‘é_ lag; IN THE HON’BLE HIGH COURT OF CHHATTISGARH AT BILASPUR. 21") gr W. Pg. No. 9379 OF 2009 PETITIONER / M/S. PAUL BROTHERS, A registered 4 AwbiCr-C U!“ Partnership Firm having its office at 57, l 51‘ 7 Near Indora Police Station, Kamptee Road Post Office, Nagpur, Tahsil & District— NAGPUR. [Maharashtra State] =VERSUS= RESPONDENT /’: M/s. SOUTH EASTERN COALFIELDS é/ NEW A Ppguyd” LTD. (Formerly Western Coalfields Ltd.) a 1?”, a, > its subsidiary Chairman-cum-Managing of Coal India Limited, Director through (C.M.D.) having its registered office at Bilaspur, Post Office Bilaspur (CHHATTISGARH) ‘L RIT PETITION UNDER ARTICLES %6’AND 227 OF THE CONSTITUTION OF INDIA. W HIGH COURT OF CHHATTISGARH AT BILASPUR Singie Bench: Hon’ble Shri Justice Prashant Kumar Mishra " Writ Petition (227) No.3519 of 2009 Writ Petition (227) No.3522 of 2009 Writ Petition (227) No.3523 of 2009 Writ Petition (227) No.3550 of 2009 ORDER Sd/- Judge i Prashant Kumar Mishra Post for i —1-2011 i M I 7 ’1 Petitioner Writ Petition 1227) No.351 9 of 2009 M/s Paul Brothers VerSUS Resgondent Mls South Eastern Coalfields Ltd. Present: Shri Manoj Kumar Sinha, counl for the petitioner. Dr. N.K.Shukia, Senior Advocate with Shri V.P.Singh, counsel for the respondent” Petitioner Resgondent Present: Dr. N.K.Shukla, Senior Advocate with Shri V.P.Singh, counsel for the respondent. Writ Petition under Article 227 of the Constitution of India Writ Petition 12271 No.3522 of 2009 M/s Paul Brothers Mls South Eastern Coalfields Ltd. Petitioner Respondent Present: Dr. N.K.Shukla, Senior Advocate with,Shri V.P.Singh, counsel for the resondent. p M/s Paul Brothers Mls South Eastern Coalfields Ltd. \ Writ Petition under Article 227 of the Constitution of India 4 HIGH COURT OF CHHATTISGARH AT BILASPUR _S_i_rl_qle Bench: Hon’ble Shri Justice Prashant Kumar Mishra Vel’SUS Shri Manoj Kumar Sinha, counsel for the petitioner. Shri Manoj Kumar Sinha. coun‘sel for the petitioner. Writ Petition under Article 227 of the Constitution of India Writ Petition 1227) No.3523 of 2009 VEI’SUS M se / /’ 2 Writ Petition (227) No.3530 of 2009 Petitioner M/s Paul Brothers VGFSUS Respondent M/s South Eastern ~ Coalflelds Ltd. Present: Shri Manoj Kumar Sinha, counsel for the petitioner. Dr. N.K.Shukla, SeniorAdvocate with Shri V.P.Singh, counsel forthe respondent. Writ Petition under Article 227 of the Constitution of India \/q ORDERv (Passed on Wk January, 2011) This order shall govern disposal of Writ Petitions (227) No.3519/2009, 3522/2009, 3523/2009 and 3550/2009 as all the writ petitions involve common question. In the impugned order passed in all the four writ petitions, the learned District Judge has rejected petitioner’s application under Sections 5, 11 and 12 of the Arbitration Act, 1940 (henceforth ‘the Act’) on the ground that the application is barred by limitation. The main order-is passed in Writ Petition (227) No.3519/2009. 2. Brief facts of the case are that the petitioner M/s Paul Brothers i/ _ was awarded contract by the respondent M/s South Eastern Coalfields Ltd. (henceforth ‘the SECL’) and an agreement was entered into in pursuance to the said award of contract. The agreement contained an arbitration clause. A dispute arose with regard to and in course of execution of contract and, therefore, the petitioner moved an application und’er Section 20 of the Act before the District Judge, Bilaspur for reference of the dispute to the ,/ 1 3. As no award was delivered even after completion of the proceedings. the petitioner submitted an application on 13-8-2003 seeking information as to further date of arbitration. ln response to this application of the petitioner, the sole arbitrator informed him that he has become functtis officio and the record has been sent back to the Chairman-cum—Managing Director of the SECL on 25-2-2002. The petitioner made a request to the SECL to send back the record to the sole arbitrator, however, the respondent/SECL did not respond. Another reminder by the petitioner to the respondent also fell in deaf ear. The petitioner,thereafter moved the subject L \ 3 arbitrator. By order dated 11—7-1996, the'rDistrict Judge allowed the said application of the petitioner and referred the dispute for adjudication to the arbitrator to be nominated by the Chairman—cum- 4 Managing Director of the respondent/SECL. In the said order, the District Judge directed that the arbitrator so nominated shall make an award in writing and shall submit the same within four months from the date of receipt of order of reference. In pursuance to the said order of the District Judge, the Chairman-cum—Managing Director of the SECL, by ietter dated 15-7—1996, appointed Shri J.P.Thakur,’Chief Engineer (Civil) of the SECL as the sole arbitrator and requested him to pass an award within four months. The sole arbitrator entered into the dispute for adjudication and commenced the arbitration proceedings. The period of four months expired on 11-11-1996, however, the arbitration proceedings continued till 2002. application before the District Judge, Bilaspur under Sections 5, 11 4 W and 12 of the Act inter alia seeking a pr’a'yer for a direction to direct the SECL to send the documents to the sole arbitrator for passing award or to send the same to any other sole arbitrator to be § appointed by m_utual agreement or to appoint any other person as arbitrator and refer the matter for adjudication. The application was later on transferred to the District Judge, Korba. The District Judge, by his order dated 20-6-2007 (Annexure P-10), rejected the application on the ground that since the Act has been repealed, he has no jurisdiction to entertain the application. The petitioner preferred Arbitration Case No.29l2007 before the High Court, which was disposed of by order dated 4-4—2008 (Annexure P—11) directing the District Judge to decide the application on merits. This order was passed by the High Court relying on the judgment of the Hon’ble Supreme Court in Neeraj Munjal and others vs. Atul Grover (Minor) and another, AIR 2005 SC 2867. The District Judge, Korba has thereafter passed the impugned order. 4. Learned counsel for the petitioner would argue that the petitioner received information from the arbitrator, for the first time, on 20-8-2003 and prior to this date, he was not aware that the arbitrator had become functus officio, therefore, the application was within limitation. According to learned counsel for the petitioner, the cause of action for filing the application under Sections 5, 11 and 12 of the Act arose on 28-8-2003 when he received the letter dated 20- 8~2003 from the arbitrator lt is further argued that in any case the \ respondent havrng parttcrpated in the proceedings after expiry of / four months there was deemed enlargement of time under Section s W/ 28 of the Act and the sole arbitrator had riot become functus officio. Reliance is placed by learned counsel for the petitioneron the jndgments in Hinduetan Steelworks Construction Ltd. vs. C.‘ Rajasekhar Rao, (1987) 4 SCC 93, State of Punjab vs. Hardyal, ~AIR 1985 SC 920, Nagar Palika, Mirza‘pur’vs. Mirzapur Elect. Supply Co. Ltd., AIR 1990 SC 2273, Eastern Coalfields vs. Joscon, (2003) 12 SCC 339, The State of Kerala and another vs. K.P. Poulose,-AIR 1973 Kerala 237, The State of Madhya Pradesh and others vs. Babulal Pathak, AIR 1974 MP 179 and Fertilisers 'and Chemicals Travancore Ltd. vs. lndustry Side Pvt. Ltd. and others, 1988 (2) Arbitration Law Reporter (Kerala High Court) 59. 5. Learned Senior Advocate for the respondent has argued that the application tiled by the petitioner under Sections 5, 11 and 12 of the Act was apparently barred by limitation and the learned District Judge has not committed any error of law by rejecting the petitioner’s application. 6. During pendency of these writ petitions, the petitioner moved an application for a. direction to the respondent to supply certified copies of the arbitration proceedings before the sole arbitrator of Mr. - J.P.Thakur. Learned counsel for the respondent sought time to file response to this application, however, it was later on informed that the tile sent back by the sole arbitrator to the SECL is not traceable. It is also informed by the learned counsel for the respondent at the I r/Bar that in the meanwhile the sole afbitrator has died. 6 , 7. The only question to be decided 'in these writ petitions is whether the proceedings before the sole arbitrator was continued with the implied consent of the parties even after expiry of four months and that in the facts and circumstances of the case whether ‘time can be extended under Section 28-of the Act. 8. The petitioner, in paragraphs 8.6, 9.5, 9.6 and 9.7 of Writ Petition (227) No.3519/2009, has stated that the proceedings before the sole arbitrator continued without any objection by the respondentlSECL. While replying to these paragraphs of the petition, the respondent has not challenged the correctness of the statement, neither the tile containing the' proceedings of the arbitration by the sole arbitrator has been made available to this Court. Thus, this Court is inclined to hold that the arbitration proceedings continued after expiry of four months with the implied consent of the parties as no objection was raised by the respondent/SECL to the continuance of the arbitration proceedings. 83 9. In Hindustan Steelworks Construction Ltd. vs. C. Rajasekhar Rao (supra), the Hon’ble Supreme Court, after relying upon its earlier decision in State of Punjab vs. Hardyal (supra), has laid down the law that when the parties had taken willing part in the proceedings before the arbitrator without demur and had‘all along been willing to extend time and had also proceeded before the Umpire on that basis which is just and proper, this will be a tit case for extension of time under‘Section 28 of the Act. The Hon’ble ———L#m Supreme Court ultimately granted time for giving the award and it was further directed that the award will be deemed to have been ‘ / 11. ln the present case, it is to be seen that the petitioner cannot be made responsible for the delay in making the award and in any case in the absence of record, no such presumption can be drawn. ~\j This is a case where the parties appgared before the arbitrators t/ r t 7 M given in time. In Nagar Paiika, Mirza’pur vs. Mirzapur Elect. Supply Co. Ltd. (supra), the Hon’ble Supreme Court has held that t‘he conduct of the parties is a major factor to waive the extension of time given by the Court and the time be taken as extended. In ‘ Fertilisers and Chemicals Travancore Ltd. vs. Industry Side Pvt. Ltd. and others (supra), it has been held that Section 28 of the Act gives power to the Court to extend time and does not impose any obligation for making a formal application in this behalf. An application for enlargement of time was only in the nature of a reminder to the Court to exercise its powers and was not subject to any limitation. In the said case, the dispute remained pending before the arbitrator for more than six years without any proceeding and one of the parties moved an application for removal of arbitrator and for appointment of another. This prayer was opposed by the other party on the ground that the application was barred by limitation under Article 137 of the Limitation Act. 10. In Hari Shankar Lal vs. Shambunath Prasad, AIR 1962 SC 78, it has been held that the competency of the arbitrations to act arises out of the reference‘made by the parties and not dependent on the period during Which they ought to make the award. even after the expiry of four months without any protest or objection. 8 The dispute between the parties are not yet decided by any Court or other authority. A party to a litigation cannot be left without remedy. 12. In view of the above, all the four writ petitions under Article 227 of the Constitution of India deserve to be and are hereby allowed. The application preferred by the petitioner was under Sections 5, 11 and 12 of the Act. As informed by the respondent that in the meanwhile, the sole arbitrator has died, the said arbitrator cannot be directed to commence the proceedings from the stage where it was stopped, therefore, in the facts and circumstances of the case, the respondent/SECL is directed to appoint an arbitrator within a period of one month from the date of this order for adjudication of the dispute. The respondent/SECL is further directed to reconstruct the record and hand over complete record to the arbitrator appointed by it. There shall be no order as to costs. 13. A copy of this order be placed on the record of the three connected writ petitions. Sd/— Prashant Kumar Mishra l j Judge Gopal