A suit filed beyond the prescribed period of limitation is liable to be dismissed, even though the plea of limitation had not been set up as a defence.

JAISHREE THAKUR, J.

1. The appellant herein is aggrieved against the order of the Additional District Judge dated 13.5.2016, dismissing the objections petition filed under Section 34 of the Arbitration and Conciliation Act 1996 against the award of the sole arbitrator dated 14.02.2013.

2. In brief the facts as alleged are that BSNL, the appellant herein, floated a tender for hiring of light commercial vehicles on long-term use in Jalandhar area in August 2004 for the period 1.11.2004 to 31.10.2005. The respondent was a successful bidder in the above-mentioned tender and in the terms of the contract was asked to submit documents of minimum 9 vehicles of models not older than the year 2001. However, as the said documents were not supplied despite repeated reminders - rather the contractor stopped providing the vehicles w.e.f. 20.2.2005. On this the contract was terminated by order dated 24.5.2005 and the security amount of Rs. 2,50,000/- was forfeited. The appellant was also forced thereafter to hire vehicles from the open market. Since the payment for the use of vehicles had not been made despite using the same for a period of three months, a claim was raised by the respondent-contractor for a sum of Rs. 4,29,208/- along with 8% per annum. In the claim, it was contended that the appellant had illegally terminated the contract on the ground that relevant documents were not supplied regarding the model of the car, despite using them. It was stated that the respondent had stopped supplying cars to BSNL since it had not made payment for the use of the cars for three months. A claim was raised by the respondent -contractor pursuant to which an arbitrator was appointed vide 4.7.2012 to determine the dispute.

3. The appellant was given time to controvert the claim and complete evidence. The arbitrator allowed the claim of the respondent herein which award came to be challenged before the District Judge under Section 34 of the Arbitration And Conciliation Act 1996. The District Judge dismissed the objections and upheld the award. Aggrieved against the dismissal of objections, the instant appeal first appeal has been preferred.

4. Mr. Anil Rathee, learned advocate appearing on behalf of the appellant, argues that the objections have wrongly been dismissed, while laying great emphasis on the plea that the claim was raised beyond the period of limitation. It is argued that it was incumbent upon the arbitrator to decide the question of limitation, even though no such plea was set up as a defence before the Arbitrator.

5. Per contra, Mr. Kamal Sharma, learned counsel appearing on behalf of the respondent submits that the claim was rightly raised since the appellant had used the cars for a period of three months and had not made any payment for such use. It is contended that all relevant papers were supplied, however, it is the department itself which did not process the same. It is also argued that the plea of limitation was never raised before the arbitrator or even the District Judge and now the appellant is estopped from doing so.

6. In view of the pleadings of the parties and the submissions so made, the following questions of law arise for consideration in this appeal.

1. Whether the question of limitation can be taken at any stage of the proceedings?

2. Whether it was incumbent upon the Arbitrator to decide the question of limitation even though no such plea was set up as a defence?

7. In order to answer the above framed questions, it would be relevant to re-produce Section 3 of the Limitation Act 1963, which reads as under:

3. Bar of limitation.- (1) Subject to the provisions contained in sections 4 to 24 (inclusive), every suit instituted, appeal preferred, and application made after the prescribed period shall be dismissed, although limitation has not been set up as a defence.

(2) For the purposes of this Act- (2) For the purposes of this Act-"a suit is instituted- (a) a suit is instituted-"

(i) in an ordinary case, when the plaint i