Gurinder Singh and Co. vs Union of India

Rakesh Kumar Jain, J.—By way of this order, I shall dispose of two revision petitions bearing CR Nos. 3271 & 3272 of 2000 as both are inter-connected. However, the facts are extracted from CR No. 3271 of 2000.

The brief facts of the case are that agreement No. CE NWC/7/80-81 for provision of certain technical building at Ambala was entered into between the petitioner and respondent-UOI on 07.10.1980. The dispute arose between the parties, but despite request of the petitioner, the matter was not referred to the Arbitrator, therefore, the petitioner filed an application u/s 20 of the Arbitration Act, 1940 (here-in-after referred to as the "Act") before the Sub Judge 1st Class, Chandigarh, in which the objection was raised that the petitioner had already submitted final bill in terms of condition no. 65 of the agreement and had given certificate of "no further claims" after receiving the payment, therefore, there was no dispute which could be referred to the Arbitrator. However, the contention of respondent no. 1 was rejected and Arbitrator was appointed to adjudicate the dispute between the parties, vide order dated 01.04.1985. According to the petitioner, this order was not challenged by respondent no. 1 and accordingly, the competent authority, i.e. the Engineer-in-Chief appointed, Shri P. Ananthram, Chief Engineer, out of the panel of Arbitrators maintained by M.E.S., as the Arbitrator. Respondent no. 1 raised objection before the Arbitrator as well that the dispute is not covered by arbitration as the contractor had already given the final bill with "no further claims" and relied upon condition no. 65 of the General Conditions of Contract, but the Arbitrator did not accept the plea of the UOI and directed it to submit its pleadings in defence on merits of the claim. Ultimately, the Arbitrator announced his award on 17.05.1986. Thereafter, the petitioner filed application under Sections 14 and 17 of the Act for making award as rule of the Court in which respondent no. 1 filed objection u/s 30 of the Act for setting aside the award, inter alia, on the ground that as per condition no. 65, no further claims should be made by the contractor after submission of the final bill as these should have been deemed to be waived of and extinguished. It is alleged that the petitioner completed his work on 01.09.1983 and final bill was signed by him with certificate "no further claim" after receiving the payment on 27.03.1984 without any reservation. The Civil Court at Chandigarh, vide its order dated 29.10.1990, dismissed the objection and ordered that the award of the Arbitrator be made rule of the Court.

The order of the Civil Court was challenged by respondent no. 1 and vide order dated 08.01.2000, appeal was allowed and the order dated 29.10.1990 was set aside which has been challenged in the present revision petitions.

Learned counsel for the petitioner has argued that even if the award of the Arbitrator does not carry reasons, it still cannot be challenged. In support of his submission, he has relied upon a judgment of this Court in the case of Union of India (UOI) Vs. Harbans Singh Tuli and Sons,

On the other hand, learned counsel for the respondents has submitted that as per condition no. 65-A of the I.A.F.W.-2249, fresh claim cannot be raised after accepting the final bill, without any reservation. In support of his submission, he has relied upon a judgment of this Court in the case of Commander Works Engineers (Air Force) Vs. Sh. Kesho Ram Sharma and Another, and a judgment of the Supreme Court in the case of Union of India (UOI) and Others Vs. Onkar Nath Bhalla and Sons,

I have heard learned counsel for the parties and perused the record.

There is no dispute that the petitioner had accepted the final bill with endorsement "no further claim" without any reservation. In this regard, the question arises as to whether acceptance of the final bill by a contractor with the endorsement "no further claim" would debar him from raising further claim in view of Clause 65-A of I.A.W.F.-2249. This question has already been answered by this Court in Commander Works Engineers (Air Force) Chandigarh''s case (supra) against the contractor holding that acceptance of the final bill without prejudice would close further claims of the contractor arising out of the contract and would not entitle him to raise further claims. Moreover, in Union of India''s case (supra), the Supreme Court has now recently held that once the final bill is signed with "no further claims" certificate, further claims are not arbitrable as after signing the final bill without any protest or reservation, the contractor waives of his right to make further claims. Once the issue involved in this case is not res integra, I do not find any reason to interfere in the order passed by the lower Appellate Court by which the order of the Trial Court has been set aside.

Accordingly, the present revision petitions are found to be without any merit and are dismissed.