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2011 Supreme(P&H) 980

2011(3) LAW HERALD (P&H) 2180
IN THE HIGH COURT OF PUNJAB AND HARYANA
Before
The Hon’ble Mr. Justice Hemant Gupta
Arb. Case No.124 of 2010
Sunil Goyal
v.
Haryana State Agriculture Marketing Board & Ors.
{Decided on 06/04/2011}

Advocates:
For the Petitioner:Mr. P.S. Rana, Advocate.
For the Respondents:Mr. Durgesh Aggarwal, Advocate.

Headnote:(A) Contract Act, 1872, S.28--Limitation for raising the dispute--Right of the petitioner to claim adjudication of the disputes arising out of a contract cannot be restricted by terms of agreement, after the amendment in Section 28 of the Act vide Indian Parliament Act No. 1 of 1997, notified on 08.01.2007. (Para 6)

       (B) Contract Act, 1872, S.28--Arbitration and Conciliation Act, 1996, S.11--Arbitrator--Appointment of--The rejection of the claim of the petitioner for the reason that the petitioner has sought appointment of an Arbitrator after 180 days from the date of payment of final bill as per arbitration clause in agreements--Held; such clause cannot extinguish either the right or the remedy of the petitioner, to sought an appointment under S.11 of the Act. (Para 12)

       

JUDGMENT

Mr. Hemant Gupta, J.: - The petitioner has sought appointment of an Arbitrator in respect of disputes arising out of an Agreement executed between the parties.

2. The work for construction of road from Singhapura to Gahlewala upto Punjab Border was allotted to the petitioner on 13.06.2002. Thereafter, an agreement in this respect was executed between the parties. The petitioner completed the work on 10.10.2004. The petitioner requested for the final payment for which request was made by the petitioner on 20.09.2005. The petitioner was informed to attend the office of the Executive Engineer so as to give rebate for maintaining allotted excess work, so that the final bill can be reviewed. The petitioner resisted such communication. The petitioner was not ready and willing to give rebate as sought for by the Executive Engineer. Therefore, the petitioner sent a communication on 18.05.2006 for an early payment. Thereafter, the petitioner was paid amount on 20.07.2006 after deducting amount in respect of which the Executive Engineer has sought rebate from the petitioner. It is, thereafter, vide communication dated 16.08.2007, the petitioner has sought resolution of the disputes by an Arbitrator in terms of the contract Agreement.

3. In information sought under the Right to Information Act, 2005, the petitioner was informed that the Arbitrator is not being appointed since the claim of the petitioner is time barred. Subsequently, the petitioner filed an application before the learned District Judge, Sirsa for appointment of an Arbitrator. Such petition was dismissed on 10.08.2009 for the reason that the application for filing of arbitration is beyond the period of limitation, which is 180 days from the date of making of final payment. It is, thereafter, the petitioner after withdrawing the revision petition filed against the order passed by the learned District Judge, with liberty to move an appropriate application before the Hon’ble Chief Justice, filed the present petition before this Court.

4. Learned counsel for the petitioner has vehemently argued that restricting the right of the petitioner to raise dispute after the expiry of 180 days from the date of payment of final bill is against the mandate of law, contained in Section 28 of the Indian Contract Act, 1872 (for short ‘the Act’) after its amendment vide Indian Parliament Act No.1 of 1997, notified on 08.01.2007. After the amendment in the Act, any condition in the contract which takes away right of a party to an agreement to raise dispute is void. Learned counsel for the petitioner points out that before the Hon’ble Supreme Court in H.P. State Forest Company Ltd. Vs. M/s United India Insurance Co. Ltd., [2009(1) Law Herald (SC) 466] : (2009)2 SCC 252, it was wrongly stated that the amendment carried out by Indian Parliament Act No. of 1997 has been repealed, therefore, the judgments rendered by the Hon’ble Supreme Court prior to amendment of Section 28 of the Act are applicable to the present case, which arises after the amendment in Section 28 carried out by Indian Parliament Act No.1 of 1997.

5. On the other hand, learned counsel for the respondents has argued that the Agreement containing time limit and restricting the right to claim amount from the respondents is valid between the parties and, thus, the petitioner cannot seek adjudication of the disputes by an Arbitrator after the expiry of 180 days from the date of final payment.

Clause 25-A of the Agreement between the parties reads as under:

“25-A. If any question, difference or objection whatsoever shall arise in any way connected with or arising out of these instruments or the meaning or operations of any part thereof or the rights, duties or liabilities of either party then save in so far as the decision of any such matter herein before provided for and has been so decided every such matter including whatever according or whether its decision has been otherwise provided for and or whether it has been finall








































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