Punjab-Haryana High Court
Bhagwan Dass And Sons Through Its ... vs Union Of India Through Secretary on 14 January, 2025
Neutral Citation No:=2025:PHHC:005146
107
CM-20964-CII-2024 in/and RA-CR-143-2024 in
ARB-7-2022
Bhagwan Dass and Sons vs. UOI and others
Present:- Mr. Anand Vardhan Khanna, Advocate,
for the review applicant.
Mr. B.S. Kanwar, Sr. Panel Counsel,
for UOI.
***
CM-20964-CII-2024
The applicant through instant application under Section 151 CPC is
seeking permission for exemption from filing certified copies of Annexures P-3
to P-5.
Allowed as prayed for.
RA-CR-143-2024
Mr. Anand Vardhan Khanna, Advocate appeared and filed his
Power of Attorney on behalf of the review applicant. The same is taken on
record. Registry is directed to tag the same at an appropriate place.
The review applicant through instant application under Order
XLVII Rule 1 read with Section 151 CPC is seeking review of order dated
14.10.2024 passed by this Court whereby its application seeking appointment of
Arbitrator under Section 11(6) of Arbitration and Conciliation Act, 1996 was
dismissed. The operative part of order dated 14.10.2024 is reproduced as
below:-
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Neutral Citation No:=2025:PHHC:005146
"7. Having held that Article 137 of
Limitation Act is applicable to proceedings under
Section 11(6) of 1996 Act, the Supreme Court in Arif
Azim Company Limited v. Aptech Limited, (2024) 5
SCC 313; BSNL v. Nortel Networks (India) (P)
Ltd., (2021) 5 SCC 738 and B&T AG v. Union of India,
(2024) 5 SCC 358 has held that though limitation is an
admissibility issue, yet it is duty of the Courts to prime
facie examine and reject nonarbitrable or dead claims
so as to protect the other party from being drawn into a
time consuming and costly arbitration process. While
considering the issue of limitation in relation to a
petition under Section 11(6) of the 1996 Act, the Courts
should satisfy themselves on two aspects by employing a
twopronged test-first, whether the petition under Section
11(6) of the 1996 Act is barred by limitation and
secondly, whether the claims sought to be arbitrated are
ex facie dead claims and are thus barred by limitation
on the date of commencement of arbitration
proceedings. If either of these issues are answered
against the party seeking referral of dispute to
arbitration, the Court may refuse to appoint an Arbitral
Tribunal. There are three principles of law regarding
the manner in which the point in time when the cause of
action arose may be determined. First, that the right to
receive the payment ordinarily begins upon completion
of the work. Secondly, a dispute arises only when there
is a claim by one side and its denial/repudiation by the
other and thirdly, the accrual of cause of action
cannot be indefinitely postponed by repeatedly
writing letters or sending reminders. It is important
to find out the "breaking point" at which any
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Neutral Citation No:=2025:PHHC:005146
reasonable party would have abandoned the efforts
at arriving at a settlement and contemplated referral
of the dispute to arbitration. Such breaking point
would then become the date on which the cause of
action could be said to have commenced. A notice
invoking arbitration after six years from the cause of
action is barred by limitation. The claim after six
years is ex-facie dead and time barred. The period of
limitation for issuing notice of arbitration would not
extend by mere exchange of letters or settlement
discussions where a final bill is rejected by making
deductions or otherwise.
8. In the case in hand, the dispute relates to
2011-12. The work was completed on 01.09.2010
and thereafter, final bill was prepared on
30.04.2011. The applicant issued no further claim
certificate on 06.08.2011. Notice invoking
arbitration clause was issued on 22.03.2021. In view
of aforecited judgments of the Supreme Court, this
Court finds that demand notice was served in 2021
with respect to a claim which on the said date was
hopelessly barred by limitation and had become
dead wood.
9. In the backdrop, this Court is of the
considered opinion that present application deserves
to be dismissed and accordingly dismissed."
Mr. Anand Vardhan Khanna, Advocate submits that last payment
was made in 2018. Thus, cause of action accrued in 2018 and this fact by
mistake could not be brought in the knowledge of this Court while passing
aforesaid order.
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Neutral Citation No:=2025:PHHC:005146
Mr. B.S. Kanwar, Sr. Panel Counsel for Union of India submits
that there was outstanding liability against applicant which was adjusted while
making payment of another contract. It is not case of outstanding liability of
respondent whereas it is a case of outstanding liability of the applicant which
was recovered in 2018.
In the wake of statement of counsel for Union of India, this Court
does not find any ground to recall its order dated 14.10.2024.
Review application stands dismissed.
14.01.2025 (JAGMOHAN BANSAL)
shivani JUDGE
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