Kerala High Court
M/S Colourmate Coatings vs M/S. Sahara India Pariwar (Deleted) on 2 November, 2024
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A.R.No.118/2023 1
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE G.GIRISH
SATURDAY, THE 2ND DAY OF NOVEMBER 2024 / 11TH KARTHIKA, 1946
AR NO. 118 OF 2023
PETITIONER:
M/S COLOURMATE COATINGS, AGED 40 YEARS
VYAPARBHAVAN, ANGAMALY NOW HAVING OFFICE AT
PANIKULANGARA, MERCY BHAVAN,12/171, PANIKULANGARA ROAD,
PARAKKADAVU P.O., ANGAMALY, ERNAKULAM,PIN- 683579
REPRESENTED BY ITS MANAGING PARTNER SANOJ STEPHEN P.
S/O STEPHEN VARHESE, AGED 40, RESIDING AT
PANIKULANGARA, MERCY BHAVAN,12/171, PANIKULANGARA ROAD,
PARAKKADAVU P.O., KURUMASSERY, ERNAKULAM,, PIN - 683579
BY ADVS.
C.P.SAJI
AHALYA PRAKASH K.V.
P.ANIYAN
RESPONDENTS:
1 M/S. SAHARA INDIA PARIWAR (DELETED)
SAHARA PRIME CITY LIMITED, SAHARA INDIA CENTRE, 2
KAPOORTHALA COMPLEX,ALIGANJ, LUCKNOW PIN - 226024,
REPRESENTED BY ITS CHIEF EXECUTIVE OFFICER SUBRATA ROY.
(THE FIRST RESPONDENT IS DELETED FROM THE PARTY ARRAY
AT THE RISK OF THE PETITIONER AS PER THE ORDER DATED
27.06.2024 IN I.A. NO. 2/2024 IN AR NO. 118/2023)
2 M/S. SAHARA PRIME CITY LIMITED
SOUTH ZONE, #13-15,SHAKTI NAGAR, OUTER RING ROAD,
BANASWADI, BENGALURU REPRESENTED BY ITS SOUTH ZONE HEAD
AMITESH AHUJA., PIN - 56004
3 M/S. SAHARA PRIME CITY PVT. LTD
SAHARA GRACE, SEAPORT AIRPORT ROAD, CHITTETH KARA CSEP
P.O., KAKKANAD, KOCHI, 682037 REPRESENTED BY ITS
MANAGER.
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A.R.No.118/2023 2
BY ADVS.
Basil Mathew
NINAN JOHN(K/346/1997)
SANJANA SARA VARGHESE ANNIE(K/000582/2018)
AJAY KRISHNAN S.(K/1630/2020)
ARYA A.R.(K/1666/2018)
ANJITHA JOBI(K/002568/2023)
ROSEMARIA JOHNSON(K/003203/2023)
THIS ARBITRATION REQUEST HAVING BEEN FINALLY HEARD ON
02.11.2024, THE COURT ON THE SAME DAY DELIVERED THE
FOLLOWING:
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A.R.No.118/2023 3
ORDER
The petitioner, a registered partnership firm engaged in carrying on
interior and exterior painting works, has filed this petition under section 11
of the Arbitration and Conciliation Act, 1996 (for short 'the Act') for the
appointment of an Arbitrator for the resolution of the dispute with the
respondents in connection with the payments said to be due from them.
2. It is stated that on 27.08.2011, the respondents issued a work
order in favour of the petitioner for the painting works of B1 and B2 blocks
of their apartment complex at Kochi. An additional work order is also said
to have been issued by the respondents in connection with the same work.
The copies of the aforesaid work orders are produced by the petitioner as
Annexures A2 and A3. According to the petitioner, the works entrusted by
the respondents were completed in agreed time as per the specifications
described in the work order. However, the respondents are said to have
made inordinate delay in making payment of the bills due in connection
with the works done during the final stages. The respondents are said to
have informed the petitioner that the payment was delayed due to some
restrictions imposed by the Apex Court in the financial transactions of the
respondents. It is also stated that, at the request of the respondents, the
petitioner completed the painting works as per the work order by
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December, 2021. As regards the amounts due to the petitioner in
connection with six bills issued to the respondents, joint measurement of
works were said to have been conducted in respect of four bills. An
amount of Rs.33,55,772/- is said to be due to the petitioner from the
respondents as per a final bill dated 01.12.2021.
3. Alleging that the respondents are not caring to make payment
of the aforesaid amount inspite of repeated demands, the petitioner issued
Annexure-A4 notice calling upon the respondents to pay the outstanding
amount of Rs.33,55,772/- along with the amount payable as GST and
interest @ 12% p.a. or to appoint a sole Arbitrator as per Clause 12 of
Annexure-A2 work order for the resolution of the dispute in the above
regard. Contending that the respondents did not oblige to make payment
or to take steps for the appointment of Arbitrator as demanded in Ext.A4
notice, the petitioner has approached this Court with this Arbitration
Request.
4. The 1st respondent M/s. Sahara India Pariwar, Sahara Prime
City Limited, Sahara India Centre, 2 Kapoorthala Complex, Aliganj,
Lucknow, Pin-226024 was deleted from the party array as per order dated
27.06.2024 in I.A.No.2/2024.
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5. The 2nd and 3rd respondents appeared through their counsel
and filed a counter affidavit contending that there was no agreement
between the petitioner and the respondents to have the disputes resolved
as per the provisions of the Act. They also denied the liability to make
payment of the amount of Rs.33,55,772/- as claimed by the petitioner. It
is also stated in the counter affidavit that the Apex Court had proscribed
the above respondents from parting with any movable or immovable
properties as per an order dated 21.11.2013 in a contempt petition.
According to the above respondents, they stopped all further constructions
in the light of the above restraint imposed by the Apex Court. The
respondents 2 and 3 also denied the issuance of lawyer's notice by the
petitioner.
6. Heard the learned counsel for the petitioner and the learned
counsel representing the respondents 2 and 3.
7. The learned counsel for the petitioner, by adverting to Clause
12 of Annexure-A2 work order, contended that the above said clause
provides for the appointment of a sole Arbitrator for the resolution of
disputes arising in between the parties in connection with the subject
matter of that work order. The learned counsel further pointed out the
relevant clause in Annexure-A3 which would state that all the terms and
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conditions in Annexure-A2 work order have been retained in the work
covered by Annexure-A3 work order as well. As regards the issuance of
legal notice, the learned counsel for the petitioner referred to Annexure-A4
and contended that the aforesaid notice would fulfill the requirements of
law and hence an Arbitrator is liable to be appointed in accordance with
the terms of agreement between the parties.
8. The learned counsel for the respondents 2 and 3 resisted the
Arbitration Request on two grounds. Firstly, it is stated that the request
for arbitration is hopelessly barred by limitation. Secondly it is contended
that there is no amount outstanding in the transaction between the
petitioner and the respondents.
9. As regards the first contention, the learned counsel for the
respondents, by relying on the first sentence in paragraph No.4 of the
Arbitration Request, submitted that the petitioner has acknowledged the
fact that the work undertaken by them was completed within the
prescribed period of time. Thus, it is pointed out that the right to sue for
the amount due to the petitioner as per the work done for the
respondents, arose on the expiry of the period of six months from the date
of Annexure-A2, since it was the period agreed to between the parties for
the completion of the work. It is further submitted that even if the above
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period of six months is reckoned from the date of Annexure-A3, the right
to sue would have arisen on 27.07.2012. Accordingly, it is argued that the
period of limitation for instituting proceedings for the realization of money
due in connection with the transactions revealed by Annexures A2 and A3
documents, expired on 26.07.2015. Thus, according to the respondents,
the present Arbitration Request is not maintainable since it is well settled
that the limitation period prescribed under Article 137 of the Limitation Act
is applicable for arbitration proceedings as well.
10. The contention of the learned counsel for the respondents in
the above regard cannot be accepted since it is apparent from the last
sentence in paragraph No.4 of the Arbitration Request that the painting
works as per Annexures-A2 and A3 work orders were completed only in
December, 2021. It is further stated in paragraph No.5 of the Arbitration
Request that joint measurement of works covered by the outstanding four
bills were conducted and accordingly a final bill for payment of
Rs.33,55,772/- was issued by the respondents on 01.12.2021. The
Annexures A8 to A11 produced by the petitioner would substantiate the
above contention about the joint inspections conducted during the period
from 2020 onwards, and the payment certification forms issued upto
12.08.2022. In the light of the above case set forth by the petitioner
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about the continued transactions with the respondents in connection with
Annexures A2 and A3 work orders and the final bill said to have been
issued on 01.12.2021 after the completion of the works in the month of
December, 2021, it is not possible to say that the present Arbitration
Request is barred by limitation. At any rate, the above issue of limitation
is a mixed question of fact and law in view of the nature of the
contentions raised by the parties to this proceedings. It is not proper for
this Court to sit on judgment on the question of limitation since it involves
an adjudication of the facts as well.
11. As regards the contention of the respondents that there is no
amount outstanding to be paid to the petitioner in connection with
Annexure A2 and A3 work orders, it has to be stated that the respondents
have not produced any records to substantiate that the entire liability in
connection with the works entrusted with the petitioner have been
cleared. Instead, the respondents who relied on Annexure-A7 email
communication issued by the petitioner in support of their contention in
the above regard. However, as rightly pointed out by the learned counsel
for the petitioner, the wordings of the said email communication would
make it clear that the payment of Rs.8,92,091/- said to have been made
by the respondents on 10.02.2022 was against retention and part bill
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balance, and that the petitioner had demanded the payment of GST as
well as interest at the rate of 18% per annum, and it was made clear that
the petitioner shall not be able to pay tax unless the amount so demanded
is paid by the respondents. It is not possible to construe Annexure A7
email communication as an acknowledgment of full and final settlement of
the amount due to the petitioner from the respondents. When viewed in
the above perspective, it is not possible to accept the challenge raised by
the respondents against the maintainability of this Arbitration Request.
Above all, the plea regarding the full and final settlement of the claim, is a
matter which comes within the exclusive domain of the arbitrator to
decide.
12. As already stated above, clause 12 of Annexure A2 work
order, which contains the terms of agreement between the parties, clearly
provides for the appointment of a sole Arbitrator for the resolution of the
issues arising in connection with the said agreement. Annexure-A4 notice
issued by the petitioner, would reveal that the petitioner had conveyed to
the respondents about their desire to have the dispute relating to the
payments due from the respondents, resolved through the appointment of
an Arbitrator, if the respondents were not ready to make payment of the
amount of Rs.33,55,772/- demanded by that notice. As the respondents
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have not cared to act in accordance with the request in the said notice and
also in compliance with clause 12 of Annexure A2, the petitioner is entitled
for the appointment of an Arbitrator at the instance of this Court.
In the result, the application stands allowed and an order is passed
as follows:
i) Sri.P.J.Vincent, Retired District Judge, Flat No.14-D, Court
Yard Apartment, Kottenkaavu Temple Road,
Chalikkavattom, Vennala, Ernakulam -682028 is nominated
as the sole Arbitrator to arbitrate upon the disputes that
have arisen between the petitioner and the respondent
within the purview of Annexure-A2 work order.
ii) The learned Arbitrator is at liberty to rule on all issues
between the parties in connection with the said
agreement, including his own jurisdiction, if the parties
raise such a dispute.
iii) The Registry is directed to communicate a copy of this
order to the learned Arbitrator within a period of ten days
from today and to obtain a Statement of Disclosure from
the learned Arbitrator as provided under Section 11(8)
read with Section12(1) of the Act.
iv) Once the Disclosure Statement is obtained from the
learned Arbitrator, the Registry shall issue the certified
copy of this order to the learned Arbitrator, with a copy of
the said statement appended to it, retaining the original of
the same by this Court.
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v) The fees of the learned Arbitrator shall be governed by the
Fourth Schedule of the Act.
vi) The learned Arbitrator shall decide the manner in which
the fees and expenses of the arbitration proceeding has to
be paid by the parties.
vii) The parties will appear before the learned Arbitrator on
such date and place as decided by the learned Arbitrator.
(sd/-)
G.GIRISH,
JUDGE
jsr
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PETITIONER ANNEXURES
Annexure A1 THE TRUE COPY OF PARTNERSHIP DEED OF THE
APPLICANT DATED 18.12.2009
Annexure A2 THE TRUE COPY OF THE WORK ORDER ISSUED TO THE
APPLICANT BY THE RESPONDENTS DATED 27.08.2011
Annexure A3 THE OFFICE COPY OF ADDITIONAL WORK ORDER
ISSUED BY THE RESPONDENTS TO THE APPLICANT
DATED 27.01.2012
Annexure A4 THE TRUE COPY OF NOTICE ISSUED TO THE
RESPONDENTS ON 25.05.2023
Annexure A5 THE PHOTO COPY OF POSTAL RECEIPT DATED
25.05.2023 SHOWING THE ISSUANCE OF THE NOTICE
TO THE RESPONDENTS REQUESTING TO APPOINT
ARBITRATOR.
RESPONDENT EXHIBITS
Exhibit R2(a) The true copy of the order by the Hon'ble
Supreme Court of India passed order dated
21.11.2013 in Contempt Petition No. 412/2012
PETITIONER ANNEXURES
Annexure A6 A TRUE COPY OF SPEED POST POSTAL COVER ALONG
WITH CHEQUE NO.170599 DRAWN ON RAJDHANI NAGAR
SAHKARI BANK LTD
Annexure A7 A TRUE COPY OF THE EMAIL LETTER ISSUED TO THE
2ND RESPONDENT BY THE PETITIONER ON
18.02.2022
Annexure A8 A TRUE PHOTOCOPY OF THE JOINT MEASUREMENT
TAKE OFF SHEET ISSUED BY THE 2ND RESPONDENT
TO THE PETITIONER SIGNED BY THE PARTIES DATED
19.01.2021
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Annexure A9 TRUE COPY OF THE PAYMENT CERTIFICATION FORM
FOR THE RUNNING BILL NO.9TH RA DATED
12.08.2022
Annexure A10 TRUE COPY OF THE PAYMENT CERTIFICATION FORM
FOR THE RUNNING BILL NO.3RD RA DATED
12.08.2022
Annexure A11 TRUE COPY OF THE PAYMENT CERTIFICATION FORM
FOR THE RUNNING BILL NO.18TH RA DATED
12.08.2022
