Himachal Pradesh High Court
Devi Singh vs State Of Himachal Pradesh And Others on 20 July, 2018
Author: Sandeep Sharma
Bench: Sandeep Sharma
IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA Arb. Case No. 46 of 2017 Decided on: July 20, 2018 .
________________________________________________________________ Devi Singh ...Petitioner Versus State of Himachal Pradesh and others ...Respondents ________________________________________________________________ Coram:
Hon'ble Mr. Justice Sandeep Sharma, Judge. Whether approved for reporting? 1 Yes. ________________________________________________________________ For the Petitioner : Mr. Karan Singh Kanwar, Advocate.
For the Respondents : Mr. S.C. Sharma and Mr. Dinesh Thakur, Addl. AG's with Mr. Amit Kumar, DAG.
________________________________________________________________ Justice Sandeep Sharma, Judge(oral) By way of present petition filed under Section 11(6) of the Arbitration & Conciliation Act 1996, prayer has been made for appointment of an arbitrator in terms of Clause 25 of the agreement (Annexure C-1), relating to work i.e. "C/O F.I.S. Udeen in G.P. Shoon" and Agreement No. 124 for the year 2002-
03.
2. Undisputedly, petitioner being the lowest bidder, came to be awarded work vide order date 2.11.2002, for a total amount of `39,50,735/-. Pursuant to aforesaid award letter, petitioner entered into an agreement with the Executive Engineer, HPPWD Killar Chamba, (Annexure C-1). Allegedly, 1 Whether reporters of the local papers may be allowed to see the judgment?
::: Downloaded on - 24/07/2018 23:00:56 :::HCHP 2claimant carried out and completed the work in terms of award made in his favour to the entire satisfaction of the said Engineer .
but since claimant was paid ` 33,19,613/-, against his claim of ` 43,07,371/-, dispute arose inter se parties. As per averments contained in the petition, claimant has been paid ` 33,19, 613/-
against the work done by him qua `43,07,731/-. A sum of `9,97,758/- is yet to be paid to him by the respondents.
Allegedly, no final bill has been prepared so far. Apart from above another sum of ` 12,25,037/- is lying with respondents in the shape of security and ` 2,32,795/- is payable to the claimant alongwith interest. Due to extra items and deviation on the work site, duly approved by respondent, cost of work increased manifold and respondent No.1 vide order dated 29.9.2008 closed agreement due to deviation occurred on account of increase in quantity of R.R. Masonry in 1:6 and edge wall at different R.D. On 10.8.2009, petitioner sent a legal notice to the respondent (Annexure C-2) praying therein for payment of amount.
3. Mr. Karan Singh Kanwar, learned counsel representing the petitioner, while inviting attention of this Court to the communication dated 7.7.2010 received by the petitioner under Right to Information Act, contended that respondents have themselves admitted that still amount is payable by the respondents to the claimant/petitioner but despite that money is ::: Downloaded on - 24/07/2018 23:00:56 :::HCHP 3 not being released to the claimant and as such, he had no option but to approach the authority concerned for appointment of .
arbitrator. Vide notice (Annexure C-4), petitioner requested respondent authorities to appoint an arbitrator in terms of Clause 25 of the agreement No. 124 for settlement of dispute inter se parties but respondents vide communication dated 2.5.2014 though admitted the claim of the claimant but refused to appoint an arbitrator on the ground that there is delay of eleven years.r Mr. Karan Singh Kanwar, learned counsel representing the petitioner, while referring to the record vehemently argued that since at no point of time, petitioner was apprised with regard to preparation of final bill as has been specifically observed in Clause 25 of the agreement, there was no occasion for the petitioner to raise demand for appointment of arbitrator within the time frame provided under Clause 25 of the agreement. He further argued that since it stands duly proved from bare perusal of Annexure C-3 communication dated 7.7.2010 that amount is still payable to the petitioner, prayer made by petitioner for appointment of arbitrator vide Annexure C-4 ought to have been accepted. Lastly, Mr. Kanwar argued that the respondents, while replying to demand notice issued by petitioner for appointment of arbitrator (Annexure C-4) have admitted factum with regard to money to be paid to the ::: Downloaded on - 24/07/2018 23:00:56 :::HCHP 4 petitioner, and thus the limitation would start from that day i.e. 2.5.2014 as such, present petition, which has been filed on .
2.5.2017 is well within prescribed period of limitation i.e. three years. It has been stated in the reply filed on behalf of the respondents that at no point of time, petitioner ever approached Chief Engineer, I&PH Department for approval of deviation as well as appointment of arbitrator in terms of Clause 25 of the agreement.
4. Mr. Dinesh Thakur, learned Additional Advocate General, while referring to the record made serious attempt to persuade this court to agree with his contention that since factum with regard to closure of agreement dated 29.9.2008 was well within the knowledge of the petitioner, who after that date never made any attempt to complete his work, limitation to file application, seeking therein appointment of arbitrator ought to have been filed within a period of three years from that date i.e. 29.9.2008. He further argued that first legal notice as per own admission of the petitioner was issued on 11.9.2013 (Annexure C-4), wherein, at no point of time, prayer, if any, was ever made for appointment of arbitrator rather, department was requested to release balance payment. While inviting attention of this Court to communication dated 2.5.2014 (Annexure C-5), Mr. Thakur strenuously argued that there is nothing in the communication ::: Downloaded on - 24/07/2018 23:00:56 :::HCHP 5 suggestive of the fact that claim, if any, was ever acknowledged by the Department, rather, it stands mentioned in the .
communication that the petitioner failed to complete the work within stipulated time. While placing reliance upon the judgment rendered by Hon'ble Apex Court in Major (Retd.) Inder Singh Rekhi vs Delhi Development Authority, AIR 1988 SCC 1007, Mr. Thakur argued that the prayer made in the present petition deserves to be rejected on the ground of inordinate delay.
5. Having heard the learned counsel for the parties and gone through the record, it is quite apparent that petitioner was awarded work vide order dated 2.11.2002 for execution of work in question. However, on 29.9.2008, Department had closed agreement due to deviation occurred on account of increase in quantity of RR masonry in 1:6 and edge wall on different RD. It is also not in dispute that claimant has already received a sum of `33,19,613/- against total work done by him amounting to `43,07,371/-. There is nothing on record to demonstrate that steps, if any, were ever taken by claimant to get the time extended for completion of work. It emerges from the record that competent authority, while approving extra item extended the time upto 20.11.2014 but even after that work was not completed. For the first time, claimant served a legal notice dated 10.8.2009 (Annexure C-2) to respondent No. 3 but even in that ::: Downloaded on - 24/07/2018 23:00:56 :::HCHP 6 communication, no prayer was ever made for appointment of arbitrator, rather, request was made to release balance payment, .
which was never replied to by the Department. Perusal of Annexure C-3, communication dated 7.7.2010 received by petitioner under Right to Information Act though suggests that certain amount is/was payable to the claimant on account of work done by him qua certain extra items but by no stretch of imagination, communication dated 7.7.2010 can be termed to be acknowledgment, if any, on the part of respondents with regard to money, if any, payable to the petitioner. Aforesaid information has been sent by the authority concerned under Right to Information Act, wherein authority has informed that balance payment of ` 29,70,434/- is to be made as per MB No. 994 P-46.
In the aforesaid communication, Department has clarified that work i.e. "C/o FIS Udeen, GP Shoon" was awarded to the contractor (petitioner) vide letter No. PW-KD-GA-Tender/2001- 02-8389-97 dated 2.11.2002 for ` 39,50,735/- against the agreement No. 124 for 2002-03 but he failed to obtain any approval from the competent authority for deviating amount against agreement in question to `43,07,371/- hence, payment could not be made. Though, having perused information rendered in the aforesaid communication, there appears to be no dispute with regard to amount claimed but it appears that money ::: Downloaded on - 24/07/2018 23:00:56 :::HCHP 7 was not released since contractor failed to obtain prior approval from competent authority for deviating the amount. Otherwise .
also, there is no document available on record suggestive of the fact that intimation, if any, was ever given with regard to preparation of final bill but definitely as per own statement of petitioner, an amount of ` 33,19,613/- was received by him against claim of ` 43,07,371/- and as such, petitioner, at the time of receiving aforesaid amount, could raise dispute under Clause 25 of the Agreement. There is no document placed on record by the petitioner to demonstrate that he had ever raised demand for appointment of arbitrator to adjudicate dispute inter se parties having arisen on account of deviation. Once, factum with regard to closure of agreement had come to the notice of the petitioner on 29.9.2008, he ought to have raised demand under clause 25 of the agreement for appointment of arbitrator, but, in the case at hand, he failed to send any communication, praying therein for appointment of an arbitrator. Even in the legal notice dated 10.8.2009 (Annexure C-2) no prayer was ever made for appointment of an arbitrator rather, request was made to release amount which was denied by the Department. Since, department failed to reply to aforesaid legal notice dated 10.8.2009, petitioner ought to have moved appropriate application in accordance with law before appropriate court of law, seeking ::: Downloaded on - 24/07/2018 23:00:56 :::HCHP 8 therein appointment of arbitrator but he chose to remain silent for almost eight years after issuance of notice because admittedly .
petition at hand came to be filed on 2.5.2017. This court finds considerable force in the arguments of Mr. Dinesh Thakur, learned Additional Advocate General that since factum with regard to closure of agreement vide communication dated 29.9.2008 was well within the knowledge of the petitioner, he ought to have filed application for appointment of arbitrator within three years from the date of communication dated 29.9.2008 and as such, present petition being barred by limitation, is not maintainable. In the case at hand, present petition has been filed after inordinate delay of eleven years and there is no plausible explanation rendered on record on this count. In Maj. Inder Singh Rekhi (supra), Hon'ble Apex Court has held that on completion of work, right to get payment would certainly arise but where final bill is not prepared and when assertion is made and there was no payment, cause of action shall arise from that date. In the case at hand, though no date has been specified with regard to receipt of amount of ` 35,19,613/- against total amount of ` 43,07,731/-, but, in the legal notice dated 10.8.2009, petitioner has acknowledged the factum with regard to receipt of aforesaid amount and as such, even if limitation is counted from that date, petition ought to ::: Downloaded on - 24/07/2018 23:00:56 :::HCHP 9 have been filed within the period of limitation for appointment of arbitrator i.e. within three years from 10.8.2009.
.
6. Even, if it is viewed from another angle, it can be safely concluded that the claim, if any, of the petitioner was denied or closed by respondents by way of passing order dated 29.9.2008 and as such, cause of action had arisen to him from that date, and not from the date, when he was supplied information under Right to Information Act with regard to balance payment to be made to him. Otherwise also, serving of notice dated 11.9.2013 (Annexure C-4), which has been admittedly received by the respondents, shall not give any cause of action to the petitioner nor will it increase the period of limitation for appointment of arbitrator.
7. It has not been disputed by the learned counsel representing the petitioner that limitation for filing petition under Section 11 of the Arbitration & Conciliation Act is three years and as such present petition being beyond period of limitation is not maintainable.
8. Consequently, in view of detailed discussion above, present petition is dismissed being devoid of merits.
(Sandeep Sharma) Judge July 20, 2018 vikrant ::: Downloaded on - 24/07/2018 23:00:56 :::HCHP