Arbitrator's jurisdiction and limitation in arbitration claims: contractual bars and stale claims can invalidate an award.

An arbitrator cannot award damages for matters expressly excluded by contract; where compensation is granted for delay in forest permissions, site handing over, or transport within a wildlife sanctuary, the award exceeds contractual jurisdiction and is illegal. The Limitation Act applies to arbitration claims, and the right to seek reference accrues when the claim is first asserted and remains unpaid; a later repudiation does not revive a stale claim. On these principles, a request for arbitration made after expiry of the limitation period is time-barred, and both the award and its affirmation cannot stand.

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Issues: (i) whether the award was without jurisdiction because it granted damages contrary to express contractual bars; (ii) whether the contractor's claim for reference to arbitration was barred by limitation.

Issue (i): whether the award was without jurisdiction because it granted damages contrary to express contractual bars.

Analysis: The contract contained clauses excluding claims for postponement of work, gradual handing over of site, and failure or delay attributable to statutory compliance or other causes beyond the parties' control. The award itself recorded that damages were granted for non-obtaining or delay in obtaining forest permissions, handing over the site, and transporting machinery within a wildlife sanctuary. Those reasons fell squarely within the contractual prohibitions, so the arbitrator was required to act within the four corners of the agreement and could not award compensation for matters expressly excluded.

Conclusion: The award on these items was without jurisdiction and illegal, in favour of the appellant.

Issue (ii): whether the contractor's claim for reference to arbitration was barred by limitation.

Analysis: The right to seek arbitration accrued when the contractor first asserted the claim in 1979 and the amount was not paid. A subsequent denial in 1983 did not revive a time-barred claim. The supplementary agreement did not preserve the earlier damages claim, and the Limitation Act applied to arbitration proceedings. On the facts, the request for arbitration made in 1985 was beyond the prescribed period, and the claim ought to have been rejected as time-barred.

Conclusion: The claim was barred by limitation, in favour of the appellant.

Final Conclusion: The award and its affirmation by the courts below could not stand because the arbitrator exceeded his authority under the contract and entertained a claim already barred by limitation.

Ratio Decidendi: An arbitrator cannot award damages for claims expressly prohibited by the contract, and a claim for arbitration must be commenced within the period of limitation from the date the cause of action first accrues.

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