KAUSHIK CONSTRUCTION COMPANY Vs. STATE OF GUJARAT

JUDGEMENT

(1.) The petitioner herein had preferred an application before the Gujarat Public Works Contracts Disputes Arbitration Tribunal, which was registered as Arbitration Reference No. 5 of 1996. It is the say of the petitioner-firm that the petitioner is running business as Engineers and Contractors and that they have undertaken the work of Modernising and Improving Shetrunji (P) Irrigation Scheme and for that purpose, they entered into contract with the State of Gujarat and the Executive Engineer, Shetrunji (P) Modernisation Division No. 1, Bhavnagar. The petitioner had filed the said Reference under Sec. 8 of the Gujarat Public Works Contracts Disputes Arbitration Tribunal Act, 1992 for settlement of dispute that has arisen between the parties and for awarding an amount of Rs. 33,94,388/-, with interest at the rate of 20% per annum, from 21.3.1994 till realisation. The Reference was filed on 24th April, 1995. The Tribunal found that the Reference was time barred. Therefore, the Tribunal gave opportunity to the present petitioner to produce documentary evidence to show whether the Reference is within the period of limitation or not. The Tribunal, thereafter, considered the relevant dates regarding Work Order, date of issuing the Work Order, the stipulated period for completion of the work in question, the application given by the petitioner to the Department for extension, etc. The Tribunal has also considered certain correspondence exchanged between the parties.

(2.) The Tribunal came to the conclusion that the said Arbitration Tribunal came into existence on 1.1.1992. The petitioner's Advocate has given names of three Arbitrators on 21.6.1994 and the Chief Engineer was called upon the select any one as the Sole Arbitrator. The Tribunal, therefore, found that right from 21.3.1994 to 21.6.1994, even after the Arbitration Tribunal came into existence, the petitioner's Advocate wanted to get out of the bar of limitation by resorting to Clauses 51 & 52 of the Tender Agreement. It was found by the Tribunal, therefore, that there was no necessity still to invoke Clauses 51 & 52 of the Tender Agreement, as, ultimately, at that time, the Tribunal was already in existence. Under these circumstances, it was found that attempt on the part of the petitioner to invoke Clauses 51 & 52 of the Tender Agreement after 1.1.1994 will not give a new life to the cause of action which has already become time barred and dead. Since the petitioner did not approach the Tribunal within the prescribed limitation period of one year from the date on which the dispute arose, the Tribunal found that the Reference was time-barred. The Tribunal also observed that the petitioner has rightly not submitted any application for condonation of delay because such application would have been outright rejected for want of sufficient cause. In view of the aforesaid observation made by the Tribunal, the Reference was rejected as time barred and the same was dismissed summarily. The aforesaid order is impugned in the present Revision Application.

(3.) At the time of hearing of this revision application, Mr. Parmar submitted that the petitioner was under a bona fide impression that since there was already an Arbitration Clause in the Agreement and unless the petitioner invokes Clauses 51 & 52, it may not give any cause of action to him, as, according to him, unless the claim is denied by the respondents, no cause of action can be said to be available to the petitioner. According to Mr. Parmar, unless the claim put up by the petitioner is rejected by the Department, it cannot be said that there was any dispute between the parties, which can be said to have taken place. According to him, on 16.6.1994, the Department refused to refer the matter to the Arbitrator and denied the claim of the petitioner and from that date, the dispute came into existence and within one year from that date, Reference was filed. As the Reference was filed on 24.4.1995, according to him, if one year's period is considered from 16.6.1994, the Reference was made within one year, i.e. within the period of limitation. Section 8 of the Act is required to be referred at this stage, which reads as under : Section 8(1) - Where any dispute arises between the parties to the works contract, either party shall, irrespective of whether such works contract contain an arbitration clause or not, refer, within one year from the date when the dispute has arisen, such dispute in writing to the Tribunal for arbitration in such form and accompanied by such documents or other evidence and by such fees, as may be prescribed. Section 17 reads as under: 17. Extension of period of limitation in certain cases. The Tribunal may admit a reference under Sub-sec. (2) of Sec. 8 or entertain an application for review under Sub-sec. (1) of Sec. 11 or for revision under Sub-sec. (1) of Sec. 12 after the period of limitation laid down in Sub-sec. (1) of Sec. 8, Sub-sec. (2) of Sec. 11, or as the case may be, Sub-sec. (1) of Sec. 12 if the party satisfies the Tribunal that the party had sufficient cause for not making the reference or, as the case may be, the application for review or revision within such period. "