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2000 DIGILAW 318 (MP)

Pandey And Company v. Power Grid Corporation Of India

2000-03-28

DIPAK MISRA

body2000
ORDER Dipak Misra, J. 1. Invoking the civil revisional jurisdiction of this Court under Section 115 of the Code of Civil Procedure (hereinafter referred to as 'the Code') the petitioner/applicant has called in question the defensibility of the Order dated 12-2-99 whereby the learned District Judge, Jabalpur has refused to entertain an application under Section 8 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as 'the Act'). 2. The facts as have been undraped are that the applicant was awarded certain works by the non-applicants and the petitioner/Firm executed some extra work which was in the knowledge of the staff of the non-applicants. The petitioner submitted the final bill but the non-applicants failed to pay any amount for the extra work done by the applicant. The applicant raised an objection and sent a letter dated 25-8-94 but his letter was not paid heed to. The applicant served a notice on 19-12-96 through his counsel but the non-applicant maintained sphinx like silence. Thereafter, notices were sent on 22-7-97 and 13-12-97. The applicant remained present for joint inspection but non-applicants did not co-operate. As there was dispute between the parties in regard to payment for extra work executed by the applicant it invoked the Clause 69 of the General Conditions of the Contract for the appointment of an arbitrator, but the non-applicants failed to do so. Hence, the petitioner approached the Court for appointment of the arbitrator. 3. Before the Court below a preliminary reply was filed by the non-applicant contending, inter-alia, that Section 8 of the Act was not applicable in the present case as the arbitration Clause itself speaks of a named arbitrator. A further objection was taken by the non-applicants that the Court at Jabalpur had no jurisdiction, and hence, the petition was not maintainable. It was also putforth that certain conditions precedent as per the agreement were not complied with as per Clause 60.2 of the General Conditions of Contract, therefore, disputes raised by the petitioner were not arbitrable. Quite apart from the above it was also pleaded that the petitioner had filed the application beyond the period of limitation as the contract closing certificate was issued on 3-1-95 and the limitation commenced from 3-1-95 and the application was filed on 17-9-98, and therefore, beyond the period as prescribed under Article 137 of the Limitation Act, 1963. Quite apart from the above it was also pleaded that the petitioner had filed the application beyond the period of limitation as the contract closing certificate was issued on 3-1-95 and the limitation commenced from 3-1-95 and the application was filed on 17-9-98, and therefore, beyond the period as prescribed under Article 137 of the Limitation Act, 1963. It was also setforth that as the final bill was accepted without any protest, the petitioner was not entitled to invoke the arbitration clause. 4. The learned District Judge on consideration of rival submissions came to hold that as the petitioner/contractor has accepted the final bill after full and final settlement on the basis of amicable decision arrived at between the parties, the arbitration Clause cannot be invoked. The Court further held that the application was barred by limitation as the same was filed beyond the period of three years. 5. I have heard Mr. Girish Shrivastava, learned counsel for the petitioner/applicant and Mr. Rajehdra Menon, learned counsel for the respondents. Submission of Mr. Girish Shrivastava, learned counsel, is that after closure of the contract certain extra work was done by the petitioner but no payments were made, and hence, the finding that the application was barred by limitation is erroneous and unsustainable. It is also putforth by him that as the contractor had finally not settled the disputes the reliance on the principle that the claims were finally settled is incorrect and that vitiates the finding of the learned trial Judge on that score. Resisting the aforesaid submission of Mr. Girish Shrivastava it is submitted by Mr. Rajendra Menon, learned counsel for the non-applicants, that the petitioner had finally settled the disputes arising between the parties, and as the same had been put to rest arbitration Clause is not invocable. In support of his submission he has placed reliance on the decision rendered in the case of Nathani Steels Limited v. Associated Constructions, 1995 Supp. (3) SCC 324. He has also contended that the application was barred by limitation, therefore, the application was not maintainable before the learned District Judge, Jabalpur. In view of the aforesaid he has placed reliance on the decision rendered in the case of Union of India v. Momin Construction Company, 1997 (9) SCC 97 . 6. The rival contentions need careful consideration. He has also contended that the application was barred by limitation, therefore, the application was not maintainable before the learned District Judge, Jabalpur. In view of the aforesaid he has placed reliance on the decision rendered in the case of Union of India v. Momin Construction Company, 1997 (9) SCC 97 . 6. The rival contentions need careful consideration. Before I advert to deal with the contention relating to full and final settlement of dispute I would like to deal with the contention relating to limitation. The learned trial Judge has come to hold that the contract closing certificate was issued on 3-1-95, and admittedly, the petitioner has filed the application after lapse of three years. In the case of Union of India v. L.K. Ahuja and Company, AIR 1988 SC 1172 the Apex Court laid down as under :-- "8. In view of the well-settled principles we are of the view that it will be entirely wrong to mix-up the two aspects, namely, whether there was any valid claim for reference under Section 20 of the Act, and, secondly, whether the claim to be adjudicated by the arbitrator, was barred by lapse of time. The second is a matter which the arbitrator would decide unless, however, if an admitted fact a claim is found at the time of making an Order under Section 20 of the Arbitration Act, to be barred by limitation." In this context I may profitably refer to the decision rendered in the case of M.L. & B. Corporation v. Bhutnath, AIR 1964 SC 1336 , wherein Their Lordships have registered the view as under :-- "Under Section 3 of the Limitation Act, it is the duty of the Court not to proceed with the application if it is made beyond the period of limitation prescribed. The Court has no choice." Similar view was taken in the case of Momin Construction Company, (supra) wherein the Apex Court expressed thus :-- "7. The claim in the first appeal aforementioned arose to the respondents therein before 11-8-1965, when they issued the "No Claim Certificate" and the final bill was passed. The right to apply under Section 20 of the Arbitration Act, therefore, arose to the respondents before 11-8-1965. The application under Section 20 was made by them much after the expiry of three years therefrom. The application under Section 20 was, therefore, plainly barred by time. The right to apply under Section 20 of the Arbitration Act, therefore, arose to the respondents before 11-8-1965. The application under Section 20 was made by them much after the expiry of three years therefrom. The application under Section 20 was, therefore, plainly barred by time. The cases in the other appeals are similar." Recently, this Court in the case of Secretary, State of M.P., Irrigation Department v. Jaswant Singh, Dhillon, (1999) 2 MPLJ 122 , while dealing with the concept of limitation held as under :-- "..... At this juncture we may observe that in an application under Section 20 of the Adhiniyam, the Court is required to see that difference or disputes had arisen between the parties. There are two aspects, namely, whether there is any valid claim for reference under Section 20 and whether the application was filed within time." In view of the aforesaid enunciation of law there remains no iota of doubt that the present petition before the learned District Judge was barred by time, and hence, not maintainable. 7. The second limb of argument relates to the fact that when there is full and final settlement of the claims by the contractor and then invocation of the arbitration Clause is not tenable. In the case of P.K. Ramaiah & Co. v. Chairman and Managing Director, NTPC, (1994) 1 Scale 1 , wherein the Apex Court held as under:-- "Admittedly the full and final satisfaction was acknowledged by a received unconditionally. Thus, there is accord and satisfaction by final settlement of the claims. The subsequent allegation of coercion is an afterthought and a devise to get over the settlement of the dispute, acceptance of the payment and receipt voluntarily given..... Having acknowledged the settlement and also accepted measurements and having received the amount in full and final settlement of the claim, there is accord and satisfaction. There is no existing arbitrable dispute for reference to the arbitration." It is to be noted here that similar view has been taken in the case of State of Maharashtra v. Nav Bharat Builders, 1994 Supp. (3) SCC 83. 8. The present factual matrix has to be tested on the anvil of the aforesaid enunciation of law. There is no existing arbitrable dispute for reference to the arbitration." It is to be noted here that similar view has been taken in the case of State of Maharashtra v. Nav Bharat Builders, 1994 Supp. (3) SCC 83. 8. The present factual matrix has to be tested on the anvil of the aforesaid enunciation of law. Appreciating the facts in entirety it can safely be concluded that after settling the dispute fully and finally and submitting a "No Claim Certificate" on 3-1-95, no further claim would come within the realm of arbitration. The submission of the learned counsel for the petitioner in this regard is without any substance, and accordingly, I repel the same. 9. As both the submissions of Mr. Shrivastava are devoid of substance the civil revision is dismissed. However, in the peculiar facts and circumstances of the case there shall be no Order as to costs.