ALLAHABAD HIGH COURT
BEFORE : PANKAJ MITHAL, J.
M/s. SUREKA INTERNATIONAL ....Applicant
Versus
UNION OF INDIA AND OTHERS ....Opposite Parties
(Arbitration and Conciliation Application No. 30 of 2013, decided on 15th April, 2014)
Hon’ble Pankaj Mithal, J.—Heard Sri V.K. Mishra and Sri Shashi Kant Dubey, learned counsel for the petitioner and Sri R.B. Singhal, learned Assistant Solicitor General of India assisted by Sri Sanjay Om and Sri Rajnish Kumar Rai, learned counsel for the respondents.
2. Petitioner has been awarded a contract for the supply of certain materials by the Ordinance Equipment Factory at Kanpur and an agreement in this regard was executed between the parties on 4.7.2002. The said agreement vide Clause 24 provides for the settlement of all disputes arising between the parties and touching to the contract by the sole Arbitrator to be appointed by the Director General, Ordinance Factories, Government of India.
3. The petitioner in the petition pleads that in respect of the supply made by it under the aforesaid contract, it had submitted bills in 2003 but no payment was made to it. The petitioner vide notice dated 9.4.2013 demanded reference of the dispute to the Arbitral Tribunal. In the supplementary-affidavit filed by the petitioner, it has been stated that the contract was completed by the petitioner on 3.6.2003. The details of the outstanding bills were submitted on 13.6.2003 but the payment was not made. Thereafter the petitioner sent reminders from 12.4.2004 to 10.12.2005 but to no avail. Accordingly, the petitioner vide notice dated 3.2.2006, invoked the arbitration clause and requested the respondents to nominate an Arbitrator. It is stated that thereafter repeated reminders for appointment of Arbitrator were sent from 3.2.2006 till 7.10.2012 and the last being dated 9.4.2013 but neither the claim was settled nor the dispute was referred to arbitration.
4. The respondents are resisting the petition on a preliminary objection that the petition which has been filed on 2.7.2013, seeking appointment of an Arbitrator is ex facie barred by limitation.
5. In response to the above objection raised from the side of the respondents, the contention of counsel for the petitioner is that the petitioner was awarded a separate contract for the supply of goods by the Gun Carriage Factory, Jabalpur. In connection with the said supply some enquiry was conducted by the C.B.I. On account of that enquiry, on the directions of the General Manager, Gun Carriage Factory, Jabalpur, the payment of the petitioner in respect of the above contract was also stopped. The dispute in respect to the contract of supply with the Gun Carriage Factory, Jabalpur was referred to the Arbitral Tribunal and an award was made on 8.11.2008 but the payment under the said award too has also not been made to it. The petitioner has been asked to wait for the completion of the C.B.I. enquiry.
6. Secondly, in view of letter dated 1.12.2011, which has been filed as Annexure-3 to the counter-affidavit, the petition seeking appointment of Arbitrator is well within time and is not barred by limitation.
7. There is no dispute to the fact that the agreement from which the dispute arises is of the year 2002. The supply under the contract was completed by the petitioner on 3.6.2003 and all bills were submitted by 13.6.2003. The petitioner had invoked the arbitration clause for the first time on 3.2.2006 as averred in the supplementary-affidavit, though in the petition the date of invoking the arbitration clause has been mentioned as 9.4.2013.
8. The time limit for filing a petition for appointment of an Arbitrator under Section 11 of the Act has not been provided either under the Act or under the Limitation Act specifically. The request to the Chief Justice or his designate by way of application would fall within the definition of “application” contained in Section 2 (b) of the Limitation Act, 1963. Therefore, the Article 137 of the Limitation Act comes into play and the limitation for seeking appointment of an Arbitrator under Section 11 would be three years from the date when the right to apply accrues.
9. Article 137 of the Limitation Act, reads as under :
10. In the instant c
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