TMI Blog1957 (2) TMI 88X X X X Extracts X X X X X X X X Extracts X X X X ..... is liability, and the balance of ₹ 611/5/6 with interest thereon remained due. As the petitioner did not pay the amount, the Society applied on 29th November, 1952 to the Assistant Registrar of Co-operative Societies, Ahmednagar, for an order for payment of the amount due by the petitioner. The dispute between the society and the petitioner was referred to a Board of Arbitrators under Section 54 of the Bombay Co-operative Societies Act. 2. The petitioner by his written statement contended inter alia that the claim made before the Assistant Registrar by the Society was barred by the law of limitation, not having been filed within three years from the date on which the cause of action arose. 3. The Registrar's nominee and the nominee for the Society held that the Society's claim was proved and that it was net tarred by the law of limitation. The nominee of the petitioner held that the claim made by the Society in the form in which it was made was not maintainable and that in any event it was barred by the law of limitation. A majority award was then directed to be drawn up. 4. Against that award a revision application was filed before the Bomb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act provides that subject to the provisions contained in Sections 4 to 25 (inclusive), every suit instituted, appeal preferred, and application made, after the period of limitation, prescribed therefor by the first schedule shall be dismissed, although limitation has not been set up as a defence . Evidently a proceedings before an arbitrator is not a suit, appeal or application, and in terms Section 3 can have no application. It is well settled that expiry of the period of limitation prescribed for a suit does not destroy the right: it only bars the remedy for enforcement of a right in a Court of law. It cannot, therefore, be said that in terms the provisions of the Limitation Act prevent an arbitrator from entertaining a claim which, if made in a Court of law, may be barred by limitation. 7. Section 37 of the Indian Arbitration Act, 1940, by its first sub-section provides that all the provisions of the Indian Limitation Act, 1908, shall apply to arbitrations as they apply to proceedings in Court . The Legislature has, therefore, regarded for the application of the Indian Limitation Act, 1908, the proceedings before arbitrators as proceedings in the nature of s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... their Lordships of the Privy Council were started under the Arbitration Act or 1399. An award made by one Mr. Singleton as sole arbitrator was set aside in a suit filed for that purpose by the High Court at Calcutta and that decision was affirmed in appeal to the Privy Council. Thereafter F.D. Sassoon and Company demanded that Messrs. Ramdutt Ramkissendass should appoint another arbitrator. The latter failed to appoint an arbitrator and the Jute Association of Calcutta nominated an arbitrator to act with the arbitrator appointed by F.D. Sassoon and Company. Messrs. Ramdutt Ramkissendass then applied to the High Court at Calcutta for an order reviewing the submissions made to the arbitration of the arbitrator nominated by F.,D. Sassoon and Company and the arbitrator nominated by the Jute Association, and the Question which fell to be determined was whether in entertaining the claim made before the new Board of arbitrators the time spent in the previous infructuous arbitration proceedings had to be excluded. The High Court at Calcutta regarded the new arbitration proceedings as a continuation of the previous arbitration proceedings before Mr. Singleton. The Privy Council did not agre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g the exclusion clause ineffective. 11. Reliance was also sought to be pieced upon a judgment of the House of Lords, Naamlooze Vennootschap Eandelsen-Transport Maats-chappij Vulcaan v. Mowinckels Rederi 1938-2 All ER 152 (C); in which case the House of Lords approved of the judgment in Ramdutt Ramkissen dass's case (A). In delivering the judgment of the House of Lords', Lord Maugham observed that even though the Limitation Act. 1623, was in terms limited to actions, toe arbitrators were bound to apply principles of equity as they would be applied in a Court of law, as they were being applied by the Courts of equity. long before the Judicature Act, 1873 where a court of equity had to adjudicate on the validity of a debt in a suit to administer an estate, or in any like suit. But that was also a case in which the arbitration was contractual. The principle of that case can have no application to statutory arbitrations. 12. In England by the Arbitration Act, 1934, statutory arbitrations were excluded from the operation of Section 18 of that Act, but the law has thereafter been rectified by Section 27 (1) and (6) of the Limitation Act 1939 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h confirmed the said award and dismissed the petitioner's revision. Following its previous decisions on the question of limitation, the Tribunal held that the provisions of the Limitation Act did not apply to proceedings under Section 54 of the Bombay Co-operative Societies Act and there was therefore no bar to the claim made by the petitioner. 16. Now, it is not disputed by Mr. Tarkunde that Section 3 of the Limitation Act would not in terms apply to arbitration proceedings. Under Section 3 of the Limitation Act. subject to the provisions contained in Sections 4 to 25 (inclusive) every suit instituted, appeal preferred, and application made, after the period of limitation prescribed therefor by the first Schedule shall be dismissed, although limitation has not been set up as a defence. It is not contended that the proceedings under Section 54 of the Bombay Co-operative Societies Act would fall within the terms of this section. Under Section 37 of the Indian Arbitration Act, 1940, all the provisions of the Indian Limitation Act, 1908, shall apply to arbitrations as they apply to proceedings in Court , and under Section 46 of the Arbitration Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of contract, and that every defence which would have been open in a Court of Law can be equally proponed for the arbitrator's decision unless the parties have agreed to exclude that defence. In this case their Lordships expressed the opinion that the law as to the applicability of the statute of limitation to arbitration proceedings was correctly laid down in the case of (1899) 68 LJQB 252 (B), which decided that a submission to arbitration does not per se exclude the right of either party to raise the defence of the Statute of Limitation, but if it be intended to exclude such a defence an express term to that effect must be imported into the agreement of submission . Some doubt, however, came to be cast as to the correctness of this view by Scrutton L.J. in the case of Board of Trade v. Cayzer, Irvine and Co., (1927) AC 610 (D). When this case went to the House of Lords, Viscount Cave made it clear that he did not wish to throw doubt upon the view which had been commonly held and affirmed in the case of In re Astley and Tyldesley Coal and Salt Co., and Tyldesley Coal Co., (B), that an arbitrator acting under an ordinary submission to arbitration is bound to give effe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arbitration proceedings just as they applied to proceedings in Court. The legal position was therefore placed beyond doubt by parliamentary legislation. But Section 16 of the English Arbitration Act dirt not apply to statutory arbitrations and that came to be remedied in 1939 by Section 27 of the English Limitation Act, 1939 (2 and 3 Geo. 6, C. 21), under which all enactments relating to limitation came to be applied to all arbitrations. In India, the position is different. Though Section 37 of the Indian Arbitration Act 1940, adopted the provisions of Section 16 of the English Arbitration Act, 1934, so that all the provisions of the Indian Limitation Act were made applicable to arbitrations as I have already pointed out, statutory arbitrations have been expressly excluded from the operation of Section 37 by virtue of Section 46 of the Indian Arbitration Act. We cannot therefore accept Mr. Tarkunde's contention that the provisions of the Indian Limitation Act should have been applied by analogy by the Co-operative Tribunal even to the statutory arbitration under Section 54 of the Bombay Cooperative Societies Act in view of the two decisions on which he relied. 19. Mr. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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