The petitioner has invoked section 34 of the Arbitration and Conciliation Act, 1996 (for short the Arbitration Act, 1996) thereby challenged the sole Arbitrator’s Award dated

11th July 2009 passed in the matter of arbitration under the bye-laws, rules and regulations of National Stock Exchange of India Ltd (NSE).

2. By the impugned Award, the Arbitrator has rejected the claim as it is barred by limitation of six months as provided.

3. It is relevant to note that the bye-law 3 of Chapter XI of the bye-laws of the NSE provides that in case of difference or dispute where it is not possible to ascertain the date of dispute, in that case the date of transaction in respect of which the claim has arisen, deems to have been basic cause of action and, therefore, six months ought be the reckoned from that date. In the present case, last transaction was on 25th January 2008. Therefore, six months period expired on 25th July 2008.

4. However, in the present case, it is necessary to note that the petitioner sent recovery letter on 15th March 2008 and 30th September 2008 apart from the balance confirmation letter dated 10th April 2008 for balance as on 31st March 2008. The Arbitrator has also noted that the respondent did not reply to the above communication at any point of time. The contention was also raised by the petitioner that since the respondent did not respond to its letter and by circular dated 9th February 2011 issued by the Securities and Exchange Board of India (CIR/MRD/DSA/2/2011), which was circulated to all Managing Director/Executive Director of all Stock Exchanges and as the said circular is issued in exercise of powers conferred under section 11(1) of the Securities and Exchange Board of India Act, 1992 read with section 10 of the Securities Contracts (Regulation) Act, 1956, the matter be re-considered. The relevant clauses of the circular are as under:

“This is in continuation of circular ref.No.CIR/MRD/DSA/24/2010 dated August 11, 2010, which inter alia prescribed that the limitation period for filing an arbitration reference shall be governed by the provisions of the Limitation Act, 1963. In this regard upon consideration of various representations received by SEBI and pursuant to the discussions held with the representatives of stock exchanges, it has been decided that the limitation period, as modified to three years in terms of Limitation Act, 1963, shall be applicable to cover inter alia the following cases:-

i where three years have not yet elapsed and the parties have not filed for arbitration with the stock exchange, or

ii where the arbitration application was filed but was rejected solely on the ground of delay in filing within the earlier limitation period of six months; and three years have not yet elapsed;

2. The cost for arbitration in such cases would be as under:-

i Cases which were not filed earlier will be subject to the fee amount in terms of SEBI circulars dated August 11, 2010 and August 31, 2010.

ii For cases filed earlier and rejected on the ground of bar of limitation as per the earlier limitation period of six months, the amount of fee already paid would be deducted from the amount computed in terms of SEBI circulars dated August 11, 2010 and August 31, 2010. The balance shall be borne by the parties to the arbitration in the manner specified vide SEBI circulars dated August 11, 2010 and August 31, 2010.

3. Stock exchanges are advised to widely publicise (including in media) the provisions of this circular. In addition to the above, stock exchanges are also directed to inform those applicants who are eligible to file for arbitration in terms of sub-para (ii) of first para of this circular.

4. The recognised stock exchanges are advised to:-

i make necessary amendments to the relevant rules/ bye-laws/ regulations for the implementation of the above decision immediately;

ii bring the provisions of this circular to the notice of the members of the stock exchange and also to dissem