Suit filed beyond the time specified barred.

Mishra, J.

A learned single Judge of this Court has held that since a clause in the arbitration agreement contemplated a period of limitation of one year, the plaintiffs appellant’s suit under Sec.20 of the Indian Arbitration Act, 1940 was filed beyond time. We record, however, before we state the facts that the impugned judgment cannot be sustained for the reason of the authoritative pronouncement of the Supreme Court of India in the case of Kerala State Electricity Board, Trivandrum v. T.P.K.K.Amson and Besom, Kerala, A.I.R. 1977 S.C. 282 and another authoritative pronouncement of the Supreme Court in the case of Union of India v. M/s.L.K.Ahuja & Company, A.I.R. 1988 S.C.1172. Facts which are not in dispute are that the appellant herein was appointed by the respondent Corporation to transport foodgrains, fertilizers, etc. from Madras Port to Air Field (vacant space of their storage) at Sholavaram for a period of three months from 4. 1976. After furnishing the required security deposit, the appellant carried on and completed the work of transport of foodgrains and fertilizers, as stated above. It appears, however, that after the completion of work the appellant furnished a detailed statement to the respondent on 7. 1976. The respondent issued a cheque for Rs.7,517.09 purported to be in full and final settlement of the claims of the plaintiff/appellant on 28. 1977. The respondent while issuing the cheque deducted Rs.17,482.91 from the security deposit of Rs.25,000 of the appellant towards transit dues and transit loss. On 28. 1977 the appellant wrote to the respondent that any deduction from the security deposit was unwarranted and requested for reconsideration and refund of the said amount. The appellant issued a lawyer’s notice on 10. 1977 in which resides requesting refund of the full security deposit the appellant also alleged that it had incurred a loss to the tune of Rs.74,760 on account of the alleged detention of the lorries at the Air Strip during nights on several days without being unloaded and demanded the respondent to compensate the loss. The respondent replied to the above on 11. 1977 repudiating all claims of the appellant. On 4. 1980 the appellant issued a letter demanding appointment of an arbitrator under Clause 19 of the terms and conditions of the agreement. It followed the said letter by reminders on 16. 1980, 7. 1980, 8. 1980 and 19.121980.The only reply to all these, however, came from the Joint Manager in the Office of the respondent on 22. 1981 stating that the request for appointment of an arbitrator could not be considered. The appellant then came to the Court and filed the suit, C.S.No.489 of (AA) under Sec.20 of the Indian Arbitration Act, 1940.

2. Learned single Judge has considered the question of limitation after quoting the proviso to Clause 19 of the agreement and thereafter saying “Now, it is for consideration whether there is justifiable reason for invoking Sec.37(4) of the Indian Arbitration Act, 1940” and then quoting Sec.37(4) to finally say:

“A reading of Sub-sec.(4) of Sec.37 of the Act clearly envisages that the terms of the agreement including the term relating to limitation for referring the dispute to Arbitration, will prevail subject to the condition that the party aggrieved in appropriate cases, can invoke the benefit of Sub-sec.(4) of Sec.37 of the Act. In the present case, the defendant, at any rate has clearly negatived the claim of the plaintiff by a letter dated 28. 1977. Again, the defendant denied its liability on 11. 1977. Strictly speaking, the plaintiff should have asked for a reference to the Arbitrator within one year from 7. 1976 or at least within one year from 11. 1977. However, the plaintiff, for reason best known to itself, has called upon the Managing Director of the Food Corporation of India to appoint an Arbitrator under Clause XIX of the Contract by a letter dated 4. 1980. It is clear from the dates given above, that the request for appointment of