Shyam Narayan And Bros vs P N Writer And Company Pvt Ltd - Arbitration Petition

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Shyam Narayan And Bros vs P N Writer And Company Pvt Ltd. on 23 March, 2026

2026:BHC-OS:6929

                                                                           Judgment-ARBP-526-2015-F.doc

                            IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                 ORDINARY ORIGINAL CIVIL JURISDICTION
       Digitally
       signed by
       CHAITANYA

CHAITANYA ASHOK
ASHOK
JADHAV
JADHAV
Date:
ARBITRATION PETITION NO. 526 OF 2015
2026.03.23
15:31:37
+0530

                     Shyam Narayan and Bros.                                               ...Petitioner
                                Versus
                     P N. Writer and Company Pvt. Ltd.                                     ...Respondent

                         Mr. Madhuranjan Shetty, for Petitioner.

                         Mr. Hasmit Trivedi a/w. Mr. Neeraj Salodkar i/b. Praxis
                         Legal, for Respondent.

                                              CORAM        : SOMASEKHAR SUNDARESAN, J.
                                              DATE         : MARCH 23, 2026.

                    JUDGEMENT : Context and Factual Background:

1. This is a Petition filed under Section 34 of the Arbitration and

Conciliation Act, 1996 ("the Act"), challenging an Arbitral Award dated

January 07, 2013, passed by the Arbitral Tribunal ("Impugned

Award"). The core issue that arises in this matter is whether the

rejection of the claims on the ground that it was barred by limitation,

deserves interference.
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1. The Impugned Award relates to certain excavation work

carried out by the Petitioner, Shyam Narayan and Brothers ("Shyam"),

upon being engaged by the Respondent, P N. Writer and Company Pvt.

Ltd. ("Writer"), pursuant to a Work Order.

1. The Work Order was for a value of Rs.49,61,100/- with a

stipulated commencement date of October 27, 2005, with the work

having to be completed within a period of 45 days, i.e. by December 11,

1. Eventually, additional work was assigned and the cost of the work

was enhanced to Rs.65,28,565/-. It is common ground that the work

could not be completed by December 11, 2005, and was instead

completed on March 15, 2006. The conflict between the parties relates

to the reasons for the delay and the allocation of accountability for what

caused such delay.

1. According to Shyam, once the work was certified by

consultants appointed by Writer, payment was to be released for the

work done. The specifications and instructions for the work were also

issued by such consultants. After completion of the work on March 15,

2006, the final bill dated March 18, 2006 was raised, and the

consultants are said to have certified the final bill for an amount of

Rs.65,28,565/-. This is also said to have been confirmed by the

consultants in their letter dated November 15, 2008.

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1. Writer, however, disputed the bill, which led to arbitration.

Writer had made part payments in the sum of Rs.4,84,997/- on October

11, 2005, and another payment of Rs.24,71,828/- on December 28,

2005, pursuant to two running bills raised by Shyam on Writer. A TDS

Certificate dated March 07, 2006, was issued by Writer indicating that

an amount of Rs. 11,52,256/- was paid by Writer to Shyam on February

8, 2006, but it is Shyam's contention that such an amount was actually

not released by Writer.

1. Therefore, the total amount received by Shyam from Writer

was to the tune of Rs. 30,50,387/- and the balance amount of Rs.

34,78,178/- pursuant to the final bill was the subject matter of the

dispute. Shyam also claimed a refund of the earnest money deposited in

the sum of Rs.1,50,000/- and the retention amount of Rs.5,92,929/-

along with interest.

1. On March 06, 2009, Shyam is said to have been approached

by Writer and it is contended that upon the request of an officer of

Writer, a copy of the final bill dated November 10, 2006, was handed

over to Writer. Thereafter, correspondence followed between the

parties, and Shyam wrote several letters to Writer, including letters

dated July 8, 2010 and September 18, 2010, demanding the balance

payment. In response, Shyam contends that Writer's officers invited

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Shyam for discussions for settlement of claims on October 1, 2010, and

at that meeting, certain calculations were scribbled, which, Shyam

contends, amounted to an admission of liability of Rs.23,95,618/-

towards the balance payment payable to Shyam.

1. This meeting is said to have been recorded by Shyam in a

letter dated October 4, 2010, objecting to the calculations made,

protesting against the wrongful recovery of Rs.7,50,000/- towards

liquidated damages and other deductions of Rs.4,82,560/-. Shyam is

said to have threatened legal action, which led to Writer issuing a denial

in a letter dated January 28, 2011.

1. A notice for winding up was issued by Shyam, and Company

Petition No. 359 of 2011 was filed in this Court on July 15, 2011, seeking

the winding up of Writer. Writer, thereafter, wrote a letter dated

September 22, 2011, indicating liquidated damages to the tune of

Rs.~47.50 lakhs and alluding to the existence of an arbitration clause in

the tender conditions. The certified balance amount of Rs.~23.95 lakhs

as stated to have been certified by the consultants was not disputed, but

Writer also raised a claim for liquidated damages of Rs.~47.50 lakhs.

March 23, 2026
Chaitanya

                                                    Judgment-ARBP-526-2015-F.doc

1. This standoff led to invocation of arbitration by Shyam on

October 24, 2011, pursuant to which a three-member Arbitral Tribunal

was constituted to deal with the proceedings.

1. At the threshold, Writer took up a defence that the claims

were hopelessly barred by limitation and called upon the Learned

Arbitral Tribunal to rule on its own jurisdiction in terms of Section 16 of

the Act. The Learned Arbitral Tribunal allowed the parties to lead

evidence in relation to certain disputed documents, and thereafter

placed the matter for arguments. According to Shyam, only the [Section

16](https://indiankanoon.org/doc/675839/) Application ought to have been considered, but the Learned Arbitral

Tribunal went on to deal with the matter in its entirety and passed the

Impugned Award on merits without rendering a separate decision on

the Application made under Section 16 of the Act. This course of action

was challenged under Section 37 of the Act; however, the challenge was

rejected on the premise that it ought to be filed under Section 34 of the

Act, leading to the present proceedings.

Contentions of the Parties:

1. I have heard Mr. Madhuranjan Shetty, Learned Advocate for

Shyam and Mr. Hasmit Trivedi, Learned Advocate for Writer.
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1. Shyam would contend that the Impugned Award is wholly

illegal since the Learned Arbitral Tribunal did not deal with the

jurisdictional question under Section 16 first, and instead went on to

pass the Impugned Award. According to him, the Tribunal was under a

legal obligation to decide the preliminary issue of jurisdiction first, and

only then proceed to pass the Award on merits in the matter. This, as

contended, would constitute an absence of a judicial approach.

1. According to Mr. Shetty, the first unequivocal rejection of

Shyam's claims took place only on January 28, 2011, because this is the

first time that Writer used express language indicating its unwillingness

to pay even the amount certified by the consultants and earlier

admitted, and instead, offered a sum of Rs.~23.95 lakhs after

discussions with Shyam. He would submit that the right to sue accrued

only when such a complete repudiation took place, but the Learned

Arbitral Tribunal has erroneously taken a view that the right to sue had

accrued when the final bill was defaulted upon.

1. It is also contended that Article 18 of the Limitation Act, 1963 (" Limitation Act ") would have no application to the facts of the case,

since the tender conditions themselves provided a timeline for payment

by insisting on certification by the consultants upon completion, and the

appropriate Article would be Article 113 of the Limitation Act, and the

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Learned Arbitral Tribunal was in error in not accepting this principle as

well. The starting point, according to Mr. Shetty, was wrongly held to be

the date of certification of the bill (November 10, 2006) rather than the

date of unequivocal denial of the bill (January 28, 2011). Mr. Shetty

would submit that the Learned Arbitral Tribunal, by not considering the

fact that the bills were not finalised, ought to have held that the claim

made by Shyam on July 8, 2010 was the date on which the cause of

action accrued, and therefore, it is from this date that the question of

limitation would have to be computed.

Analysis and Findings:

1. The Impugned Award is a short one, running into six pages,

essentially holding against Shyam, primarily, on the ground of

extraordinary delay. The Learned Arbitral Tribunal noted that the

certification of the final bill by the consultants had been effected on

November 10, 2006, which was said to have been reaffirmed

subsequently on November 15, 2008. The Learned Arbitral Tribunal

noticed the contention on behalf of Writer that when one counts the

limitation of three years from November 10, 2006, the invocation of

arbitration took place only on October 24, 2011, which is nearly five

years after the certification of the final bill by the Consultants.

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Chaitanya

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1. The Learned Arbitral Tribunal noticed the affidavit of one

Mr. Kaustubh Raikar, Executive Director of the Consultants, which

confirmed that he had issued a second certification on November 15,

1. However, the said affidavit clearly asserted that Mr. Raikar would

not make himself available for cross-examination. Therefore, the

Learned Arbitral Tribunal specifically gave another opportunity to

Shyam to enable Mr. Raikar to attend, regardless of his earlier position

of not being willing to be subjected to cross-examination, but this was

not availed of by Shyam.

1. The Learned Arbitral Tribunal took a view that under [Section

18](https://indiankanoon.org/doc/85586/) of the Limitation Act, intermittent letters dated October 13, 2008,

and November 15, 2008, the receipt of which was denied by Writer, in

any case, would not lead to an acknowledgment of liability on the part of

Writer. The Learned Arbitral Tribunal, upon appreciation of evidence,

came to the view that it was not convinced of these letters actually

having been served upon Writer. Yet, looking into their contents, the

Learned Arbitral Tribunal came to a view that the letters do not entail

any acknowledgment of liability and, therefore, the provisions of [Section

18](https://indiankanoon.org/doc/85586/) would not have any application, for extending the date from which

the clock of limitation must start ticking.

March 23, 2026
Chaitanya

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1. The Learned Arbitral Tribunal also examined the contention

that the entitlement to payment would commence only after the

Consultants certify the bill. This is precisely why the Learned Arbitral

Tribunal took the view that limitation must be computed from the date

on which the Consultants certified the final bill, namely November 10,

2006, and therefore held that the limitation period of three years

expired on November 10, 2009.

1. According to Shyam, Article 113 of the Limitation Act must

apply, and towards the same, certain decisions were cited. However, the

Learned Arbitral Tribunal took the view that the period of limitation for

arbitration would start only when the dispute regarding arbitration is

first raised by the parties. Applying Article 113, the right to sue accrued

when Writer disputed and denied payment even after the certification

by the consultants on November 10, 2006, and the finding that the

claim was hopelessly barred by limitation cannot be faulted.

1. Even if the reference to arbitration proceedings may not be

barred by limitation with reference to the invocation, whether the

underlying claims are barred by limitation would have reference to the

accrual of the underlying cause of action, and this was held against

Shyam. This approach cannot be faulted.

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Chaitanya

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1. The Learned Arbitral Tribunal took the view, rightly in my

view, that the right to sue accrued right after the Consultants certified

the final bill and despite such certification, Writer was denying its

obligation to pay; therefore, the cause of action accrued from that point

of time. Arbitration was admittedly invoked only on October 24, 2011.

This was five years after the cause of action for recovery of the final bill

had accrued on November 10, 2006.

1. Having examined the material on record with the assistance

of Learned Advocates for the parties, it is also apparent that on the face

of it, the contentions raised by Shyam before the Learned Arbitral

Tribunal have been squarely examined and exhaustively dealt with, with

particular regard to the facet of limitation. Necessarily, limitation was a

mixed question of fact and law for the Learned Arbitral Tribunal, and on

the basis of the evidence available before the Arbitral Tribunal, the

Tribunal, being the master of the evidence, has examined the relevant

contents of the evidence and returned a finding.

1. The test for this Court, in exercise of jurisdiction under Section 34 of the Act, is to see whether in doing so, the Tribunal has

ignored any vital evidence or whether the Tribunal has taken into

account any extraneous facet as relevant for consideration. The Tribunal

has indeed tested the communications claimed to have been issued in

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the interregnum. The said letters dated October 13, 2008, and

November 15, 2008, have been rightly held not to constitute any

acknowledgment of liability on Writer's part. Such a finding is quite

logical and reasonable, and it could not be possible for this Court to

second guess and interpret the same on the basis of its own assessment

of how such correspondence should be read.

1. That apart, when it is claimed that the consultants issued

another certification on November 15, 2008, it ought to have been

necessary for Shyam to produce the Consultant for cross-examination.

In any case, the basis for a second certification of the same work done

would not result in the accrual clock being reset, unless the parties had

agreed to have some facet re-examined and that led to the second

certification. Even if Mr. Kaustubh Raikar was unwilling to come for

cross-examination, recourse could have been had to Section 27 of the

Act, to have a witness summons issued to Mr. Raikar, particularly when

the affidavit filed by him was sought to be pressed into service by Shyam

in the arbitration proceedings. When Shyam, of its own accord, was

unwilling to have its witness, i.e., Mr. Raikar, step into the box to defend

his affidavit and have the same tested in the course of the arbitration

proceedings, the view taken by the Learned Arbitral Tribunal in relation

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to resetting the date to November 15, 2008 cannot be lightly interfered

with.

1. As regards the refund of the earnest money deposit, the same,

having fallen due on May 07, 2005, was held to be barred by limitation

by 2011 when the claim was made. The Learned Arbitral Tribunal went

on to deal with the return of the retention amount. Shyam's pleadings

indicated that these amounts were due from September 15, 2006.

1. The issue of retention money also came up for consideration.

It was contended that 50% was to be released along with the final bill

and the balance 50% was to be released after the defect liability period

of one year from the issue of the final completion certificate. Relying on

the second purported certification claimed by Shyam, it was contended

that the claim for at least 50% of the retention amount was not barred

by limitation. However, having examined the work order that was

actually issued by Writer to Shyam, the Arbitral Tribunal noted that the

work order provided for 10% of the retention amount having to be given

against a bank guarantee for six months after completion and handover.

The Arbitral Tribunal returned a finding that the refund of the retention

amount is covered by the work order and that it was due after six

months from the completion of the contract, which indeed is consistent

with the pleadings made by Shyam in the arbitration proceedings.

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1. Even if the tender conditions were applied (ignoring the work

order), considering that the work had been completed by March 15,

2006, which is a stated date of completion asserted by Shyam, the

period for computing the deadline for refund of retention money ought

to be computed from that date, and one year from such date would lead

to the deadline being March 15, 2007. The claim, therefore, applying a

period of three years, was held to be alive until March 15, 2010, but the

arbitration was invoked only in October 2011, thereby resulting in this

claim being barred by limitation.

1. Finally, the Learned Arbitral Tribunal held that claims in

relation to loss suffered by Shyam because of a delay occasioned by

Writer constituted a claim for compensation for breach of contract, and

in this regard, it was held that Article 55 of the Limitation Act would

apply. As the contract had been completed on March 15, 2006, any

claim for compensation on account of delay ought to be computed from

March 15, 2006, and on this ground too, the claim for compensation in

view of delay was dismissed as being barred by limitation.

1. As a result, it was stated that the claim for costs too would not

survive, since each of the claims made in the matter stood dismissed on

the ground of limitation.

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1. Having examined the record and the notes of the settlement

meeting pressed into service by Mr. Shetty, it is apparent that the

unanimous decision of the three-member Learned Arbitral Tribunal

does not call for interference. The findings on limitation, even as a

mixed question of fact and law, are logical and reasoned. The

interpretation of evidence does not lend itself to a finding that any vital

evidence was ignored. The interpretation of law is in line with the

declared position in law.

Scope 0f Review:

1. It is now well settled in the law, and repeatedly iterated by

the Supreme Court, that the Section 34 Court must not lightly interfere

with arbitral awards. The scope of review by the Section 34 Court is also

well covered in multiple judgements of the Supreme Court including

Dyna Technologies1, Associate Builders2, Ssyangyong3,

Konkan Railway4 and OPG Power5. To avoid prolixity, I do not

think it necessary to burden this judgement with quotations from these

judgements. Suffice it to say (to extract from just one of the foregoing),

in Dyna Technologies, the Supreme Court held thus:

1 Dyna Technologies Private Limited v. Crompton Greaves Ltd - (2019) 20 SCC 1
2 Associate Builders vs. Delhi Development Authority - (2015) 3 SCC 49
3 Ssangyong Engineering & Construction Co. Ltd. v. National Highways Authority of
India - (2019) 15 SCC 131
4 Konkan Railways v. Chenab Bridge Project Undertaking - 2023 INSC 742
5 OPG Power vs. Enoxio - (2025) 2 SCC 417

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"24. There is no dispute that Section 34 of the Arbitration Act limits a
challenge to an award only on the grounds provided therein or as interpreted
by various courts. We need to be cognizant of the fact that arbitral awards
should not be interfered with in a casual and cavalier manner, unless the court
comes to a conclusion that the perversity of the award goes to the root of the
matter without there being a possibility of alternative interpretation which
may sustain the arbitral award. Section 34 is different in its approach and
cannot be equated with a normal appellate jurisdiction. The mandate
under Section 34 is to respect the finality of the arbitral award and the party
autonomy to get their dispute adjudicated by an alternative forum as provided
under the law. If the courts were to interfere with the arbitral award in the
usual course on factual aspects, then the commercial wisdom behind opting
for alternate dispute resolution would stand frustrated.

1. Moreover, umpteen number of judgments of this Court have categorically held that the courts should not interfere with an award merely because an alternative view on facts and interpretation of contract exists. The courts need to be cautious and should defer to the view taken by the Arbitral Tribunal even if the reasoning provided in the award is implied unless such award portrays perversity unpardonable under Section 34 of the Arbitration Act." [Emphasis Supplied]

1. In the facts of this case, having examined the record and for

the reasons set out above, in my view, it would not be appropriate for

this Court to interfere with an eminently reasonable and logical view

taken by the Arbitral Tribunal and replace it with a competing view

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canvassed on behalf of Shyam. Considering the findings of fact based on

appreciation of evidence, regardless of the dispute sought to be raised

on the applicable Article in the Limitation Act, the distinction sought to

be pointed out would not make a difference in the facts of the case.

1. In the result, the Section 34 Petition is finally disposed of

without any interference with the Impugned Award.

1. All actions required to be taken pursuant to this order shall

be taken upon receipt of a downloaded copy as available on this Court's

website.

[ SOMASEKHAR SUNDARESAN, J.]

                                  March 23, 2026

Chaitanya