JUDGMENT Hon’ble H.L. Gokhale, C.J.—Heard Mr. Rakesh Kumar, in support of this petition and Sri S.C. Srivastava, learned Counsel for the respondents. 2. The petitioner is a proprietary concern. It is engaged in the business of civil construction. It entered into a contract with the first respondent-U.P. Power Corporation Ltd. on the basis of a tender notice issued in the year 1998-1999. Tender submitted by the petitioner was accepted by respondent No. 2, on behalf of respondent No. 1, vide order dated 3.1.1999. Two works were to be executed at Orai. One was for a Control Room Building costing of Rs. 22,59,670.41 and the second was for security fencing around a transformer and an approach road, which was to cost of Rs. 48,09,266.66. From a letter of the petitioner dated 29.5.2002, it is seen that the petitioner was required to stop the works sometime in December, 1999. This was due to the respondents not making available adequate quantity of supply of cement. 3. The petitioner claims to have issued a notice on 30.8.2001, demanding the payment for the work done and the damages for not allowing the petitioner to complete the work and compensation for the resultant loss. The respondents have placed it on record through their counter-affidavit that the claim was settled by making the payment of Rs. 13,43,448.65 in full and final settlement. Counter-affidavit by one Vishwanath, Executive Engineer, Kanpur, states in paragraph 2 that agreement No. 19/1999-2000 was finalised for Rs. 13,43,448.65, which amount was received by the petitioner by endorsing on the Measurement Register No. 1/97, as follows : “No other payment of mine apart from the security deposit is pending under this contract from the concerned department. The final bill as well as all the measurement are accepted.” Sd/- 4.8.02" (As translated from original Hindi) 4. The petitioner however, was of the view that this was not the correct and complete payment for the work done nor towards the damages, which the petitioner ought to have been paid. He, therefore, filed the present arbitration petition invoking the arbitration clause. This petition has been filed on 25.1.2004. As stated above, the same has been countered by filing affidavit and supplementary affidavits. The petitioner has filed rejoinder affidavit thereto as well. 5. Learned Counsel for the petitioner raised two fold submissions. He, therefore, filed the present arbitration petition invoking the arbitration clause. This petition has been filed on 25.1.2004. As stated above, the same has been countered by filing affidavit and supplementary affidavits. The petitioner has filed rejoinder affidavit thereto as well. 5. Learned Counsel for the petitioner raised two fold submissions. Firstly, he submitted that this receipt does not bar the claim of the petitioner and he relied upon a judgment of the Apex Court in Union of India v. L.K. Ahuja and Co., AIR 1988 SC 1172 . The Apex Court had held in paragraph 8 of that judgment that it is true that on completion of the work, right to get payment would normally arise and it is also true that on settlement of the final bill, the right to get further payment gets weakened but the claim subsists and whether it does subsist, is a matter which is arbitrable. 6. Mr. Srivastava, learned Counsel appearing for the respondents-Power Corporation, however, points out that this judgment has been distinguished subsequently in M/s P.K. Ramaiah and Company v. Chairman & Managing Director, National Thermal Power Corporation, 1994 Supp. (3) SCC 126. In paragraph 8 of this judgment, the Apex Court has commented on the judgment in L.K. Ahuja & Co. (supra), by stating that while laying down the general law the Court had held that if the bill was prepared by the department and accepted, the claim gets weakened. The Court further held that it was not a case of accord and satisfaction but one of pleading bar of limitation without prior rejection of the claim. When, there is full and final settlement, which is acknowledged by a receipt in writing and the amount is received unconditionally, there is accord and satisfaction by final settlement of the claims. The Apex Court has referred to Russell on Arbitration, 19th Edn., p. 396, wherein it is stated that “an accord and satisfaction may be pleaded in an action on award and will constitute a good defence”. Mr. Srivastava, points out that apart from receiving this amount of Rs. 13,43,448.65 in full and final settlement, the petitioner received the security amount also subsequently on 1.10.2002. In my view, this answers the submission of the petitioner. 7. The other submission of Mr. Mr. Srivastava, points out that apart from receiving this amount of Rs. 13,43,448.65 in full and final settlement, the petitioner received the security amount also subsequently on 1.10.2002. In my view, this answers the submission of the petitioner. 7. The other submission of Mr. Rakesh Kumar, is that his claim was not merely for the unpaid amount for the work done, but it was for the damages for the work, which was not allowed to be completed. He drew our attention to the notice dated 30.8.2001 and submitted that the claim would be separately maintained under Section 73 of the Contract Act. In his submission, that claim could not be said to have been settled. 8. As far as this submission is concerned, it is material to note that the notice dated 30.8.2001, is a demand notice. It cannot be split in the manner to say, that the claim for damages has survived. In any case, the receipt is given thereafter on 4.8.2002. That is nearly one year thereafter. Nothing prevented the petitioner from saying that he had received the payment in part satisfaction only for the work done, and that he was reserving his claim for compensation for the work not allowed to be completed and the resultant loss. 9. Mr. Srivastava has, of course, opposed the application on the ground that it is barred by limitation. In my view, that plea cannot be accepted for the reason that though the work was closed in December, 1999, the demand notice was served within three years, i.e., on 30.8.2001, and the arbitration petition is filed by the petitioner within three years thereafter. The application cannot be, therefore, rejected only on the ground of limitation. However, in view of accord and satisfaction between the parties, one cannot say that the claim survives. In view of dicta laid down by the Apex Court in SBP & Co. v. Patel Engineering Ltd. and another, (2005) 8 SCC 618 , the Chief Justice is required to examine as to whether the claim survives even before issuing a notice or going ahead with the appointment of an Arbitrator. The arbitration petition, as filed to appoint an Arbitrator is, therefore, rejected. ————