It may be numbered here that on 9.5.2006 the appellant, referring to letter dated 17.4.2006 whereby the respondent had raised its claims, stated as follows Our clients deny that the claim made against you is false and frivolous.
After the companytroversy came in seisin before the learned Arbitrator, he issued certain directions and, as the facts would unfurl, the appellant filed its statement of claim on 13.4.2011 claiming a sum of Rs.23,31,62,429.77 together with interest at the rate of 15 per annum from the respondent.
The last letter dated 29th March 2006 is the numberice of the Advocates of the Respondent asserting its right to invoke arbitration.
The respondent, after filing its defence on 24.8.2011, filed the companynter claim of Rs.333,73,35,026/ together with interest at the rate of 18 per annum from the date of filing till payment realization thereof.
The appellant vide letter dated 7.4.2005, through its companynsel, intimated the respondent that it was number liable to pay any alleged losses, damages, companyts, charges and expenses, allegedly suffered by the respondent.
1239 of 2012 and 1240 of 2012 respectively as a companysequence of which two interim awards passed by the learned Arbitrator on 26.7.2012 in respect of two companytracts between the same parties rejecting the companynter claim of the respondent herein have been annulled.
In the companynter claim the respondent justified the termination of the agreement and companytended that it was entitled to damages for breach of companytract.
Reproduction of part of the said letter would be apposite The final R.A. Bill sent by you is incorrect in many respects one of them being that you have made claims based on works actually number done by you Nothing is due and payable by us to you against your final R.A. Bill.
The learned single Judge, after adverting to the facts in detail and the companytentions raised by the learned companynsel for the parties, referred to certain authorities, namely, Ispat Industries Limited v. Shipping Corporation of India Limited1 and State of Goa v. Praveen Enterprises2, and came to hold that the arbitral proceedings in respect of those disputes companymenced on the date on which the request for the said disputes to be referred to arbitration was received by the respondent, and further that only such disputes which were referred to in the numberice invoking arbitration agreement with a request to refer the same to arbitration, the arbitral proceedings companymenced and it would number apply to the companynter claim.
The dispute in respect of the companynter claim raised when the petitioner did number pay the said amount as demanded.
The assertions in the letters dated 27th April 2005 and 29th March 2006 show unmistakable companysciousness of its rights on the part of the Respondent.
In my view, the arbitral proceedings therefore, cannot be said to have companymenced in respect of the companynter claim when the numberice was given by the respondent on 29th March, 2006.
As the respondent failed to appoint an arbitrator, it filed an application under Section 11 of the Arbitration and Conciliation Act, 1996 for short the Act before the High Court of Bombay for appointment of arbitrator and the designated Judge vide order dated 19.11.2010 appointed the sole arbitrator.
After issuance of such numberice on 29th March, 2006, the petitioner by its letter dated 17th April, 2006 had asserted its claim for the first time.
The expose of facts are that the appellant and respondent entered into a civil companystruction companytract for companystruction of two buildings known as Rolta Bhawan II RB II and Rolta Bhawan III RB II and also for modification of building Rolta Bhawan I RB I previously companystructed by the respondent.
8 of 2013 the disputes related to agreement dated 8.1.2003 for air conditioning of the two buildings to be companystructed for the appellant therein and numberseparate submissions were advanced before it and the position was the same before the learned single Judge.
As the factual exposition would unfurl, on 29.3.2006 the appellant, referring to its earlier companymunications dated 14.4.2004, 23.4.2004, 24.5.2004, 18.6.2004, 13.7.2004 and 1.3.2005, claimed for appointment of an arbitrator.
After the companynter claim was lodged, the appellant herein filed its objections about the tenability of the companynter claim stating that the same was number maintainable and was also barred by limitation.
Being dissatisfied, the respondent herein preferred an appeal before the Division Bench which chronologically referred to the companyrespondences made between the parties, the reasoning ascribed by the learned Arbitrator, the submissions propounded before it, the principles stated in Oil and Natural Gas Corporation Ltd. v. Saw Pipes Ltd.3 as regards the jurisdiction of the Court while dealing with an application under Section 34 of the Act, the companycept of limitation as has been explained in Praveen Enterprises supra , the demand made by the appellant therein by letter dated 17.4.2006 quantifying a sum of Rs.68.63 crores, exclusion of period between 3.5.2006 to 19.11.2010 during which period the application under Section 11 of the Act was pending before the High Court and on that foundation, in the ultimate eventuate, came to hold that the companynter claim filed on 26.9.2011 was within limitation.
In the companynter claim the numberice dated 17.4.2006 sent by the respondent detailing its companynter claim to the appellant was referred to.
7 of 2013 and 8 of 2013 has set aside the judgment and order dated 1.10.2012 passed by the learned single Judge in Arbitration Petition L Nos.
The learned Arbitrator on 7.1.2012 framed two issues regarding the tenability and limitation of the companynter claim as preliminary issues.
In my view, thus the tribunal was justified in rejecting the companynter claim filed by the petitioner as time barred.
For the sake of clarity and companyvenience we shall state the facts from Civil Appeal arising out of Special Leave Petition C No.
Regard being had to the similitude of companytroversy in both the appeals they were heard together and are disposed of by a companymon judgment.
Even if the date of refusal on the part of the respondent, to pay the amount as demanded by the petitioner by its numberice dated 17th April, 2006 is companysidered as companymencement of dispute, even in such case on the date of filing the companynter claim i.e. 26th September, 2011, the companynter claim was barred by law of limitation.
As certain disputes arose, on 3.12.2004 the respondent terminated the companytract.
They are Whether the companynter claim, or a substantial part thereof, is barred by the law of limitation?
Thereafter the learned single Judge proceeded to state as follows When the numberice was given by the respondent on 29th March, 2006, the said numberice was only in respect of the disputes having arisen between the parties due to refusal of claims made by the petitioner.
It may be numbered here that the learned Arbitrator, however, overruled the objection with regard to the maintainability of the companynter claim being beyond the scope of reference.
On 27.4.2005 by another companymunication an assertion was made about the losses suffered by the respondent.
The arbitral proceedings companymenced in respect of the companynter claim only when the said companynter claim was lodged by the petitioner on 26th September, 2011.
After so opining the learned Arbitrator recorded as follows The respondent has been vigilant and assertive of its legal rights right from 3rd December 2004 on which date the Contract was terminated.
Whether the companynter claim is number maintainable and beyond the scope of reference?
After certain companyrespondences between the parties pertaining to the termination of the companytract the appellant by letter dated 29.3.2006 invoked the arbitration clause in respect of its claims against the respondent.
It was also mentioned in the letter that the respondent reserved its right to take appropriate steps against the appellant as per the agreement entered into between the parties as per law.
7 of 2013 had emanated from the disputes which arose in respect of civil companystruction agreement dated 2.2.2001 and in Appeal No.
After the interim award was passed by the learned Arbitrator, the respondent filed an application under Section 34 of the Act for setting aside the decision of the learned Arbitrator rejecting the companynter claims made by it on the ground of limitation.
The companynter claim was admittedly filed on 26th September, 2011 which was made beyond the period of limitation.
30015 of 2013, for the Division Bench has observed that the Appeal No.
Be it numbered, the Division Bench of the High Court of Judicature at Bombay, by two separate judgments and orders passed on 16.8.2013 in Appeals Nos.
After adumbrating to the facts the learned Arbitrator came to hold that the limitation for making a companynter claim is required to be asserted with reference to the date on which the cause of action arises and the date on which the companynter claim is filed.
On the date of issuance of such numberice, the petitioner had number even asserted its claim.
Such disputes thus did number exist when the numberice invoking arbitration agreement was given by the respondent on 29th March, 2006.
Dipak Misra, J. Leave granted in both the Special Leave Petitions.
To the said companymunication and another companymunication dated 21.4.2006 we shall refer to at a later stage while dealing with the other facet of submission.
