NARAIN DAS HARI VANSH Vs. KANPUR NAGAR MAHAPALIKA

JUDGEMENT

(1.) THIS is a plaintiff's appeal. The plaintiff constructed some zonal reservoirs for the Municipal Board of Kanpur now represented by the Nagar Mahapalika. The contract given for the construction of the reservoirs contained an arbitration clause and provided that if any dispute arose it was to be referred to the Superintending Engineer for decision. The reservoirs having been constructed a final bill was prepared which was certified by the person who was to certify it under the contract and was submitted to the Board. The amount was not paid. Some security had also been deposited in connection with the contract. It was also not refunded. The plaintiff, therefore, filed a suit for the recovery of Rs. 42,772/2/9 as balance due according to the final bills, Rs. 7,126/ 2/- as interest from the date of the bill to the date of the suit, Rs. 9,725/- as security deposit and Rs. 1,179/- as interest thereon. The total amount claimed was Rs. 60,802/4/9. After the suit was filed the defendant made an application under Section 34 of the Indian Arbitration Act praying that the suit be stayed and a reference be made to arbitration as provided for in the arbitration agreement.

(2.) A question arose about the payment of Court-fee on the application under Section 34 of the Indian Arbitration Act. That question having been decided an application in revision was filed in this Court. It was, however, not pressed. When the case went back the question whether the suit was to be stayed under Section 34 of the Act was taken up and ultimately decided in favour of the defendant. Against that order a First Appeal from Order was filed in this Court. That appeal was, however, not pressed and it was decided that the dispute between the parties should be referred to arbitration. It was, therefore, referred for arbitration to the Superintending Engineer Mr. A.K. Roy. Before him the plaintiff submitted his claim and the defendant submitted its objections. He framed certain issues. One of them related to the claim being barred under Section 326 of the U. P. Municipalities Act, 1916. No evidence was produced in respect of this issue and after hearing arguments the arbitrator decided that issue in favour of the plaintiff. He then proceeded to consider the other questions raised and gave an award on 8-3-1960 by which he allowed the plaintiff's claim in respect of two items of Rs. 42,772/2/9 and Rs. 9,725/-. He allowed the claim for interest in part only. The rest of the claim was rejected. The award was filed in Court as required by Section 14 of the 'Indian Arbitration Act and both the plaintiff and the defendant filed objections. The objection of the plaintiff was in respect of the rejection of a part of the claim for interest. It was contended on behalf of the plaintiff that the award should be remitted to the arbitrator for inclusion of the full interest on the security deposit and the amount of the final bill in favour of the plaintiff. The objection filed by the defendant was to the effect that the arbitrator "had misconducted himself and the proceedings" by not properly considering and deciding the plaintiff's claim with reference to Section 326 of U. P. Act II of 1916. It was also urged in the objection that in view of the mandatory provision under Section 3 of the Limitation Act it was incumbent upon the arbitrator to reject the claim of the plaintiff without going into the merits of the case.

(3.) THE objection filed by the defendant against the award was taken up by the learned Civil Judge along with the application for the rejection of the plaint under Section 3 of the Limitation Act and both the objection and the application were disposed of together. THE learned Civil Judge was of the view that the suit of the plaintiff was barred by the six month's rule of Limitation, that in view of the provisions of Section 3 of the Limitation Act the suit was bound to be dismissed, and that in overruling the plea of limitation the arbitrator had misconducted himself. He, therefore, passed the following order: