Section 11 arbitration reference: limitation and pending cheque proceedings did not bar arbitration; tribunal to decide preliminary objections.

At the Section 11 referral stage, limitation is generally not decided finally by the court: it runs from when the dispute arises and the right to invoke arbitration accrues, while questions of limitation, merits, and maintainability are ordinarily left to the arbitral tribunal. Pending Section 138 proceedings under the Negotiable Instruments Act do not bar arbitration because they arise from separate causes of action, and an unsuccessful pre-litigation mediation attempt does not displace an agreed arbitration clause. On that basis, the disputes were referred to arbitration, a sole arbitrator was appointed by consent, and preliminary objections were left for the arbitrator to decide.

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Issues: (i) Whether the request for appointment of an arbitrator was barred by limitation at the stage of reference under Section 11 of the Arbitration and Conciliation Act, 1996. (ii) Whether pending proceedings under Section 138 of the Negotiable Instruments Act, 1881 or prior pre-litigation mediation prevented reference of the disputes to arbitration.

Issue (i): Whether the request for appointment of an arbitrator was barred by limitation at the stage of reference under Section 11 of the Arbitration and Conciliation Act, 1996.

Analysis: Limitation for invoking arbitration does not commence from the date of execution of the underlying agreement, but from the time the dispute actually arises and the right to seek arbitration accrues. At the referral stage, the scope of inquiry is limited to the prima facie existence of an arbitration agreement, and issues touching limitation, merits, or maintainability are ordinarily for the arbitral tribunal to decide.

Conclusion: The limitation objection did not bar reference to arbitration.

Issue (ii): Whether pending proceedings under Section 138 of the Negotiable Instruments Act, 1881 or prior pre-litigation mediation prevented reference of the disputes to arbitration.

Analysis: Proceedings under Section 138 of the Negotiable Instruments Act, 1881 and arbitration arise from separate causes of action, so their pendency does not preclude arbitration. Likewise, an unsuccessful attempt at pre-litigation mediation does not compel the party to file a civil suit instead of invoking an agreed arbitration clause. The existence of a valid arbitration agreement remained decisive for reference.

Conclusion: Neither the Section 138 proceedings nor the failed mediation blocked arbitration.

Final Conclusion: The disputes were referred to arbitration, a sole arbitrator was appointed by consent, and preliminary objections were left to be decided by the arbitrator at the outset.

Ratio Decidendi: At the stage of a Section 11 petition, the court examines only the prima facie existence of an arbitration agreement, while issues such as limitation and other objections to the claim are generally for the arbitral tribunal to decide.

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