Uttarakhand High Court
M/S Calyx Advance Real Estate Pvt. Ltd vs M/S Geeta Developers on 10 June, 2025
2025:UHC:4776
IN THE HIGH COURT OF UTTARAKHAND
AT NAINITAL
HON'BLE THE CHIEF JUSTICE SRI G. NARENDAR
10TH JUNE, 2025
ARBITRATION APPLICATION No. 30 OF 2025
M/s Calyx Advance Real Estate Pvt. Ltd. ...Applicant
Versus
M/s Geeta Developers. ...Respondent
Counsel for the applicant. : Mr. Jai and Mr. Kundan Singh, learned
counsels.
JUDGMENT :
Heard the learned counsel for the applicant. The
agreement is of the year 2013, i.e. an agreement for
development of the property. A perusal of the agreement would
demonstrate the formation of a partnership deed for the purpose
of execution of the agreement. Pleadings do not disclose either
the formation of the partnership deed, nor any demand for the
same till 28.01.2025, when notice, under Section 21 of the
Arbitration and Conciliation Act, 1996 came to be issued.
2. Law in this regard is no more res integra. Hon’ble
Apex Court in the case of Arif Azim Company Limited v.
Aptech Limited, (2024) 5 SCC 313 has held in paragraph
nos. 46 to 52 as under :
“46. The plain reading of Section 11(6) of the Act, 1996,
which provides for the appointment of arbitrators, indicates that
no time-limit has been prescribed for filing an application under
the said section. However, Section 43 of the Act, 1996 provides
that the Limitation Act, 1963 would apply to arbitrations as it
applies to proceedings in court. The aforesaid section is
reproduced hereinbelow:
“43. Limitations.–(1) The Limitation Act, 1963 (36 of
1963), shall apply to arbitrations as it applies to
proceedings in court.
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(2) For the purposes of this section and the
Limitation Act, 1963 (36 of 1963), an arbitration shall be
deemed to have commenced on the date referred to in
section 21. Page 23 of 58
(3) Where an arbitration agreement to submit
future disputes to arbitration provides that any claim to
which the agreement applies shall be barred unless some
step to commence arbitral proceedings is taken within a
time fixed by the agreement, and a dispute arises to
which the agreement applies, the Court, if it is of opinion
that in the circumstances of the case undue hardship
would otherwise be caused, and notwithstanding that the
time so fixed has expired, may on such terms, if any, as
the justice of the case may require, extend the time for
such period as it thinks proper.
(4) Where the Court orders that an arbitral award
be set aside, the period between the commencement of
the arbitration and the date of the order of the Court shall
be excluded in computing the time prescribed by the
Limitation Act, 1963 (36 of 1963), for the commencement
of the proceedings (including arbitration) with respect to
the dispute so submitted.”
47. Since none of the Articles in the Schedule to the
Limitation Act, 1963 provide a time period for filing an
application under Section 11(6) of the Act, 1996, it would be
covered by Article 137 of the Limitation Act, 1963 which is the
residual provision and reads as under:
Description of Application Period of limitation Time from which period
begins to run
137. Any other application for Three years When the right to
which no period of limitation apply accrues.
is provided elsewhere in this
Division
48. In his authoritative commentary, “International
Commercial Arbitration, Wolters Kluwer, 3rd Edition, pp. 2873-
2875”, Gary B. Born has observed that as Page 24 of 58 a
general rule, limitation statutes are applicable to arbitration
proceedings. The relevant extract is as follows:
“Most nations impose limitation or prescription
periods within which civil claims must be brought. Of
course, statutes of limitation differ from country to
country. As discussed below, statutes of limitations are
virtually always applicable in international arbitration
proceedings, in the same way that they apply in national
court proceedings. Choosing between various
potentiallyapplicable statutes of limitations in international
arbitration raises significant choice-of-law questions.
xxx xxx xxx
Conflict of laws issues also arise as to the date that
the statute of limitations period is tolled. The issue can be
addressed by national laws, as well as by institutional
arbitration rules. Unfortunately, inconsistencies can arise
between institutional rules and one or more potentially-
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applicable national laws (which may also apply in a
mandatory fashion). For counsel in a particular dispute, of
course, the only safe course is to satisfy the shortest
potentially-applicable limitations period.” (emphasis
supplied)
49. A seven-Judge Bench of this Court in SBP & Co. v.
Patel Engineering Ltd. and Another reported in (2005) 8 SCC
618 held that the issue of limitation being one of threshold
importance, it must be decided at the pre-reference stage, so
that the other party is not dragged through a long-drawn
arbitration, which would be expensive and time consuming.
50. A three-Judge Bench of this Court in Geo Miller and
Company Private Limited v. Chairman, Rajasthan Vidyut
Utpadan Nigam Limited reported in (2020) 14 SCC 643
observed as follows:
“14. Sections 43(1) and (3) of the 1996 Act are in pari materia
with Sections 37(1) and (4) of the 1940 Act. It is well-settled that by
virtue of Article 137 of the First Schedule to the Limitation Act, 1963
the limitation period for reference of a dispute to arbitration or for
seeking appointment of an arbitrator before a court under the 1940
Act (see State of Orissa v. Damodar Das [(1996) 2 SCC 216] ) as well
as the 1996 Act (see Grasim Industries Ltd. v. State of Kerala [
(2018) 14 SCC 265 : (2018) 4 SCC (Civ) 612] ) is three years from
the date on which the cause of action or the claim which is sought to
be arbitrated first arises.
15. In Damodar Das [(1996) 2 SCC 216], this Court observed,
relying upon Russell on Arbitration by Anthony Walton (19th Edn.) at
pp. 4-5 and an earlier decision of a two-Judge Bench in Panchu Gopal
Bose v. Port of Calcutta [(1993) 4 SCC 338], that the period of
limitation for an application for appointment of arbitrator under
Sections 8 and 20 of the 1940 Act commences on the date on which
the “cause of arbitration” accrued i.e. from the date when the
claimant first acquired either a right of action or a right to require
that an arbitration take place upon the dispute concerned.
16. We also find the decision in Panchu Gopal Bose [(1993) 4
SCC 338] relevant for the purpose of this case. This was a case
similar to the present set of facts, where the petitioner sent bills to
the respondent in 1979, but payment was not made. After an interval
of a decade, he sent a notice to the respondent in 1989 for reference
to arbitration. This Court in Panchu Gopal Bose [(1993) 4 SCC 338]
observed that in mercantile references of this kind, it is implied that
the arbitrator must decide the dispute according to the existing law of
contract, and every defence which would have been open to the
parties in a court of law, such as the plea of limitation, would be open
to the parties for the arbitrator’s decision as well. Otherwise, as this
Court observed : (SCC p. 344, para 8)
“8. … a claim for breach of contract containing a
reference clause could be brought at any time, it might be 20
or 30 years after the cause of action had arisen, although the
legislature has prescribed a limit of three years for the
enforcement of such a claim in any application that might be
made to the law courts.”
17. This Court further held as follows: (Panchu Gopal Bose case [
(1993) 4 SCC 338] , SCC pp. 345-46, paras 11-12)
“11. Therefore, the period of limitation for the
commencement of an arbitration runs from the date on which,
had there been no arbitration clause, the cause of action
would have accrued. Just as in the case of civil actions the
claim is not to be brought after the expiration of a specified
number of years from the date on which the cause of action
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accrued, so in the case of arbitrations, the claim is not to be
put forward after the expiration of the specified number of
years from the date when the claim accrued.
12. In Russell on Arbitration….
At p. 80 it is stated thus:
‘An extension of time is not automatic and it is
only granted if “undue hardship” would otherwise be
caused. Not all hardship, however, is “undue hardship”;
it may be proper that hardship caused to a party by his
own default should be borne by him, and not
transferred to the other party by allowing a claim to be
reopened after it has become barred.’ ” (emphasis
supplied)
51. Having traversed the statutory framework and case
law, we are of the clear view that there is no doubt as to the
applicability of the Limitation Act, 1963 to arbitration
proceedings in general and that of Article 137 of the Limitation
Act, 1963 to a petition under Section 11(6) of the Act, 1996 in
particular. Having held thus, the next question that falls for our
determination is whether the present petition seeking
appointment of an arbitrator is barred by limitation.
52. The determination of the aforesaid question is an
exercise involving both law and facts. As is evident from Article
137 of the Limitation Act, 1963, the limitation period for making
an application under Section 11(6) of the Act, 1996 is three
years from the date when the right to apply accrues. Thus, to
determine whether the present petition is barred by limitation,
it is necessary to ascertain when the right to file the present
petition under Section 11(6) of the Act, 1996 accrued in favour
of the petitioner.”
3. In view of the above law, this Court is of the
considered opinion that this Arbitration Application is woefully
barred by limitation, and is, accordingly, rejected.
As a sequel thereto, the miscellaneous petitions, if any
pending, shall stand closed.
_______________
G. NARENDAR, C.J.
Dt: 10th June, 2025
Rahul
RAHUL Digitally signed by RAHUL PRAJAPATI
DN: c=IN, o=HIGH COURT OF
UTTARAKHAND, ou=HIGH COURT OF
UTTARAKHAND,
PRAJAPAT
2.5.4.20=aa4fa3bee6691397758b14516ed3
e66e61bf4c848741983ed8c39e4145cf1dab,
postalCode=263001, st=UTTARAKHAND,
serialNumber=303B55CC3063D34AC45BF8
I
A192FCAD15C390A1AAD7B39857D2540AE
4C28A4898, cn=RAHUL PRAJAPATI
Date: 2025.06.17 18:11:01 +05’30’
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