MANISH ENGINEERING ENTERPRISES v. MANAGING DIRECTOR
2006-09-22
AJOY NATH RAY
body2006
DigiLaw.ai
JUDGMENT Hon’ble Ajoy Nath Ray, C.J.—This is a recall application made by IFFCO directed against the order passed by me on the 19th of May, 2006 making appointment of an Arbitrator. Application of the respondent was made in respect of six contracts which resulted in the said order. Those contracts are respectively dated in the years, 1981 1983, 1985, 1991, 1993 and 1996. In regard to the last of these, the 1996 contract, an earlier appointment had already been made in the year 2005 and as such the order dated 19.5.2006 has to be modified to that extent since two Arbitrators cannot arbitrate on the same contract. 2. About the rest of the order, covering, other five contracts, the applicant IFFCO has raised points of limitation, jurisdiction and bona fides all clubbed together. According to them the alleged claims are so grossly barred by long lapse of time and the materials for saving limitation brought before the Court for its prima facie satisfaction are so scanty, if at all any existence, that obtaining an order for appointment of an Arbitrator in these circumstances would tend to bring the machinery of appointment itself into disrepute. 3. It is quite clear that from 1996 upto 2002 when the application for appointment was made, six years had already elapsed. The contracts in question including those of the 80’s referred to conclusion periods of sixty days or 90 days. 4. The materials brought before the Court on the part of the contractors are basically only two. First, a letter dated 1.7.1998 allegedly issued from IFFCO is relied upon, wherein it is purportedly stated that the old contracts should be made the subject-matter of submission of bills and calculations so that those might be processed. There are numerous over writings in this letter. Its genuineness is seriously disputed. Even if this letter exists a large part of the claim of the claimant, if not the whole, is already barred by limitation, both before 1998 and again after 1998 even if that letter could save limitation in some respect. 5. The second fact for saving the long lapse of time is an allegation that one Rashid Ikbal is processing the claim of the contractor. It is submitted that by an award of a Retired Hon’ble Judge dated 26.2.2006 Rashid Ikbal had been held to be an employee of IFFCO.
5. The second fact for saving the long lapse of time is an allegation that one Rashid Ikbal is processing the claim of the contractor. It is submitted that by an award of a Retired Hon’ble Judge dated 26.2.2006 Rashid Ikbal had been held to be an employee of IFFCO. That decision will not necessarily bind me here. IFFCO submits that there is an interview letter issued to Rashid Ikbal dated 3.5.2000 but that was all, he never became an employee of IFFCO. 6. In these circumstances, no reasonable authority can be even prima facie satisfied that there is a case to go to trial which is of sufficient recent origin. 7. It is well known that the issue of limitation is an issue of jurisdiction. No Court and no Arbitrator can ex facie disregard the point of limitation. 8. In view of M/s. SBP & Co. v. M/s. Patel Engineering Ltd. 2005(7) Supreme To-Day 610 (see e.g. paragraph 8 thereof in the judgment) the Chief Justice is no longer to be considered as a mere administrative appointing authority. The basic prerequisites that the appointment of an Arbitrator have to be looked into and the applicant has to satisfy the Chief Justice or his nominee in that regard. I am not to be understood as saying that the Arbitrator’s jurisdiction to decide of his own jurisdiction is wholly to be usurped by the Chief Justice or his nominee even at the threshold or at the very beginning when the appointment is made but some sort of satisfaction the about desirability and appropriateness of the case to go to arbitration has to be made by the applicant. It need not necessarily be satisfaction of a very high order but the applicant cannot simply come and say I had a contract; it might be very old but I want an Arbitrator; simply on this basis the appointing authority is not bound to comply with or even request. 9. If these principles are applied here, there can be no answer to the recall application but that it has to succeed the point of limitation is so unanswarable and is so scrappily answered left or evenunanswered by the contractor that it would certainly being the machinery of appointment by the Chief Justice into disrepute if appointments were to be regard into this type of stale claims also. 10.
10. I do not pay any regard to the clubbing together of the five or six contracts for one arbitration, it is wrong in law but it is only a technical error; the other error is of substance and simply cannot be overlooked. On the 24th of February, 2006 I had earlier dismissed the application of the contractor claiming to obtain a reference for the alleged claim of Rs. 14 lakhs because the claim appeared at first blush to be barred. On the second application, however, I was persuaded to pass the order dated 19.5.2006, on hearing the other side on the undesirability of maintaining that order, however, I am of the view that such order should be recalled. The application for review/recall succeeds and the order dated 19.5.2006 passed by me is recalled. Application Allowed. ———