AMIT RAWAL J. - (1.) The appellant -Union of India is aggrieved of the order declining their objection under Section 34 of the Arbitration and Conciliation Act, 1996 seeking setting aside of the Award dated 28.04.2011. Mr. Pankaj Jain, learned counsel for the petitioner submitted that work of Sardar Swaran Singh National Institute of Renewable Energy on Jalandhar -Kapurthala Road, Distt. Kapurthala was awarded to the respondents that was to be completed by 12.06.2004 but further extension was given upto 30.06.2005. However, the respondent -contractor vide letter dated 04.07.2005 repudiated the claim but the appellant granted the extension upto 31.12.2006. The claim before the Arbitrator was time barred in the sense that the arbitration clause was invoked on 28.05.2009 and claim statement was filed on 12.10.2009. Though the objection was called, issue of limitation was not taken but as per the provisions of Section 43(1) of the Arbitration and Conciliation Act, 1996 and Section 3 of the Limitation Act, the objection of limitation cannot be waived in the absence of specific pleadings. He submitted that once the contractor had abandoned the right by repudiating the contract in the year 2005, the claim made in the year 2009 was ex facie barred by law of limitation. In support of his contention, he has relied upon the judgment rendered by Hon'ble Supreme Court in Steel Authority of India Ltd. Vs. J.C. Budharaja, Government and Mining Contractor AIR 1999 SC 3275; Major (Retd) Inder Singh Rekhi Vs. Delhi Development Authority AIR 1988 SC 1007 and by a Division Bench of this Court in Sharma and Associates Vs. State of Punjab and others 2006(1) RCR (Civil) 213. He further submitted that the Arbitrator exceeded its jurisdiction in granting the Award more than what was claimed in the letter dated 04.07.2005 (Annexure A -2) which is part and parcel of the record of the arbitration proceedings. The contractor had alleged following claims: - JUDGEMENT_42_LAWS(P&H)7_2016.jpg
(2.) The claims from Sr. No.5 onwards are on account of demobilization and damages w.e.f. 30.12.2005 to 31.03.2009. Though in the objection petition filed under Section 34 of the Act, this specific objection was not taken but in view of the provisions referred to above, the plea can be taken at any stage of the proceedings. He further submitted that finalization of the bill would not enlarge the scope of limitation, much less, fall within the expression acknowledgment of payment. He further submitted that the claim on account of loss of profit is not maintainable as it is beyond the scope of Section 73 of Indian Contract Act. The damages have to be ascertained on the day of breach of the contract and no future damages can be claimed in the afore -mentioned provisions. Even the Additional District Judge failed to assign reasons qua the claim being barred by law of limitation. The Arbitrator travelled beyond the terms of the agreement as the appellant was well within its rights to proceed against the contractor under Section 3 (a) (b) and (c) of the Contract. In support of his contention, he has also relied upon the provisions of Article 55 of the Limitation Act and thus, urges this Court for setting aside the Award as well as the impugned order under challenge.
(3.) There is a caveat and Mr. Ashish Aggarwal, Senior Advocate assisted by Mr. Nikhil Handa, Advocate for the caveator raised the following arguments: - (i) That the appellant fore -closed the contract vide letter dated 16.04.2007 proved by the Government on 13.07.2007 w.e.f. 29.03.2005. The appellant did not get the work done by the contractor on account of not releasing the payment due whereas the appellant -Union of India was cautioned for charging the future interest on outstanding dues. On various occasions, the appellant was requested to effect the measurement of the work already done by the respondent -contractor. On 13.07.2007, 03.08.2007, 07.01.2008 and 03.02.2008, the appellant was requested but did not yield any result. It is only on 26.08.2008, the joint measurement was weighed and there was admission of the appellant for preparation of the final bill on 07.11.2008. The respondent had also submitted the final bill which was rejected by the appellant on 07.01.2009 and since Clause 25 of the Contract envisaged the filing of the appeal to the Superintending Engineer, appeal was filed but again it did not yield result and accordingly, the jurisdiction of the Engineer -in - Chief vide letter dated 28.05.2009 (Annexure A -6) was invoked. Ultimately, the matter was referred to the Arbitrator. In view of the aforementioned facts, the Award cannot be said to be beyond limitation. The Department had acknowledged the preparation of the final bill on 07.11.2008. The joint measurement was done only in 2008 and thus, claim cannot be said to be beyond 3 years as the claim statement was filed on 12.10.2009 and the matter was referred to the Arbitrator few months back i.e. On 20.07.2009. (ii) That the claim was totally in consonance with the bills raised qua work done as well as liquidated damages as per the provisions of Section 73 of the Indian Contract Act. This aspect has been noticed by the Arbitrator in extenso. In this regard, he has drawn the attention of this Court to the Award of the Arbitrator. (iii) He further submitted that there is little scope of interference in the appeal as the objections at the instance of the appellant were not falling within the provisions of Section 34 of the Arbitration and Conciliation Act. (iv) He further submitted that even scope of public policy has been enlarged by the Hon'ble Supreme Court in Associate Builder Vs. Delhi Development Authority 2015 (3) SCC 49 and in view of the aforementioned ratio decidendi, the point of limitation does not fall within the enlarged scope of public policy. ;