TMI Blog1988 (4) TMI 429X X X X Extracts X X X X X X X X Extracts X X X X ..... on Act, to be barred by limitation. In order to be entitled to ask for a reference under Section 20 of the Act, there must be an entitlement to money and a difference or dispute in respect of the same. It is true that on completion of the work, right to get payment would normally arise and it is also true that on settlement of the final bill, the right to get further payment gets weakened but the claim subsists and whether it does subsist, is a matter which is arbitrable. In this case the claim for reference was made within three years commencing from April 16, 1976 and the application was filed on December 18, 1976. We are, therefore, of the view that the High Court was right in this case - C.A. 757 OF 1988 - - - Dated:- 5-4-1988 - SAB ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itation. There was an appeal from the said decision to the High Court of Allahabad and the High Court by its impugned Judgment and Order dated 14th August, 1986 allowed the appeal. Hence, this appeal. The sole question, involved in this appeal, is whether the High Court was right in dismissing the application. In matters of this nature, the main question is whether the application under Section 20 was within time. Though there was some doubt before but now it is well-settled in view of the decision of this Court in Kerala State Electricity Board, Trivandrum v. T.P.K.K. Amson Beson, Kerala, [1977] 1 SCR 996 that Article 137 would apply to any petition or application filed under any Act to a Civil Court. The Words any other application ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e State be referred to the sole arbitration of the Deputy Commissioner of Mandi Distt. The State of Himachal Pradesh contended, inter alia that the application for filing the arbitration agreement was barred by law of limitation as the right to apply if any arose in 1950 and not in June, 1952 as alleged. The Court of First Instance held in favour of the appellants. In appeal the Judicial Commissioner reversed the order of the Trial Court. In the view of the Judicial Commissioner an application for filing an arbitration agreement under Section 20 of the Act was governed by Article 181 of the Limitation Act, 1908 and since the period of three years prescribed thereby commenced to run from the date on which the differences arose between the pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here was no limitation for making an application under Sections 8 20 of the Act. The defendant's appeal was dismissed by the High Court as incompetent insofar as it challenged the order under Section 8 but was allowed insofar as it challenged the order under Section 20 of the Act. The High Court held that an application under Section 20 was governed by Article 181 of the Indian Limitation Act, 1908. In coming to this conclusion the High Court took into account the settled judicial view that the operation of Article 181 was limited to applications under the Code of Civil Procedure and reasoned that Article 181 should be construed as if the words `under the Code' were added in it. The Arbitration Act, 1940 repealed para 17 of the se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ukharji) was a party and which held after discussing all these authorities the question whether the claim sought to be raised was barred by limitation or not, was not relevant for an Order under Section 20 of the Act. Therefore, there are two aspects. One is whether the claim made in the arbitration is barred by limitation under the relevant provisions of the Limitation Act and secondly, whether the claim made for application under Section 20 is barred. In order to be a valid claim for reference under Section 20 of the Arbitration Act, 1940, it is necessary that there should be an arbitration agreement and secondly differences must arise to which the agreement in question applied and, thirdly, that must be within time as stipulated in Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be referred in accordance with law. In view of the well-settled principles we are of the view that it will be entirely a wrong to mix-up the two aspects, namely, whether there was any valid claim for reference under Section 20 of the Act and, secondly, whether the claim to be adjudicated by the arbitrator, was barred by lapse of time. The second is a matter which the arbitrator would decide unless, however, if on admitted facts a claim is found at the time of making an Order under Section 20 of the Arbitration Act, to be barred by limitation. In order to be entitled to ask for a reference under Section 20 of the Act, there must be an entitlement to money and a difference or dispute in respect of the same. It is true that on completion o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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