Punjab-Haryana High Court
Jagdish Rai vs The Executive Engineer Hisar And Ors on 1 April, 2011
Author: Hemant Gupta
Bench: Hemant Gupta
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
Arb. Case No. 26 of 2008
Date of decision: 1.4.2011
Jagdish Rai, Contractor .....petitioner
vs.
The Executive Engineer Hisar and ors .....respondents
CORAM: - HON'BLE MR. JUSTICE HEMANT GUPTA Present: - Mr. D. R. Bansal, Advocate for the petitioner Mr. D.K.Khanna, Advocate for respondents.
HEMANT GUPTA, J Present is the petition for appointment of an Arbitrator under Section 11 of the Arbitration and Conciliation Act, 1996 (for short the 'Act').
Petitioner has sought appointment of an Arbitrator in respect of the dispute arising out of a Contract awarded to the petitioner for lining of water course 14616/TC Ladwa minor. The agreement was executed on 12.6.1996. It is the case of the petitioner that the payment was made on 9.1.1999 i.e. after gross delay but without interest. It is the case of the petitioner that the petitioner is entitled to interest @ 24% in terms of tender documents. Present petition for appointment of an Arbitrator was filed on 29.10.2007.
Arb. Case No. 26 of 2008 2
Learned counsel for respondents has pointed out that the payment of final bill was released on 20.11.1998 and that present petition is barred by limitation.
As per the records, vide the communication 31.8.1994 (Annexure P-4), the claim of the interest @ 24% was denied.
The question which is required to be examined is whether the dispute regarding the claim of interest @ 24% is required to be referred to an Arbitrator in terms of the agreement between the parties or not. Learned counsel for the petitioner argues that earlier the petitioner has filed a petition under Section 8 of the Arbitration and Conciliation Act, 1996 before the Civil Court on 13.4.2000. The same was returned only on 20.9.2000. Therefore, the period spent in such proceedings is required to be excluded while determining the period of limitation under Section 11 of the Act.
The period spent in proceedings before the wrong Forum can be excluded under Section 14 of the Limitation Act, 1963 only if the petitioner was bona fide and with due diligence prosecuting the proceedings before the wrong Forum. After the Act came into force on 25.1.1996, the power of appointment of an Arbitrator was either before the learned District Judge or this Court depending upon the jurisdictional value of the claim in terms of the scheme Arb. Case No. 26 of 2008 3 framed. However, the judgment of Hon'ble the Supreme Court rendered in M/s State Bank of Patiala and Company vs. M/s Patel Engineering Limited and another, (2005)8 SCC 618, the power of appointment of an Arbitrator came to be vested with the Hon'ble Chief Justice or his delegate.
The petition under Section 8 of the Act was filed by the petitioner. Such provision bars the judicial authority to proceed with the proceedings other than before the Forum agreed by the parties. Therefore, such application under Section 8 of the Act cannot be said to be bona fide in exercise of the jurisdiction with due diligence availed before the wrong Forum and thus, the period spent by the petitioner in such proceedings cannot be excluded.
Consequently, present petition is dismissed being barred by limitation.
(HEMANT GUPTA) JUDGE 1.4. 2011 preeti