KOTHARI, J. - (1.) THIS appeal is filed by the appellant M/s. Shiv Construction Company whose connected appeal No. 36/1993 for other contract with the same department has been decided by a separate judgment today. The present appeal is directed against the order of the learned District Judge, Bikaner in Civil case No. 4/1989 dated 31. 1. 1992 holding that application under Section 20 of the Arbitration Act, 1940 filed by the plaintiff on 23. 12. 1988, was time barred by the bar of Article 137 of the Limitation Act, 1963.
(2.) LEARNED counsel appearing for the appellant urged before this Court that Article 137 of the Limitation Act does not apply in the case of application under Section 20 of the old Arbitration Act, 1940 and no limitation is prescribed for filing application in Section 20 of that Act. According to her, the final bill prepared on 30. 5. 79 was accepted by the plaintiff under protest and in fact the final bill itself was not fully paid by the department and some other deductions were also wrongly made according to the plaintiff. In support of her submissions, learned counsel has relied upon the following judgments to fortify her submission that Article 137 of the Limitation Act does not apply to the applications filed under Section 20 of the Arbitration Act, 1940. 1. Wazir Chand Mahajan & Anr. vs. The Union of India (AIR 1967 SC 990) 2. Mohd. Usman vs. Union of India (AIR 1969 SC 474) On the said opposite, Mr. S. N. Tiwari appearing on behalf of the respondent State relies upon the judgment of U. O. I. vs. Momin Construction Company (1997 (9) SCC 97), to submit that provisions of Article 137 of the Limitation Act would apply even in cases of Section 20 under the Arbitration Act, 1940. He further submits that according to clause 19 (a) of the Agreement in the event of the contractor failing to refer the matter in dispute to the Arbitrator within 180 days from the preparation of the final bill, his right and claims under the contract shall have been deemed to have been extinguished and waived. Therefore, he submits that the court below was justified in rejecting the application under Section 20 as time barred. I have heard learned counsel for the parties. The Hon'ble Supreme Court in the case of Wazir Chand Mahajan and Anr. vs. Union of India (AIR 1967 SC 990) (supra), held that in dealing with as application for filing an arbitration agreement, the Court must satisfy itself about the existence of a written agreement which is valid and subsisting and which has been executed before the institution of any suit, and also that a dispute has arisen with regard to the subject matter of the agreement which is within the jurisdiction of the Court. But the Court is not concerned, in dealing that application, to deal with the question whether the claim of a party to the arbitration agreement is barred by the law of limitation: that question falls within the province of the arbitrator to whom the dispute is referred. The Hon'ble Supreme Court in another earlier case of Mohd. Usman vs. Union of India (AIR 1969 SC 474) (supra), while being concerned with the old Article 181 which is equivalent to Article 137 of the Limitation Act, 1963 also held similarly, referring to the history of amendment in Arbitration Act, 1940 and Article 158 and 178 of the old Limitation Act, 1908, that it is not possible to construe the implied reference in Article 181 of the CPC as a reference to the Arbitration Act, 1940 or to hold that Article 181 applies to application under that Act. The rule of construction given in Section 8 (1) of the General Clauses Act cannot be applied, as it appears that the legislature had a different intention. It follows that an application under Sections 8 and 20 of the Arbitration Act, 1940 is not governed by Article 181. The Limitation Act does not prescribe any period of limitation for such an application. It follows that the present application under Sections 8 and 20 is not barred by limitation.
(3.) PER contra, the judgment cited by the learned counsel for the respondent in U. O. I. vs. Momin Construction Company (1997 (9) SCC 97) (supra) which was decided in the absence of respondents' appearance on the facts of the case, the Hon'ble Supreme Court held that the claim of the first appeal arose to the respondents before 11. 8. 1965 when they issued "no Claim Certificate" and the final bill was passed. The right to apply under Section 20 of the Arbitration Act therefore arose to the respondents before 11. 8. 1965. The application under Section 20 was made by them much after the expiry of three years therefrom and therefore, the application under Section 20 was held to be barred by time. With great respect, it appears that the said judgment cited by learned counsel for the respondents would not apply in the present case where even the final bill was not paid to the contractor and that was signed apparently under protest. The conclusion which can be derived from the perusal of the aforesaid judgments that it is not for this Court to decide whether the claim of the contractor would be old or stale or justified or not and that would be for the Arbitrator to decide during the course of arbitration proceedings but the precise question that this Court is concerned as to whether the application under Section 20 of the Arbitration Act, 1940 could be filed beyond the period of three years of the preparation of the final bill. In the absence of any specific limitation under the Arbitration Act, 1940 for this purpose, there seems to be force in the submissions made by learned counsel for the appellant that the application in the present case filed in the year 1988 i. e. on 23. 11. 1988 after serving a notice on the respondents for appointment of an Arbitrator was maintainable and the trial Court has erred in rejecting the said application as time barred invoking the Article 137 of the Limitation Act, 1963. Accordingly, the impugned order is liable to be set aside and the same is accordingly set aside and the present appeal is allowed and the plaintiff shall now be entitled to file its claim before the Chief Engineer, the Arbitrator under the contract between the parties who would enter upon the arbitration and proceed to decide the same in accordance with the law as expeditiously as possible. ;