Bona fide misapprehension can justify condonation of delay in arbitration referral, and unreferenced disputes remain arbitrable.

Delay in filing a Section 20 Arbitration Act petition may be condoned under Section 5 of the Limitation Act where the legal position on limitation was unsettled and the applicant acted under a bona fide misapprehension, constituting sufficient cause. The remaining disputes were also held capable of being referred to arbitration because they had not been covered by the earlier partial reference and still fell within the arbitration clause; limitation on the claims themselves was left for the arbitrator. Claims already pending under the earlier reference were excluded from the fresh referral.

---

---

Issues: (i) Whether delay in filing the petition under Section 20 of the Arbitration Act should be condoned under Section 5 of the Limitation Act, 1963. (ii) Whether the disputes raised in the petitioner's letter dated 24 August 1976 were referable to arbitration notwithstanding the earlier partial reference.

Issue (i): Whether delay in filing the petition under Section 20 of the Arbitration Act should be condoned under Section 5 of the Limitation Act, 1963.

Analysis: The petition was filed after the legal position on limitation for applications under Section 20 had been unsettled and later clarified by the Supreme Court and by the High Court. On that footing, the petitioner's impression that no period of limitation applied was treated as bona fide, and the subsequent filing delay was held to have been explained by sufficient cause.

Conclusion: The delay was rightly condoned and the petition was admitted beyond limitation.

Issue (ii): Whether the disputes raised in the petitioner's letter dated 24 August 1976 were referable to arbitration notwithstanding the earlier partial reference.

Analysis: The disputes now sought to be referred had not previously been referred to any arbitrator. Since the earlier reference covered only some claims, proceedings under Chapter II of the Arbitration Act were not exhausted in respect of the remaining disputes. The court found that the unresolved disputes fell within the arbitration clause and that questions of limitation on the claims themselves were for the arbitrator.

Conclusion: The remaining disputes were held referable to arbitration, and the Chief Engineer was directed to appoint an arbitrator and refer those disputes, excluding the claims already pending before the earlier reference.

Final Conclusion: The petition succeeded in part: the delay was condoned, and the unresolved disputes covered by the arbitration clause were directed to be referred to a newly appointed arbitrator, while the claims already pending under the earlier reference were excluded.

Ratio Decidendi: Where the legal position on limitation for a Section 20 arbitration petition had been unsettled and the petitioner acted under a bona fide misapprehension, delay could be condoned for sufficient cause; and unreferenced disputes within the arbitration clause remained capable of being referred to arbitration despite an earlier partial reference.

---