Claims for arbitration must be raised promptly upon accrual of rights; failure to do so results in dismissal due to limitation.

ORDER :

Michael Zothankhuma, J.

1. Heard Mr. F. Hassan, learned counsel for the petitioner. Also heard Mr. H. Gupta, learned CGC for the respondents.

2. This is an application under Section 11(6) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as 'the Arbitration Act'), for appointment of an Arbitrator in terms of the Arbitration Clause provided in the Contract Agreement dated 20.07.2010.

3. The petitioner's counsel submits that as per Clause 15.0 of the contract agreement executed between the parties, arbitration and settlement of disputes is to be governed in terms of Clause 63 and 64 of the General Conditions of Contract. He submits that the petitioner had completed the contract work in all respects in the month of June, 2017. However, the security deposit and PVC bill has not been released by the respondents despite submitting letters of release for the same by the petitioner. The petitioner's counsel submits that the petitioner had submitted a letter dated 11.05.2021 for release of the security deposit and PVC bill and as the same has not been acted upon by the respondents, the petitioner submitted letter dated 28.01.2023 to the respondents invoking the Arbitration Clause provided in the contract agreement, for appointment of an Arbitrator to decide the dispute between the parties.

4. The petitioner's counsel further submits that in terms of the petitioner's letter dated 14.01.2022, the final bill for the contract work had been signed by the Deputy Chief Engineer/Con/SPTR on 19.11.2018. He however submits that the petitioner is not agreeable to the final bill made and signed by the respondents on 19.11.2018. As the respondents have not acted upon the Arbitration Clause, this Court should appoint an Arbitrator to decide the dispute between the parties.

5. Mr. H. Gupta, learned CGC appearing for all the respondents submits that the present application under Section 11(6) of the Arbitration Act is time barred in terms of Section 21 and Section 43(1) & 43(2) of the Arbitration Act. He accordingly submits that the Arbitration Petition should be dismissed in terms of the judgment of the Supreme Court in the case of B and T AG Vs. Ministry of Defence, 2023 SCC OnLine SC 657.

6. I have heard the learned counsels for the parties.

7. Section 21 and Section 43 of the Arbitration Act states as follows-

"21. Commencement of arbitral proceedings.- Unless otherwise agreed by the parties, the arbitral proceedings in respect of a particular dispute commence on the date on which a request for that dispute to be referred to arbitration is received by the respondent."

"43. Limitations.-

(1) The Limitation Act, 1963 (36 of 1963), shall apply to arbitrations as it applies to proceedings in court.

(2) For the purposes of this section and the Limitation Act, 1963 (36 of 1963), an arbitration shall be deemed to have commenced on the date referred to in section 21.

(3) Where an arbitration agreement to submit future disputes to arbitration provides that any claim to which the agreement applies shall be barred unless some step to commence arbitral proceedings is taken within a time fixed by the agreement, and a dispute arises to which the agreement applies, the Court, if it is of opinion that in the circumstances of the case undue hardship would otherwise be caused, and notwithstanding that the time so fixed has expired, may on such terms, if any, as the justice of the case may require, extend the time for such period as it thinks proper.

(4) Where the Court orders that an arbitral award be set aside, the period between the commencement of the arbitration and the date of the order of the Court shall be excluded in computing the time prescribed by the Limitation Act, 1963 (36 of 1963),for the commencement of the proceedings (including arbitration) with respect to the dispute so submitted."

8. As can be seen from a reading of Section21 of the Arbitration Act, arbitral proceedings in respect of a particular dispute commences on the date on whi