IMPORTANT POINT
– There is no limitation prescri

Dhiraj Singh Thakur, J.

The present petition has been filed under Section 11(6) of the Jammu and Kashmir Arbitration and Conciliation Act, 1997 for reference of the disputes mentioned in the petition for arbitration to an independent arbitrator.

2. It is averred that the petitioner was incorporated as a partner along with the respondent in the business of selling of LPG Gas and the partnership deed executed between them, which was registered before the learned Sub- Registrar, 2nd Additional Munsiff, Jammu on 26-4-2011.

3. It is further averred by the petitioner that he had invested a capital of Rs. 20,00,000/- (Rupees Twenty Lacs) in the partnership business with the understanding that the profits would be shared in equal proportion by both the partners but subsequently it is averred that the respondent went back on his promise and stopped sharing the profits of the business and also filed a suit for permanent prohibitory injunction, restraining the petitioner from interfering into the business of Gas Agency, which is run in the name and style of M/s. Shaheed Mohd. Fareed Gas Agency, Nowshera).

4. Further it is averred that the disputes have arisen between the parties, which are required to be adjudicated upon in accordance with the arbitration clause contained in the agreement.

5. Per contra, the respondent in his objections has taken a stand that the arbitration petition is barred by limitation and in view of the fact that a civil suit has been filed by the respondent, seeking declaration that the partnership deed be declared as null and void, the present arbitration petition is not maintainable.

6. It was further averred by the respondent that a sum of Rs. 20,00,000/- (Rupees Twenty Lacs), which was advanced as loan to the respondent had since been paid back and therefore, disputes raised by the petitioner was illusory.

7. Heard learned counsel for the parties.

8. The issue with regard to application of the Jammu and Kashmir Limitation Act to arbitration petitions is no longer res integra. A full Bench of this Court in M/s. Megha Enterprises & Ors. v. State & Ors. as reported in AIR 1995 J&K 16 has in very clear terms held in paragraph 17 as under:

'In the premises, we hold that Article 181 of the State Limitation Act, 1938, does not govern and is not applicable to applications filed under the special acts including the applications under Section 20 of the Arbitration Act and is limited to application under the Code of Civil Procedure only. In other words, it does not prescribe any time limitation for an application under Section 20 of the Arbitration Act or for any application under the special act. We answer the reference accordingly but hasten to add that it will be the duty of the arbitrator to consider the plea of limitation and to decide whether or not the claims of appellants are time barred.'

9. Although reference in the aforementioned judgment was to Section 20 under the Jammu and Kashmir Arbitration Act, 1945, which has since been repealed, yet the provisions of the J&K Limitation Act, Samvat, 1995 continue to remain the same.

10. Section 43 of the J.&K. Arbitration and Conciliation Act, 1997 applies the provisions of the Limitation Act, Samvat, 1995 to arbitrations as it applies to proceedings in court. Sub-section (2) of Section 43 of the said Act envisages that for purposes of Section 43 and the Limitation Act, Samvat, 1995, an arbitration shall be deemed to have commenced on the date referred to in Section 21. Section 21 deals with commencement and completion of arbitral proceedings and is reproduced hereunder:

21. Commencement and completion of arbitral proceedings.

Unless otherwise agreed by the parties the arbitral proceedings in respect of a particular dispute.-

(a) shall commence on the date on which a request for that dispute to be referred to arbitration is received by the respondent; and

(b) shall be completed within a period of four months from the date of its commencement under Clause (a).

11. The Apex Court