NATIONAL ALUMINIUM CO. LTD. & ANR. versus G.C. KANUNGO

Citation: [2009] 7 S.C.R. 333 · Decided: 29-04-2009 · Supreme Court of India · Bench: ARIJIT PASAYAT · Disposal: Appeal(s) allowed

Judgment (excerpt)

[2009] 7 S.C.R. 333 
' 
-.. 
NATIONAL ALUMINIUM CO. LTD. & ANR. 
A 
' 
v. 
G.C. KANUNGO 
Civil Appeal No. 62 of 2003 
APRIL 29, 2009 
B 
(DR. ARIJIT PASAYAT AND ASOK KUMAR 
-
GANGULY, JJ.) 
__.,. 
Arbitration Act, 1940 - s.39 - Works contract - Dispute 
in respect of dues - Arbitrator, appointed' at the request of c 
respond.ent-contractor, passing award - Civil Judge making 
the award, rule of the Court - Order challenged in appeal, on 
ground that the claim made by respondent-contractor was 
barred by limitation - High Court dismissed appeal - Held: 
.... 
On facts, there was no finality in the matter and the matter was 
alive for consideration -
Since claim was made by D 
.,/ 
respondent-contractor within period of three years, stand of 
appellant, that the claim was barred by limitation, not tenable 
- However, considering the peculiar facts of the case, interest 
directed to be granted@ 12% p.a. in place of 15% p.a. as 
awarded by the arbitrator - Limitation Act, 1963 -s. 137. 
E 
CIVILAPPELLATE JURISDICTION: Civil Appeal No. 62 
-~ 
of 2003 
From the Judgement and Order dated 28.02.2002 of the 
Hon'ble High Court of Judicature at Orissa at Cuttack in 
F 
Miscellaneous Appeal No. 630 of 2001. 
A. Sharna, ASG, Farrukh Prasad, Ashok Kumar Gupta, 
s 
for the Appellant. 
"""'-. 
R.K. Rath, Jana Kalyan Das, Milan Kanun, Avijeet Bhujabal, 
G 
·' 
for the Respondent. 
-· 
The Judgement of the Court was delivered by 
333 
H 
334 
SUPREME COURT REPORTS 
[2009] 7 S.C.R. 
A 
DR. ARIJIT PASAYAT, J. 
Ir 
v 
Heard. 
Challenge in this appeal is to the order of a learned Single 
Judge of the Orissa High Court dismissing the miscellaneous 
B appeal filed by the present appellant. In the miscellaneous 
appeal which was filed under Section 39 of Arbitration Act, 1940 
(in short the 'Act') challenge was to the order passed by learned 
Civil Judge, Senior Division, Angul making the award rule of. 
~ 
the Court. 
c 
The primary stand before the High Court was that the claim 
made by the respondent-contractor was barred in terms of 
Section 137 of the Limitation Act, 1963, (in short 'Limitation 
Act') The High Court did not accept the stand of the appellant. 
D 
In the present appeal, Mr. A.Sharan, learned ASG -
appearing for the appellant submitted that the claim was barred 
"' 
and for substantiating this stand reference was made to certain 
dates which are almost undisputed. The work order in this case 
was issued on 18.12.1985 and the work was completed on 
E 
15.6.1987. On 20.05.1995, the respondent made a request for 
appointment of an Arbitrator and on 29.6.1995 an Arbitrator was 
appointed. It is the case of the appellant that sometime in 1989, 
final bill was paid and there was nothing remaining to be paid 
and therefore the further correspondence, if any, are of no 
~· 
F 
consequence. In any event, the office notings on which reliance 
has been placed by the Arbitrator as well as the courts below 
did not confer any legal right on the respondent. It was also 
submitted that the award for the additional work done was 
against the terms of the contract. It was, however, fairly accepted 
that the later point was never argued before the High Court. It 
G was also submitted that the rate at which interest has been 
,L. 
awarded is high. 
.._ 
In response, Mr. R.K.Rath, learned senior counsel 
-' 
appearing for the respondent submitted that there are several 
H documents on which the courts below have placed reliance. This 
NATIONAL ALUMINIUM CO LTD. & ANR. V. 
335 
G.C. KANUNGO [DR. ARIJIT PASAYAT, J.] 
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unmistakably show that the matter was alive and more A 
particularly the letter of the appellant dated 26.8.1992 to the 
respondent puts the controversy beyond doubt. 
"Dear Sir, 
The case file for consideration of your different claims for 
8 
the above said work is processed. 
. ~ 
The decision is awaited . 
After the decision is known, the same shall be 
communicated to you." 
c 
In other words, there was no finality in the matter and the 
matter was alive for consideration. If this date i.e. 26.5.1992 is 
taken into account, the claim made was within the period of 
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three years. That being so, the claim as made was within the 
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period of limitation and the stand of the appellant that the claim 
D 
·<( 
was barred by limitation is not tenable. 
Another point which has been urged with some vehemence 
is that the rate at which interest has been granted is 15%. It is 
stated that rate is quite high. In response, learned co

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