Research › Search › Judgment

Patna High Court · body

2000 DIGILAW 561 (PAT)

Jamadar Singh v. Engineer In Chief

2000-04-07

M.Y.EQBAL

body2000
Judgment 1. In this application filed under S. 11(6) of the Arbitration and Conciliation Act (hereinafter referred to as the Act), the petitioner prays for revocation of the authority of the respondent No. 3 being the appointed Arbitrator and for appointment of an Arbitrator for reference of the disputes and differences to him with a direction to make and publish the award. 2. The petitioners case is that he was awarded three contracts for earth work vide agreement Nos. 44F2 of 1986-87, 42F2 of 1986-87 in Bagodar Branch Canal and 3F2 of 1986-87 of Right Bank Canal. The estimated cost of the above works were Rs. 3,77,460.00 , Rs. 4,17,907.72 paise and Rs. 4,78,417.00 respectively. The petitioners case is that with respect to the agreement No. 44F2 of 1986-87 the work to the tune of Rs. 2,33,083.00 was completed by the petitioner for which the bill was prepared after taking measurement on 19-7-90 by the competent and authorised officers. The bill so prepared was duly checked and passed but payment has not been made to the petitioner. Rather the work was stopped as per unilateral decision of the Department and as such, the execution of the work could not be proceeded further. It is stated that as against the agreement No. 44F2 some extra item of work was got done by the petitioner at the request of the respondents as per the recommendation of the officers. So far agreement No. 44F2 of 1986-87 is concerned the petitioners case is that the total work amounting to Rupees 1,30,681.00 was completed by him as per the terms of the agreement but only a sum of Rs. 47,544.00 was paid and the balance amount is still lying due since the year 1990. With regard to agreement No. 3F2 of 1986-87 it is stated that the work was completed well within stipulated period amounting to Rs. 4,92,877.00 and the petitioner was already paid a sum of Rs. 4,54,123.00 against the bill but a sum of Rs. 38,754.00 is still lying due. The petitioner stated that he filed a representation on 1-12-90 and 6-2-91 for payment of his bill but despite several correspondences made between the respondents in the year 1991 the amount could not be paid. The petitioner filed several representations in 1991 and ultimately filed a writ application in 1997 being CWJC No. 3195 of 1997 (R) for payment of the entire dues. The petitioner filed several representations in 1991 and ultimately filed a writ application in 1997 being CWJC No. 3195 of 1997 (R) for payment of the entire dues. The said writ application was dismissed on 2-11-98 on the ground that contract being a non-statutory one and on account of delay. The petitioner then filed second writ application for the extra items of work being CWJC No. 3198/97(R) but the same was ultimately withdrawn. It is contended that after withdrawal of the writ application the petitioner served Advocates notice on all the respondents ventilating his legal and genuine grievances but nothing was done at the instance of the respondents. The petitioner, therefore, claims that dispute and differences exists which needs adjudication through arbitration under the provisions of the aforesaid Act. 3. A counter-affidavit has been filed in this case denying and disputing the claim of the petitioner. It is stated that there is no dispute existed between the parties and, therefore, the question of reference does not arise. Moreover, it is merely a money claim for which the petitioner has already moved this Court twice and both the writ applications were dismissed and now he is trying to take recourse of the said Act. It is further stated in the counter-affidavit that the work was not stopped as per the unilateral decision of the Department. It is stated that the work carried out by the petitioner up to 1990-91 instead of completing it in 1987-88. The work was still incomplete till 19-7-90. The bill submitted by the petitioner was passed by the authorities for Rs. 2,33,083 but the same could not be paid for want of fund. 4. I have heard Mr. N. K. Prasad, learned Sr. counsel for the petitioner and Mrs. Ritu Kumar, learned JC to GA. 5. Mr. N. K. Prasad, learned counsel, firstly submitted that admittedly the petitioner executed the work under the agreements and submitted bills, although the work was not completed. The respondents are, therefore, bound to pay the dues to the petitioner and reference cannot be said to be barred by limitation. Learned counsel further submitted that even assuming that the claim of the petitioner is barred by limitation, the same could be decided only by the Arbitrator along with other issues and not by this Court. The respondents are, therefore, bound to pay the dues to the petitioner and reference cannot be said to be barred by limitation. Learned counsel further submitted that even assuming that the claim of the petitioner is barred by limitation, the same could be decided only by the Arbitrator along with other issues and not by this Court. In this connection learned counsel relied upon decisions in the case of M/s R. P. Souza and Co. V/s. Chief Engineer, PWD, Panaji, AIR 2000 Bombay 74 and in the case of Rajbir Singh V/s. Union of India, AIR 1999 Delhi 65. 6. On the other hand, Mrs. Ritu Kumar, JC to GA. submitted that admittedly the work was allotted to the petitioner in the year 1986-87 and the same was to be completed by 1989. However, the petitioner executed part of the work and submitted bill in 1989. Most of the bills have been paid to the petitioner. Learned counsel further submitted that the petitioner never raised any dispute nor invoked the provisions of S. 11(6) of the said Act for about 14 years. Instead the petitioner filed writ application before this Court twice, the first writ was dismissed and second writ application was withdrawn. Learned counsel further submitted that even in the Advocates notice dated 26-11-98 the petitioner was not intended to invoke the provisions of the Arbitration and Conciliation Act rather he asked the respondents for payment of certain dues in order to avoid unnecessary litigation. Learned counsel then submitted that even before filing of the instant application under S. 11(6) of the Act the petitioner did not comply the requirements as contemplated under different clauses of S. 11 of the said Act. Learned counsel relied upon a decision in the case of Steel Authority of India Ltd. V/s. J. C. Budharaja (1999) 8 SCC 122 : ( AIR 1999 SC 3275 ) and submitted that since the dispute was not raised by the petitioner at any point of time before filing the instant application, the same is barred by limitation. 7. After having heard the learned counsels for the parties and after considering the facts of the case, I am of the opinion that there are much force in the submission of Mrs. 7. After having heard the learned counsels for the parties and after considering the facts of the case, I am of the opinion that there are much force in the submission of Mrs. Ritu Kumar, learned J.C. to G.A. As noticed above, according to his own case, the petitioner executed part of the work and thereafter he stopped doing any further work in 1990. The petitioners further case is that bills were raised by him and amounts have been paid in 1990. However, petitioners case is that some further amount was lying due and the same was payable by the respondents for which several representations were submitted by the petitioner but the amount was not paid. In 1997 i.e. after about seven years the petitioner filed a writ petition being CWJC No. 3195/97(R). The said writ application was dismissed by a Bench of this Court holding that contract being non-statutory and the petitioner approached the Court after about 10 years for payment of money claim. The petitioner again filed another writ petition being CWJC No. 3198/97(R) for the same relief. The petitioner ultimately prayed for withdrawal of the writ petition without seeking any leave to approach the appropriate forum and the writ application was dismissed as withdrawn. It further appears from the legal notice (Annexure 5) that the petitioner never intended to invoke the jurisdiction under S. 11 of the said Act. It is only after the expiry of about 14 years the instant application has been filed for appointment of arbitrator. It is well settled that the parties to an agreement must invoke the Arbitration clause within three years from the date when such dispute and differences arises between the parties. 8. In the case of Steel Authority of India Ltd. ( AIR 1999 SC 3275 ) (supra) the Apex Court considering a question with regard to limitation observed as follows (at p. 3283 of AIR) :- "In the present case, as stated above, on 29-8-1979, the contractor wrote a letter making certain claims. Thereafter the supplementary agreement was executed on 20-12-1980. In that agreement it is nowhere stated that the contractors alleged right of getting damages or losses suffered by him was kept alive. On the contrary he has agreed to complete the work within the time stipulated in the second agreement by charging some higher rate. Thereafter the supplementary agreement was executed on 20-12-1980. In that agreement it is nowhere stated that the contractors alleged right of getting damages or losses suffered by him was kept alive. On the contrary he has agreed to complete the work within the time stipulated in the second agreement by charging some higher rate. The contractor has not sought any reference within three years from the date when the cause of action arose, i.e. from 29-8-1979. Only in 1986 when the dispute arose with regard to the second agreement the respondent gave notice on 2-12-1985 to appoint a sole arbitrator. The sole arbitrator was appointed with a specific reservation regarding the tenability, maintain-ability and validity of reference as also on the ground that the claim was barred by the period of limitation and it pertained to excepted matters in terms of the general condition of the contract. From these facts, it is apparent that the claim before the Arbitrator in November-December 1985 was apparently barred by the period of limitation. Letter dated 3-9-1983 written by the appellant repudiating the respondents claim on account of damages or losses sustained by him would not give a fresh cause of action. On that date the cause of action for recovering the said amount was barred by the period of three years prescribed under Art. 137 of the Limitation Act, 1963 .Under S. 3 of the Limitation Act, it was the duty of the Arbitrator to reject the claim as it was on the face of it, barred by the period of limitation. 9 As noticed above, the petitioners own case is that various representations were filed in 1990 but the respondents neither paid the amount nor took any decision. Subsequently a writ application was filed by the petitioner which was dismissed on the ground that such application was a money claim raised after ten years, was not maintainable. It is only thereafter, in order to make fresh cause of action, the petitioner gave a legal notice in the year 1998. Be that as it may, no notice was given or demand was raised by the petitioner before filing the instant application under S. 11(6) of the said Act. In that view of the matter, I am of the opinion that the instant application for appointment of Arbitrator for adjudicating a dispute is barred by limitation and is not maintainable. 10. Mr. In that view of the matter, I am of the opinion that the instant application for appointment of Arbitrator for adjudicating a dispute is barred by limitation and is not maintainable. 10. Mr. N. K. Prasad, relied upon the aforementioned two decisions of the Bombay High Court and Delhi High Court. In my opinion, the ratio decided by the Delhi High Court in Rajbir Singhs case (AIR 1999 Delhi 65) (supra) rather support the case of the respondents. The fact of that case was that the petitioner was awarded the work by providing counter berm on the city side of the left forward Bund. The contract was completed in 1989 and the account was finalised by the respondents on 28-5-90. However, by letter dated 24-6-96 the respondents raised a demand for a sum of Rs. 40,586.75 paise. This amount has since been recovered by the respondents from the amount due to the petitioner under some other contract. After this amount had been recovered, the petitioner by letter dated 22-8-96 invoked the provisions of Arbitration agreement for referring certain dispute to the Arbitrator. Besides the dispute of unjustified recovery of Rs. 40,586.75 made in July, 96 the petitioner sought the dispute about the increase in wages of labour under clause 100 of the contract and compensation in relation to the additional work allegedly executed by the petitioner to be referred to the Arbitrator. Their Lordship held that so far the dispute relating to recovery of Rs. 40,586.75 can still be referred to the Arbitrator but the claim under the contract which was finalised in 1990 cannot be referred for arbitration as the same was barred by limitation. Their Lordships observed : "In the present case, it is the case of the petitioner himself that "after the completion of the work which was recorded to be executed as per applicable specifications of the contract the Respondent finalised the account on 28-5-1990. While finalising the account the amount due and payable towards rise in wages of labour and other dues admissible by way of compensation as well as certain work executed etc. were not released." It clearly shows that, according to the petitioner himself, as on 28th May, 1990 when the accounts were finalised certain amount allegedly due to the petitioner were not released. were not released." It clearly shows that, according to the petitioner himself, as on 28th May, 1990 when the accounts were finalised certain amount allegedly due to the petitioner were not released. If that was the position, the petitioner could have raise a dispute about the said dues allegedly not released to him or seek the said disputes to be referred to an Arbitrator in terms of the Arbitration agreement between the parties. That having not been done, in my view, the petitioner cannot now after a lapse more than eight years filed this application for reference of the said dispute to an arbitrator, as the same is clearly barred under Art. 137 of the Limitation Act. In my view, therefore, the disputes now sought to be referred regarding the alleged rise in the wages of Labour and Compensation in relation to additional work cannot be referred to the Arbitrator." 11. Similarly the ratio decided by the Bombay High Court in the case of R. P. Souja (AIR 2000 Bombay 74) (supra) is equally does not support the case of the petitioner. In that case the respondent was awarded a contract in 1992. Though the work was completed in all respect by October, 94 the final bill was not prepared and paid till October, 98. The applicant by letter dated 8th October, 98 called upon the respondents to finalise the account and to pay the amount claimed by the applicant within fifteen days from the date of receipt of the letter. It was made clear in the said letter that in the event of failure on the part of the respondents to pay the dues the dispute has to be referred to the Arbitration. Accordingly the applicant invoked the Arbitration clause in 1998 itself and requested for referring the dispute to arbitration. In that context their Lordships held that application for appointment of Arbitrator under S. 11(6) of the Arbitration and Conciliation Act cannot be said to be barred by law of limitation. 12. Having regard to the entire facts and circumstances of the case and the law discussed hereinabove, I am of the definite opinion that the instant application filed by the petitioner under S. 11(6) of the said Act is barred by limitation. The instant Request Case is, therefore, dismissed having no merit. However, there shall be no order as to costs.Application dismissed.