M/S. EMM ENN ASSOCIATES versus COMMANDER WORKS ENGINEER & ORS.

Citation: [2016] 5 S.C.R. 503 · Decided: 29-06-2016 · Supreme Court of India · Bench: ABHAY MANOHAR SAPRE · Disposal: Appeal(s) allowed

Judgment (excerpt)

[2016] 5 S.C.R. 503 
M/S. EMM ENN ASSOCIATES 
v. 
COMMANDER WORKS ENGINEER & ORS. 
(Civil Appeal No.7184 of2008) 
JUNE 29, 2016 
[ABHAY MANOHAR SAPRE AND ASHOK BHUSHAN, JJ.) 
Arbitration and Conciliation Act, 1996 - s. 11 - Work contract 
- To appellant-contractor, by Government - After completion of 
work, payment of undisputed part of final bill on 10.4.2001 - As 
per the contract defect liability period was two years, during which 
recovery could be made from the contractor - On 23.2.2005 
contractor served notice to the Government raising other claims 
which were disputed - Claim denied - Letter by contractor to 
Government for appoint111ent of arbitrator as per the contract -
Thereafter application uls.11 filed - Rejection of application by 
the Chief Justice of High Court on the ground that the clai111 was 
not a live clai111 and the notice dated 23.2.2005 was ti111e-barred -
On appeal, held: The Chief Justice since exercises judicial power 
while deciding application u/s. 11, can examine the question as to 
whether the claim survives or needs to be adjudicated - But a clai111 
can be held to be a dead claim only when the clai111 is evidently and 
patently long time-barred and there is no need for any detailed 
consideration of evidence - Jn the present case there was a dispute 
which needed adjudication after looking into all relevant documents, 
which could have been appropriately exa111ined by Arbitral Tribunal 
- Case remitted to Designated Judge for appointment of the 
arbitrator. 
Allowing the appeals and remitting the matters to 
Designated Judge, the Court 
HELD: 1. The Chief Justice exercises the judicial power 
while passing an order under Section 11 of the Arbitration and 
Conciliation Act, 1996 and thus can examine the question as to 
whether the claim which has been raised before him survives 
and needs to he adjudicated. If Chief Justice finds that claim is a 
dead claim, he can exercise jurisdiction in rejecting the 
application. [Para 17] [ 509-B-C) 
503 
A 
B 
c 
D 
E 
F 
G 
H 
504 
SUPREME COURT REPORTS 
[2016) 5 S.C.R. 
A 
SEP & CO. versus Patel Engineering Ltd and another 
2005 (4) Suppl. SCR 688 : (2005) 8 SCC 618 - relied 
on. 
B 
c 
D 
E 
F 
G 
H 
2. An application under Section 11 of the Act is expected to 
contain pleading about the existence of a dispute and the applicant 
is not expected to justify the claim or plead extensively in regard 
to limitation or production of document to demonstrate that claim 
is within time in proceeding under Section 11 and that issue should 
normally be left to the Arbitral Tribunal. Therefore, the Chief 
Justice may chose to hold a claim as a dead claim only when the 
claim is evidently and patently long time barred claim and there 
is no need for any detailed consideration of evidence. [Paras 19 
and 20] [510-C-D, H; 511-A) 
Indian Oil Corporation Limited v. SPS Engineering 
Limited 2011 (2) SCR 512 : 2011 (3) SC 507 - relied 
on. 
3. In the present case, the appellant has also contended 
that there is a defect liability period of two years during which 
any recovery can be made from the contractor. Further the 
categorical case of the appellant was that final payment made at 
10.04.2001 was the final payment of the undisputed claim and 
there were other claims of the appellant which were disputed. 
There being no adjudication with regard to disputed claim, the 
claim raised by notice dated 23.02.2005 cannot be said to be 
barred by time or a dead claim. [Para 21] [511-B-C] 
4. The examination of the additional materials brought on 
this appeal, d.oes indicate that the case required consideration of 
relevant bills and certificates and determination on the question 
as to whether the claim laid by appellant was a dead claim and 
was not a live claim depended upon scrutiny of relevant 
documents. The pleadings in the proceeding under Section 11 by 
the appellant were clearly to the effect that on 10.04.2001, he 
was paid only undisputed part and the appellant has reserved his 
right to raise claim to the disputed part. [Para 25] [513-A-B) 
5. Thus, there was a dispute which needed an adjudication 
after looking into all relevant documents, bills and certificates 
which could have been appropriately examined by Arbitral 
MIS. EMM ENN ASSOCIATES v. COMMANDER WORKS 
505 
ENGINEER & ORS. 
Tribunal and the observation of the Chief Justice "As the appellant 
A 
has failed to prinw facie show this court that there was a live 
claim of the appellant" is not co

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