-1- IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION APPEAL NO. 85 OF 2004 IN ARBITRATION PETITION NO. 166 OF 2003 M/s. Premlaxmi & Co., ) a registered partnership firm, having their office at ) Plot No. 99, Gilbert Hill, Near Bhavan’s College, ) Andheri (W), Mumbai-400 058 )..Appellant vs. 1. Ingersoll Rand (India) Limited, ) a Company registered under the provisions of the ) Companies Act, 1913, having its office at Phase-1, ) Peenya Industrial Area, Peenya, Bangalore-560 058 ) 2. Mr. Justice D.R.Dhanuka (Retd.) ) Sole Arbitrator of the Arbitral Tribunal appointed ) by Bombay Chamber of Commerce and Industry, ) having his office at Bombay Chamber of Commerce ) and Industry, Mackinnon Mackenzie Bldg. ) Ballard Estate, Mumbai-400 001 )..Respondents Mr. U.S. Samudrala for the appellant. Mr. D.H. Mehta, instructed by M/s. Sudhir Shah & Associates, for the respondents. CORAM: P.B. MAJMUDAR & ANOOP V. MOHTA, JJ. DATE: OCTOBER 11, 2010. ORAL JUDGMENT: (Per P.B. Majmudar, J.) By way of this appeal, the appellant has challenged the order passed by the learned single Judge dated 2nd June, 2003 in Arbitration Petition No. 166 -2- of 2003 by which the learned single Judge set aside the award passed by the Arbitrator on the ground that it suffers from non-application of mind and held that it was in breach of principles of natural justice. The learned single Judge also held that the claim of the appellant was also barred by Law of Limitation and on that ground the award was set aside which order is impugned in this appeal by the appellant. 2. The appellant herein placed an order with respondent No.1 (hereinafter “the respondent”) for purchase of machineries i.e. portable compressor. Pursuant to the said order, four machines were supplied to the appellant by the respondent. The machineries were supplied during 3-4-92, 7-9-93, 3-9-92 and 21-1-93. It is the case of the appellant that the said machines were defective and it was noticed at the time when there was a breakdown in the machines. 3. The appellant thereafter filed a complaint before the National Consumer Disputes Redressal Commission on 8th February, 1994. The appellant had claimed before the National Consumer forum that the respondent should take back the machineries and refund the amount paid by the appellant to the respondent. The Consumer Forum disposed of the said complaint by an order dated 22nd January, 1996 holding that as the machines were purchased for commercial purpose by the appellant, the appellant was not a consumer within -3- the meaning of the Consumer Protection Act. The complaint was held to be not maintainable. The said order was received by the appellant on 25th February, 1996. 4. The appellant thereafter invoked the arbitration clause in the order of acceptance and the reference was made on 19th January, 1999. Both the sides appeared before the learned Arbitrator and filed their respective replies. Oral and documentary evidence was also led before the Arbitrator. The Arbitrator passed an award in favour of the appellant to the tune of Rs. 8,91,318/-. 5. The present respondent thereafter filed an application under Section 34 of the Arbitration and Conciliation Act, 1996, challenging the said Award. The main grievance of the respondent was that the aforesaid claim before the Arbitrator was barred by limitation as the cause of action for instituting the arbitration proceedings accrued on 19th January, 1994 and the arbitration proceedings were initiated in 1999. The Arbitrator held that the period between 8th February, 1994 and 25th February, 1996 is required to be excluded under Section 14 of the Limitation Act. The learned single Judge found that the appellant herein has failed to make out any case for getting exclusion of limitation period under Section 14 of the Limitation Act and accordingly set aside the award which is impugned at the instance of the appellant in this -4- appeal. 6. The learned counsel for the appellant submits that since the appellant went to the National Consumer Forum under the Consumer Protection Act, the period spent therein is required to be excluded. It is further submitted that the appellant had not engaged any advocate before the National Consumer Forum and with a bona fide impression that they are entitled to get their claim adjudicated under the Consumer Protection Act that the dispute was filed and, therefore, the period is required to be excluded. Mr. Mehta, learned counsel appearing for the respondent, on the other hand submitted that the appellant had failed to make out any case for getting benefit of Section 14 of the Limitation Act as it cannot be said that the appellant had pursued the proceedings before the National Consumer forum in a bona fide manner at all. 7. We have heard the learned counsel appearing for the parties and have gone through the record and proceedings. We have also gone through the order of the learned single Judge as well as the award of the Arbitrator. 8. So far as the Consumer Protection Act, 1986 is concerned, in our view, it is no doubt true that the proceeding before the Consumer Fora can be said to be a proceeding before the Court as it has all the trappings of a Civil Court. Therefore, in a given case if any bona fide proceedings have been -5- initiated before the Consumer Forum, the benefit of Section 14 of the Limitation Act, 1963 can still be available, if the claim is not entertained by the Forum on the ground of jurisdiction. Therefore, in our view, the authority functioning under the Consumer Forum can be said to be a court for all practical purposes. The question which requires consideration is as to whether in the facts and circumstances of the present case, the time spent before the National Consumer forum can come to the aid of the appellant to get benefit under Section 14 of the Limitation Act. At this stage, reference is required to be made under Section 14 of the Limitation Act which reads thus: “ 14. Exclusion of time of proceeding bona fide in Court without jurisdiction.- (1) In computing period of limitation for any suit the time during which the plaintiff has been prosecuting with due diligence another civil proceeding, whether in a Court of first instance or of appeal or revision, against the defendant shall be excluded, where the proceeding relates to the same matter in issue and is prosecuted in good faith in a Court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it. (2) In computing the period of limitation for any application, the time during which the applicant has been prosecuting with due diligence another civil proceeding, whether in a Court of first instance or of appeal or revision, against the same party for the same relief shall be excluded, where such proceeding is prosecuted in good faith in a Court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it. ..... ...... ......” 9. In order to find out whether the appellant was prosecuting his case -6- before the National Consumer fora with due diligence and in good faith, it is necessary to record the stand taken by the appellant before the National forum. In the cross-examination, the witness of the appellant stated as under: “We had filed a complaint before the Hon’ble Consumer Forum. We had not taken any legal advice before filing the complaints before the National Consumer Disputes Redressal Commission. On 22-1-1996, we became aware of the fact that our complaint before the Hon’ble Consumer Forum was not entertained for want of jurisdiction and we are expected to resort to some other legal remedy like filing a suit or resorting to arbitration.” The learned counsel for the appellant has fairly stated that no legal opinion was sought before approaching the National Forum. In order to get benefit of Section 14 of the Limitation Act, it is required to be proved before the Court that he was prosecuting the remedy in a wrong forum in a bona fide manner. It is an admitted fact that the appellant has not led any evidence before the Arbitrator to point out that he was prosecuting the remedy before the Consumer Forum in good faith and under genuine belief that it had jurisdiction to decide the dispute. If a party in a negligent manner and without verifying as to whether the claim is maintainable before the appropriate Court and without good faith and due diligence prosecute such proceedings, such party naturally is not entitled to the benefit under Section 14 of the Limitation Act. Learned counsel for the appellant is also not in a position to point out as to why and under what circumstances the appellant approached the National Forum. At this stage, reference is required to be made to Section 2 (d) of the Consumer Protection Act -7- which reads thus: “2 (d) “Consumer” means any person who - (i) buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or (ii) hires or avails of any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person but does not include a person who avails of such services for any commercial purpose. Explanation- For the purpose of this clause, “commercial purpose” does not include use by a person of goods bought and used by him and services availed by him exclusively for the purpose of earning his livelihood by means of self-employment.” In view of the above, it is clear that for any transaction in connection with commercial purpose, the provisions of the Act will have no application. If a party deliberately approaches a wrong forum without due care and diligence is not entitled to get benefit under Section 14 of the Limitation Act. 10. Over and above the aforesaid aspect, there is an additional fact which is not in dispute. The machinery was supplied to the appellant on 7th April, 1992. -8- The warranty period was upto 10th April, 1993. According to the appellant, the machinery broke down on 23rd November, 1992, 17th December, 1993 and 27th December, 1993, the claim was made before the Consumer Forum on 8th December, 1994 after about one year from last machinery being broke down. The Consumer Forum passed the final order dismissing the applications on 22nd January, 1996 for want of jurisdiction. The appellant invoked the arbitration clause in the order of acceptance and the reference was made on 19th January, 1999. Even for approaching the Arbitrator, the appellant waited practically for more than two years and eight months. Even the appellant approached the Consumer Forum after about one year of accruing the cause of action. It is not the case where the appellant had approached the Arbitrator immediately after the decision of the Consumer Forum. The appellant even thereafter waited for more than two years and eight months. The said facts are not in dispute and accepted by the learned counsel for the appellant. In view of the above, the claim of the appellant was beyond the period of limitation. Even if Section 14 of the Limitation Act can be said to be available, it is clear that the appellant was not diligently prosecuting his claim. The appellant was, therefore, thoroughly negligent and perhaps was taking chance by invoking the arbitration clause. Considering the said fact, in our view, the benefit of Section 14 of the Limitation Act cannot be given to the appellant in view of what is stated above as it is found that the appellant has deliberately approached a wrong forum without due care and diligence. Even otherwise, if the said period is to be excluded then also the -9- claim before the Consumer Forum is beyond limitation as the appellant had approached the Consumer Forum after one year from accruing the cause of action and after the order of Consumer Forum, the appellant remained silent for more than two years and eight months. The Appeal is accordingly dismissed with no order as to costs. P. B. MAJMUDAR, J. ANOOP V. MOHTA, J.