Em & Em Associates vs Delhi Development Authority
1995 Latest Caselaw 99 Del

JUDGMENT

Devinder Gupta, J.

1. This petition under Section 20 of the Arbitration Act (hereinafter called the Act) was presented on 31.7.1985 paying for directions to file the arbitration agreement in court and to make reference of the disputes to an arbitrator, in terms of Clause 25 of the Agreement.

2. It is stated that the petitioner was allotted the work of providing and fixing cup-boards in 185 DU's Phase-I through respondent's letter dated 19.2.1982. A formal agreement was signed, which contains an arbitration clause for referring the disputes for adjudication by an arbitrator to be appointed by the Engineer Member of the DDA. Some of the disputes and differences, which had arisen were in terms of the petitioner's letter dated 10.5.1983, referred to the sole arbitration of Shri C. Banerjee, Superintending Engineer, but rest of the petitioner's claim for which request was made subsequently, were not referred. Accordingly it is prayed for the claims for which cause of action arose on 27.1.1984 and 26.3.1984, the same be referred for arbitration.

3. The application is opposed by the respondent primarily on the ground that the same is barred by Order 2 Rule 2 of the Code of Civil Procedure. Petitioner ought to have raised all disputes when initially he invoked the arbitration clause on 10.5.1983. By not getting the claims referred earlier, the present petition cannot be entertained for further disputes. It is stated that the agreement related to Asian Games Village Complex, which was handed over by the respondent on completion, to the organising committee in November, 1982 and it is now a stale claim, which cannot be entertained.

4. I have heard the learned counsel and gone through the record.

5. There cannot be any dispute with the proposition that in so far as the claims for which cause of action had arisen to the petitioner, when reference was sought by him by virtue of letter dated 10.5.1983, the same cannot be allowed to be made a subject matter of a second reference, but with respect to such of the claims, for which cause of action had not at all arisen till then, the petition will be entitled to seek reference. In K. V. George v. The Secretary to Govt. Water and Power Dept., Trivandrum and anothers, it was held that all such issues which had arisen out of terms of contract ought to have been raised in the first claim petition or before the arbitrator. Having not done so, a second claim petition before the arbitrator raising remaining issues will be clearly barred on the analogy of Order 2 Rule 2 of the Code of Civil Procedure. In the instant case the contract stood completed on 10.10.1982. The petitioner invoked arbitration clause on 10.5.1983 on which basis a reference was made to the arbitrator, who was appointed on 10.8.1983 and made his award on 14.2.1984. Before the arbitrator gave his award, petitioner on 27.1.1984 sent another letter to the Engineer Member staling that in addition to the claims already referred for adjudication, there were more additional claims. Request was made to him to enter upon reference on those claims. Obviously the arbitrator did not adjudicate upon the claims, which were sought to be raised through letter dated 27.1.1984 and in his award the arbitrator has clearly stated that he had not adjudicated upon the additional claims. On 20.3.1984 two more claims were made by the petitioner and a request was made for reference. On 25.4.1984, Engineer Member appointed G. Subramanyam. SE (Arbn.) I, DDA for adjudicating upon three of the petitioner's claim which had not been adjudicating upon by the earlier arbitrator and for which no reference had been made earlier. The claims were to the following effect :

"Claim No. 1 : Claimants Rs. 20,000/- against the item of commercial boards in 'B' & 'C' type houses electrical nitches.

Details : 80 sqm. @ Rs. 250/-, Rs. 20,000/-.

Claim No. 2 : Claimants claim pendente lite interest.

Claim No. 3 : Claimants claim Rs. 1,73,604.92 on account of increase in the wages of labour as per clause 10 C.

(Arbitrator is to decide whether the claim of the claimant is justified per terms and conditions of the arguments, if so to what extent ?)"

Now the petitioner seeks reference on five claims as set out in para 5 of this petition. The same are to the following effect :

"(a) Payments due for extra work done after completion of the original work as per annexure 'A'. Rs. 1,72,654.88.

(b) Items not so far referred to arbitration as detailed in annexure B. Rs. 1,87,334.44.

(c) Balance payment against contract item Nos. 1 and 2 (not previously claimed). Rs. 20,000.00.

(d) Claim on account of under utilization of overhead and labour because of delay on the part of the Department in getting the work executed and civil work rectification. Rs. 3,30,000.00.

(e) Interest on the aforesaid claims at 18 per cent per annum from 10.10.1982 till actual payment."

In so far as claims at S. Nos. (b) and (d) are concerned, it is nowhere stated that cause of action for these claims arose to the petitioner after 10.5.1983. It is to be inferred that cause of action, if any, arose prior to 10.5.1983, namely, on completion of the work. In so far as claims at items (a), (c) and (e) are concerned the same pertain to the extra work done after completion of the original work and for which measurements had not been completed. In so far as claims at S. Nos. (b) and (d) are concerned, the same will be barred on the analogy of Order 2 Rule 2 but in so far as claims at S. Nos. (a) (c) and (e) are concerned, the reference cannot be withheld since cause of action had not arisen when the first reference was sought.

6. Accordingly, the petition is partly allowed and direction is issued for referring these disputes mentioned at S. No. (a), (c) and (e) for adjudication by an arbitrator to be appointed by the Engineer Member of DDA. Reference accordingly be made to an arbitrator to be nominated by Engineer Member within four weeks from today and who will make his award in accordance with law.