PAUL BROTHERS Vs. SOUTH EASTERN COALFIELDS LTD

JUDGEMENT

(1.) THIS order shall govern disposal of Writ Petitions (227) No. 3519/2009, 3522/2009,3523/2009 and 3550/2009 as all the writ petitions involve common question. In the impugned order passed in all the four writ petitions, the learned District Judge has rejected petitioner's application under Section-5, 11 and 12 of the Arbitration Act, 1940 (hence forth the Act) on the ground that the application is barred by limitation. The main order is passed in Writ Petition (227) No. 3519/2009.

(2.) BRIEF facts of the case are that the petitioner M/S Paul Brothers was awarded contract by the respondent M/s South Eastern Coalfields Ltd. (hence forth 'the SECL') and an agreement was entered into in pursuance to the said award of contract. The agreement contained an arbitration Clause. A dispute arose with regard to and in course of execution of contract and, therefore, the petitioner moved an application under Section 20 of the Act before the District Judge, Bilaspur for reference of the dispute to the arbitrator. By order dated 11-7-1996, the District Judge allowed the said application of the petitioner and referred the dispute for adjudication to the arbitrator to be nominated by the Chairman-cum-Managing Director of the respondent/SECL. In the said order, the District Judge directed that the arbitrator so nominated shall make an award in writing and shall submit the same within four months from the date of receipt of order of reference. In pursuance to the said order of the District Judge, the Chairman-cum-Managing Director of the SECL, by the letter dated 15-7-1996, appointed Shri J.P. Thakur, Chief Engineer (civil) of the SECL as the sole arbitrator and requested him to pass an award within four months. The sole aribitrator entered into the dispute for adjudication and commenced the arbitration proceedings. The period of four months expired on 11-11-1996, however the arbitration proceedings continued till 2002.

(3.) LEARNED counsel for the petitioner would argue that the petitioner received information from the arbitrator, for the first time, on 20-08-2003 and prior to this date, he was not aware that the arbitrator had become functus officio, therefore, the application was within limitation. According to learned counsel for the petitioner, the cause of action for filing the application under Sections-5,11 and 12 of the Act arose on 28-8-2003 when he received the letter dated 20-8-2003 from the arbitrator. It is further argued that in any case, the respondent having participated in the proceedings after expiry of four months, there was deemed enlargement of time under Section 28 of the Act and the sole arbitrator had not become functus officio. Reliance is placed by learned counsel for the petitioner on the judgments in Hindustan Steelworks Construction Ltd. vs. C. Raja Sekhar Rao,(1987) 4 SCC 93, State of Punjab vs. Hardyal, AIR 1985 SC 920, Nagar Palika, Mirzapur Vs. Mirzapur Elect. Supply Co. Ltd. AIR 1990 SC 2273, Eastern Coalfields Vs. Joscon, (2003) 12 SCC 339, The State of Kerala 237, The State of Madhya Pradesh and others vs. Babulal Pathak,AIR 1974 MP 179 and Fertilisers and Chemicals Travancore Ltd. vs. Industry Side Pvt. Ltd. and others, 1988 (2) Arbitration Law Reporter (Kerala High Court) 59.