Delhi High Court
U.P. Jal Vidyut Nigam Ltd. vs C.G. Power And Industrial ... on 12 April, 2019
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ OMP(COMM) 405/2018
Reserved on: 12.11.2018
Date of Decision : 12.04.2019
U.P. JAL VIDYUT NIGAM LTD. ..... Petitioner
Through: Mr.Ajit Rajput, Ms.Sakshi
Sharma, Advs. along with
Mr.Abhishek Chauhan, AR of
petitioner company.
versus
C.G. POWER AND INDUSTRIAL SOLUTION LIMITED
..... Respondent
Through: Mr.Ramesh Singh, Ms.Monisha
Handa, Advs.
CORAM:
HON'BLE MR. JUSTICE NAVIN CHAWLA
I.A. No.13088/2018
1. This application has been filed by the petitioner under Section 14
of the Limitation Act, 1963 (the Limitation Act) praying for exclusion of
time spent by the petitioner in pursuing its earlier application under
Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter
referred to as the „Act‟) before the District Courts at Saharanpur for the
purpose of computing the limitation for filing of the present petition. The
total period of time sought to be excluded is 6263 days.
OMP(COMM) 405/2018 Page 1
2. The present petition has been filed by the petitioner challenging the
Arbitral Award dated 15.03.2001 passed by the Arbitral Tribunal
consisting of three Arbitrators. The said Award adjudicated the disputes
that had arisen between the parties in relation to the work of construction
and maintenance of Babail Power House at Village Babail in District
Saharanpur awarded by the petitioner to the respondent.
3. The petitioner challenged the above Award by way of a petition
under Section 34 of the Act before the Court of Civil Judge, Saharanpur.
As far as the territorial jurisdiction is concerned, the petitioner made the
following submission:
"The agreement was made at Lucknow but the working site
was at village Babail in District Saharanpur. The entire
work was done and executed, measured and cause of action
arose within the jurisdiction of this Court. Hence this Court
has the jurisdiction."
4. As far as the pecuniary jurisdiction is concerned, the same was
valued at Rs.3,83,41,431/-.
5. The Civil Judge, Saharanpur vide order dated 26.08.2003 held that
the Court lacked pecuniary jurisdiction to entertain the said petition.
6. Upon presenting the petition before the Court of District Judge,
Saharanpur, the District Judge extended the benefit of Section 14 of the
Limitation Act to the petitioner vide his order dated 13.02.2004.
7. The said petition was thereafter transferred from the Court of
District Judge, Saharanpur to the Court of Additional District Judge,
OMP(COMM) 405/2018 Page 2
Saharanpur on 11.04.2011. The reason for such transfer is not evident
from the record.
8. The petition was, however, dismissed for non prosecution on
15.07.2013 as none appeared before the Court on behalf of the petitioner.
9. The petition was thereafter restored for hearing vide order dated
05.09.2014.
10. Learned counsel for the respondent submits that the petition was
thereafter transferred to the Court of District Judge, Saharanpur on
03.09.2015. It was again dismissed for non prosecution on 22.11.2016.
11. On 08.12.2016, the petitioner filed application seeking restoration
of the petition. Notice on such application was issued to the respondent,
however, the order dated 10.01.2017 and 28.04.2017 reflects that the
same was not served. In the meantime, the respondent filed an execution
petition, being Execution Petition no.63/2017, before the Court of
District Judge, Saharanpur seeking enforcement of the Impugned Award.
12. The petitioner filed an application seeking stay of the execution
proceedings, however, the same was dismissed by the District Judge,
Saharanpur vide order dated 06.01.2018.
13. The petitioner thereafter filed Misc. Petition No.775/2018 before
the High Court of Allahabad praying for direction to the Additional
District Judge, Saharanpur, for early disposal of petitioner‟s application
seeking restoration of the petition filed under Section 34 of the Act.
OMP(COMM) 405/2018 Page 3
14. The petitioner also filed another petition, being Misc. Petition
No.744/2018, before the High Court of Allahabad praying for a direction
against the District Judge from proceeding further with the Execution
Petition.
15. The above Writ Petitions were disposed of by the High Court of
Allahabad vide its order dated 19.02.2018 directing as under:
"After some argument, learned counsel for the parties
agree for disposal of the instant petition in the following
terms :-
(a) The impugned order dated 6.1.2018 be set aside and
the restoration application be directed to be decided within
two weeks from the date of production of certified copy of
this order.
(b) The parties will not seek any adjournment.
(c) In case restoration application is allowed, the main
petition, i.e., Misc. Case No. 2 of 2004, under Section 34,
shall be decided within 3 months, without granting
unnecessary adjournments.
(d) Till the restoration application is decided or in case the
matter is restored, till the objections under Section 34 are
decided, the proceedings before the executing court, shall
remain in abeyance."
16. The Additional District Judge, Saharanpur, vide his order dated
14.03.2018 was pleased to restore the petition filed under Section 34 of
the Act by the petitioner for hearing.
17. As noted above, the High Court by its order dated 19.02.2018 had
directed that incase restoration is allowed, the petition shall be decided
within three months without granting any adjournment. However, the
petitioner, on 02.05.2018 filed an application seeking withdrawal of the
OMP(COMM) 405/2018 Page 4
petition stating that it has received legal advice that the Court at
Saharanpur shall have no jurisdiction to entertain the petition as the
Award had been passed at Delhi.
18. Learned counsel for the respondent submits that this application
was filed with malafide intent to further delay the adjudication of the
petition. He submits that the respondent has never challenged the
jurisdiction of the Courts at Saharanpur to entertain the petition and in
fact, the Courts at Saharanpur had territorial jurisdiction to adjudicate the
said petition as the Contract was performed within its jurisdiction. He
submits that the respondent also sought to file a reply to the said
application and a copy thereof was duly served on the petitioner,
however, the same was not taken on record and instead, the learned
Additional District Judge by his order dated 03.05.2018 allowed the
application of the petitioner.
19. The petitioner thereafter filed the petition under Section 34 of the
Act before the Court of District Judge, Patiala House Courts, New Delhi.
In the said petition, the respondent filed an application under Order VII
Rule 10 of the Code of Civil Procedure, 1908 (CPC) on the ground of
lack of pecuniary jurisdiction of the Court.
20. During the pendency of the said application, petitioner filed an
application under Order VII Rule 10A of the CPC for return of the
petition for filing before this Court and for fixing a date for hearing. The
said application was allowed by the Additional District Judge vide his
order dated 04.08.2018.
OMP(COMM) 405/2018 Page 5
21. The present petition has thereafter been filed by the petitioner
before this Court praying for exclusion of 6263 days for the purpose of
calculating the limitation.
22. Learned counsel for the petitioner submits that the petitioner is
entitled to the exclusion of the period during which it was prosecuting the
petition before the Courts at Saharanpur and thereafter before the Court
of Additional District Judge, Patiala House Courts, New Delhi. Relying
upon the judgment of the Supreme Court in Consolidated Engineering
Enterprises v. Principal Secrertary, Irrigation Department & Ors,.
(2008) 7 SCC 169, he submits that Section 14 of the Limitation Act is not
excluded under Section 34(3) of the Act. He further submits that Section
14 of the Limitation Act has to be interpreted and has to be adopted more
liberally so as to advance the cause of justice.
23. On the other hand, the learned counsel for the respondent relying
upon the judgment of the Supreme Court in Madhavrao Narayanrao
Patwardhan v. Ramkrishna govind Bhanu and Ors., (1959) SCR 564;
Deena (Dead) Through LRs v. Bharat Singh (Dead) Through Lrs. &
Ors., (2002) 6 SCC 336; and of this Court in M/s K.G. Khosla & Co. v.
The Trustees of the Port of Bombay, ILR (1970) 2 Delhi 60, submits that
the petitioner has been unable to show that it was prosecuting the earlier
petition at Saharanpur and Patiala House Courts with due diligence and in
good faith. He submits that in the first instance the petitioner had filed
the petition before the Court of Civil Judge, Saharanpur knowing fully
well that the said Court did not have the pecuniary jurisdiction to
entertain the petition. Thereafter the petition was dismissed twice due to
OMP(COMM) 405/2018 Page 6
non-prosecution. Even after withdrawing the same from the Court of
Additional District Judge at Saharanpur, the petitioner filed the petition
before the Court of Additional District Judge, Patiala House Courts, New
Delhi again knowing fully well that the said Court lacked pecuniary
jurisdiction to entertain the said petition. He submits that, therefore, the
petitioner is not entitled to claim the benefit of Section 14 of the
Limitation Act.
24. I have considered the submissions made by the learned counsels
for the parties and find merit in the submissions made by the counsel for
the respondent. Section 14 of the Limitation Act is reproduced
hereinunder;
"14. Exclusion of time of proceeding bona fide in court
without jurisdiction.- (1) In computing the period of
limitation for any suit the time during which the plaintiff has
been prosecuting with due diligence another civil
proceeding, whether in a court of first instance or of appeal
or revision, against the defendant shall be excluded, where
the proceeding relates to the same matter in issue and is
prosecuted in good faith in a court which, from defect of
jurisdiction or other cause of a like nature, is unable to
entertain it.
(2) In computing the period of limitation for any
application, the time during which the applicant has been
prosecuting with due diligence another civil proceeding,
whether in a court of first instance or of appeal or revision,
against the same party for the same relief shall be excluded,
where such proceeding is prosecuted in good faith in a
court which, from defect of jurisdiction or other cause of a
like nature, is unable to entertain it.
OMP(COMM) 405/2018 Page 7
(3) Notwithstanding anything contained in rule 2 of Order
XXIII of the Code of Civil Procedure, 1908 (5 of 1908), the
provisions of sub-section (1) shall apply in relation to a
fresh suit instituted on permission granted by the court
under rule 1 of that Order where such permission is granted
on the ground that the first suit must fail by reason of a
defect in the jurisdiction of the court or other cause of a like
nature.
Explanation: For the purposes of this sections-
(a) in excluding the time during which a former civil
proceeding was pending, the day on which that proceeding
was instituted and the day on which it ended shall both be
counted;
(b) a plaintiff or an applicant resisting an appeal shall be
deemed to be prosecuting a proceeding;
(c) misjoinder of parties or of causes of action shall be
deemed to be a cause of a like nature with defect of
jurisdiction."
25. The Supreme Court in Madhavrao Narayanrao (supra) laid down
the following pre-conditions for invocation of Section 14 of the
Limitation Act as under:
"In order to bring his case within the section quoted above,
the plaintiff has to show affirmatively:
(1) that he had been prosecuting with due diligence the
previous suit in the court of the Munsif at Miraj,
(2) that the previous suit was founded upon the same
cause of action,
OMP(COMM) 405/2018 Page 8
(3) that it had been prosecuted in good faith in that
court, and
(4) that that court was unable to entertain that suit on
account of defect of jurisdiction or other cause of a
like nature."
26. In the said judgment, the Supreme Court further clarifies that as the
Limitation Act contains its own definition of "Good Faith", the definition
of "Good Faith" as contained in the General Clauses Act, 1897 would not
be applicable. I quote from the judgment as under:
"Both the courts below have viewed the controversy under
S. 14 of the Limitation Act, as if it was for the defendant to
show mala fides on the part of the plaintiff when he
instituted the previous suit and was carrying on the
proceedings in that court. In our opinion, both the courts
below have misdirected themselves on this question.
Though they do not say so in terms, they appear to have
applied the definition of "good faith" as contained in the
General Clauses Act, to the effect that "A thing shall be
deemed to be done in good faith where it is in fact done
honestly, whether it is done negligently or not". But the
Indian Limitation Act contains its own definition of good
faith to the effect that "nothing shall be deemed to be done
in good faith which is not done with due care and
attention" -- [Section 2(7)]......."
27. The Court further held that when the plaintiff has not satisfied the
initial burden which lay upon him to bring his case within Section 14, the
burden would not shift to the defendant to show the contrary.
OMP(COMM) 405/2018 Page 9
28. In Deena (Dead) through Lrs. (supra), the Court further clarified
the interplay between Order 23 Rule 2 of CPC and Section 14 of the
Limitation Act in the following words:
13. From the provisions it is clear that it is in the nature of
a proviso to Order 23 Rule 2. The non obstante clause
provides that notwithstanding anything contained in Rule 2
of Order 23 of the Code of Civil Procedure the provisions of
sub-section (1) of Section 14 shall apply in relation to a
fresh suit instituted on permission granted by the court
under Rule 1 of Order 23. For applicability of the provision
in sub-section (3) of Section 14 certain conditions are to be
satisfied. Before Section 14 can be pressed into service the
conditions to be satisfied are: (1) both the prior and
subsequent proceedings are civil proceedings prosecuted by
the same party; (2) the prior proceeding had been
prosecuted with due diligence and good faith; (3) the failure
of the prior proceeding was due to defect of jurisdiction or
other cause of like nature; (4) the earlier proceeding and
the later proceeding must relate to the same matter in issue;
and (5) both the proceedings are in a court.
14. The main factor which would influence the court in
extending the benefit of Section 14 to a litigant is whether
the prior proceeding had been prosecuted with due
diligence and good faith. The party prosecuting the suit in
good faith in the court having no jurisdiction is entitled to
exclusion of that period. The expression "good faith" as
used in Section 14 means "exercise of due care and
attention". In the context of Section 14 the expression
"good faith" qualifies prosecuting the proceeding in the
court which ultimately is found to have no jurisdiction. The
finding as to good faith or the absence of it is a finding of
fact...........
15. ........ It is to be kept in mind that there is a distinction
between granting permission to the plaintiff to withdraw the
OMP(COMM) 405/2018 Page 10
suit with leave to file a fresh suit for the same relief under
Order 23 Rule 1 and exclusion of the period of pendency of
that suit for the purpose of computation of limitation in the
subsequent suit under Section 14 of the Limitation Act. The
words "or other cause of a like nature" are to be
construed ejusdem generis with the words "defect of
jurisdiction", that is to say, the defect must be of such a
character as to make it impossible for the court to entertain
the suit or application and to decide it on merits. Obviously
Section 14 will have no application in a case where the suit
is dismissed after adjudication on its merits and not because
the court was unable to entertain it."
29. In Consolidated Engg Enterprises (supra), the Supreme Court
again clarified as under:
"31. ............ The time during which a court holds up a case while
it is discovering that it ought to have been presented in another
court, must be excluded, as the delay of the court cannot affect the
due diligence of the party. Section 14 requires that the prior
proceeding should have been prosecuted in good faith and with
due diligence. The definition of good faith as found in Section 2(h)
of the Limitation Act would indicate that nothing shall be deemed
to be in good faith which is not done with due care and attention.
It is true that Section 14 will not help a party who is guilty of
negligence, lapse or inaction. However, there can be no hard and
fast rule as to what amounts to good faith. It is a matter to be
decided on the facts of each case. It will, in almost every case be
more or less a question of degree. The mere filing of an
application in wrong court would not prima facie show want of
good faith. There must be no pretended mistake intentionally made
with a view to delaying the proceedings or harassing the opposite
party. In the light of these principals, the question will have to be
considered whether the appellant had prosecuted the matter in
other courts with due diligence and in good faith."
OMP(COMM) 405/2018 Page 11
30. A reading of the above judgments clearly shows that one of the
conditions for extending the benefit of Section 14 of the Limitation Act
to the petitioner is that the petitioner must have been prosecuting the
earlier proceedings in good faith and with due diligence. The onus of
proving the same also lies upon the petitioner.
31. In the present case, as noted hereinabove, the petitioner had earlier
filed a petition under Section 34 of the Act before the Court of Civil
Judge, Saharanpur. The said Court admittedly lacked pecuniary
jurisdiction to entertain the said petition. Though, upon filing of the
petition before the District Judge, Saharanpur, the petitioner was
extended the benefit of Section 14 of the Limitation Act, in my opinion,
the same would again become relevant to test whether the petitioner was
prosecuting the earlier petition with due diligence and in „good-faith‟.
32. The petition was dismissed twice before the Saharanpur District
Court due to non appearance of the petitioner and thereafter, the
petitioner again filed the petition before the Patiala House Courts, which
lacked pecuniary jurisdiction to entertain the same. The conduct of the
proceedings by the petitioner clearly establish lack of due care and
attention.
33. It is also relevant to note that the High Court of Allahabad in its
order dated 19.02.2018 had directed the petition under Section 34 of the
Act to be decided within three months on its restoration. The said petition
was restored on 14.03.2018. The petitioner on 02.05.2018, filed the
cryptic application seeking withdrawal of the said petition on the ground
OMP(COMM) 405/2018 Page 12
of alleged lack of territorial jurisdiction. The contents of the application,
as given in the translated copy filed by the respondent, are as under:
"It is submitted that the plaintiff had filed aforesaid suit for setting
aside the Award dated 15.03.2001 passed by the Arbitrator under
Section 34 of the Arbitration and Conciliation Act. In the above
case the question of jurisdiction lies. At the time of filing the case
the plaintiff was given legal advice of filing the same and at that
time as per the legal advice the aforesaid case was filed before the
this on Hon'ble Court the further proceedings in the matter was
going on. Recently, the plaintiff received a legal advice that this
Hon'ble Court has no jurisdiction to entertain the said suit rather
that the same court has the jurisdiction to hear from where the
Arbitrator Award has been passed. The award should have been
presented in the jurisdiction of the same court for its cancellation.
In the interest of justice in light of the aforesaid facts and on the
basis of the legal advice plaintiff be permitted to withdraw the
aforesaid case so the plaintiff can file the same before the
Competent Court.
Hence it is humbly prayed to this Hon'ble Court in the light of the
aforesaid facts plaintiff be permitted to withdraw the aforesaid
case so the plaintiff can file the same before the Competent Court.
Prayed accordingly."
34. A reading of the above would show that the application itself has
not disclosed any reason on which it is claimed that the Courts at
Saharanpur lack territorial jurisdiction to entertain the said petition. The
counsel for the petitioner has relied upon the judgment of the Supreme
Court in M/s Bhandari Udyog Ltd. v. Industrial Facilitation Council
and Another, AIR 2015 SC 1320 to contend that as the arbitration
proceedings were held at Delhi, only Courts at Delhi would have the
jurisdiction to entertain the petition under Section 34 of the Act.
OMP(COMM) 405/2018 Page 13
However, what has not been explained is how this sudden advice was
obtained, afterall the petitioner had been prosecuting the petition not only
before the Saharanpur District Court, but also before the Allahabad High
Court. The petition at Saharanpur remained pending from 2001 to 2018,
that is, almost a period of 17 years.
35. Equally, it has not been explained why the petition was filed before
the Patiala House District Courts when it clearly lacked pecuniary
jurisdiction to entertain the said petition on the valuation given by the
petitioner in its original petition filed before the Civil Judge, Saharanpur.
36. In such circumstances, the petitioner certainly is not entitled to
seek the benefit of Section 14 of the Limitation Act.
37. In view of the above, the application lacks merit and is dismissed.
O.M.P. (COMM) 405/2018 & I.A. No.13089/2018
As the application seeking exclusion of time has been dismissed,
the petition filed by the petitioner is barred by limitation and the delay,
being beyond the period of 30 days from the expiry of three months from
the date of the receipt of the Award, cannot be condoned under Section
34(3) of the Act.
The petition and the application are therefore dismissed. There
shall be no order as to cost.
NAVIN CHAWLA, J
APRIL 12, 2019/vp
OMP(COMM) 405/2018 Page 14
