TMI Blog1992 (7) TMI 295X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by B.P. JEEVAN REDDY, J. Heard Counsel for the parties. Leave granted. 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 Section 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 arbitator to be appointed within ten days from the date of the order" for the purpose. A Division Bench set aside the said order on the ground that the very application under Section 20 was barred by limitation. An agreement was entered into between the appellant and the State of Kerala on 19.2.1966 whereunder the appellant undertook 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 retendered. It was completed by another contractor. State of Kerala took proceedings under the provisions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red 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. Sri P.S. poti, learned counsel for the appellant contended that no period of limitation is prescribed for making an application under Section 20 of the Arbitration Act either by that Act or the Limitation Act and that whenever differences or disputes arise between the parties, they can approach the court under the said provision. He submitted that the appellant requested the Government to refer the disputes and differences between them to arbitration only in the year 1983 which was rejected in the year 1984. The application under Section 20 filed in 1985 cannot be said to be barred by limitation, even if Article 137 or 113 is held to apply. Learned counsel submitted that if the three years' period of limitation is applied, it will lead to very serious consequences and many arbitration disputes would become barred by time. So far as the applicability of Limitation Act to an application under Section 20 of the Arbitration Act is concerned, it is no longer res integra. In Inder Singh Rekhi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt shall direct notice thereof to be given to all parties to the agreement other than the applicants, requiring them to show cause within the time specified in the notice why the agreement should not be filed. (4) Where no sufficient cause is show, the Court shall order the agreement to be filed, and shall make an order of reference to the arbitrator appointed by the parties, whether in the agreement or otherwise, or, where the parties cannot agree upon an arbitrator, to an arbitrator appointed by the court. (5) Thereafter the arbitration shall proceed in accordance with, and shall be governed by, the other provisions of this Act so far as they can be made applicable." According to Sub-section (1) where an arbitration agreement has been entered into before the institution of any suit with respect to subject matter of such agreement, and where difference has arisen to which the agreement applies, either or both the parties can apply to the Court that the agreement be filed in Court. According to the Sub- section, the occasion for filing the application arises when a difference arise between the parties to which the agreement applies. In such a case, it is open to a party to ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the agreement is placed before us. Therefore, we cannot say whether the arbitration clause contemplates that a reference to arbitration can be made only by the Government and not by the appellant. Assuming that such was the requirement of the arbitration clause, even so it must be held that the very request in 1983 was very much belated and cannot, in any event, be treated as the date on which the right to apply accrued. The differences had already arisen between the parties following the service of the demand notice. The challenge to the said demand notice made by the appellant by filing a writ petition in the Kerala High Court is the demonstrable proof of the dispute. Accordingly, we agree with the High Court that 30.5.1974 is the date on which the right to apply accrued in terms of article 137 read with Section 20(1) and that therefore the application filed in the year 1985 was clearly 657 barred by limitation. We also think it appropriate to point out that the learned Subordinate Judge was not justified in directing the parties to submit their respective panels of arbitrator so as to enable him to appoint an arbitrator or arbitrators, as the case may be, out of such panel ..... X X X X Extracts X X X X X X X X Extracts X X X X
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