Jharkhand High Court
Birat Chandra Dagara vs State Of Jharkhand & Ors on 12 September, 2011
Author: Prakash Tatia
Bench: Chief Justice
1
IN THE HIGH COURT OF JHARKHAND AT RANCHI
A.A. No. 1 of 2008
Birat Chandra Dagara... ... ...... Applicant
Versus
The State of Jharkhand & Ors. ... ..... Respondents
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CORAM: HON'BLE THE CHIEF JUSTICE
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For the Applicant : Mr. Rajan Raj
For the Respondents : Mr. Manjul Pd. (S.C L & C)
------ Dated 12th September, 2011
Heard learned counsel for the parties.
The applicant has submitted this application under Section
11 (6) of the Arbitration and Conciliation Act, 1996 seeking
appointment of the Arbitrator in view of Clause 52 of the Contract
entered into between the parties, which provides for settlement
of disputes through arbitration.
According to the applicant, the agreement was executed
between the parties on 23.1.1986. In pursuance thereof, work
order was given to the applicant on 19.2.1986 and the work was
supposed to be completed by 19.2.1988. However, it was
completed on 31.12.1990. The applicant submitted the bills for
the work and final payment was made to the applicant on
31.12.2002. The applicant thereafter submitted the letter of request to the respondents on 5.10.2004 and submitted this application for appointment of Arbitrator on 8.1.2008.
Learned counsel for the applicant submitted that firstly in view of the fact that this application is under section 11 (6) of the Act of 1996, the period of limitation will not apply which limitation applies in a case where appointment of Arbitrator is sought under Section 11(4) of the Act of 1996 and secondly if there is delay, it can be condoned. Learned counsel for the applicant relied upon the judgment of Hon'ble Supreme Court 2 delivered in the case of Asia Resorts Ltd. Vs. Usha Breco Ltd. reported in (2001) 8 SCC 710. Learned counsel for the applicant has also submitted that the applicant has since been paid the amount of final bill on 31.12.2002, cause of action accrued on 31.12.2002 and thereafter had served notice for appointment of Arbitrator on 5.10.2004 and thereafter he submitted this application on 8.1.2008. But it is clear from the counter affidavit of the respondent-State that the Liability Committee of the respondent rejected the applicant's claim in the year 2008; therefore, this application is not barred by time. It is also submitted that the delay can be condoned even on payment of cost.
Learned counsel for the respondent-State submitted that the claim is barred by time and the period of limitation once started and the claim became barred, then it cannot be revived by subsequent payment or on the plea of part payment of the alleged debt. It is also submitted that even from the letter of request dated 5.10.2002, limitation cannot extend beyond 5.10.2005 because of the State Government's decision to reject the stale claim of the applicant.
I considered the submissions of the learned counsel for the parties and perused the facts of the case. From the facts mentioned above, it clearly indicates that it was a contract work of the year 1986 to be completed in the year 1988. If any amount has not been paid to the applicant by the State then the cause of action accrued to the applicant on 31.12.1990 when work was completed by the applicant. Pendency of the bill for consideration before the respondent-State beyond the period of 3 years cannot create any fresh cause of the action nor can extend the period of limitation because of part payment made after the 3 expiry of the limitation period. As for extension of period of limitation, payment must be within the period of limitation. Section 21 of the Act of 1996 prescribes the date of commencement of arbitral proceedings and this is not the provision providing any different period of limitation for money claim contrary to provision in the Indian Limitation Act. The starting point of the arbitral proceeding is quite different from the cause of action and its expiry. In a money claim, the claim becomes barred by time only according to the provision of the Indian Limitation Act and not by the provisions made in the Act of 1996.
Apart from above facts, the applicant was paid the bill amount on 31.12.2002, then he gave his letter of request on 5.10.2002 and that request was within the period of three years but that, as stated above, is not creation of the cause of action.
Be that as it may be, filing of this petition after 5.10.2005 is certainly beyond the period of 3 years. It cannot be argued that in application under Section 11 (6) the period of limitation has no application and any claim, if it became barred by time, can be revived by giving a letter of request for appointment of Arbitrator at any time.
In view of the above reasons, the application submitted before this Court under Section 11 (6) of the Act of 1996 is barred by time. Learned counsel for the applicant submitted that in view of the Judgment of the Hon'ble Supreme Court delivered in the case of Asia Resorts Ltd. Vs. Usha Breco Ltd., the delay can be condoned. In an appropriate case, the delay can be condoned and even if the technicalities of filing an application under Section 5 of the Limitation Act is dispensed with in a case where sufficient facts are available on record giving cause for 4 condonation of delay, then also on the facts of the case, I do not find any reason for condonation of delay in a case where work order was of 1986, work completed in the year 1990 and the payment made to the applicant in full and final settlement on 31.12.2002. Therefore, I do not find any reason to condone the delay in the facts of the case.
So far as the contention of the respondent State that since the applicant has accepted the payment of the bills in full and final satisfaction is concerned, the respondents failed to prove that contention by any cogent evidence as the respondents failed to indicate that the applicant has given undertaking that he is accepting the payment in full and final satisfaction.
In view of the reasons mentioned above, the application for appointment of arbitrator is dismissed.
(Prakash Tatia, C.J.) Dey/-Alankar/-