Allowed

A K Builders v. Delhi Tourism and Transportation Development Corporation Ltd.

Delhi HC5 Nov 2024ARB.P./365/2024

Case brief

AI extract

What is this about?

Petitioner sought appointment of a sole arbitrator under Section 11 of the Arbitration Act regarding a construction dispute. The Court held that the claim was within limitation due to pandemic extension orders and that the arbitrary mechanism under the contract was properly exhausted. The petition was allowed.

What did the court decide?

Appointment of Mr. Vidit Gupta as Sole Arbitrator to adjudicate disputes under the aegis of DIAC.

A K Builders Vs Delhi Tourism and Transportation Development… — Arbitration | Delhi HC (2024)

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IN THE HIGH COURT OF DELHI AT NEW DELHI

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- ARB.P. 365/2024 A K BUILDERS

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.....Petitioner

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Through: Mr. BK Prabhat, Mr. Bhola Dayal, Mr. Ashok Kr. Verma, Advs.

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versus

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DELHI TOURISM AND TRANSPORTATION DEVELOPMENT CORPORATION LTD

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.....Respondent

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Through: Mr. Siddhant Nath, SC with Mr. Bhavishya Makhija, Adv.

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CORAM:

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HON'BLE MR. JUSTICE JASMEET SINGH O R D E R % 05.11.2024

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This is a petition filed under Section 11 of the Arbitration and Conciliation Act, 1996 seeking appointment of the Sole Arbitrator for adjudication of disputes between the parties.

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In the present case, the respondent awarded the contract on 24.02.2018 for upgradation of Coffee Home, Connaught Place, New Delhi. After completion of the work, the respondent issued completion certificate. Thereafter, the petitioner submitted its final bill to the respondent. On 11.07.2022, the respondent in its letter acknowledged the balance amount and stated that the after sanction is received, the same will be released to the petitioner.

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The arbitration clause is clause 25 of General Conditions of Contract

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This is a digitally signed order.

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The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 13/11/2024 at 12:08:34

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which reads as under:-

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This is a digitally signed order.

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The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 13/11/2024 at 12:08:34

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This is a digitally signed order.

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The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above.

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The Order is downloaded from the DHC Server on 13/11/2024 at 12:08:34

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This is a digitally signed order.

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The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 13/11/2024 at 12:08:34

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As the dues of the petitioner were not cleared, the petitioner invoked the arbitration clause in the manner as contemplated and thereafter filed the present petition.

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Mr. Nath, learned Standing Counsel states that the reply to the present petitioner has been filed, however, the same is not on record. The copy of the reply has been handed over in Court today which is taken on record.

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He opposes the present petition on the ground that the claims of the petitioner are barred by limitation and the mechanism as contemplated under the arbitration clause has not been followed.

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He states that in terms of clause 25(1), the petitioner was required to first approach the Superintending Engineer, thereafter the Executive Engineer, thereafter the Dispute Redressal Committee and lastly to the Court by filing the present petition. Since none of them has been

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This is a digitally signed order.

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The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 13/11/2024 at 12:08:34

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followed, the present petition is pre-mature.

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As regards the issue of limitation is concerned, the Hon’ble Supreme Court in Arif Azim Co. Ltd. v. Aptech Ltd., (2024) 5 SCC 313 has observed as under:-

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“84. Thus, in ordinary circumstances, the limitation period available to the petitioner for raising a claim would have come to an end after an expiry of three years, that is, on 273-2021. However, in March 2020, the entire world was taken under the grip of the deadly Covid-19 Pandemic bringing everyday life and commercial activity to a complete halt across the globe. Taking cognizance of this unfortunate turn of events, this Court vide order dated 23-32020 passed in Cognizance for Extension of Limitation, In re [Cognizance for Extension of Limitation, In re, (2020) 19 SCC 10 : (2021) 3 SCC (Cri) 801] directed the period commencing from 15-3-2020 to be excluded for the purposes of computation of limitation. The said extension of limitation was extended from time to time by this Court in view of the continuing pandemic. As a result, the period from 15-3-2020 to 28-2-2022 was finally determined to be excluded for the computation of limitation. It was provided that the balance period of limitation as available on 15-32020 would become available from 1-3-2022.”

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In the present case, the final bill was submitted in the month of August, 2019 and as per the arbitration clause, the petitioner approached the Executive Engineer of the respondent on 08.09.2022. The judgment of

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This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 13/11/2024 at 12:08:34

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Hon’ble Supreme Court in Cognizance for Extension of Limitation, In re, (2020) 19 SCC 10 has observed that the period from 15.03.2020 to 28.02.2022 shall be excluded for the purposes of computation of limitation. The petitioner consumed the period of approx. 7 months out of 3 years and the balance period i.e. 2 years 5 months, if added from 01.03.2022, the limitation period would expire on or before July, 2024.

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As noted above, the arbitration mechanism was invoked on 08.09.2022. Hence, the petitioner invoked the arbitration mechanism within 3 years of the disputes having been arisen between the parties.

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As regards the arbitration mechanism is concerned, firstly the petitioner issued legal notice to the Executive Engineer on 08.09.2022 as there was no Superintending Engineer which was the first step as envisaged under arbitration clause. It is not disputed in the reply of the respondent that there was no Superintending Engineer at that time.

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Since the disputes were not addressed, the petitioner then approached the Managing Director on 11.05.2023 as there was no Chief Engineer. It is also not disputed that there was no Chief Engineer at that time. The petitioner issued another notice requesting the respondent to constitute the Dispute Redressal Committee or appoint an Arbitrator. The same was also not replied by the respondent. The petitioner having exhausted all the mechanism as envisaged under the arbitration clause, the present petition has been rightly filed by the petitioner.

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For the said reasons, I am satisfied that, the petition is within limitation and also the petitioner had followed the mechanism as envisaged under Clause 25 quoted above.

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For the said reasons, the petition is allowed and the following

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This is a digitally signed order.

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The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 13/11/2024 at 12:08:34

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directions are issued:-

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i) Mr. Vidit Gupta, Advocate (Mob. No. 9910995511) is appointed as a Sole Arbitrator to adjudicate the disputes between the parties.

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ii) The arbitration will be held under the aegis of the Delhi International Arbitration Centre, Delhi High Court, Sher Shah Road, New Delhi (hereinafter, referred to as the ‘DIAC’).

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iii) The remuneration of the learned Arbitrator shall be in terms of DIAC (Administrative Cost and Arbitrators’ Fees) Rules, 2018.

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iv) The learned Arbitrator is requested to furnish a declaration in terms of Section 12 of the Act prior to entering into the reference.

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v) It is made clear that all the rights and contentions of the parties, including as to the arbitrability of any of the claim, any other preliminary objection, as well as claims/counter-claims and merits of the dispute of either of the parties, are left open for adjudication by the learned arbitrator.

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vi) The parties shall approach the learned Arbitrator within two weeks from today.

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With these directions, the petition is disposed of.

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JASMEET SINGH, J

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NOVEMBER 5, 2024 / (MS)

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Click here to check corrigendum, if any

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This is a digitally signed order.

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The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 13/11/2024 at 12:08:34

A K Builders v. Delhi Tourism and Transportation Development Corporation Ltd.

Case brief

What is this about?

What did the court decide?

A K Builders v. Delhi Tourism and Transportation Development Corporation Ltd.

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Cases cited

Statutes considered

Parties & counsel

Coram

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