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2001 DIGILAW 320 (DEL)

UNITY ENGINIRS v. LIEUTENANT GOVERNOR DELHI

2001-03-21

J.D.KAPOOR

body2001
J. D. Kapoor ( 1 ) THE solitary legal objection to the award dated 28/01/1999 is that the arbitration proceedings were not maintainable as these were wholly barred by limita tion by virtue of clause 25 of the contract which provides for referring the disputes within 90 days from the intimation that the final bill is ready for payment. Remaining objections are as to the findings of facts given by the Arbitrator which are not enter- tainable as reappraisal of evidence or revaluation or the assessment of the material or evidence on the record does not come within the purview of the Court. ( 2 ) RECENTLY the Supreme Court in Arosan Enterprises Ltd. v. Union of India and anr, (1999) 9 SCC 449 made the following observations as to the role of the Court the hon ble Supreme Court as to such findings of the Arbitrator :- "reappraisal of evidence by the Court is not permissible and as a matter of fact exercise of power by the Court to reappraise the evidence is unknown 10 proceedings under Section 30 of the Arbitration Acl. In the event-of there being no reasons in the award, question of interference of the Court would not arise at all. In the event, however, there are reasons, the inter ference would still be not available within the jurisdiction of the Court un less of course, there exists a total perversity in the award or the judgment is based on a wrong proposition of law. In the event however two views are possible on a question of law as well, the Court would not be justified in in terfering with the award. The common phraseology "error apparent on the face of the record" does not itself, however, mean and imply closer scrutiny of the merits of documents and materials on record. The Court as a matter of fact, cannot substitute its evaluation and come to the conclusion that the arbitrator had acted contrary to the bargain between the parties. If the view of the arbitrator is a possible view the award or the reasoning contained therein cannot be examined". ( 3 ) THOUGH the objection raised by the respondent is partly of legal and partly of factual nature yet the fact remains that the respondent had been groping in the dark as to the final bill. If the view of the arbitrator is a possible view the award or the reasoning contained therein cannot be examined". ( 3 ) THOUGH the objection raised by the respondent is partly of legal and partly of factual nature yet the fact remains that the respondent had been groping in the dark as to the final bill. The last 6th bill which according to the respondent is final bill was passed on 21/12/1990 still the 6th Running Bill was received by the petitioner on 18/03/1991 subject to final settlement. This itself shows that the limitation was to run when the entire accounts were settled or the respondent gave the notice that the bill was ready for final settlement. Though a letter dated 22/10/1990 was sent by the respondent wherein the respondent admitted that they have to pay balance payment after successful running of the plant but the respondent for the purpose of limitation considers t,he signatures of the claimant in the Measurement book made on 18/12/1990 as an intimation to the petitioner/claimant that the final bill is ready. ( 4 ) ACCORDING to the learned counsel for the respondent this was sufficient intima- tion in the eyes of law about the fact that the final bill was ready for collection. How- ever there is no gainsaying the fact that the limitation as per clause 25 of the contract was to run from the date of intimation that the final bill is ready but the question thai arises for determination is whether the signatures of the petitioner obtained on the measurement Book on 18/12/1990 tantamount of intimation by the respon- dent to the petitioner that the final bill was ready for collection. ( 5 ) IN support of this contention the learned counsel for the respondent has relied upon Shri Ram Singh v. DDA, 1996 (1) ALR 163 wherein a view was taken that if the contractor does not prefer the objection within 90 days of receiving the information the final bill is ready for payment it is an error apparent on the face of the award and the entire award is liable to be set aside. The learned counsel has also relied upon wild Life Institute of India v. Vijay Kumar Garg, (1997) 10 SCC 528 wherein it was held that in view of the provision in the arbitration clause the liability of the appellants ceases if no claim of the contractor is received within 90 days for payment. This clause relates to discharge of the liability of the appellants on expiry of 90 days as set out therein and is not merely a clause providing a period of limitation. ( 6 ) HOWEVER in the instant case the facts are prominently distinguishable. The sig- natures of the petitioner obtained on the Measurement Book cannot by any stretch of imagination he deemed as an intimation as provided in the agreement to the effect that the final bill was ready. The title "measurement Book" itself suggests and shows that it pertains to details of the work done by the contractor and nothing more. The first and foremost obligation of the respondent was to send intimation in writing to the petitioner that the final billwas ready. This obligation has not been discharged by the respondent. On the contrary the respondent has till date not settled the final accounts and is not sure as to which is the final bill. One bill which is so called final bill was passed on 21/12/1990, another bill which too is called a final bill was passed on 18/03/1991. The last bill was accepted by the petitioner subject to final settle- ment. This meant that the final accounts were yet to be settled. If. the signatures of the petitioner on the Measurement Book are deemed as intimation given by the respon- dent to the petitioner as to the fact that the final bill is ready the question of passing of 6th RA Bill as on 18/03/1991 and non-finalisation of the final bill till date would not have arisen. ( 7 ) ALMOST in a similarly placed situation the Supreme Court in Jayesh Engineering works v. New India Assurance Company Limited, 2000 (10) SCC 178 took a view that whether the contract has been fully worked out and whether the payments have been made in full and final settlement are questions to be considered by the Arbitrator when there is a dispute regarding the same. The right to get the money arises on settle- ment of final bill and the right to get further payment gets weakened but whether the claim subsists or not is a matter which is arbitrable. ( 8 ) IN the aforesaid case though several claims were made by the contractor but ultimately the respondents intimated the contractor on 6/02/1989 to receive a cheque for a sum of Rs. 2,79,600. 00 in full and final settlement of the works. The con tractor acknowledged the same by endorsing on the said letter stating that he had received the said amount as full and final settlement and he had no further claim in this regard. Thereafter he wrote a letter dated 24/02/1989 stating that his statement that payment had been accepted by. him on 6/02/1989 in full and final settlement is not correct and still there are outstanding dues which need to be paid, otherwise the matter will have to be referred for arbitration in terms of clause 37 of the agreement. Pursuant to the" said notice each of the parties nominated their respective arbitrators. It was at this stage that an application was filed under Section 33 of the Arbitration Act seeking a declaration that the agree- ment dated 7/04/1981 between the parties no longer subsists as the work has already been completed and the payment was received by the respondent in full and final settlement. ( 9 ) THE instant case is rather on stronger footing. Not only the respondent never intimated the petitioner in writing that the final bill was ready but it continued tor months together is settling the full and final payment and till date the bills are not set tled. In this situation the obligation by the respondent as to intimation regarding the final bill cannot be deemed to have been discharged, even as per its understanding, as according to it the final bill has still not been settled. ( 10 ) THE objections are palpably untenable and are hereby dismissed. The relief claimed by the petitioner as to the award of the interest in respect of item l (a), l (b) and 4 (a) cannot be allowed as the Arbitrator also did not deem if fit to award the in terest wheres in respect of remaining items the Arbitrator has awarded interest. How ever the counsel does not press this relief any more. How ever the counsel does not press this relief any more. The award is made a rule of the court. The suit is decreed with pendente lite and future interest @ 15% per annum till realisation of the awarded amount.