LexWAZIRCHAND MAHAJAN AND ANR. versus UNION OF INDIA
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A WAZillCHAND MAHAJAN AND ANR. v. UNION OF INDIA September 12, 1966 303 B K. N. WANCHOO, J.C. SHAH AND R. S. J3ACHAWAT, JJ.j c D E F G H Inaian Limitation Act, 1908, art. 181-Whether aPPlies 'to applicatio111 w.:Jer Arbitration Act, s. 20. Indian Arbitration Act, 1940, s. 37(1)-Whether governs application& under s. 20 of the Act. The second appellant ·purchased from the Himachal Pradesh Govern- .ment the right to extract and collect certain medicinal herbs from the forests of Cliamba District The period of agreement was one year from September l, 1960. Under an arbitration clause in the agreement all disputes between the parties were to be referred to tho Deputy Commis- sioner, Mandi District Himachal Pradesh. The s~cond appellant trans- ferred all his rights under the agreement to the first appellant with the consent of the State of Himachal Pradesh. Disputes arose between the parties in October 1950. On May 30, 1952 the appellants addressed· a letter to the Chief Conservator of Forests Himachal Pradesh requiring that officer to submit the matters in difference to the arbitration of the Deputy Commissioner, Mandi District. By his reply dated June 23, 1952, the Chief Conservator. declined to agree to a reference contending that the matters desired to be' referred were outside the arbitration cla1111e. On June 22, 1955 the appellants applied to the District Court of Chamba for an order that the agreement be filed in Court and that the disputes between them and the State be referred to the sole arbitration ·of the Deputy Commissioner, Mandi District. The State of Himachal Pradesh contended, inter al/a that the application for filing the arbitration. agree- ment was barred by the law of limitation as the right to apply if any arose in the year 1950 and not on June 23, 1952 as alleged. The Court of First Instance held in favour of the appellants. In appeal the Judicial Commissioner reversed the order of the trial court. In the view of the Judicial Co~ioner an application for filing. an arbitration agtte- ment under s. 20 of the Arbitration Act was governed by Art. 181 of the. Limitation Act 1908, and since the period of thiee years prescribed thereby commeoced to run from· the date on which the differences arose between the p·arties I.e., about the month of September- October 1950, and in any case on September I, 1951, the application for references filed by the appellants was barred. HELD: The Judicial Commissioner was in erro'r in rejecting the appli- cation of the appellants for filng the arbitration agreement as barred under Art. 181 of the Llmitation Act, 1908. (i) The terms of Art. 181, though general and apparently not restrict- ed to applications under the Code of Civil Procedure have always been interpreted ·as so restricted. There is a catena of authorities holding that in Art. 181 the expression ''under the Code of Civil Procedure" must be deemed to be necessarily implied. [305 HJ Hansraj Gupta and Ors. v. OfJicial Liquidatws of the Dehradun- Mussoorie Electric Tramway Co. Ltd., L.R. 60 I.A. 13, Sha Mulchand ·.t Company Ltd. (in LlquidaliOn) v. Jawahar Milb Ltd., [1953] S.Cll. 351 and Bombay Gas Company Ltd. v. Gopal Bhtya d: .Orr., [1964] 3 S.C.R. 70'), referred to. 3-04 SUPREME COURT REPORTS (1967] I 5.C.R, U Art. 181 · '!f tl!e. Limitation Act, 1~08 only gO\"erns applications unde_r the. Code if Civil Procedure for which no period of limitation is proV!dcd 10 the schedule an apphcauon under· the Arbitration Act 1940 DOI being an applicat:on under the Code of Civil Procedure unles; there is some provision, which by express enactment or plain int..;dment · to 1he contrary in the Arbitration Act, will not be governed by that Anicle [307 E) . . . (ii) Section 37(1) of the :Arbitration Act, 19~ which makes lhe pro- VIS1ons of the Indian L1m1tat1on Act, 1908 apphcable 10 arbi1ra1ions as ~ apply to P'.oceedings in coun, does not govern an application for filin~ an arb1traUon agreement under s. 20 of the Arbitration Act. The sect.Ion deals only with the authority of the arbitrator to deal with and d1> cide any dispute referred to him : it bas no concern with an application made to the coun to file an arbitration agreement to refer a dispute to the arbitrator. (308 El OVIL APPELLATE JURISDICTION : Civil Appeal No. 601 of 1964. Appeal from the judgment and order dated May 27, 1961 of the Judicial Commissioner, Himachal Pradesh, in first
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