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2024 Supreme(Online)(Ker) 88465
IN THE HIGH COURT OF KERALA AT ERNAKULAM
G.GIRISH, J
The petitioner – Appellant
Versus
the respondents – Respondent
Arbitration Request
For the Appellants/Petitioners: Unknown
For the Respondents: Unknown
The court determined that the arbitration request was valid as the right to sue arose after the completion of work, and the issue of payment settlement is for the Arbitrator to resolve.
Headnote:(A) Arbitration and Conciliation Act, 1996 - Section 11 - Request for appointment of Arbitrator - Petitioner, a partnership firm, sought appointment of an Arbitrator due to non-payment of Rs.33,55,772/- by respondents for completed painting works as per work orders - Respondents denied liability and claimed the request was barred by limitation. (Paras 1-2, 10-11)
(B) Limitation - Court held that the right to sue arose upon completion of work in December 2021, and thus the request for arbitration was not barred by limitation. (Paras 9-10)
(C) Appointment of Arbitrator - Clause 12 of the work order provided for appointment of a sole Arbitrator, and the court noted the respondents failed to comply with the request for arbitration. (Paras 12)
Findings of Court:
The application for appointment of an Arbitrator was allowed, with a retired District Judge appointed as the sole Arbitrator to resolve disputes. (Paras 11-12)
Issues: Whether the arbitration request is maintainable given the claims of limitation and outstanding payments.
Ratio Decidendi: The court ruled that the arbitration request is valid as the right to sue arose post-completion of work, and the issue of settlement is for the Arbitrator to decide.
Result: Application allowed, Arbitrator appointed.
| Table of Content |
|---|
| 1. petitioner seeks arbitration for unpaid amounts. (Para 1 , 2 , 3) |
| 2. one respondent removed from proceedings. (Para 4) |
| 3. respondents deny agreement and liability. (Para 5 , 8) |
| 4. court analyzes limitation and facts of the case. (Para 6 , 10) |
| 5. court finds no evidence of full settlement. (Para 7 , 9 , 11) |
| 6. arbitrator appointed per agreement terms. (Para 12) |
ORDER
The petitioner, a registered partnership firm engaged in carrying on interior and exterior painting works, has filed this petition under section 11 of the Arbitration and Conciliation Act, 1996 (for short ‘the Act’) for the appointment of an Arbitrator for the resolution of the dispute with the respondents in connection with the payments said to be due from them.
2. It is stated that on 27.08.2011, the respondents issued a work order in favour of the petitioner for the painting works of B1 and B2 blocks of their apartment complex at Kochi. An additional work order is also said to have been issued by the respondents in connection with the same work. The copies of the aforesaid work orders are produced by the petitioner as Annexures A2 and A3. According to the petitioner, the works entrusted by the respondents were completed in agreed time as per the specifications described in the work order. However, the respondents are said to have made inordinate delay in making payment of the bills due in connection with the works done during the final stages. The respondents are said to have informed the petitioner that the payment was delayed due to some restrictions imposed by the Apex Court in the financial transactions of the respondents. It is also stated that, at the request of the respondents, the petitioner completed the painting works as per the work order by December, 2021. As regards the amounts due to the petitioner in connection with six bills issued to the respondents, joint measurement of works were said to have been conducted in respect of four bills. An amount of Rs.33,55,772/- is said to be due to the petitioner from the respondents as per a final bill dated 01.12.2021.
3. Alleging that the respondents are not caring to make payment of the aforesaid amount inspite of repeated demands, the petitioner issued Annexure-A4 notice calling upon the respondents to pay the outstanding amount of Rs.33,55,772/- along with the amount payable as GST and interest @ 12% p.a. or to appoint a sole Arbitrator as per Clause 12 of Annexure-A2 work order for the resolution of the dispute in the above regard. Contending that the respondents did not oblige to make payment or to take steps for the appointment of Arbitrator as demanded in Ext.A4 notice, the petitioner has approached this Court with this Arbitration Request.
4. The 1st respondent M/s. Sahara India Pariwar, Sahara Prime City Limited, Sahara India Centre, 2 Kapoorthala Complex, Aliganj, Lucknow, Pin-226024 was deleted from the party array as per order dated 27.06.2024 in I.A.No.2/2024.
5. The 2nd and 3rd respondents appeared through their counsel and filed a counter affidavit contending that there was no agreement between the petitioner and the respondents to have the disputes resolved as per the provisions of the Act. They also denied the liability to make payment of the amount of Rs.33,55,772/- as claimed by the petitioner. It is also stated in the counter affidavit that the Apex Court had proscribed the above respondents from parting with any movable or immovable properties as per an order dated 21.11.2013 in a contempt petition. According to the above respondents, they stopped all further constructions in the light of the above restraint imposed by the Apex Court. The respondents 2 and 3 also denied the issuance of lawyer’s notice by the petitioner.
6. Heard the learned counsel for the petitioner and the learned counsel representing the respondents 2 and 3.
7. The learned counsel for the petitioner, by adverting to Clause 12 of Annexure-A2 work order, contended that the above said clause provides for the appo
