2013 (1) TMI 1020 - HC - Indian Laws

Summary

Issues Involved:
1. Limitation of the Claim
2. Termination of the MOU
3. Quantum Meruit

Summary:

1. Limitation of the Claim:
The Petitioner challenged the arbitral award dated 12 November 2009 u/s 34 of the Arbitration and Conciliation Act, 1996, on the ground that the claim was barred by the law of limitation. The Arbitral Tribunal concluded that the claim was barred by limitation since the expenditure was incurred prior to 18 April 2001. The Petitioner argued that the MOU was terminated on 20 December 2002, and the arbitration was invoked on 25 June 2005, thus within the limitation period. However, the Tribunal found that the termination occurred on 26 December 2001, making the claim time-barred.

2. Termination of the MOU:
The Tribunal held that the MOU was terminated by the Petitioner's letter dated 26 December 2001, which demanded reimbursement of Rs. 4.4 Crores. The Petitioner contended that the termination was effective from 20 December 2002, but the Tribunal found that the letter of 20 December 2002 merely reiterated the termination and demand made in the letter of 26 December 2001. The Tribunal noted that the demand for interest from 26 December 2001 indicated the understanding of both parties that the MOU was terminated on that date.

3. Quantum Meruit:
The Tribunal also addressed the principle of quantum meruit, concluding that the claim was barred by limitation. The Petitioner had incurred expenditure on pre-project activities before 18 April 2001, and the Tribunal found no basis to recover these costs due to the limitation period. The Tribunal emphasized that monetary claims are governed by the law of limitation, and the Petitioner's claim was not recoverable for this reason.

Conclusion:
The High Court dismissed the Petition, upholding the Tribunal's findings that the claim was barred by limitation and that the MOU was terminated on 26 December 2001. The Court found no merit in the Petitioner's arguments and ruled that the claim for reimbursement of pre-project expenditure was time-barred. There was no order as to costs.