JUDGMENT

B. P. JEEVAN REDDY, J. :- Heard counsel for the parties.

2. Leave granted.

3. The civil appeal is directed against the judgment of a Division Bench of Kerala High Court allowing the appeal preferred by the State of Kerala and setting aside the order of the learned Subordinate Judge, Thiruvanathapuram. On an application made under S. 20 of the Arbitration Act by the appellant, the learned Subordinate Judge had directed the appointment of an arbitrator to decide the dispute and differences between the parties. He directed both the parties "to submit their panels of arbitrator to be appointed within ten days from the date of the order" for that purpose. A Division Bench set aside the said order on the ground that the very application under S. 20 was barred by limitation.

4. An agreement was entered into between the appellant and the State of Kerala on 19-2-1966 whereunder the appellant under. took to carry out certain work within a period of ten months. He did not complete the work within the period prescribed whereupon the contract was terminated on 19-12-1968 and the work re-tendered. It was completed by another contractor. State of Kerala took proceedings under the provisions of the Revenue Recovery Act for recovering the loss suffered by the State on account of the appellants failure to carry out the work in accordance with the contract. A notice of demand was served upon him on 30-5-1974. The appellant challenged the said notice by way of a writ petition in the High Court.of Kerala which was dismissed on 25-11-1978. In the year 1983, he applied to the Government of Kerala to refer the disputes and. differences between them to an arbitrator. This was refused in the year 1984, whereupon the appellant filed the application under S. 20 of the Arbitration Act before the learned Subordinate Judge. He prayed for the appointment of an arbitrator to decide the disputes arising between him and the State of Kerala. In their written statement the State raised several objections including limitation and res judicata. An objection was also raised as to the maintainability of the said application. It was submitted that according to clause (3) of the contract, the Superintending Engineer, (B&R) South Circle, Trivandrum is the named arbitrator. In that view of the matter, it was submitted, the appellants request for appointing an arbitrator by the court is inadmissible and liable to be rejected.

5. The learned Subordinate Judge concluded that here is a case where certain claims were put forward by the plaintiff which were denied by the defendants. (In the State of Kerala, an application under S. 20 is registered as a suit). Since there is a clause in the agreement providing for arbitration, the disputes and differences arising between the parties ought to be referred. He rejected the various objections raised by the state. The operative paragraph of the judgment reads:

"In the result the disputes and differences mentioned in para 10 of the plaint are hereby ordered to be referred to an arbitrator for arbitration. Both parties are directed to submit their panels of arbitrator to be appointed within 10 days from this date."

6. The State of Kerala filed an appeal which has been allowed by the Division Bench, as stated hereinabove, on the only ground that the very application under Sec. 20 was barred by Article 137 (and also under Art. 113) of the Limitation Act, 1963. The High Court held that the three years period of limitation prescribed by the said Articles commenced on 30-5-1974 when the notice demanding the payment of loss suffered by the Government was served upon the appellant. The present application is filed in the year 1985, he held, was clearly barred. In this appeal the correctness of the said view is questioned.

7. Sri P. S. Poti, learned counsel for the appellant contended that no period of limitation is prescribed for making an application under See. 20 of the Arbitration Act either by that Act or the Limitation Act and that wh