Rajasthan High Court
M/S Onkar Plaster Decorations ... vs Urban Improvement Trust on 7 September, 2022
Bench: Pankaj Bhandari
HIGH COURT OF JUDICATURE FOR RAJASTHAN
BENCH AT JAIPUR
S.B. Arbitration Application No. 17/2022
M/s Onkar Plaster Decorations Works, (Registered Govt.
Contractor) 642, Joshi Road, New Delhi-110005 Through K.v.
Singh.
----Applicant
Versus
1. Urban Improvement Trust, Bhilwara Through Secretary,
Ajmer Road Bhilwara Raj.
2. The Executive Engineer, Office Of Urban Improvement
Trust Road Bhilwara.
----Respondents
For Applicant(s) : Mr. Sharad Purohit
For Respondent(s) : Mr. Nitin Sinsinwar
HON'BLE MR. JUSTICE PANKAJ BHANDARI
Order
RESERVED ON :: 01/09/2022
PRONOUNCED ON :: 07/09/2022
1. The applicant has filed this arbitration application under
Sections 10 & 11 of the Arbitration and Conciliation Act, 1996
(hereinafter referred to as "the Act") seeking appointment of an
arbitrator.
2. It is pleaded in the arbitration application that the
respondents-non-applicants floated a tender for a sum of
Rs.39,82,694/- for Acoustic Treatment in the auditorium, namely,
Rajeev Gandhi Auditorium, RC Vyas Colony, Bhilwara. The
applicant was awarded the entire contract work. The applicant
completed the entire work entrusted to him within the stipulated
time before 02.08.2011 and requested for final measurement of
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the said work in the non-applicants' mathematical book. It is also
pleaded that the applicant also submitted a completion certificate
dated 02.08.2011 in the month of August, 2011 itself. The non-
applicants did not pay any heed to the repeated requests and
reminders and did not prepare any of the final bills till 2017.
Eighth and final bill was submitted, but the non-applicants did not
pay the amount. It is further pleaded that Clause 5.11 in the
tender document for Acoustical Treatment in the
Auditorium/Indoor Stadium is the Arbitration Clause.
3. It is contended that when even after preparation of the final
bill, payment was not made. The applicant served a legal notice
upon the non-applicants on 16.09.2020 seeking appointment of an
arbitrator for settlement of the dispute between the parties.
4. The non-applicants have filed reply to the arbitration
application. It is stated in the reply that the work was awarded in
the year 2006. The work was required to be completed till
19.11.2006, however, the same was extended time to time and
lastly extended till 31.08.2011. It is also stated that the final bill
was prepared in the month of December, 2017 with a delay of
about 7 years after completion of work and since, the applicant
has not complied with the Clauses of the Agreement, the claim is
time-barred. It is further stated in the reply that the tender limit
has been extended exceeding to the financial jurisdiction of the
non-applicants and the same is pending for approval of the State
Government and as and when same will be received, without any
delay, dues payable to the applicant as per his final bill will be
paid.
5. A rejoinder to the said reply has also been filed by the
applicant. It is contended by the counsel for the applicant that
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admittedly, the final bill has not been paid. The final bill was
prepared in December, 2017 and has not been paid because of
financial jurisdiction of the non-applicants as mentioned in their
reply. It is also contended that the notice seeking appointment of
an arbitrator was given on 16.09.2020 i.e. within 3 years from
preparation of the final bill and is thus, within the prescribed
period of limitation. Counsel for the applicant has placed reliance
on Bharat Sanchar Nigam Ltd. & Anr. Versus M/s. Nortel Networks
India Pvt. Ltd.: (2021) 5 SCC 738.
6. Counsel for the non-applicants has vehemently opposed the
arbitration application. It is contended that the claim is hopelessly
time-barred. The claimant-applicant has not completed the work
in time and has not raised the final claim within the prescribed
time and thus, the claim is hopelessly time-barred.
7. I have considered the contentions and have carefully perused
the material on record.
8. The scope of rejecting the claim for referring a dispute for
arbitration has been restricted after insertion of Section 11(6)(A)
in the Act. In Bharat Sanchar Nigam Ltd. & Anr. Versus M/s.
Nortel Networks India Pvt. Ltd. (supra), the Apex Court after
relying on the various judgments has held that only in the very
limited category of cases, where there is not even a vestige of
doubt that the claim is ex facie time-barred, or that the dispute is
non-arbitrable, that the court may decline to make the reference.
However, if there is even the slightest doubt, the rule is to refer
the dispute to arbitration, otherwise it would encroach upon what
is essentially a matter to be determined by the tribunal.
9. In the present case in hand, admittedly the final bill as per
the reply of the non-applicant was prepared in December, 2017.
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From perusal of the reply, it is also evident that the amount of the
final bill has not been paid by the non-applicants, as the tender
limit has exceeded the financial jurisdiction of the non-applicants
and the same is pending for the approval of the State
Government. The non-claimants have clearly mentioned in the
reply that as and when they will receive the approval of the State
Government, without any delay, dues payable to applicant as per
his final bill will be paid. Since the non-applicants have not
disputed that the final bill has not been paid and that the same is
pending before the State Government, the fact that the final bill
was prepared in December, 2017 is also not disputed and since
the notice has been given on 16.09.2020 i.e. within 3 years of the
preparation of the final bill, the same cannot be said to be barred
by limitation.
10. Admittedly, there is an arbitration clause, the claim is
pending and payment of final bill is also pending with the non-
applicants, hence, this Court deems it proper to allow the present
arbitration application and the same is accordingly, allowed. This
Court appoints Mr. Justice K.S. Chaudhari (Retired), B-231, Meera
Path, Vaishali Nagar, Jaipur, as the sole arbitrator to decide the
dispute.
11. The appointment of the sole arbitrator is subject to the
declarations being made under Section 12 of the Arbitration and
Conciliation Act, 1996 with respect to the independence and
impartiality, and the ability to devote sufficient time to complete
the arbitration within prescribed period.
12. Accordingly, arbitration application stands allowed. The
arbitrator shall be entitled to lay down fees as provided under
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Manual of Procedure for Alternative Disputes Resolution, 2009 as
amended from time to time.
13. Registry is directed to intimate Mr. Justice K.S. Chaudhari
(Retired) and obtain his formal consent.
14. The observations made herein-above are only for the
purpose of deciding the present application and the same will not
disentitle the parties to raise all valid objections before the learned
Arbitrator and the Arbitrator will be free to dispose the said
objection without being influenced by the observations made by
this Court.
(PANKAJ BHANDARI),J
SUNIL SOLANKI /PS
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