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of <h1>Arbitration petition dismissed as claim filed beyond three-year limitation period under amended Stock Exchange bye-law</h1> <h3>M/s. Satish K. Narang & Co. Versus Jamnadas Morarje Secs. Ltd. Mumbai</h3> M/s. Satish K. Narang & Co. Versus Jamnadas Morarje Secs. Ltd. Mumbai - 2021:BHC - OS:1997 - DB Issues Involved:1. Applicability of the Limitation Act, 1963 to the transactions prior to 29th August 1998.2. Effect of the amendment to Bye-law 252(2) of the Bombay Stock Exchange.3. Vested rights under Section 2(4) of the Arbitration and Conciliation Act, 1996.4. Timeliness of the arbitral proceedings filed by the appellant.Issue-Wise Detailed Analysis:1. Applicability of the Limitation Act, 1963:The primary issue was whether the Limitation Act, 1963 applied to transactions that occurred before the amendment of Bye-law 252(2) on 29th August 1998. Section 2(4) of the Arbitration and Conciliation Act, 1996, initially excluded the applicability of the Limitation Act to statutory arbitrations. The court held that prior to the amendment, there was no prescribed limitation period for arbitration under the Bombay Stock Exchange bye-laws. However, with the amendment, the provisions of the Limitation Act became applicable, thereby introducing a three-year limitation period for filing claims.2. Effect of the Amendment to Bye-law 252(2):The amendment to Bye-law 252(2) was significant as it introduced the applicability of the Limitation Act to arbitrations under the Stock Exchange's rules. The court concluded that the amendment did not have retrospective effect. The appellant argued that since the transactions occurred before the amendment, the limitation should not apply. However, the court rejected this argument, stating that the amendment applied to all transactions from the date of its enactment, thus affecting claims filed after the amendment.3. Vested Rights Under Section 2(4) of the Arbitration Act:The appellant contended that vested rights under Section 2(4) allowed for filing claims without a limitation period. The court disagreed, noting that no arbitral proceedings were initiated before the amendment. Therefore, no vested rights were accrued. The court emphasized that the amendment curtailed the unlimited period of limitation, aligning with procedural law changes, and did not confiscate any existing cause of action.4. Timeliness of the Arbitral Proceedings:The court examined whether the appellant filed the arbitral proceedings within the prescribed limitation period post-amendment. The appellant filed the statement of claim on 1st July 2002, which was beyond the three-year limitation period starting from 29th August 1998. The court noted that the time taken before the Investor's Grievances Redressal Cell should be excluded from the limitation period calculation. Despite this exclusion, the claim was still time-barred. The court held that the cause of action commenced on 29th August 1998, and the appellant failed to file within the stipulated time frame.Conclusion:The court upheld the arbitral tribunal's decision and the learned Single Judge's judgment, dismissing the appeal. It concluded that the appellant's claims were time-barred under the amended bye-laws, and no vested rights allowed for bypassing the limitation period. The appeal was dismissed with no order as to costs, emphasizing the importance of adhering to procedural timelines in arbitration proceedings.
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