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2024 Supreme(MP) 290
IN THE HIGH COURT OF MADHYA PRADESH AT JABALPUR
SHEEL NAGU, VINAY SARAF, JJ.
M.P. MADHYA KSHETRA VIDYUT VITRAN COMPANY LTD., SEHORE – Petitioner
Versus
PSR AMRCL (JV), HYDERABAD (TELANGANA) – Respondent
Misc. Petition Nos. 6406 and 6411 of 2022
Decided On : 12-01-2024
For the Petitioner: Abhishek Arjaria
IMPORTANT POINT
The court affirmed that time spent in bona fide legal proceedings can be excluded from limitation calculations, emphasizing the need for a liberal interpretation of the Limitation Act.
Headnote:
Limitation - Arbitration - Limitation Act, 1963 (Sections 14), M.P. Madhyastham Adhikaran Adhiniyam, 1983 (Section 7-B) - The court interpreted the provisions of the Limitation Act regarding exclusion of time spent in bona fide proceedings and upheld the tribunal's decision to allow such exclusion, affirming the importance of good faith in legal proceedings.
Fact of the Case:
The petitioner challenged a tribunal's order allowing the respondent's application under Section 14 of the Limitation Act, which excluded time spent in prior proceedings, claiming the reference was time-barred under Section 7-B of the M.P. Madhyastham Adhikaran Adhiniyam, 1983.
Finding of the Court:
The court found that the tribunal correctly applied the law by excluding the time spent in pursuing the arbitration remedy, as the respondent acted in good faith and with due diligence, fulfilling the conditions set by the Supreme Court.
Issues: Whether the tribunal erred in allowing the exclusion of time under Section 14 of the Limitation Act, given the claim was allegedly time-barred under Section 7-B of the Adhiniyam, 1983.
Ratio Decidendi: The court held that the exclusion of time under Section 14 of the Limitation Act is applicable when the prior proceedings were pursued in good faith and with due diligence, regardless of the jurisdictional defects.
Result: The petitions are dismissed.
ORDER :
(Vinay Saraf, J.) :
As both the cases are between the same parties and issue involved in both the cases is identical in nature therefore this order will decide M.P.No. 6406/2022 and M.P.No. 6411/2022.
2. Shri Jaideep Sirpurkar, Advocate who was representing sole respondent, M/s PSR-AMRCL(JV) moved an application to withdraw his Vakalatnama on behalf of the respondent as he has no instructions.
3. Accordingly, the application for withdrawal of Vakalatnama is allowed. Shri Jaideep Sirpurkar, Advocate is permitted to withdraw his Vakalatnama filed on behalf of respondent.
4. Heard learned counsel for the petitioner on the question of admission.
5. For disposal of the present petitions, the facts of M. P. No. 6406/2022 are being taken.
6. By the present miscellaneous petition filed under Article 227 of the Constitution of India, the petitioner, M. P. Madhya Kshetriya Vidyut Vitran Co. Limited (for short, ‘the MPMKVVCL) has challenged the order dated 22-9-2022 passed in MJC No. 14/2020 by the M. P. State Arbitration Tribunal, Bhopal whereby learned tribunal allowed the application filed by the respondent/claimant under section 14 of the Limitation Act and excluded the time spent in prosecuting proceeding bona fidely with due diligence before another forum.
7. The short facts for deciding the present miscellaneous petition are that the respondent/Company preferred a reference under section 7 of the M. P. Madhyastham Adhikaran Adhiniyam, 1983 (herein after referred as ‘Adhiniyam, 1983’) claiming an award for recovery of Rs. 31,40,26,457 along with interest. Along with petition, the respondent also filed an application under section 14 of the Limitation Act, 1963 (for short, ‘the Act, 1963’) read with Adhiniyam 1983 seeking exclusion of time spent in prosecuting proceedings bona fidely by the respondent before other forum. On 7-12-2010, petitioner, MPMKVVCL issued letter of acceptance in favour of the respondent/Company for supply of material, survey, consumer indexing, installation, testing and commissioning of 11 KB feeder separation programme, installation of distribution transformers and L.T. works for segregation of domestic and agricultural consumers in Sehore District of M. P. scheduled to be completed within 18 months. On 23-12-2010, the contract/agreement was signed and work order was issued by MPMKVVCL and effective date was finalized as 31-1-2011 for scheduled completion of work in 18 months i.e. up to 31-7-2012.
7.1 According to the respondent/Company, the work was started and could not be completed in scheduled time due to several reasons and the Company requested for grant of appropriate extension of time to MPMKVVCL and the contract was extended till 31-12-2014. The work was continued till 30-5-2014 and on 30-5-2014, MPMKVVCL terminated instant contract and encashed CPBG and advanced bank guarantee. On 11-6-2014, the respondent/Company replied to above action of MPMKVVCL and submitted that termination of contract is unjustifiable and requested for revocation of termination order and encashment of bank guarantee. MPMKVVCL has not replied to the said letter and raised liabilities of respondent/Company under the contract and demanded the payment. The respondent/Company denied the liabilities and invoked the arbitration clause by issuance of notice for constitution of arbitration tribunal for settlement of disputes arisen as postulated in Clause 45.5 General Conditions of Contract (for short, ‘the GCC’) but MPMKVVCL did not reply to the arbitration notice and the matter remained pending till 14-4-2017.
7.2 When the respondent/company issued reminder for appointment of arbitrator, however MPMKVVCL failed to appoint the arbitrator according to Clause 45.5 of GCC. On 22-7-2017, the respondent/Company filed A.C. No. 42/2017 under section 11(6) of the Arbitration and Conciliation Act, 1996 (herein after referred to as ‘the Act 1996’) before the High Court of Madhya Pradesh, Jabalpur for appointment of sole arbitrator, but the Hig
