Section 11 arbitration reference may be refused for manifestly time-barred claims; negotiations do not stop limitation running.

A petition under Section 11(6) of the Arbitration and Conciliation Act, 1996 may be refused where the underlying claims are manifestly stale, dead, or ex facie time-barred, because the Court need not refer non-existent disputes to arbitration. In the absence of an express limitation period in Section 11(6), Article 137 of the Limitation Act, 1963 governs the application, and time begins when the dispute is clearly crystallised by denial or repudiation. Mere correspondence or settlement talks do not stop limitation once it has started to run under Section 9 of the Limitation Act. On the stated facts, the claims were already barred and not referable to arbitration.

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Issues: Whether a petition under Section 11(6) of the Arbitration and Conciliation Act, 1996 can be entertained when the underlying claims are ex facie barred by limitation and no subsisting dispute survives for reference to arbitration.

Analysis: Section 11(6) contains no express limitation period, so the residuary rule under Article 137 of the Limitation Act, 1963 governs the time to move the Court for appointment of an arbitrator. The right to apply accrues when the dispute is clearly crystallised by denial or repudiation, and limitation is not kept alive merely because the parties continue correspondence or engage in settlement discussions. Section 9 of the Limitation Act prevents subsequent negotiations from stopping time once it has begun to run. At the referral stage, the Court may refuse reference where the claim is manifestly stale, dead, or ex facie time-barred, since the arbitral process is not meant to revive extinguished claims. The record showed that the dispute had crystallised and the relevant recovery had been completed years before the arbitration notice was issued, and the later negotiations did not extend limitation.

Conclusion: The petition was barred by limitation and the claims were not referable to arbitration; the answer is against the petitioner and in favour of the respondent.

Ratio Decidendi: In a Section 11 proceeding, the Court may decline reference where the claims are manifestly time-barred or dead, and limitation is governed by Article 137 of the Limitation Act, 1963, with mere negotiations or reminders not suspending the running of time.

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