Section 11 arbitration limitation runs from failure to appoint after valid notice, and stale claims may be refused at referral stage.

Limitation for a Section 11 arbitration petition runs under Article 137 of the Limitation Act from the date the right to apply accrues, namely when a valid notice invoking arbitration is not acted on within the stipulated time. Repeated reminders do not extend that period, and a later rejection of the demand does not create a fresh starting point. At the referral stage, a court may refuse appointment only where the claim or request is manifestly ex facie time barred or otherwise dead. On the facts described, the claims had become stale before the Section 11 applications were filed, so no arbitrator could be appointed.

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Issues: (i) When does limitation begin to run for an application under Section 11 of the Arbitration and Conciliation Act, 1996; and (ii) whether the claims and the request for appointment of an arbitrator were ex facie time barred and therefore incapable of referral.

Issue (i): When does limitation begin to run for an application under Section 11 of the Arbitration and Conciliation Act, 1996

Analysis: Limitation for a petition seeking appointment of an arbitrator is governed by Article 137 of the Limitation Act, 1963 and begins when the right to apply accrues upon failure to appoint the arbitrator after a valid notice invoking arbitration. The period for the Section 11 petition is distinct from the limitation governing the underlying substantive claims. Repeated reminders do not extend the limitation period, and once time starts running it is not renewed by a later rejection of the demand.

Conclusion: Limitation began when the notice invoking arbitration was not complied with within the stipulated period, and the later rejection did not give a fresh starting point.

Issue (ii): whether the claims and the request for appointment of an arbitrator were ex facie time barred and therefore incapable of referral

Analysis: At the referral stage the Court may decline reference only where it is manifest that the claims are ex facie time barred and dead or that there is no subsisting dispute. On the facts, final payment had been received in 2003, the demand for price variation was made thereafter, and the claim was rejected in 2010. Even on the most favourable date relied upon by the respondent, the claim had become stale long before the Section 11 applications were filed. The disputes were therefore not fit for reference.

Conclusion: The claims were ex facie time barred and no arbitrator could be appointed.

Final Conclusion: The High Court's order appointing an arbitrator was unsustainable, and the appeals succeeded with the Section 11 applications failing on limitation as well as on the absence of a live referable dispute.

Ratio Decidendi: A court acting under Section 11 of the Arbitration and Conciliation Act, 1996 may refuse reference only where it is manifest that the request for appointment or the underlying claim is ex facie time barred or otherwise dead; repeated correspondence does not postpone accrual of limitation once the right to apply has arisen.

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