BHARAT COKING COAL LTD. versus L.K. AHUJA

Citation: [2004] 3 S.C.R. 1105 · Decided: 12-04-2004 · Supreme Court of India · Bench: S. RAJENDRA BABU · Disposal: Disposed off

Judgment (excerpt)

BHARAT COKING COAL LTD. 
A 
V. 
L.K. AHUJA . 
APRIL 12, 2004 
[S. RAJENDRA BABU AND ASHOK BHAN, JJ.] 
B 
Arbitration Act, 1940-Sections 15 rlw 30 and 39(2): 
Dispute-Award of Arbitrator-Grant of claims-Application for setting 
aside and improving the award-Held: In view of the facts of the case award C 
modified 
Award of Arbitrator-Interference with- Scope of-Held: When award 
is passed in view of pleadings, the evidence and terms of contract, there is no 
scope for interference-Even if two views are possible view of Arbitrator D 
would prevail-However, the same can be interfered with when Arbitrator 
exceeds the terms of agreement and award is passed in absence of evidence 
apparent on the face of the award. 
Limitation Act, 1963-Artic/e 1J9(b)-Application for setting aside 
award-Limitation Period-Commencement of-Held: It commences from the E 
date of notice of the same by the Court and not from the date of filing as mere 
knowledge of passing an award is not sufficient. 
Disputes in respect of contract of work were referred for arbiLation. 
After a round of litigation, Supreme Court remanded the matter back to 
Arbitrator for fresh consideration, appointing a new Arbitrator. There F 
was large difference in the original and subsequent claim. The Arbitrator, 
regarding claim of final bill, found that the same had not been paid fully 
and allowed the claim regarding the balance amount. In the final bill, 
claim was also made with regard to extra work and the same was rejected 
on the ground that there was no order in writing by the Engineer-in-Chief G 
and that even if it had been executed, it had been paid for. Claim for 
labour escalation was awarded around 50% of the claim because for 
prolongation of the work as contractor as well as appellant, both were 
responsible for the de!ay. Claim for refund of Sales Tax was allowed by 
Arbitrator holding that Sales Tax was leviable. Claim for additional 
1105 
H 
1106 
SUPREME COURT REPORTS 
[2004) 3 S.C.R. 
A payment consisted of four items i.e. extra work, watch and ward expenses 
for the staff of 18 members, rolling margin and refund of security deposit. 
Claim for extra work was rejected as the same was already considered in 
final bill. The claim for watch and ward expenses was awarded only to 
the extent of Rs. 1,40,000 as against Rs. 7,09,000 for a reduced period of 
14 months holding that 3 members of staff would have been sufficient. 
B The other two claims were also rejected. Regarding material escalation 
only half of the claim was allowed on the ground that though the material 
was used, but in view of having secured a sum by way of advance, the 
escalation would get off-set and further running account payments would 
have taken into consideration the price rise. Claim for loss arising out of 
C turnover due to prolongation of work was allowed to the extent of 15% 
of the profit, holding that there was no justification for asking for the 
compensation under the head, as compensation was obtained on account 
of escalation in wage and material price. Interest was also paid on the 
amount. The award was submitted in this Court on 18.2.2002, copies of 
which were also served upon the parties. On 11.3.2002 when the matter 
D was listed before the Court, parties took notice of the same. On I 1.4.2002 
appellant filed application raising objection to the passing of decree in 
terms of the award. 
Respondents contended that the limitation period for filing 
E application for setting aside an award in terms of Article I 19(b) of 
Limitation Act, 1963 is 30 days from the date of filing of the award in the 
Court and hence objections filed were barred by limitation as the counting 
of 30 days commenced on 18.2.2002. 
F 
Disposing of the appeals, the Court 
HELD: I.I. Article 119(b) of the Limitation Act, 1963 prescribes 
a period of limitation of 30 days for making an application after the 
required notice regarding filing of the award in the Court is given to the 
parties. If there is no material to show that a notice of filing of the award 
has ever been given to the parties, any period of limitation as prescribed 
G in Article II 9(b) loses its significance. Mere knowledge of passing of an 
award is not enough. The period of limitation will commence as provided 
in Article 119(b) only upon notice as to filing of the award in the Court 
has been given to the parties concerned. 11111-A-BI 
1.2. Though on 18.2.2002 the Registry notified the submission of the 
H award i

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