1999 (1) TMI 549

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....respondent. 2. On 7th September, 1974 the appellant entered into a contract, with the respondent under which the appellant agreed to supply Allumina Ferric of I.C.I, specification to the respondent. The contract was operative till 22.8.1975. On account of certain disputes and differences which arose between the parties the appellant, on 12.9.1976, gave a notice to the respondent. The notice is not on the record of the proceedings. From the judgment of the High Court which refers to this notice, it seems that under that notice, the appellant stated that huge amounts were due to it under the said contract and it appointed one Sohan Lal Saraf, Barrister-at-Law as its Arbitrator and called upon the respondent to concur in that appointment. N....

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....er Section 8 of the Arbitration Act was barred by limitation. 5. The relevant Article of the limitation Act is Article 137 which provides as follows: 6. therefore, the time for the purposes of limitation begins to run from the date when the right to make an application under Section 8 accrues. Section 8 of the Arbitration Act, which is relevant for our present purposes, is reproduced below: Section 8. Power of Court to appoint arbitrator or umpire. -(1) In any of the following cases - (a) where an arbitration agreement provides that the reference shall be to one or more arbitrators to be appointed by consent of the parties, and all the parties do not, after differences have arisen, concur in the appointment or appoin....

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.... has failed to secure the concurrence of the other party to the appointment of an Arbitrator within the prescribed period, the Court will not intervene under Section 8. The right to apply under Section 8, therefore, would accrue when, within 15 clear days of the notice, the other parties do not concur in the appointment of an Arbitrator. 10. In this connection one may refer to a decision of this Court in Major (Retd.) Inder Singh Rekhi v. DDA [1988]3SCR351 . In that case the Court had to consider the application of Article 137 of the Limitation Act to a petition under Section 20 of the Arbitration Act. The Court considered when the period of limitation under Article 137 would begin to run. The Court said that in order to be entitled to a....

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....appointment of an arbitrator under Section 8 or a reference under Section 20 of the Act. 11. Applying the same reasoning in the present case, the notice was served by the appellant asking the respondent to concur in the appointment of an Arbitrator on 12.9.1976. The application before the Calcutta High Court under Section 8 was made on 22.12.1977 and the application before the Subordinate Judge, Ranchi under Section 8 of the Arbitration Act was made on 9.8.1978. Both these applications are within the period prescribed under Article 137. The High Court was, therefore, not right in coming to the conclusion that the application under Section 8 of the Arbitration Act was barred by limitation. Since even the second application was within the ....