Rajasthan High Court - Jodhpur
Amril Lal Khatri vs Varaha Indra Limited on 9 December, 2021
Bench: Vinit Kumar Mathur
HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
JODHPUR
S.B. Arbitration Application No. 29/2020
Amril Lal Khatri S/o Shri Goverdhandas Ji, Aged About 73 Years,
R/o Azad Chowk, Barmer, District Barmer (Raj.)
----Petitioner
Versus
Varaha Indra Limited, Umesh Smriti 6, Jalam Vilas Scheme,
Paota 'B' Road, Jodhpur - 342006.
----Respondent
For Petitioner(s) : Mr. Vineet Dave
For Respondent(s) : Mr. Mohit Singhvi with
Mr. Vishwas Khatri
HON'BLE MR. JUSTICE VINIT KUMAR MATHUR
Order
09/12/2021
The present arbitration application has been filed for
appointment of the Arbitrator under Section 11 (6) of the
Arbitration and Conciliation Act, 1996 (hereinafter referred to as
'the Act of 1996').
Heard learned counsel for the parties.
Learned counsel for the applicant submits that in pursuance
of the contract agreement dated 14/08/2010, the parties entered
into an agreement for the purpose of construction of the road
from 225 to 269 on NH-112 of the Jodhpur-Barmer Section in
Rajasthan. The contract agreement between the parties is placed
on record as Annexure-1.
Learned counsel further submits that as per clause 13(a) of
the said agreement, in the event of dispute having been arisen
(2 of 5) [ARBAP-29/2020]
between the parties, the matter will be referred to the sole
arbitrator to be appointed by the parties.
Learned counsel submits that although the commencement
of period of contract for the construction of the road was 2010 and
the completion date was given as 31/03/2011 but factually the
work was not completed within the stipulated period. He further
submits that the applicant was under an obligation for
maintenance of the road during the Defect Liability Period also and
the Defect Liability Period was stated to be five years from the
date of completion of the road. It is also contended that as per
Clause (h) of the Defect Liability Period, the same was stated to
be 15/10/2017 or as specified in the agreement with the Main
Contractor. He submits that when the amount due to the
applicant was not paid by the respondent and the amount was
disputed, the applicant gave a registered notice on 01/07/2020
(Annex.2) to the respondent for invoking the Clause 13(a) of the
agreement for appointment of an arbitrator. He, therefore,
submits that since the notice has not been honoured by the
respondent by appointing an arbitrator, therefore, the applicant
was compelled to prefer an application before this Court under
Section 11(6) of the Act of 1996 for appointment of an arbitrator.
Per contra, learned counsel for the respondent submits that
the application preferred by the applicant for appointment of the
arbitrator is at a belated stage and the same is liable to be
dismissed on the ground that the request for arbitration has not
been made by the applicant within a period of three years from
the date of the dispute. In support of his submission, he has
relied upon the judgment of the Hon'ble Supreme Court in the
(3 of 5) [ARBAP-29/2020]
case of Bharat Sanchar Nigam Ltd. & Anr vs. M/s. Nortel
Networks India Pvt. Ltd, reported in (2020) 14 SCC 643.
Learned counsel submits that since the date of completion
of work has never been informed by the applicant nor it has been
stated in the arbitration application or notice, therefore, the
period of limitation cannot be construed as 15/10/2017 in this
case and the notice was served for arbitration after the expiry of
period of three years. Learned counsel, therefore, submits that the
arbitration application is liable to be dismissed on the ground of
not invoking the clause for appointment of the arbitrator within a
period of three years from the dispute which arose for the first
time.
I have considered the submissions made at the bar and I
have gone through the documents as well as agreement placed on
record.
It is an admitted position that the applicant and the
respondent entered into an agreement which is dated 14/08/2010
(Annex.1). In the agreement, there is an arbitration clause
mentioned in Clause 13(a) and the parties have agreed that in
case the dispute arose between them, the same would be referred
to the Arbitrator to be appointed by the parties. The fact that the
commencement of the period of work and the completion of the
same has been mentioned in Clause 6(a) of the agreement which
is dated 20/08/2010 and completion being 31/03/2011, the same
is not in dispute. As far as the defect liability period and the
liability of the applicant during the defect liability period is
concerned, the same is not disputed by learned counsel for the
respondent. As per clause 8 (h) of the said agreement, the defect
(4 of 5) [ARBAP-29/2020]
liability period is mentioned to be 15/10/2017 or as specified in
the Agreement with the Main Contractor.
On a pointed query being raised to the learned counsel for
the respondent with respect to any specific date having been
mentioned in the agreement with the Main Contractor about the
defect liability period, he is unable to inform the date and
submitted that the date which is mentioned for the completion of
the project would be construed for the defect liability period.
Para 5 of the reply reads as under :-
"5. That the contentions and the averments as
contended under para no. 5 of the application are
admitted by the Answering Respondent to the extent
that as per the agreement dated 14.08.2010 executed
between the parties the Defect Liability Period was
agreement to be up to 15.10.2017 and therefore the
cause of actions raised and contentions by the
Applicant are liable to be done away with on the
preliminary ground of Limitation. It is worth
mentioning here that no security deposit is due to be
paid on part of the Answering Respondents herein as
the matter was resolved and closed between the
parties, back in the year 2013".
A bare perusal of the reply shows that the defect liability
period is mentioned to be 15/10/2017 and, therefore, being no
other date mentioned in the main agreement, there is no reason
for this Court to take into consideration any other date than the
date 15/10/2017 as the date of the defect liability period. If
15/10/2017 is taken as the last date for the period of defect
liability period then the notice has been served by the applicant
for appointment of the arbitrator on 01/07/2020 is within a period
(5 of 5) [ARBAP-29/2020]
of three years and thus the argument of learned counsel for the
respondent that the claim of the applicant is barred by limitation
as the applicant has failed to invoke the provision of clause for
appointment of the arbitrator within a period of three years is not
sustainable.
In the circumstances, the application is allowed. Mr. Harish
Purohit, Advocate R/o. 28A, Opposite Sardar School, Hakam
Bagh, Jalore Gate, Jodhpur is appointed as a sole arbitrator to
adjudicate upon the dispute between the parties in terms of
arbitration agreement and as per the Rajasthan Manual of
Procedure for Alternative Dispute Resolution, 2009, as amended
up to date and also as per the provisions of Arbitration and
Conciliation Act.
The record of the case may be transmitted to the Mr. Harish
Purohit, Advocate.
The above appointment is subject to the necessary
disclosure under Section 12 of the Act.
Needles to say that the fees of the arbitrator will be as per
Schedule 1V of the Arbitration and Conciliation Act.
(VINIT KUMAR MATHUR),J
161-SanjayS/-
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