV rule 1 of the Original Side Rules with Order VII Rule 1 and Order IV Rule 1 of the Code of Civil Procedure to (a) direct the defendants to pay to the plaintiff a sum of Rs.53,83,048/-together with interest at 18% per annum on the sum of Rs.22,90,655/- from the date of plaint till realisation (b) to pay the cost of the suit and (c) grant such further reliefs.
2. The case of the plaintiff is as follows:
(a) The defendants called for a tender for the work of north extension of Inner Ring Road and the bid by the plaintiff was accepted by the defendants and agreement was entered into between the plaintiff and the defendants on 21.4.1992. The total value of the contract was Rs.4,65,65,000/-(Rupees four crore sixty five lakhs and sixty five thousand only). The period of contract was 30 months from the date of handing over the site.
(b) The defendants could not hand over the entire site, as the land acquisition proceedings were not completed. The site was only handed over partially on 2.5.1992, therefore, their portion of the work was delayed. The defendants have also caused various interruptions which also prolonged the original period contemplated under the agreement, various disputes arose between the parties and the plaintiff invoked the clause for appointment of Arbitrator to decide the disputes in C.S.No.140 of 1994. The Arbitration Tribunal of three retired Chief Engineers was constituted. The plaintiff filed his claim before Arbitral Tribunal on 20.6.1994, claiming a sum of Rs.1,33,74,810/- (Rupees one crore thirty three lakhs seventy four thousand eight hundred ten only).
(c) The defendants filed their counter statement on 20.1.1985 and made counter claims. Pending arbitration, the defendants terminated the contract on 23.2.1986. The Tribunal passed an Award dated 31.3.1997. As per the award, the Tribunal held that the termination of contract was illegal. A sum of Rs.51,72,502/- (Rupees fifty one lakh seventy two thousand five hundred two only) was awarded to the plaintiff. A sum of Rs.22,96,000/-(Rupees twenty two lakhs ninety six thousand only) was awarded to the defendants. Therefore, the plaintiff is entitled to a sum of Rs.28,76,502/- with interest at the rate of 18% per annum. The plaintiff filed O.P No.423 of 1999 to receive the award and pass a decree. The defendants instituted OP No.852 of 1999 to set aside the award. By judgment and decree dated 11.12.2000, OP No.852 of 1999, filed by the defendants, was dismissed. The defendants preferred an appeal in OSA No.64 of 2000 and the OSA was dismissed on 19.12.2007. However, the defendants have not settled the final bill, which is calculated at Rs.5,00,000/- (Rupees five lakhs only) and also a sum of Rs.17,90,655/-(Rupees seventeen lakhs nineteen thousand six hundred fifty five only) as being withheld by the defendants. Therefore, the present suit.
3. The case of the defendants is as follows:
(a) The plaintiff has not raised any plea before the Arbitral Tribunal regarding the claim of Rs.5,00,000/-(Rupees five lakhs only) due from the final bill and the sum of Rs.17,90,655/-, being the withheld amount.
(b) The Tribunal, passed the award on 31.3.1997, declaring the termination as illegal. Therefore, the limitation starts from 31.3.1997. The claim should have also been made within three years from date of termination, which is 20.3.1996. Even assuming that the termination was held illegal on 31.3.1997, a suit ought to have been filed on or before 29.3.2000, but the suit filed in the year 2003 is hopelessly barred by limitation.
(c) The suit is also not maintainable as the same claim was not made before the Arbitration Tribunal.
4. Based on the above averments, the following issues were framed:
1. Whether the suit is maintainable in law?
2. Whether the suit claim is barred by limitation?
3. Whether the defendants are liable to pay the suit claim?
4. Whether the plaintiff is entitled to interest?
5. To what other relief
