High Court of Delhi was dealing with the petition to appoint/nominate an Arbitrator and to refer the entire disputes and differences that have arisen between the parties to the arbitration to be conducted by the Arbitration Tribunal.
Brief Facts:
The respondent had invited offers for “Mobile Application Development for progress monitoring of Projects across PAN India on Real Time Basis”. The petitioner was successful and the respondent awarded the contract for the aforesaid mobile application called “Garv” to the petitioner. The respondent issued a Work Order to the petitioner to develop the said mobile application at a contract value of ₹19,45,000/-. The petitioner avers that it had completed the work in accordance with the Work Order in the month of December, 2015. The work was also appreciated by the respondent company in its letter dated 05.04.2016. There is no dispute that the petitioner was paid the agreed consideration for the said work. The petitioner claims that the respondent sent an e-mail requesting for support in respect of a non-mobile application. According to the petitioner, the same was beyond the scope of work as agreed under Work Order.
Petitioner’s Contention:
Learned counsel for the petitioner submitted that the petitioner executed the said work and claimed that it was entitled to a sum of ₹56,58,006/- for the extra features and the services provided that were beyond the original scope of work under the Agreement. According to the petitioner, a sum of ₹6,35,960/- was paid in the month of April, 2016. However, the remaining amount of ₹50,22,046/- remains due and payable.
Respondent’s Contention:
Learned Counsel for the respondent has opposed the present petition on two grounds. First, on the ground that the petitioner has not issued the notice under Section 21 of the A&C Act invoking the Arbitration Clause and second, that the claim sought to be raised is barred by limitation.
HC’s Observations:
After hearing both the sides Court observed that insofar as the notice under Section 21 of the A&C Act is concerned, it is admitted that the petitioner did not send any notice to the respondent. The petitioner relies upon two communications. First, an e-mail sent to one Mr. Rajiv Sharma. This e-mail is not addressed to the respondent. However, it does indicate that the respondent had declined to pay the amount as claimed by the petitioner. The second communication relied upon by the petitioner is a complaint lodged with the Department of Administrative Reforms and Public Grievances.
Court observed that none of the said two communications are addressed to the respondent. Thus, there is merit in the contention that the petitioner has not invoked the Arbitration Clause. Merely, filing of a complaint with an unrelated government office expressing one’s grievance does not constitute a notice under Section 21 of the A&C Act. Court also observed that it is apparent from the plain language of Section 21 of the A&C Act that the arbitral proceedings would commence when a notice under Section 21 of the A&C Act is received by the concerned party.
HC addressed the second question whether the present petition can be rejected on the ground that the claims made by the petitioner are barred by limitation. Court stated that it is trite law that all contentious disputes are required to be addressed by the forum chosen by the parties – the Arbitration Tribunal. However, in cases where there is no vestige of doubt that the claims are barred by limitation, the Court would decline to appoint an arbitrator.
Court found that there is admittedly no communication issued by the respondent acknowledging any liability for the amount as claimed by the petitioner. According to the petitioner, it had completed the works in the year 2016. Whilst, the respondent has paid an amount of ₹6,35,960/- in the month of April, 2016, it had not cleared the balance.
HC Held:
After evaluating submissions made by both the parties the Court held that “the limited question to be addressed is as to whether it is ex facie clear that the claim made by the petitioner is barred by limitation. Admittedly, there is no communication acknowledging any payments due to the petitioner. It is the petitioner’s case that the respondent had denied the payments as claimed by it and had not cleared the same since 2016. In this view of the matter, there is no scope to entertain even an iota of doubt that the petitioner’s claim is barred by limitation.”
Bench: Hon'ble Mr. Justice Vibhu Bakhru
Case Title: Glocaledge Consultants Pvt Ltd v. Rec Power Distribution Company Ltd
Case Details: ARB.P. 1045/2021
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