HIGH COURT OF PUNJAB AND HARYANA CHANDIGARH. *** Arbitration case No.83 of 2009. Date of Decision : August 18, 2010. *** PEC Limited Versus The State of Haryana and another. *** CORAM: Hon'ble Mr. Justice Mukul Mudgal, Chief Justice. *** 1. Whether Reporters of local papers may be allowed to see the judgment? 2. Whether to be referred to the Reporters or not? 3. Whether the judgment should be reported in the Digest? *** Present: Shri Sameer Rothore, Advocate, for Shri Sumeet Goel, Advocate, for the petitioner. Shri B.S.Rana, Addl: Advocate General, Haryana for the respondents. *** Mukul Mudgal, CJ (Oral) This petition has been filed by the petitioner under Section 11 of the Arbitration and Conciliation Act, 1996 for appointment of arbitrator based on an arbitration clause contained in the agreement to adjudicate upon the disputes between the parties. Clause 18 of the agreement relating to settlement of disputes is to the following effect:- ''If any question, difference or objection whatsoever shall arise, in any way connected with or arising out of this instrument or the meaning or operation of any part thereof or the rights, duties or liabilities or either party then, save in so far as the decision of any such matter is herein before provided for and has been so decided every such matter including where its decision has been otherwise provided for and / or whether it has been finally decided accordingly in whether the contract should be terminated or has been rightly terminated in whole or part and as regards the rights and obligations of the parties as the result of such termination, shall be referred for arbitration to any officer appointed by the Haryana Government and his decision shall be final and binding and where the matter involves a claim the amount if any awarded in such arbitration shall be recoverable in respect of the matter so referred''. Arbitration case No.83 of 2009. -2- Learned counsel for the respondents submitted that admittedly a notice was sent by the petitioner to the respondent for appointment of an arbitrator but the same was not considered on the ground of limitation because the appointment of arbitration had been sought after a lapse of period of three years and thus the petition filed by the petitioner is not maintainable and liable to be dismissed on the ground of limitation alone. On the other hand learned counsel for the petitioner in order to controvert the plea of learned counsel for the respondents that the petition is not maintainable after a period of three years, placed reliance upon para No. 31 of the decision of the Hon'ble Supreme Court in M/A Shree Ram Mills Ltd. Versus M/S Utility Premises (P) Limited- 2007 (2) R.C.R. (Civil) 721, which reads as under:- ''According to Shri Salve, learned counsel appearing on behalf of the appellants the clock had started ticking against the respondents in relation to the agreement dated 27.4.1994 and they could have had only three years period for filing a suit as per Article 137 of the Limitation Act and as such the claim made with reference to that agreement cannot be arbitrable now in the year 2005. We do not agree. It is for this reason alone that we have given the complete history of the negotiations in between the parties. The things do not seem to have settled even by 19.1.2005 but that would be for the Arbitral Tribunal to decide. We only observe, at this stage, that the claim of the respondent cannot be said to have become dead firstly because of the settlement or because of lapse of limitation. What is the effect of MoU dated 19.1.2005; was the respondent justified in repudiating the said MoU; and what is the effect of repudiation thereof on the earlier agreement dated 27.4.1994 would be for the Arbitral Tribunal to decide. In Groupe Chimique Tunisien SA vs. Southern Petrochemicals Industries Corpn. Ltd. [(2006) 5 SCC 275] this Court had clearly held in para 10 that the Arbitral Tribunal can also go into the question of limitation for the claims in between the parties. We have discussed this subject only to hold that since the issue in between the parties is still alive, there would be no question of stifling the arbitration proceedings by holding that the issue has become dead by limitation. We leave the question of limitation also Arbitration case No.83 of 2009. -3- upon the Arbitral Tribunal to decide. After going through the case law cited by learned counsel for the petitioner, I am of the view that the plea of limitation raised by learned counsel for the respondents is a question which can be determined by the arbitrator during the arbitral proceedings. Accordingly, I direct the respondent-State of Haryana to appoint an arbitrator as per provisions of clause 18 of the agreement within a period of four weeks from today to settle the dispute between the parties. In the meanwhile the parties will exchange the statements of claim and response thereof. The statement of claim be supplied to counsel for the respondents within four weeks and response to the statement of claim shall be supplied to the counsel for the petitioner within four weeks thereafter. The parties shall appear before the Arbitrator on 8.11.2010 or on an agreed date convenient to the parties but not later than a fortnight from 8.11.2010 after exchange of pleadings as directed aforesaid. The Arbitrator shall render his award not later than six months from the first date of appearance of the parties. With these directions, the petition stands disposed of. (Mukul Mudgal) August 18, 2010 Chief Justice Malik