MIDAS GRANITES Vs. UNION OF INDIA

JUDGEMENT

(1.) By filing this revision petition under Article 227 of the Constitution of India petitioner, M/S Midas Granites, has challenged the order dated 25.02.2016 passed by learned Civil Judge No.1, Cachar at Silchar whereby the application filed by the present petitioner purportedly under Order VII Rule 11 and Order XIV Rule 2 of the Code of Civil Procedure was rejected by the learned trial Court.

(2.) The present opposite party (Union of India, Ministry of Road Transport and Highways) as plaintiff instituted Money Suit No.34/2016 in the Court of learned Civil Judge No.1, Cachar at Silchar alleging that the present petitioner being the sole defendant therein was settled with a contract vide letter dated 19.01.2009 for construction of paved shoulder and strengthening of Katakhal Byepass Road between KM 16.610 to KM 22.240 on Silchar Badarpur section of NH-53. The work was delayed due to slow progress on the part of the defendant and so keeping in view the urgency to complete the prestigious SARDP work in scheduled time the subject contract was cancelled by the Accepting Officer on 20.08.2011 and the defendant was advised by contract incharge for preparation of joint inventory of the complete/incomplete work. The same having been prepared a demand notice was raised on the defendant on 14.01.2012 for a sum of Rs.1,33,54,113.00. According to the plaintiff, as per averments made in paragraph 12 of the plaint, this cause of action for filing the suit arises on 27.08.2009 and on all subsequent dates corresponding to demand referred to in paragraph 4 of the plaint. A prayer was made for pass of a decree for Rs.1,33,54,113.00 along with interest pendentelite as well as further cost at the rate of 18% per annum. The suit appears to have been instituted on 08.09.2014.

(3.) On being summoned the sole defendant appeared and submitted written statement on 20.02.2015 taking objection both on maintainability as well as on merit. According to the defendant, the suit is barred by limitation, estoppels, waiver and acquiescence etc. and that no cause of action did arise in the case. In the written statement the defendant has specifically denied almost all the averments made in the plaint and made a prayer for dismissal of the suit with cost. In paragraph 2 of the written statement the defendant appears to have taken a plea that the suit is not maintainable in view of existence of an arbitration clause in the contract agreement which binds the parties. But at the time of filing the written statement the defendant does not appear to have filed any application under Section 8 of the Arbitration and Conciliation Act, 1996 asking for referring the matter to arbitration. Section 8 of the Arbitration and Conciliation Act, 1996 provides that if an action is brought before any judicial authority involving arbitration agreement and if a party so applies not later than submitting his first written statement on the substance of the dispute for referring the parties to arbitration, the Court shall refer the same. But such an application shall not be entertained unless it is accompanied by the original arbitration agreement or a duly certified copy thereof. The recital of Section 8 of the Arbitration and Conciliation Act, 1996, goes to show that it does not provide an absolute bar against institution of suit in regard to contract involving arbitration agreement. The Section has conferred a right on the defendant only to raise objection at the first instance before or at the time of filing written statement for making a prayer for referring the same to arbitration. Statutes also provide the manner in which such prayer has to be made. The prescribed manner is that an application has to be filed and it has to be accompanied by the original arbitration agreement or a duly certified copy thereof. It is established law that if statutes provide something to be done in a particular manner, in that event, it has to be done in that manner only and not otherwise. Under such circumstances there was no occasion on the part of the learned trial Court in the present case to refer the matter to arbitration although a mention was made by the defendant in paragraph 2 about possible existence of arbitration agreement. The arbitration agreement was filed long thereafter at the stage of document and issues. The learned trial Court, therefore, proceeded to frame issues and thereafter permitted the parties to lead evidence on their respective behalf. The petitioner has not furnished the issues before this Court to show as to whether any of those issues can be decided only on the point of law and jurisdiction as referred to in Order XIV Rule 2 of the CPC. The defendant thereafter filed an application on 30.07.2015 when the suit reached evidence stage stating that the suit is not maintainable in view of existence of arbitration clause in the agreement and that 'the actual cause of action' started from 30.07.2010 and so the suit having been instituted beyond three years from that date the suit is liable to be dismissed on the point of limitation alone. Be that as it may, without making any mention as to what should be the preliminary issue, a prayer was made by the defendant to dismiss the suit on the aforesaid preliminary issue of arbitration and limitation.