Delhi High Court
Sant Kumar Agarwal vs Bhasin Infotech & Infrastructure ... on 7 December, 2018
$~10
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of decision:07th December, 2018
+ O.M.P.(T) 3/2018
SANT KUMAR AGARWAL ..... Petitioner
Through: Mr.Prakhar Bhatnagar & Mr.Mohit
Tyagi, Advs.
versus
BHASIN INFOTECH & INFRASTRUCTURE PVT. LTD.
..... Respondent
Through: Mr.Lokesh Bhola, Mr.Karan
Grover & Ms.Harshita Agarwal,
Advs.
CORAM:
HON'BLE MR. JUSTICE NAVIN CHAWLA
NAVIN CHAWLA, J. (Oral)
IA No. 12838/2018
This application has been filed by the petitioner seeking
modification of order dated 04.09.2018 whereby this Court had recorded
the statement made by the learned counsel for the respondent that all
further arbitration proceedings against the respondent company have
been stayed by the Supreme Court. The appellant/petitioner submits that
this statement was incorrect.
O.M.P.(T) 3/2018 Page 1
The learned counsel for the respondent submits that the above
statement was made due to inadvertence and was a bona fide mistake. He
admits that there is no order staying such arbitration proceedings against
the respondent company.
Recording the above statement made by the learned counsel for the
respondent, the application is disposed of.
O.M.P.(T) 3/2018 & IA No. 6654/2018
1. This petition under Section 14 of the Arbitration and Conciliation
Act, 1996 (hereinafter referred to as the „Act‟) has been filed by the
petitioner seeking termination of the mandate of the Sole Arbitrator
appointed by the respondent to adjudicate the disputes that have arisen
between the parties in relation to the Allotment Letter/Agreement dated
29.10.2007 whereby the respondent had allotted a shop in favour of the
petitioner in its upcoming shopping mall "Grand Venezia" situated at
Plot No. SH-3, Site-IV, Industrial Area, Surajpur, Greater Noida, UP.
2. The learned counsel for the petitioner submits that the last payment
made by the petitioner to the respondent towards allotment of the shop
was in the year 2008. Thereafter, due to defaults of the respondent, the
petitioner decided not to take this shop and infact, abandoned its claim
over the said shop. The respondent, on the other hand continued raising
demands of installments on the petitioner, which the petitioner refused to
pay. The respondent, thereafter, initiated the arbitration proceedings on
19.01.2018 by invoking the Arbitration Agreement and appointed a Sole
Arbitrator.
O.M.P.(T) 3/2018 Page 2
3. The learned counsel for the petitioner submits that the claim of the
respondent is ex facie barred by Law of Limitation and therefore, the
mandate of the Arbitrator deserves to be terminated. He places reliance
on the judgment of this Court in Sharma Enterprises v. National
Building Construction Corporation Ltd. & Anr., 153 (2008) DLT 594.
4. I have considered the submission made by the learned counsel for
the petitioner, however, find no merit in the same. Sub-Section 1 of
Section 14 of the Act is reproduced hereinunder:-
"14. Failure or impossibility to act.--(1) The mandate
of an arbitrator shall terminate and he shall be
substituted by another arbitrator, if -
(a) he becomes de jure or de facto unable to
perform his functions or for other reasons fails
to act without undue delay; and
(b) he withdraws from his office or the parties
agree to the termination of his mandate."
5. The plea of the petitioner that the claim of the respondent would be
barred by Law of Limitation is one on the merits of the claim. This does
not make the Arbitrator de jure or de facto unable to perform "his
functions" as an Arbitrator.
6. The learned counsel for the respondent has also drawn my
attention to the consumer complaint filed by the petitioner before the
National Consumer Disputes Redressal Commission in the year 2018
inter alia making a claim for refund of the amount paid by the petitioner
to the respondent for the above mentioned shop alongwith interest at the
O.M.P.(T) 3/2018 Page 3
rate of 24% per annum from the date of booking of the shop. He submits
that the petitioner cannot, therefore, maintain its objection of limitation.
7. I need not go into the issue of limitation at this stage. In my
opinion this issue has to be determined by the Arbitrator alone, may be
on an application under Section 16 of the Act filed by the petitioner.
However, certainly this issue cannot be determined in an application
under Section 14 of the Act. The judgment of this Court in Sharma
Enterprises (Supra) can be of no assistance to the petitioner. In the said
case the Court found that there was no doubt at that the claim filed by the
party was dead and long barred by limitation. This cannot be said in the
present case for the petitioner himself has filed a consumer complaint in
the year 2018.
8. Further, the said judgment was passed prior to the amendment in
the Act by way of Arbitration and Conciliation (Amendment) Act, 2015,
which has specifically introduced Section 11(6A) to the Act, which
reproduced as under:-
"11 (6A) The Supreme Court or, as the case may be, the
High Court, while considering any application under
sub-section (4) or sub-section (5) or sub-section (6),
shall, notwithstanding any judgment, decree or order of
any Court, confine to the examination of the existence of
an arbitration agreement. "
9. This Court, in its judgment in Sharma Enterprises (supra) had
relied upon the provisions of Section 11 of the Act prior to its
amendment, where, as the law then standing was, the Court in exercise of
its powers under Section 11 of the Act could refuse appointment of an
O.M.P.(T) 3/2018 Page 4
Arbitrator where the claims are ex facie barred by law of limitation or
long dead. In Duro Felguera, S.A v. Gangavaram Port Limited, (2017)
9 SCC 729, the Supreme Court has clarified that with the introduction of
Section 11 (6A) of the Act, these questions cannot be determined by the
Court while exercising its powers under Section 11 of the Act. The only
issue to be considered by the Court while exercising its powers under
Section 11 of the Act would be confined to the examination to the
existence of an Arbitration Agreement. Existence of the Arbitration
Agreement is not denied by the petitioner in the present case.
10. In view of the above, I find no merit in the present petition and the
same is dismissed leaving it open for the petitioner to agitate all
objections that it may have against the arbitration proceedings in form of
an appropriate application before the Arbitrator. It is made clear that this
order shall not bind or influence the Arbitrator in any manner.
11. There shall be no order as to cost.
NAVIN CHAWLA, J
DECEMBER 07, 2018/rv
O.M.P.(T) 3/2018 Page 5
