UNION OF INDIA Vs. B P SHARMA

JUDGEMENT

(1.) This is a petition under Section 34 of the Arbitration and Conciliation Act, 1996 in respect of the Award dated 24.03.2006 passed by the respondent No.2. Although various grounds have been taken for challenging the said Award, the main grounds taken by the petitioner are that claim was time barred and that the claim was also barred under Clause 25 of the agreement entered into between the petitioner and the respondent No.1.

(2.) It appears that preliminary objections had been raised with regard to the claim being time barred and also being barred under clause 25 of the said agreement. The said preliminary objections were disposed of by an order dated 16.12.2003 passed by the learned Arbitrator. However, since the petitioner felt aggrieved by the rejection of the objections, a review application was filed for reconsideration. Without going into the objections as to whether an Arbitrator ought or ought not to consider an application for review, the learned Arbitrator decided to re-hear the matter and consider the objections once again. The same were disposed of by an order dated 27.07.2004 Both the objections were addressed and answered in the following manner:-

(3.) With regard to the question that the claim was time barred under Clause 25, I find that the learned Arbitrator has correctly relied upon the provisions of Section 28 (b) of the Indian Contract Act, 1872 and has held that the said Clause 25 of the agreement would be void to the extent that it extinguishes the rights of the respondent No.1 upon the expiry of the period of 90 days prescribed therein. With regard to the claim being time barred, the learned Arbitrator has also examined the question of limitation and has taken the date of last payment as the starting point of limitation and found that the claim, which preferred within a period of three years thereof, was within time. I see no infirmity with the Award passed by the learned Arbitrator so as to warrant interference under Section 34 of the said Act.