PARMESHRI DASS AND SONS Vs. UNION OF INDIA

JUDGEMENT

(1.) This petition under Section 20 of the Arbitration Act, 1940 (for short the Act) seeking directions to the respondents to file the arbitration agreement in the Court and for reference of the disputes to the Arbitrator to be appointed as per terms of the contract, raises the question whether the petition was filed within three years from the date when the cause of arbitration arose, the limitation prescribed under Article 137 of the Limitation Act, 1963 ?

(2.) The petitioner filed the above petition alleging therein that it is a registered partnership firm. The respondents invited tenders for execution of the work named "Provision of MT complex & Misc. Accn. for RRH at Delhi Cantt". The petitioner's tender was accepted. The contract documents were duly signed. The work was to commence on 17th December, 1991. Stipulated date of completion was 16th June, 1993 (18 months); General conditions of the contract provided for Settlement of all claims and disputes between the parties arising out of the contract by way of arbitration under Clause 70 of the contract. The petitioner mobilised resources and material, and completed the work despite several hindrances on 31st January, 1994; on 1st February, 1994 respondents were requested for issuance of completion certificate arid for preparation of final bill. The petitioner made claim for certain deviations etc. Respondents pointed out certain defects in the work which were removed. However, in final bill the amounts demanded by the respondents were "not included. The petitioner informed the 'Chief Engineer' that payments for the claims made by him were not included in the final bill and same was signed by him under protest, On 15th February, 1995 the petitioner addressed a letter to the "Engineer-in-Chief", Army Headquarters, Kashmir House, New Delhi requesting for appointment of an Arbitrator in terms of the contract. In response vide letter dated 1.3.1995 Senior Surveyor on behalf of Engineer-in-Chief asked some in formation, which was also furnished by the petitioner on 25th March, 1995. Ultimately on 1st March, 1996 Chief Engineer informed the petitioner that his claim stood waived and extinguished. The petitioner claims that cause of arbitration commenced from this date.

(3.) Respondents filed the reply raising preliminary objection pleading that the petition is barred by limitation. On 25th July, 2000, it was clarified by the respondents that without prejudice to their rights they do not intend to file reply on merits to the petition at this stage.