Delhi High Court
Ahuja Builders vs Doonvalley Technopolis Pvt Ltd on 6 November, 2017
$~17
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ CS(OS) 3205/2015
AHUJA BUILDERS ..... Plaintiff
Through Mr.Rajesh Arya with Mr.Abhay
Mahajan, Advocates.
versus
DOONVALLEY TECHNOPOLIS PVT LTD ..... Defendant
Through Mr.Keshav Mohan with Mr.Rishi
K.Awasthi, Advocates.
% Date of Decision: 06th November, 2017
CORAM:
HON'BLE MR. JUSTICE MANMOHAN
JUDGMENT
MANMOHAN, J: (Oral)
I.A.Nos.12362-12363/2017
1. While I.A.No.12363/2017 has been filed seeking leave to leave the
instant suit, I.A.No.12362/2017 has been filed seeking condonation of delay
of 271 days in re-filing the I.A.No.12363/2017.
2. In the leave to defend application, it has been averred that the present
suit is not maintainable as the contract dated 08 th December, 2008 executed
between the parties contains an Arbitration Clause. It is further contended
that the amount claimed in the present suit has been deducted by the
defendant from the bills of the plaintiff for defect and delay in completion of
contractual work and also for charging wrongful amounts in prior bills.
3. The learned predecessor of this Court by a detailed judgment and
order dated 23rd August, 2017 dismissed the defendant's application under
Sections 5 & 8 of the Arbitration and Conciliation Act, 1996 holding that
their existed no disputes between the parties for reference to Arbitration.
The relevant paras of the said judgment and order dated 23 rd August, 2017 is
reproduced hereinbelow:-
"16. The defendant has not denied its letter dated 01.04.2013 which is
reproduced as under:-
" Date: 1st April 2013
To
M/s Ahuja Builders
X-3 Hauz Khas
New Delhi 110016
Sub: Party Account balance confirmation
Dear Sir,
We wish to confirm that as on 31/03/13 we have an outstanding of Rs.
2,72,04,349/- (Rs. Two crore seventy two lac four thousand thee
hundred & forty nine only) towards you running bill for the civil work
of Hotel & Mall. We wish to undertake that these dues shall be cleared
by us latest by 15th May, 2013.
Thanking you,
Yours sincerely
For Doonvalley Technopolis Pvt. Ltd.
Sd/-
(Sanjeev Srivastava)
Director"
xxx xxx xxx xxx
18. In view of these facts, it is clear that none of the parties has raised
any dispute arising out of the said Contract. When there is no dispute
between the parties relating to the contract containing an arbitration
clause, the arbitration clause cannot be invoked. There has to be
dispute arising out of the contract for invoking the arbitration
agreement. The findings in the cases relied upon by the defendant are
given on different set of facts. The facts in ION case (supra), relates to
liabilities under a letter of intent, containing arbitration clause. There
arose a dispute between the parties as to the acceptance or non-
acceptance of the liability or the acknowledgment of the liability and it
was on these facts that the Court held that the suit CS(OS) 3205/2015
Page 10 under Order XXXVII was not maintainable. In Branch
Manager case (supra), the Court laid down the proposition of law that
even on termination of the Contract Agreement, the Arbitration
Agreement survives and binds the parties and where the conditions
mentioned in Section 8 of Arbitration and Consultation Act are
satisfied, the matter needs to be referred for Arbitration and the Civil
suits are not maintainable. The Court discussed Section 8 of Arbitration
and Conciliation Act and has laid down the principle of law as under:-
"21. xxx xxx xxx xxx
22. An analysis of Section 8 would show that for its
applicability, the following conditions must be satisfied: (a)
that there exists an arbitration agreement; (b) that action has
been brought to the court by one party to the arbitration
agreement against the other party; (c) that the subject matter
of the suit is same as the subject matter of the arbitration
agreement; (d) that the other party before he submits his first
statement of the substance of the dispute, moves the court for
referring the parties to arbitration; and (e) that along with the
application the other party tenders the original arbitration
agreement or duly certified copy thereof.
23. Section 8 is in the form of legislative command to the court
and once the pre-requisite conditions as aforestated are
satisfied, the court must refer the parties to arbitration. As a
matter of fact, on fulfillment of conditions of Section 8, no
option is left to the court and the court has to refer the parties
to arbitration.
(emphasis supplied)"
xxx xxx xxx xxx xxx
21.From the facts of this case which are akin to Nathani Steels case
(supra) and National Insurance case (supra), it is clear that on
completion of the Contract between the parties after negotiation, the
defendant/applicant calculated the payable amount as 2,72,04,349/-
and the said calculation of the payable amount was accepted by the
plaintiff. There is thus a voluntary settlement between the parties and
the letter dated 01.04.2013 of defendant clearly shows that there was no
outstanding claim or pending dispute between the parties. On the
settlement of accounts, there is no existing dispute or outstanding claim
under the contract and so the contract stands discharged to the
satisfaction of both the parties. It therefore is apparent that there is no
arbitrable dispute arising out of the contract.
(emphasis supplied)
22. In view of the above facts and circumstances of the case, there
exists no dispute to refer for arbitration in terms of Section 8 of the
Arbitration and Conciliation Act."
4. Even a Special Leave petition being SLP (C) No.27750/2017 against
the judgement and order dated 23rd August, 2017 has been dismissed by the
Apex Court on 30th October, 2017.
5. Keeping in view the aforesaid findings by the learned predecessor of
this Court as well as the fact that the defendant has admitted that it was
liable to pay Rs.2,72,04, 349/- to the plaintiff, this Court is of the view that
the present application being I.A.No.12363/2017 is bereft of any merits.
Accordingly, the leave to defend application is dismissed.
CS(OS) No.3205/2015
6. Since today the defendant's application for leave to defend has been
refused, the plaintiff is entitled to a judgment in its favour forthwith.
7. Consequently, the present summary suit is decreed for
Rs.2,72,04,349/- in favour of the plaintiff and against the defendant along
with the interest @18% per annum from 15th May, 2013 till the date of
actual payment along with the costs. Registry is directed to prepare a decree
sheet accordingly.
MANMOHAN, J
NOVEMBER 06, 2017
KA
