Case Note & Summary
The petitioner, a trading-cum-clearing member of the National Commodity and Derivatives Exchange Limited (respondent no.2), filed a petition under Section 43 of the Arbitration and Conciliation Act, 1996 seeking extension of time to file a claim before the arbitrator. The claim arose from transactions between February 25, 2005 and June 15, 2006. After a demand notice on April 9, 2007 and non-payment, the petitioner lodged a claim with the exchange on April 1, 2008. The exchange informed the petitioner on April 15, 2008 that the complaint was received beyond the extended timelines under its bye-laws. The petitioner then filed an arbitration petition (12/2009) on the Appellate Side of the Bombay High Court, which was returned on June 18, 2010 for presentation to the Original Side, leading to the present petition. The petitioner argued that the claim was filed within three years from the cause of action and sought extension under Section 43(3) of the Act. The respondent no.1 contended that the bye-laws of the exchange are statutory and the arbitration under them is statutory, not consensual, and therefore Section 43(3) does not apply. The court held that Section 43(3) of the Arbitration and Conciliation Act, 1996 does not empower the court to extend time for filing a claim before an arbitrator under statutory bye-laws of a commodity exchange. The court reasoned that Section 43(1) makes the Limitation Act applicable to arbitrations, but Section 43(3) only applies to arbitration agreements and not to statutory arbitrations where the limitation period is prescribed by a special statute. The court dismissed the petition, finding no merit in the petitioner's request for extension of time.
Headnote
A) Arbitration Law - Limitation - Extension of Time - Section 43(3) Arbitration and Conciliation Act, 1996 - Court cannot extend time for filing claim before arbitrator under statutory bye-laws of commodity exchange - Held that Section 43(3) applies only to arbitration agreements and not to statutory arbitrations where limitation is prescribed by special statute (Paras 6-10).
Issue of Consideration
Whether the court can extend time for filing a claim before an arbitrator under Section 43(3) of the Arbitration and Conciliation Act, 1996 when the claim is governed by statutory bye-laws of a commodity exchange that prescribe a specific limitation period.
Final Decision
The petition is dismissed. The court held that Section 43(3) of the Arbitration and Conciliation Act, 1996 does not apply to statutory arbitrations under the bye-laws of a commodity exchange, and the court cannot extend time for filing a claim before the arbitrator.
Law Points
- Section 43(3) of Arbitration and Conciliation Act
- 1996 does not empower court to extend time for filing claim before arbitrator under statutory bye-laws of commodity exchange
- Limitation Act applies to arbitration as per Section 43(1) but court cannot extend time beyond period prescribed by special law
