JUDGMENT :. By this petition filed under Section 34 of the Arbitration and Conciliation Act, 1996 (for short “the said Arbitration Act”), the petitioner has impugned the arbitral award dated 30th March 2000 made by the learned arbitrator allowing the claims made by respondent no.2 and directing the petitioner to pay a sum of Rs.48,11,103/- to the respondent no.2 with interest @7% p.a. from the date of claim till the date of award and @18% p.a. from the date of award till the date of payment. Some of the relevant facts for the purpose of deciding this petition are as under :- 2. The petitioner was the original respondent in the arbitration proceedings whereas the respondent no.2 was the original claimant. On 6th July 1993, respondent no.2 entered into an agreement for sale/supply of kerosene oil on the terms and conditions set out therein. It was provided in the said agreement that the said agreement shall come into force on 6th July 1993 and shall remain for a period of one year during which period the buyer shall get the requirements of superior kerosene oil (SKO) through Indian Oil Corporation Ltd. (IOC); provided nothing contained in clause 1 shall prejudice the rights of IOC to terminate this agreement earlier on the happening of any of the events specified in clause 10.7 of the said agreement. Under clause 4.1 of the agreement, it was provided that sale of SKO will be made by IOC from time to time through import. 3. Under clause 5.1 of the agreement, it was agreed that for each import parcel that may be required by the buyer, the IOC shall establish provisional cost and freight (C & F) price in Indian Rupees which was required to be worked out in accordance with the said clause. Demurrage was payable @100/ MT. Under clause 5.2 of the said agreement, it was provided that IOC will work out the final price for each parcel sold to the buyer on the basis mentioned therein by including the elements set out therein within a period of 45 days from the date on which the provisional price was established for the same. Under clause 5.2 of the said agreement, it was provided that IOC will work out the final price for each parcel sold to the buyer on the basis mentioned therein by including the elements set out therein within a period of 45 days from the date on which the provisional price was established for the same. Under clause6.1 of the agreement, it was provided that the buyer shall open a confirmed irrevocable letter of credit without recourse to drawers 30 days in advance of the expected arrival of the cargo in favour of IOC through SBI duly confirmed by its commercial branch, Bombay. The letter of credit to be opened by the buyer shall be in a format as advised by IOC and acceptable to IOC. 4. Under clause 6.2 of the agreement, it was agreed that the payment under the letter of credit shall be based on the bill of lading quantity. Clause 10.2 of the said agreement which is relevant for the purpose of deciding this matter is extracted as under :- “10.2 CLAIMS : Any claim regarding quality, quantity, demurrage, non-delivery or otherwise which either party may have against the other party shall be filed with that other party within 150 days from the date of delivery of the product to the buyer or the last date on which such delivery should have been made (hereinafter referred to as “the Delivery date”). If such claim is not admitted in full within 90 days of its being filed with the other party, it shall automatically lapse and be forfeited and the other party against whom it is made shall be discharged of all liability with regard thereto unless arbitration proceedings in respect thereof are commenced and notice thereof is given within 360 days of the delivery date to the party against whom the claim is made.” Clause 11 of the agreement provides an arbitration clause. 5. By letter dated 20th December 1993, the respondent no.2 informed the petitioner about revision in settled terms of the original agreement dated 6th July 1993 and informed that the said revision shall constitute as an integral part of the agreement dated 6th July 1993 and that all other clauses of the agreement dated 6th July 1993 shall remain unaltered. 6. By letter dated 20th December 1993, the respondent no.2 informed the petitioner about revision in settled terms of the original agreement dated 6th July 1993 and informed that the said revision shall constitute as an integral part of the agreement dated 6th July 1993 and that all other clauses of the agreement dated 6th July 1993 shall remain unaltered. 6. On 6th July 1994, the petitioner and respondent no.2 signed an agreement thereby reviving and extending the said agreement dated 6th July 1993 for a further period of 12 months commencing from 6th July 1994, however, on the same terms and conditions as contained in the agreement dated 6th July 1993. On 6th July 1995, the petitioner and respondent no.2 entered into an another agreement thereby reviving and extending the said agreement dated 6th July 1994 for a further period of 12 months commencing from 6th July 1995, however, on the same terms and conditions as contained in the agreement dated 6th July 1994. 7. It is the case of the petitioner that though the sale of superior kerosene oil in favour of the petitioner is supposed to have been completed on High Seas, the petitioner had to take actual possession of the product only from the share tank which was in complete possession of respondent no.2. The petitioner was required to rely upon the assistance of respondent no.2 in all matters relating to receipt, storage and handling of the product purchased from the petitioner on High Seas basis. It is the case of the petitioner that respondent no.2, however, did not extend any help to the petitioner in the matter of receipt, storage and handling of SKO purchased from the petitioner on High Seas basis under clause 10.1 of the amended agreement. 8. During the course of the arguments, learned counsel for the petitioner tendered a statement showing relevant dates of the delivery of SKO and under clause 10.2 of the agreement, respondent no.2 was liable to make a claim, if any, against the petitioner and when the arbitration proceedings commenced. It is submitted that the details mentioned in the said statement are not disputed. It is the case of the petitioner that the admitted dates of delivery of SKO from respondent no.2 to the petitioner were during the period from 10th October 1995 to 23rd January 1996. It is submitted that the details mentioned in the said statement are not disputed. It is the case of the petitioner that the admitted dates of delivery of SKO from respondent no.2 to the petitioner were during the period from 10th October 1995 to 23rd January 1996. The respondent no.2 by its letter dated 6th June 1997 invoked arbitration agreement by addressing a letter to the Director (M) of IOC Ltd. alleging that a sum of Rs.38,58,107.86 became due and payable by the petitioner to respondent no.2 on account of the supplies made. It is stated in the said letter that the petitioner was requested to clear the outstanding vide letter dated 17th May 1997 with interest accrued thereon. The petitioner, however, failed to pay the said amount and interest accrued thereon despite the said notice served upon it and as a result thereof, the dispute had arisen in terms of the agreement dated 6th July 1995 and the amendments thereto. By the said letter, respondent no.2 requested the Director (M) of the respondent no.2 to appoint his nominee in case the said Director (M) himself was unable to act as a sole arbitrator for adjudication of the claims of the respondent no.2. Copy of the said notice was forwarded to the petitioner. 9. The petitioner vide its letter dated 10th June 1997 requested the respondent no.2 to waive-off the interest on the dues and allow it to pay the outstanding amount in parts, along with every parcel of SKO in future. The petitioner stated in the said letter that as the petitioner was desirous of reviving the import of SKO through respondent no.2 forthwith, the petitioner requested the respondent no.2 to allow the petitioner to clear the outstanding amount as suggested in the said letter. 10. The Director (M) appointed one Mr. G.R. Menon as a sole arbitrator who resigned subsequently. The Director (M) thereafter appointed Mr. B.L. Bansal, Dy. General Manager (LPG-OPS), HO of respondent no.2 as a sole arbitrator. Pursuant to the directions issued by the learned arbitrator, the parties filed their respective pleadings along with copies of the documents. None of the parties led any oral evidence. The learned arbitrator framed 15 issues for consideration. 11. The Director (M) thereafter appointed Mr. B.L. Bansal, Dy. General Manager (LPG-OPS), HO of respondent no.2 as a sole arbitrator. Pursuant to the directions issued by the learned arbitrator, the parties filed their respective pleadings along with copies of the documents. None of the parties led any oral evidence. The learned arbitrator framed 15 issues for consideration. 11. On the issue of limitation raised by the petitioner herein that the claims were barred under clause 10.2 of the agreement, the learned arbitrator rendered a finding and answered the said issue in negative holding that the claims of respondent no.2 were not barred by limitation under clause 10.2 of the agreement. The learned arbitrator also held that the petitioner had not discharged all its liability in respect of the claims made by respondent no.2 though the arbitration proceedings had not been commenced and notice thereof had not been given within 360 days of the delivery date to the petitioner. The learned arbitrator also held that respondent no.2 (original claimant) could be permitted to urge that clause 10.2 of the agreement was void as opposed to Section 28 of the Indian Contract Act, 1872. 12. The learned arbitrator rejected the allegations of official bias made against him by the petitioner. It is held by the learned arbitrator that the elements of demurrage could be included in the price structure. On merits of the claim, the learned arbitrator held that the petitioner was liable to pay demurrage charges at actual due to the congestion at berthing which was beyond the control of the petitioner and for which it was not at all responsible. It is held by the learned arbitrator that the petitioner was not entitled to refund of the demurrages at actual paid by the petitioner with interest. The learned arbitrator rendered a finding that respondent no.2 was right in contending that the petitioner had admitted to the claim. The learned arbitrator accordingly allowed the claims made by the respondent no.2 with interest. This award has been impugned by the petitioner in this petition under Section 34 of the said Arbitration Act. 13. Mr. Seksaria, learned counsel for the petitioner made the following submissions :- a) In the impugned award, the learned arbitrator had declared the clause 10.2 of the agreement as allegedly opposed to Section 28 of the Indian Contract Act. This award has been impugned by the petitioner in this petition under Section 34 of the said Arbitration Act. 13. Mr. Seksaria, learned counsel for the petitioner made the following submissions :- a) In the impugned award, the learned arbitrator had declared the clause 10.2 of the agreement as allegedly opposed to Section 28 of the Indian Contract Act. The learned arbitrator could not have declared any provision of the agreement as void as the same was beyond the scope and powers of the learned arbitrator. The award shows patent illegality on the face of the award. b) Under clause 10.2 of the agreement, the claim regarding quality, quantity, demurrage, non-delivery or otherwise was required to be made within 150 days from the date of delivery of the product to the buyer or the last date on which such delivery should have been made and if such claim was not admitted in full within 90 days of its being filed with the other party, such claim shall automatically lapse and be forfeited and the other party would be discharged of all its liability with regard thereto unless the arbitration proceedings in respect thereof were commenced and notice thereof was given within 360 days of the delivery date to the party against whom the claim was made. Since, the claim has not been preferred by respondent no.2 within the period stipulated in clause 10.2 of the agreement and since the arbitration clause was not invoked in respect of such claim within 360 days from the date of delivery of the product to the petitioner in each instance, the claims made by respondent no.2 were barred by limitation and liability of the petitioner, if any, stood discharged. The respondent no.2 invoked the arbitration agreement only on 6th June 1997 by addressing a letter to the Director (M) which was long after 360 days from the date of delivery of the product to the petitioner in each case. The respondent no.2 invoked the arbitration agreement only on 6th June 1997 by addressing a letter to the Director (M) which was long after 360 days from the date of delivery of the product to the petitioner in each case. c) It was the case of the respondent no.2 itself in the claim filed before the learned arbitrator that the provisional cost and freight price was required to be worked out in Indian Rupees as provided in clause 5.1 and final price for each parcel sold to the buyer which was required to be worked out by respondent no.2 as provided in clause 5.2 of the said agreement within 45 days from the date of establishing the provisional price. In respect of 9 invoices, respondent no.2 had furnished final invoices much after 45 days from the date of provisional invoice and all the final invoices had been furnished beyond 116 days. d) The letter of 10th June 1997 addressed by the petitioner to respondent no.2 did not amount to an admission of its alleged liability in paying the alleged outstanding amount to the respondent no.2. The said letter was a conditional letter and was issued as and by way of counter offer to the respondent no.2 stating that if the respondent no.2 would waive the interest then the petitioner would pay the outstanding amount which offer was not accepted by respondent no.2. There was no binding contract arrived at between the parties based on Exhibit-H. Acknowledgement of liability has to be during the subsistence of the liability and not after the claim having become time barred. The letter dated 10th June 1997 at Exhibit-H could not revive the time barred claim. There was no fresh promise of the petitioner to pay to the respondent no.2 as contemplated under Section 25(3) of the Indian Contract Act, 1872. The finding of the learned arbitrator that the petitioner had acknowledged its liability is thus contrary to Section 25 (3) of the Indian Contract Act and also by misinterpreting the letter of the petitioner dated 10th June 1997. The finding of the learned arbitrator that the petitioner had acknowledged its liability is thus contrary to Section 25 (3) of the Indian Contract Act and also by misinterpreting the letter of the petitioner dated 10th June 1997. The agreement entered into between the petitioner and the respondent no.2 duly amended came to an end on 5th July 1996 which was prior to the amendment to Section 28 of the Indian Contract Act notified on 8th January 1997, which amendment declared any contract that extinguishes the rights of any party or discharges any party from any liability after the expiry of a specified period to be void. The amendment to Section 28 of the Indian Contract Act is not retrospective in operation. Clause 10.2 did not seek to curtail the period of limitation for enforcement but stipulates the forfeiture or extinguishment of the rights itself. e) The learned arbitrator appointed by the Director (M) was an employee of respondent no.2 and was bound to follow the instructions of the Director (M) of respondent no.2 who was involved in the dealings with the petitioner on several occasions in the past before the matter was referred to the arbitration. The learned arbitrator has, therefore, clearly shown an official bias. The petitioner vide its letter dated 28th December 1996 raised certain complaints to the Director (M) in respect of demurrage charges. The learned arbitrator thus appointed by the Directior (M) would be obviously obliged to follow the instructions of the superior and could not permit to act as an independent arbitrator. 14. In support of the submission that the amendment to Section 28 notified on 8th January 1997 was not with retrospective effect, learned counsel for the petitioner relied upon the following Judgments:- 1. M/s. Continental Construction Ltd. Vs. Food Corporation of India and Ors., reported in AIR 2003 DELHI 32; 2. The Oriental Insurance Company Limited Vs. Karur Vysya Bank Limited, reported in AIR 2001 MADRAS 489; 3. Food Corporation of India Vs. New India Assurance Co.Ltd. & Ors., reported in (1994) 3 SCC 324 ; 4. National Insurance Co. Ltd. Vs. Sujir Ganesh Nayak & Co. & Anr., reported in (1997) 4 SCC 366 ; 5. Wild Life Institute of India, Dehradun Vs. Vijay kumar Garg, reported in (1997) 10 SCC 528 ; 6. Himachal Pradesh State Forest Company Limited Vs. New India Assurance Co.Ltd. & Ors., reported in (1994) 3 SCC 324 ; 4. National Insurance Co. Ltd. Vs. Sujir Ganesh Nayak & Co. & Anr., reported in (1997) 4 SCC 366 ; 5. Wild Life Institute of India, Dehradun Vs. Vijay kumar Garg, reported in (1997) 10 SCC 528 ; 6. Himachal Pradesh State Forest Company Limited Vs. United India Insurance Company Limited, reported in (2009) 2 SCC 252 ; 7. Judgment of the Division Bench of this Court in the case of M/s. Indusind Bank Ltd. Vs. Union of India & Ors., delivered on 20th April 2011 passed in Appeal No.258 of 2008; 8. Axios Navigation Co. Ltd. Vs. Indian Oil Corporation Limited, reported in 2012 (2) Bom.C.R. 271 ; 9. Unreported judgment of this Court in the case of M/s.Mascon Multiservices & Consultants Pvt. Ltd. Vs. Bharat Oman Refineries Ltd., delivered on 11st August 2014 passed in Arbitration Petition No.1088 of 2010; and 10. Judgment of the Delhi High Court in the case of M/s. Chander Kant & Co. Vs. The Vice Chairman, DDA & Ors., delivered on 26th May 2009 passed in Arbitration Petition No.246 of 2005. 15. Relying upon the aforesaid judgments, learned counsel for the petitioner submits that since the last date of delivery under the contract was 23rd January 1996 and the entire cause of action had arisen much prior to the date of amendment i.e. 8th January 1997, unamended Section 28 of the Indian Contract Act, 1872 would apply to the dispute between the parties and not amended Section 28 as sought to be canvassed by respondent no.2. 16. In support of the submission that there was an official bias on the part of the learned arbitrator who was an employee of respondent no.2 and the award is vitiated on that ground alone is concerned, learned counsel for the petitioner placed reliance on the judgment of the Supreme Court in the case of Indian Oil Corporation Limited Vs. Raja Transport Private Limited, reported in (2009) 8 SCC 520 and it is submitted that there can be a justifiable apprehension about the independence or impartiality of an employee arbitrator, if such person was the controlling or dealing authority in regard to the subject contract or if he is a direct subordinate to the officer whose decision was the subject matter of the dispute. 17. 17. Mr.Jagtiani, learned counsel for respondent no.2, on the other hand, supported the reasonings and conclusions in the impugned award. Learned counsel for the respondent no.2 made the following submissions: a) Amendment to Section 28 of the Indian Contract Act, 1872 notified on 8th January 1997 would apply with retrospective effect to all the existing contracts on the date of amendment. It would also apply to the contracts entered into prior to the date of amendment. The expression“any agreement/contract” would not mean that such agreement/contract was to be entered into only after the date of amendment for the purpose of attraction of Section 28 (b) of the Indian Contract Act, 1872 and if such argument of the petitioner is accepted, it would be in violation of the words “any agreement/contract.” b) The period of 360 days mentioned in clause 10.2 would not mean that the contractual obligation/right of the parties would not survive after expiry of 360 days. It is not the case of the petitioner that under the provisions of the Limitation Act, 1963, the claims of the respondent no.2 have become barred. If such argument is accepted, the whole purpose of Section 28(b) of the Indian Contract Act, 1872 would be defeated. c) Since the dispute between the parties was governed by the amended provision of Section 28 of the Indian Contract Act, the learned arbitrator was entitled to consider such amended provision applicable to the parties and was empowered to declare clause 10.2 of the agreement as void in view of the amended Section 28 (b) of the Indian Contract Act. The learned arbitrator has not exceeded his jurisdiction and that the award does not show any illegality on this ground. d) Since the petitioner had not complied with its obligation to pay price for supplies effected by the respondent no.2, the term of the agreement/contract for the purpose of payment/obligation continued and was in place. The petitioner had not disputed its liability on merits, but had opposed the claim only on the ground of limitation under clause 10.2 of the agreement. e) Under clause 10.2 of the agreement, the purchase by the petitioner was required to be completed within one year. The petitioner had not disputed its liability on merits, but had opposed the claim only on the ground of limitation under clause 10.2 of the agreement. e) Under clause 10.2 of the agreement, the purchase by the petitioner was required to be completed within one year. In so far as the payment/ obligation of the petitioner under the agreement was concerned, the same was required to be continued even beyond the expiry of one year and such obligation was not discharged till such payment was made by the petitioner. It is submitted that under clause 10.2 of the agreement, the claims were kept alive for a period of 360 days from the date of delivery and not from the date of execution of the contract. There were various dates on which the delivery was effected by respondent no.2 to the petitioner. The agreement/contract would not come to an end on 8th January 1997. f) The petitioner cannot be permitted to urge that obligation of the petitioner to make payment to the respondent no.2 also was required to be made within one year i.e. during the contractual period. It is submitted that by letter dated 3rd July 1996, the petitioner had informed the respondent no.2 that the petitioner had made a representation to the Chairman of respondent no.2 for considering its claim for waiver and it was in the process of making arrangement for drawal of the product from the respondent no.2. The Director of the petitioner was planning to visit the office of respondent no.2 to explain the problems faced by the petitioner and also with regard to the upliftment of the product. The said letter was addressed three days prior to 3rd July 1996. The respondent no.2 vide its letter dated 26th July 1996 addressed to the petitioner in response to the said letter dated 6th July 1996 called upon the petitioner to settle the dues of Rs. 39,31,674.35 at the earliest. g) On 17th May 1997, the respondent no.2 called upon the petitioner to pay the outstanding dues within 15 days from the date of receipt of the said notice and threatened to take legal action. The said notice was followed by notice for invoking arbitration agreement on 6th June 1997. 39,31,674.35 at the earliest. g) On 17th May 1997, the respondent no.2 called upon the petitioner to pay the outstanding dues within 15 days from the date of receipt of the said notice and threatened to take legal action. The said notice was followed by notice for invoking arbitration agreement on 6th June 1997. On 10th June 1997, the petitioner requested the respondent no.2 to waive-off the interest on the dues and to allow the petitioner to pay the outstanding amount in parts along with every parcel of SKO in future and requested to permit the petitioner to clear the outstanding amount as suggested in the said letter. The respondent no.2 in response to the said letter informed the petitioner that it was not possible for respondent no.2 to waive the interest and called upon the petitioner to pay the outstanding amount immediately. Relying upon the aforesaid correspondence, it is submitted that the demand made by the respondent no.2, refusal on the part of the petitioner to pay the amount as demanded and request for waiver of the interest, raised a fresh cause of action. The respondent no.2 had not given up its request made by letter dated 26th July 1996. h) On the allegations of bias made by the petitioner against the learned arbitrator, it is submitted that no such allegations of bias were made before the learned arbitrator. No application under Sections 12 and 13 was made before the learned arbitrator. The petitioner has not even raised any such ground under Section 34 of the said Arbitration Act in this petition and thus cannot be allowed to urge such ground across the bar. In support of this submission, learned counsel placed reliance on the judgment of the Supreme Court in the case of Narayan Prasad Lohia Vs. Nikunj Kumar Lohia and Ors., reported in (2002) 3 SCC 572 (para 18). i) The petitioner had never disputed its liability to pay to the respondent no.2 but had only requested for waiver of interest. The learned arbitrator has interpreted the correspondence exchanged between the parties and has held that the petitioner had admitted and acknowledged its liability. The learned arbitrator has considered all the submissions made by the parties and had rendered a reasonable and valid award. 18. Learned counsel placed reliance on the judgment of the Supreme Court in the case of Dr. Indramani Pyarelal Gupta and Ors. The learned arbitrator has considered all the submissions made by the parties and had rendered a reasonable and valid award. 18. Learned counsel placed reliance on the judgment of the Supreme Court in the case of Dr. Indramani Pyarelal Gupta and Ors. Vs.W.R. Natu and Ors., reported in AIR 1963 SC 274 in support of his submission that the amendment to Section 28 of the Indian Contract Act would apply with retrospective effect. 19. Learned counsel for respondent no.2 also placed reliance on the judgment of Delhi High Court in the case of D.D.A. Vs. Pandit Construction Co., delivered on 19th April 2012 in FAO(OS) 382 of 2007. 20. Learned counsel placed reliance on the objects and reasons of amendment to Section 28 of the Indian Contract Act, 1872 in support of the submission that the said amendment was made effective with retrospective effect. Learned counsel also placed reliance on the Ninety- Seventh Report of the Law Commission of India on the amendment to Section 28. 21. Learned counsel distinguished the judgments relied upon by Mr. Seksaria, learned counsel for the petitioner on the ground that all the judgments referred to and relied upon by the petitioner had considered the unamended provision of Section 28 of the Indian Contract Act, 1872 and not the amended provision. The facts in this matter are totally different and those judgments would not assist the case of the petitioner. It is submitted that in so far as the judgment of the Division Bench of this Court in the case of Dr. Indramani Pyarelal Gupta and Ors. (supra) is concerned, the Division Bench of this Court has considered the judgment of the Supreme Court in the case of Food Corporation of India Vs. New India Assurance Co. Ltd. & Ors. (supra) in which the Supreme Court has considered unamended Section 28 of the Indian Contract Act, 1872. Learned counsel submits that the learned Single Judge of this Court in the case of Axios Navigation Co. Ltd. Vs. Indian Oil Corporation Limited (supra) also considered the judgment of the Division Bench of this Court in the case of Dr. Indramani Pyarelal Gupta and Ors. (supra) and thus that judgments would not assist the case of the petitioner. It is submitted that in the judgment of the Division Bench of this Court, the Court was considering the validity period of a bank guarantee. Indramani Pyarelal Gupta and Ors. (supra) and thus that judgments would not assist the case of the petitioner. It is submitted that in the judgment of the Division Bench of this Court, the Court was considering the validity period of a bank guarantee. The facts of that case were totally different and the said judgment is thus not applicable to the facts of this case. 22. Learned counsel placed reliance on the judgment of this Court delivered on 20th August 2014 in the case of JSW Steel Ltd. Vs. AI Ghuriar Iron & Steel LLC passed in Arbitration Petition No.398 of 2014 and would submit that the judgment of the Division Bench of this Court relied upon by the petitioner had already been interpreted by the learned Single Judge of this Court. 23. It is submitted that in view of plain language of Section 28 (b) of the Indian Contract Act, the said provision applies to 'every agreement' and 'any contract' subsisting on that date and entered into thereafter. Section 28 (b) of the Indian Contract Act applies to the contracts which are subsisting as on 8th January 1997 and those which were not discharged, such as the present agreement, where the claims made by the petitioner against the respondent no.2 were outstanding. Reliance is placed on the judgment of the Delhi High Court in the case of Chander Kant and Co. Vs. the Vice Chairman DDA and Ors. (supra) and would submit that the applicability of Section 28 (b) of the Contract Act would not be determined by the date of the contract. Reliance is also placed on the judgment of the Division Bench of the Delhi High Court in the case of Delhi Development Authority Vs.Pandit Construction Co. (supra). 24. It is submitted that the purpose of enacting Section 28(b), was to overcome the situation wherein the liability was extinguished because of clause like clause 10.2 and to get over such mischief. Reliance is placed on Section 37 of the Contract Act by the learned counsel. Reliance is also placed on the judgment in the case of East and West Steamship Co., Georgetown, Madras Vs. Reliance is placed on Section 37 of the Contract Act by the learned counsel. Reliance is also placed on the judgment in the case of East and West Steamship Co., Georgetown, Madras Vs. S.K. Ranalingam Chettiar, reported in AIR 1960 SC 1058 which explains what is 'discharge of liability.' The discharge of liability takes place only when there was no response to the demand within 90 days of the demand and the arbitration proceedings were not initiated within 365 days from the date of date of delivery. Reliance is also placed on the judgment of the Supreme Court in the cases of Thyssen Stahlunion Gmbh Vs. Steel Authority of India Ltd., reported in (1999) 9 SCC 334 and Commissioner of Income Tax (Central)-I, New Delhi Vs. Vatika Township Private Limited, decided on 15th September 2014 in Civil Appeal No.8750 of 2014 and other connected matters. 25. In rejoinder, Mr.Sekseria, learned counsel for the petitioner submits that an amendment to a substantive law is never retrospective and is presumed not to have retrospective operation unless the same is expressly provided or it follows by necessary implication. It is submitted that any amendment, which modifies accrued rights or imposes obligations, or imposes new duties or attaches new disability has to be treated as prospective unless and until the legislature's intention is so clear that it intended to give the enactment retrospective effect. It is submitted that the presumption in favour of a legislation giving retrospective effect is only when the legislation seeks to confer benefit on some person but without inflecting corresponding detriment on some other person or the public generally. It is submitted that the expression 'discharged from liability' has been interpreted by the Supreme Court in the case of East and West Steamship Co., Georgetown, Madras Vs. S.K. Ranalingam Chettiar (supra) and followed by this Court in the case of Reliance Industries Limited Vs. P & O Containers Limited and Anr., reported in AIR 2005 Bom 65 . The expression 'discharged from liability' would mean a total extinction of liability following upon the extinction of right. The words 'absolved from liability' and 'discharged from liability' do not bear any distinction and that the expression 'discharged from liability' was intended to mean and do mean the liability has totally disappeared. 26. The expression 'discharged from liability' would mean a total extinction of liability following upon the extinction of right. The words 'absolved from liability' and 'discharged from liability' do not bear any distinction and that the expression 'discharged from liability' was intended to mean and do mean the liability has totally disappeared. 26. It is submitted by the learned counsel that in this case, the tenure of the agreement came to an end on 5th July 1996. The goods were delivered by the respondent no.2 to the petitioner between 22nd August 1995 and 29th February 1996. The period of 150 days for assertion of right by the respondent no.2 to a claim for demurrage expired on or before 28th July 1996 which is calculated as 150 days from the last delivery date. The period of 90 days within which the petitioner had to accept the claim as contemplated under clause 10.2 expired on 26th October 1996. The notice invoking arbitration agreement was issued on 6th June 1997 which was barred by law of limitation. The petitioner stood discharged of its liability accordingly which was much prior to the amendment to Section 28 of the Indian Contract Act, 1872. Learned counsel distinguished the judgments of the Supreme Court relied upon by the respondent no.2. It is submitted that since the liability of the petitioner stood discharged/ extinguished before the amendment, there was no right available to the respondent no.2 that could be enforced by it whether before or after the amendment. There was no question of any outstanding obligation to pay alleged subsisting dues under the said agreement on the date of amendment. 27. In so far as the submission of the learned counsel for the respondent no.2 that there was an admission of the liability on the part of the petitioner is concerned, the learned counsel for the petitioner placed reliance on the judgment of the Supreme Court in the case of East and West Steamship Company (supra) and submits that once the liability of the petitioner stood discharged, no acknowledgement of liability could have resurrected such a dead liability. Reliance is also placed on the judgment of this Court in the case of Reliance Industries Limited (supra). 28. Reliance is also placed on the judgment of this Court in the case of Reliance Industries Limited (supra). 28. In so far as the reliance placed by the respondent no.2 on Section 37 of the Contract Act is concerned, it is submitted that Section 37 of the Contract Act itself is qualified by the words 'unless such performance is dispensed with or excused under the provisions of this Act, or of any other law.' It has been held that a contracting party is bound by termination clauses, exemption clauses and clauses entitling forfeiture. It is submitted that reliance placed on Section 37 of the Indian Contract Act, 1872 by the respondent no.2 is thus misplaced. Learned counsel distinguished the judgments relied upon by the respondent no.2 including the judgment of the learned Single Judge of this Court in the case of JSW Steel Ltd. Vs. AI Ghuriar Iron & Steel LLC (surpa) on the ground that the learned Single Judge could not have declared the judgment of the Division Bench of this Court as per incurium. 29. In so far as the submission of the learned counsel for the respondent no.2 that in view of retrospective effect of Section 28 of the Indian Contract Act, the learned arbitrator could have declared clause 10.2 of the agreement as void is concerned, it is submitted by the learned counsel for the petitioner that the learned arbitrator could not re-write the contract between the parties and had no jurisdiction to sever part of the agreement by declaring clause 10.2 of the agreement as void. The learned arbitrator could not construe a part of the clause as offending the amended provisions of Section 28 of the Contract Act to render the said clause as void and retain the rest of the agreement. It is submitted that a contract must be read as a whole and it is not open to dissect it by taking out a part treating it to be contrary to law and by ordering enforcement of the rest if otherwise it is not permissible. REASONS AND CONCLUSIONS :- 30. I have heard the learned counsel appearing for the parties at length and have given anxious consideration to the rival submissions made by the learned counsel. REASONS AND CONCLUSIONS :- 30. I have heard the learned counsel appearing for the parties at length and have given anxious consideration to the rival submissions made by the learned counsel. The following issues arise for consideration in this matter : a) Whether the amendment to Section 28 (b) of the Indian Contract Act, 1872 effective from 8th January 1997 is prospective or retrospective? b) If the amendment to Section 28 (b) of the Indian Contract Act, 1872 is not with retrospective effect, whether the claims made by the respondents were barred by limitation? c) Whether the learned arbitrator has power to declare any part of the contract as void and opposed to Section 28 of the Indian Contract Act, 1872? d) Whether the petitioner had admitted its alleged liability by letter dated 10th June 1997 or any other correspondence? e) Whether the learned arbitrator had acted with any official bias of the matter? 31. I shall now deal with the issue whether amendment to Section 28 of the Indian Contract Act, 1872 would apply with retrospective effect or prospective effect. 32. Prior to 8th January 1997, the unamended Section 28 of the Indian Contract Act, 1872 is extracted as under :- “Section 28. Agreements in restraint of legal proceedings void – Every agreement, by which any party thereto is restricted absolutely from enforcing his rights under or in respect of any contract, by the usu0al legal proceedings in the ordinary tribunals, or which limits the time within which he may thus enforce his rights, is void to that extent.” Amendment to Section 28 of the Indian Contract Act, 1872 reads thus :- “Section 28. Agreements in restraint of legal proceedings void : Every agreement, -- (a) by which any party thereto is restricted absolutely from enforcing his rights under or in, respect of any contract, by the usual legal proceedings in the ordinary tribunals, or which limits the time within which he may thus enforce his rights; or (b) which extinguishes the rights of any party thereto, or discharges any party thereto from any liability, under or in respect of any contract on the expiry of a specified period so as to restrict any party from enforcing his rights, is void to that extent...” 33. A perusal of the record indicates that the agreement entered into between the petitioner and the respondent no.2 was extended till 6th July 1995. A perusal of the record indicates that the agreement entered into between the petitioner and the respondent no.2 was extended till 6th July 1995. During the period between 22nd August 1995 and 29th February 1996, the goods were delivered by the respondent no.2 to the petitioner in accordance with the said agreement. The period of 150 days for assertion of right by the respondent no.2 to a claim for demurrage expired on or before 28th July 1996 which was calculated at 150 days from the last delivery date of the goods. The period of 90 days within which the petitioner could accept the claim as contemplated under clause 10.2 expired on 26th October 1996. The respondent no.2 invoked arbitration agreement on 6th June 1997. The amendment to Section 28 of the Indian Contract Act, 1872 was brought into effect on 8th January 1997. 34. It is the submission of the learned counsel for the petitioner that since the liability of the petitioner stood discharged much prior to the amendment to Section 28 of the Indian Contract Act, 1872, there was no right available to the respondent no.2 which could be enforced by it before or after the amendment, the respondent no.2 could not claim any benefit of the amendment to Section 28 of the Indian Contract Act, 1872 brought into effect from 8th January 1997. It is also the case of the petitioner that once the liability of the petitioner stood discharged prior to the letter of 10th June 1997 addressed by the petitioner requesting to waive the interest which was in any event the conditional letter, the alleged claims of the respondents did not revive and a fresh period of limitation did not commence. 35. Per contra, the submission of the learned counsel for the respondents on this issue is that the amendment to Section 28 of the Indian Contract Act, 1872 would apply with retrospective effect to all the existing contracts on the date of the amendment. The expression “any agreement/contract” would not mean that such agreement/contract was to be entered into only after the date of amendment for the purpose of attraction of Section 28 (b) of the Indian Contract Act, 1872. Claims of the respondents were not barred by limitation under the provisions of Limitation Act, 1963. The expression “any agreement/contract” would not mean that such agreement/contract was to be entered into only after the date of amendment for the purpose of attraction of Section 28 (b) of the Indian Contract Act, 1872. Claims of the respondents were not barred by limitation under the provisions of Limitation Act, 1963. Since the petitioner failed to comply with its obligation to pay price for supplies effected, the term of the agreement for the purpose of payment/obligation continued and was in place on the date of amendment to Section 28 of the Indian Contract Act, 1872. Under clause 10.2 of the agreement, the claims were kept alive for the period of 360 days from the date of delivery and not from the date of execution of the contract. 36. Both the learned counsel placed reliance on the several judgments of the Supreme Court, this Court and other High Courts in support of their respective submissions on the issue whether the amendment to Section 28 of the Indian Contract Act, 1872 would apply with retrospective effect or prospective effect. 37. The Supreme Court in the case of Wild Life Institute of India, Dehradun Vs. Vijay Kumar Garg, reported in (1997) 10 SCC 528 construed an arbitration clause which provided that if the contractor does not make any demand for arbitration in respect of any claim in writing within 90 days of receiving the intimation from other party that the bill is ready for payment, the claim of the contractor would be deemed to have been waived and absolutely barred and the owner shall be discharged and released of all liabilities under the contract. The Supreme Court held that such clause operates to discharge the liability of the owner on expiry of 90 days as set out therein and was not merely a clause providing a period of limitation. Paragraph 6 of the said judgment in the case of Wild Life Institute of India, Dehradun (supra) reads thus :- “6. The Supreme Court held that such clause operates to discharge the liability of the owner on expiry of 90 days as set out therein and was not merely a clause providing a period of limitation. Paragraph 6 of the said judgment in the case of Wild Life Institute of India, Dehradun (supra) reads thus :- “6. It is also necessary to refer to the arbitration clause under the contract which clearly provides that if the contractor does not make any demand for arbitration in respect of any claim in writing within 90 days of receiving the intimation from the appellants that the bill is ready for payment, the claim of the contractor will be deemed to have been waived and absolutely barred and the appellants shall be discharged and released of all liabilities under the contract in respect of these claims. The liability, therefore, of the appellants ceases if no claim of the contractor is received within 90 days of receipt by the contractor of an intimation that the bill is ready for payment. This clause operates to discharge the liability of the appellants on expiry of 90 days as set out therein and is not merely a clause providing a period of limitation. In the present case, the contractor has not made any claim within 90 days of even receipt of the amount under the final bill. The dispute has been raised for the first by the contractor 10 months after the receipt of the amount under the final bill.” 38. The Supreme Court in case of National Insurance Co. Ltd. Vs. Sujir Ganesh Nayak & Co. and Anr., reported in (1997) 4 SCC 366 has considered a case under unamended Section 28 of the Indian Contract Act and has held that such a clause in the agreement would not fall within the mischief of Section 28 of the Contract Act. It is held that to put it differently, curtailment of the period of limitation is not permissible in view of Section 28 but extinction of the right itself unless exercised within a specified time is permissible and can be enforced. It is held that if the policy of insurance provides that if a claim is made and rejected and no action is commenced within the time stated in the policy, the benefits flowing from the policy shall stand extinguished and any subsequent action would be time barred. It is held that if the policy of insurance provides that if a claim is made and rejected and no action is commenced within the time stated in the policy, the benefits flowing from the policy shall stand extinguished and any subsequent action would be time barred. Paragraphs 5, 7, 8, 13 and 16 of the said judgment of the Supreme Court in the case of National Insurance Co. Ltd.(supra) read thus :- “5. The appellants contested the suit inter alia on the ground that the suit was barred by limitation as well as by condition No. 19 of the policy and on the ground that the claim made by the respondent No.1 was not covered by the policy. Condition 19 of the policy which was set up by way of defence runs as under: "Condition No. 19 - In no case whatever shall the company be liable for any loss or damage after the expiration of 12 months from the happening of loss or the damage unless the claim is the subject of pending action or arbitration." 7. In the present appeal, the appellant contended that condition No. 19 extinguishes the right of the assured as the suit was not filed within 12 months from the day when the loss or damage had occurred. It is further reiterated in the appeal that special Condition 5(i)(b) of the Riot and Strike Endorsement excludes the claim of the respondent No.1 from the scope of two Insurance Policies. 8. Section 28 of the contract Act may be quoted now before going into further discussion : "Section 28. Every agreement, by which any party thereto is restricted absolutely from enforcing his rights under or in respect of any contract, by the usual legal proceedings in the ordinary tribunals, or which limits the time within which he may thus enforce his rights, is void to that extent." 13. The next case we would like to notice is the Food Corporation of India (supra); the abridged factual matrix is that it, as principal, had appointed millers for procuring, hulling and supplying rice on certain conditions. On behalf of these millers the respondent insurance company executed fidelity Insurance Guarantee in favour of the appellant hereunder the former undertook to indemnify the latter for any loss suffered by the appellant by reason of branch of agreement. On behalf of these millers the respondent insurance company executed fidelity Insurance Guarantee in favour of the appellant hereunder the former undertook to indemnify the latter for any loss suffered by the appellant by reason of branch of agreement. Under the terms of the guarantee when the appellant found that it had suffered losses on account of breach of terms and conditions of their respective contracts by the millers it made demands on the insurance company to indemnify it. These demands were made well before the expiry of six months from the date of termination of the contract with the concerned miller. The insurance company did not satisfy the demands which led the appellants to file suits to recover the losses. Those suits were decreed in favour of the appellants against the respondents including the insurance companies. The insurance companies filed appeals in the High Court which were allowed holding that the terms of the guarantee concerned in each case did not entitle the appellant to sue the insurance companies after 'six month' period from the date of termination of the respective contracts with the rice millers. The matter was therefore carried in appeal to this Court. 16. From the case law referred to above the legal position that emerges is that an agreement which in effect seeks to curtail the period of limitation and prescribes a shorter period than that prescribed by law would be void as offending section 28 of the Contract Act. That is because such a an agreement would seek to restrict the party from enforcing his right in Court after the period prescribed under the agreement expires even though the period prescribed by law for the enforcement of his right has yet not expired. But there could be agreements which do not seek to curtail the time for enforcement of the right but which provides for the forfeiture or waiver of the right itself if no action is commenced with in the period stipulated by the agreement. Such a clause in the agreement would not fall within the mischief of section 28 of the Contract Act. To put it differently, curtailment of the period of limitation is not permissible in view of Section 28 but extinction of the right itself unless exercised within a specified time is permissible and ca be enforced. Such a clause in the agreement would not fall within the mischief of section 28 of the Contract Act. To put it differently, curtailment of the period of limitation is not permissible in view of Section 28 but extinction of the right itself unless exercised within a specified time is permissible and ca be enforced. If the policy of insurance provides that if a claim is made and rejected and no action is commenced within the time stated in the policy, the benefits flowing from the policy shall stand extinguished and any subsequent action would be time barred. Such a clause would fall outside the scope of Section 28 of the Contract Act. This, in Brief, seems to be the settled legal position. We may now apply it to the facts of this case.” 39. The Supreme Court in the case of Himachal Pradesh State Forest Company Limited Vs. United India Insurance Company Limited, reported in (2009) 2 SCC 252 has considered its earlier judgment in the case of National Insurance Co. Ltd. Vs.Sujir Ganesh Nayak & Co. and Anr. (supra). The judgment of the Supreme Court in the case of Food Corporation of India Vs. New India Assurance Co. Ltd. and Ors., reported in (1994) 3 SCC 324 and several other judgments and applied the principles laid down even to the case arising under amendment to Section 28 of the Indian Contract Act, 1872. Paragraphs 13, 14 and 15 of the said judgment in the case of Himachal Pradesh State Forest Company Limited (supra) read thus :- “13. In Sujir Nayak's case (supra) to which primary reference has been made by the learned counsel for the parties while dealing with an identical situation where a contract contained a provision prescribing a period of limitation shorter than that prescribed by the Limitation Act, it was held that the contractual provision was not hit by Section 28 as the right itself had been extinguished. 14. Mr. Sharma has, however, submitted that in view of the observations in some paragraphs in Food Corporation of India's case, the observations in Sujir Nayak's case were liable to reconsideration. We, however, find no merit in this plea for the reason that in Sujir Nayak's case, Food 12 Corporation of India's case (supra) has been specifically considered and Vulcan Insurance Company's case (supra) too had been relied upon. JUDGMENT :. We, however, find no merit in this plea for the reason that in Sujir Nayak's case, Food 12 Corporation of India's case (supra) has been specifically considered and Vulcan Insurance Company's case (supra) too had been relied upon. JUDGMENT :. By this petition filed under Section 34 of the Arbitration and Conciliation Act, 1996 (for short “the said Arbitration Act”), the petitioner has impugned the arbitral award dated 30th March 2000 made by the learned arbitrator allowing the claims made by respondent no.2 and directing the petitioner to pay a sum of Rs.48,11,103/- to the respondent no.2 with interest @7% p.a. from the date of claim till the date of award and @18% p.a. from the date of award till the date of payment. Some of the relevant facts for the purpose of deciding this petition are as under :- 2. The petitioner was the original respondent in the arbitration proceedings whereas the respondent no.2 was the original claimant. On 6th July 1993, respondent no.2 entered into an agreement for sale/supply of kerosene oil on the terms and conditions set out therein. It was provided in the said agreement that the said agreement shall come into force on 6th July 1993 and shall remain for a period of one year during which period the buyer shall get the requirements of superior kerosene oil (SKO) through Indian Oil Corporation Ltd. (IOC); provided nothing contained in clause 1 shall prejudice the rights of IOC to terminate this agreement earlier on the happening of any of the events specified in clause 10.7 of the said agreement. Under clause 4.1 of the agreement, it was provided that sale of SKO will be made by IOC from time to time through import. 3. Under clause 5.1 of the agreement, it was agreed that for each import parcel that may be required by the buyer, the IOC shall establish provisional cost and freight (C & F) price in Indian Rupees which was required to be worked out in accordance with the said clause. Demurrage was payable @100/ MT. Under clause 5.2 of the said agreement, it was provided that IOC will work out the final price for each parcel sold to the buyer on the basis mentioned therein by including the elements set out therein within a period of 45 days from the date on which the provisional price was established for the same. Under clause 5.2 of the said agreement, it was provided that IOC will work out the final price for each parcel sold to the buyer on the basis mentioned therein by including the elements set out therein within a period of 45 days from the date on which the provisional price was established for the same. Under clause6.1 of the agreement, it was provided that the buyer shall open a confirmed irrevocable letter of credit without recourse to drawers 30 days in advance of the expected arrival of the cargo in favour of IOC through SBI duly confirmed by its commercial branch, Bombay. The letter of credit to be opened by the buyer shall be in a format as advised by IOC and acceptable to IOC. 4. Under clause 6.2 of the agreement, it was agreed that the payment under the letter of credit shall be based on the bill of lading quantity. Clause 10.2 of the said agreement which is relevant for the purpose of deciding this matter is extracted as under :- “10.2 CLAIMS : Any claim regarding quality, quantity, demurrage, non-delivery or otherwise which either party may have against the other party shall be filed with that other party within 150 days from the date of delivery of the product to the buyer or the last date on which such delivery should have been made (hereinafter referred to as “the Delivery date”). If such claim is not admitted in full within 90 days of its being filed with the other party, it shall automatically lapse and be forfeited and the other party against whom it is made shall be discharged of all liability with regard thereto unless arbitration proceedings in respect thereof are commenced and notice thereof is given within 360 days of the delivery date to the party against whom the claim is made.” Clause 11 of the agreement provides an arbitration clause. 5. By letter dated 20th December 1993, the respondent no.2 informed the petitioner about revision in settled terms of the original agreement dated 6th July 1993 and informed that the said revision shall constitute as an integral part of the agreement dated 6th July 1993 and that all other clauses of the agreement dated 6th July 1993 shall remain unaltered. 6. By letter dated 20th December 1993, the respondent no.2 informed the petitioner about revision in settled terms of the original agreement dated 6th July 1993 and informed that the said revision shall constitute as an integral part of the agreement dated 6th July 1993 and that all other clauses of the agreement dated 6th July 1993 shall remain unaltered. 6. On 6th July 1994, the petitioner and respondent no.2 signed an agreement thereby reviving and extending the said agreement dated 6th July 1993 for a further period of 12 months commencing from 6th July 1994, however, on the same terms and conditions as contained in the agreement dated 6th July 1993. On 6th July 1995, the petitioner and respondent no.2 entered into an another agreement thereby reviving and extending the said agreement dated 6th July 1994 for a further period of 12 months commencing from 6th July 1995, however, on the same terms and conditions as contained in the agreement dated 6th July 1994. 7. It is the case of the petitioner that though the sale of superior kerosene oil in favour of the petitioner is supposed to have been completed on High Seas, the petitioner had to take actual possession of the product only from the share tank which was in complete possession of respondent no.2. The petitioner was required to rely upon the assistance of respondent no.2 in all matters relating to receipt, storage and handling of the product purchased from the petitioner on High Seas basis. It is the case of the petitioner that respondent no.2, however, did not extend any help to the petitioner in the matter of receipt, storage and handling of SKO purchased from the petitioner on High Seas basis under clause 10.1 of the amended agreement. 8. During the course of the arguments, learned counsel for the petitioner tendered a statement showing relevant dates of the delivery of SKO and under clause 10.2 of the agreement, respondent no.2 was liable to make a claim, if any, against the petitioner and when the arbitration proceedings commenced. It is submitted that the details mentioned in the said statement are not disputed. It is the case of the petitioner that the admitted dates of delivery of SKO from respondent no.2 to the petitioner were during the period from 10th October 1995 to 23rd January 1996. It is submitted that the details mentioned in the said statement are not disputed. It is the case of the petitioner that the admitted dates of delivery of SKO from respondent no.2 to the petitioner were during the period from 10th October 1995 to 23rd January 1996. The respondent no.2 by its letter dated 6th June 1997 invoked arbitration agreement by addressing a letter to the Director (M) of IOC Ltd. alleging that a sum of Rs.38,58,107.86 became due and payable by the petitioner to respondent no.2 on account of the supplies made. It is stated in the said letter that the petitioner was requested to clear the outstanding vide letter dated 17th May 1997 with interest accrued thereon. The petitioner, however, failed to pay the said amount and interest accrued thereon despite the said notice served upon it and as a result thereof, the dispute had arisen in terms of the agreement dated 6th July 1995 and the amendments thereto. By the said letter, respondent no.2 requested the Director (M) of the respondent no.2 to appoint his nominee in case the said Director (M) himself was unable to act as a sole arbitrator for adjudication of the claims of the respondent no.2. Copy of the said notice was forwarded to the petitioner. 9. The petitioner vide its letter dated 10th June 1997 requested the respondent no.2 to waive-off the interest on the dues and allow it to pay the outstanding amount in parts, along with every parcel of SKO in future. The petitioner stated in the said letter that as the petitioner was desirous of reviving the import of SKO through respondent no.2 forthwith, the petitioner requested the respondent no.2 to allow the petitioner to clear the outstanding amount as suggested in the said letter. 10. The Director (M) appointed one Mr. G.R. Menon as a sole arbitrator who resigned subsequently. The Director (M) thereafter appointed Mr. B.L. Bansal, Dy. General Manager (LPG-OPS), HO of respondent no.2 as a sole arbitrator. Pursuant to the directions issued by the learned arbitrator, the parties filed their respective pleadings along with copies of the documents. None of the parties led any oral evidence. The learned arbitrator framed 15 issues for consideration. 11. The Director (M) thereafter appointed Mr. B.L. Bansal, Dy. General Manager (LPG-OPS), HO of respondent no.2 as a sole arbitrator. Pursuant to the directions issued by the learned arbitrator, the parties filed their respective pleadings along with copies of the documents. None of the parties led any oral evidence. The learned arbitrator framed 15 issues for consideration. 11. On the issue of limitation raised by the petitioner herein that the claims were barred under clause 10.2 of the agreement, the learned arbitrator rendered a finding and answered the said issue in negative holding that the claims of respondent no.2 were not barred by limitation under clause 10.2 of the agreement. The learned arbitrator also held that the petitioner had not discharged all its liability in respect of the claims made by respondent no.2 though the arbitration proceedings had not been commenced and notice thereof had not been given within 360 days of the delivery date to the petitioner. The learned arbitrator also held that respondent no.2 (original claimant) could be permitted to urge that clause 10.2 of the agreement was void as opposed to Section 28 of the Indian Contract Act, 1872. 12. The learned arbitrator rejected the allegations of official bias made against him by the petitioner. It is held by the learned arbitrator that the elements of demurrage could be included in the price structure. On merits of the claim, the learned arbitrator held that the petitioner was liable to pay demurrage charges at actual due to the congestion at berthing which was beyond the control of the petitioner and for which it was not at all responsible. It is held by the learned arbitrator that the petitioner was not entitled to refund of the demurrages at actual paid by the petitioner with interest. The learned arbitrator rendered a finding that respondent no.2 was right in contending that the petitioner had admitted to the claim. The learned arbitrator accordingly allowed the claims made by the respondent no.2 with interest. This award has been impugned by the petitioner in this petition under Section 34 of the said Arbitration Act. 13. Mr. Seksaria, learned counsel for the petitioner made the following submissions :- a) In the impugned award, the learned arbitrator had declared the clause 10.2 of the agreement as allegedly opposed to Section 28 of the Indian Contract Act. This award has been impugned by the petitioner in this petition under Section 34 of the said Arbitration Act. 13. Mr. Seksaria, learned counsel for the petitioner made the following submissions :- a) In the impugned award, the learned arbitrator had declared the clause 10.2 of the agreement as allegedly opposed to Section 28 of the Indian Contract Act. The learned arbitrator could not have declared any provision of the agreement as void as the same was beyond the scope and powers of the learned arbitrator. The award shows patent illegality on the face of the award. b) Under clause 10.2 of the agreement, the claim regarding quality, quantity, demurrage, non-delivery or otherwise was required to be made within 150 days from the date of delivery of the product to the buyer or the last date on which such delivery should have been made and if such claim was not admitted in full within 90 days of its being filed with the other party, such claim shall automatically lapse and be forfeited and the other party would be discharged of all its liability with regard thereto unless the arbitration proceedings in respect thereof were commenced and notice thereof was given within 360 days of the delivery date to the party against whom the claim was made. Since, the claim has not been preferred by respondent no.2 within the period stipulated in clause 10.2 of the agreement and since the arbitration clause was not invoked in respect of such claim within 360 days from the date of delivery of the product to the petitioner in each instance, the claims made by respondent no.2 were barred by limitation and liability of the petitioner, if any, stood discharged. The respondent no.2 invoked the arbitration agreement only on 6th June 1997 by addressing a letter to the Director (M) which was long after 360 days from the date of delivery of the product to the petitioner in each case. The respondent no.2 invoked the arbitration agreement only on 6th June 1997 by addressing a letter to the Director (M) which was long after 360 days from the date of delivery of the product to the petitioner in each case. c) It was the case of the respondent no.2 itself in the claim filed before the learned arbitrator that the provisional cost and freight price was required to be worked out in Indian Rupees as provided in clause 5.1 and final price for each parcel sold to the buyer which was required to be worked out by respondent no.2 as provided in clause 5.2 of the said agreement within 45 days from the date of establishing the provisional price. In respect of 9 invoices, respondent no.2 had furnished final invoices much after 45 days from the date of provisional invoice and all the final invoices had been furnished beyond 116 days. d) The letter of 10th June 1997 addressed by the petitioner to respondent no.2 did not amount to an admission of its alleged liability in paying the alleged outstanding amount to the respondent no.2. The said letter was a conditional letter and was issued as and by way of counter offer to the respondent no.2 stating that if the respondent no.2 would waive the interest then the petitioner would pay the outstanding amount which offer was not accepted by respondent no.2. There was no binding contract arrived at between the parties based on Exhibit-H. Acknowledgement of liability has to be during the subsistence of the liability and not after the claim having become time barred. The letter dated 10th June 1997 at Exhibit-H could not revive the time barred claim. There was no fresh promise of the petitioner to pay to the respondent no.2 as contemplated under Section 25(3) of the Indian Contract Act, 1872. The finding of the learned arbitrator that the petitioner had acknowledged its liability is thus contrary to Section 25 (3) of the Indian Contract Act and also by misinterpreting the letter of the petitioner dated 10th June 1997. The finding of the learned arbitrator that the petitioner had acknowledged its liability is thus contrary to Section 25 (3) of the Indian Contract Act and also by misinterpreting the letter of the petitioner dated 10th June 1997. The agreement entered into between the petitioner and the respondent no.2 duly amended came to an end on 5th July 1996 which was prior to the amendment to Section 28 of the Indian Contract Act notified on 8th January 1997, which amendment declared any contract that extinguishes the rights of any party or discharges any party from any liability after the expiry of a specified period to be void. The amendment to Section 28 of the Indian Contract Act is not retrospective in operation. Clause 10.2 did not seek to curtail the period of limitation for enforcement but stipulates the forfeiture or extinguishment of the rights itself. e) The learned arbitrator appointed by the Director (M) was an employee of respondent no.2 and was bound to follow the instructions of the Director (M) of respondent no.2 who was involved in the dealings with the petitioner on several occasions in the past before the matter was referred to the arbitration. The learned arbitrator has, therefore, clearly shown an official bias. The petitioner vide its letter dated 28th December 1996 raised certain complaints to the Director (M) in respect of demurrage charges. The learned arbitrator thus appointed by the Directior (M) would be obviously obliged to follow the instructions of the superior and could not permit to act as an independent arbitrator. 14. In support of the submission that the amendment to Section 28 notified on 8th January 1997 was not with retrospective effect, learned counsel for the petitioner relied upon the following Judgments:- 1. M/s. Continental Construction Ltd. Vs. Food Corporation of India and Ors., reported in AIR 2003 DELHI 32; 2. The Oriental Insurance Company Limited Vs. Karur Vysya Bank Limited, reported in AIR 2001 MADRAS 489; 3. Food Corporation of India Vs. New India Assurance Co.Ltd. & Ors., reported in (1994) 3 SCC 324 ; 4. National Insurance Co. Ltd. Vs. Sujir Ganesh Nayak & Co. & Anr., reported in (1997) 4 SCC 366 ; 5. Wild Life Institute of India, Dehradun Vs. Vijay kumar Garg, reported in (1997) 10 SCC 528 ; 6. Himachal Pradesh State Forest Company Limited Vs. New India Assurance Co.Ltd. & Ors., reported in (1994) 3 SCC 324 ; 4. National Insurance Co. Ltd. Vs. Sujir Ganesh Nayak & Co. & Anr., reported in (1997) 4 SCC 366 ; 5. Wild Life Institute of India, Dehradun Vs. Vijay kumar Garg, reported in (1997) 10 SCC 528 ; 6. Himachal Pradesh State Forest Company Limited Vs. United India Insurance Company Limited, reported in (2009) 2 SCC 252 ; 7. Judgment of the Division Bench of this Court in the case of M/s. Indusind Bank Ltd. Vs. Union of India & Ors., delivered on 20th April 2011 passed in Appeal No.258 of 2008; 8. Axios Navigation Co. Ltd. Vs. Indian Oil Corporation Limited, reported in 2012 (2) Bom.C.R. 271 ; 9. Unreported judgment of this Court in the case of M/s.Mascon Multiservices & Consultants Pvt. Ltd. Vs. Bharat Oman Refineries Ltd., delivered on 11st August 2014 passed in Arbitration Petition No.1088 of 2010; and 10. Judgment of the Delhi High Court in the case of M/s. Chander Kant & Co. Vs. The Vice Chairman, DDA & Ors., delivered on 26th May 2009 passed in Arbitration Petition No.246 of 2005. 15. Relying upon the aforesaid judgments, learned counsel for the petitioner submits that since the last date of delivery under the contract was 23rd January 1996 and the entire cause of action had arisen much prior to the date of amendment i.e. 8th January 1997, unamended Section 28 of the Indian Contract Act, 1872 would apply to the dispute between the parties and not amended Section 28 as sought to be canvassed by respondent no.2. 16. In support of the submission that there was an official bias on the part of the learned arbitrator who was an employee of respondent no.2 and the award is vitiated on that ground alone is concerned, learned counsel for the petitioner placed reliance on the judgment of the Supreme Court in the case of Indian Oil Corporation Limited Vs. Raja Transport Private Limited, reported in (2009) 8 SCC 520 and it is submitted that there can be a justifiable apprehension about the independence or impartiality of an employee arbitrator, if such person was the controlling or dealing authority in regard to the subject contract or if he is a direct subordinate to the officer whose decision was the subject matter of the dispute. 17. 17. Mr.Jagtiani, learned counsel for respondent no.2, on the other hand, supported the reasonings and conclusions in the impugned award. Learned counsel for the respondent no.2 made the following submissions: a) Amendment to Section 28 of the Indian Contract Act, 1872 notified on 8th January 1997 would apply with retrospective effect to all the existing contracts on the date of amendment. It would also apply to the contracts entered into prior to the date of amendment. The expression“any agreement/contract” would not mean that such agreement/contract was to be entered into only after the date of amendment for the purpose of attraction of Section 28 (b) of the Indian Contract Act, 1872 and if such argument of the petitioner is accepted, it would be in violation of the words “any agreement/contract.” b) The period of 360 days mentioned in clause 10.2 would not mean that the contractual obligation/right of the parties would not survive after expiry of 360 days. It is not the case of the petitioner that under the provisions of the Limitation Act, 1963, the claims of the respondent no.2 have become barred. If such argument is accepted, the whole purpose of Section 28(b) of the Indian Contract Act, 1872 would be defeated. c) Since the dispute between the parties was governed by the amended provision of Section 28 of the Indian Contract Act, the learned arbitrator was entitled to consider such amended provision applicable to the parties and was empowered to declare clause 10.2 of the agreement as void in view of the amended Section 28 (b) of the Indian Contract Act. The learned arbitrator has not exceeded his jurisdiction and that the award does not show any illegality on this ground. d) Since the petitioner had not complied with its obligation to pay price for supplies effected by the respondent no.2, the term of the agreement/contract for the purpose of payment/obligation continued and was in place. The petitioner had not disputed its liability on merits, but had opposed the claim only on the ground of limitation under clause 10.2 of the agreement. e) Under clause 10.2 of the agreement, the purchase by the petitioner was required to be completed within one year. The petitioner had not disputed its liability on merits, but had opposed the claim only on the ground of limitation under clause 10.2 of the agreement. e) Under clause 10.2 of the agreement, the purchase by the petitioner was required to be completed within one year. In so far as the payment/ obligation of the petitioner under the agreement was concerned, the same was required to be continued even beyond the expiry of one year and such obligation was not discharged till such payment was made by the petitioner. It is submitted that under clause 10.2 of the agreement, the claims were kept alive for a period of 360 days from the date of delivery and not from the date of execution of the contract. There were various dates on which the delivery was effected by respondent no.2 to the petitioner. The agreement/contract would not come to an end on 8th January 1997. f) The petitioner cannot be permitted to urge that obligation of the petitioner to make payment to the respondent no.2 also was required to be made within one year i.e. during the contractual period. It is submitted that by letter dated 3rd July 1996, the petitioner had informed the respondent no.2 that the petitioner had made a representation to the Chairman of respondent no.2 for considering its claim for waiver and it was in the process of making arrangement for drawal of the product from the respondent no.2. The Director of the petitioner was planning to visit the office of respondent no.2 to explain the problems faced by the petitioner and also with regard to the upliftment of the product. The said letter was addressed three days prior to 3rd July 1996. The respondent no.2 vide its letter dated 26th July 1996 addressed to the petitioner in response to the said letter dated 6th July 1996 called upon the petitioner to settle the dues of Rs. 39,31,674.35 at the earliest. g) On 17th May 1997, the respondent no.2 called upon the petitioner to pay the outstanding dues within 15 days from the date of receipt of the said notice and threatened to take legal action. The said notice was followed by notice for invoking arbitration agreement on 6th June 1997. 39,31,674.35 at the earliest. g) On 17th May 1997, the respondent no.2 called upon the petitioner to pay the outstanding dues within 15 days from the date of receipt of the said notice and threatened to take legal action. The said notice was followed by notice for invoking arbitration agreement on 6th June 1997. On 10th June 1997, the petitioner requested the respondent no.2 to waive-off the interest on the dues and to allow the petitioner to pay the outstanding amount in parts along with every parcel of SKO in future and requested to permit the petitioner to clear the outstanding amount as suggested in the said letter. The respondent no.2 in response to the said letter informed the petitioner that it was not possible for respondent no.2 to waive the interest and called upon the petitioner to pay the outstanding amount immediately. Relying upon the aforesaid correspondence, it is submitted that the demand made by the respondent no.2, refusal on the part of the petitioner to pay the amount as demanded and request for waiver of the interest, raised a fresh cause of action. The respondent no.2 had not given up its request made by letter dated 26th July 1996. h) On the allegations of bias made by the petitioner against the learned arbitrator, it is submitted that no such allegations of bias were made before the learned arbitrator. No application under Sections 12 and 13 was made before the learned arbitrator. The petitioner has not even raised any such ground under Section 34 of the said Arbitration Act in this petition and thus cannot be allowed to urge such ground across the bar. In support of this submission, learned counsel placed reliance on the judgment of the Supreme Court in the case of Narayan Prasad Lohia Vs. Nikunj Kumar Lohia and Ors., reported in (2002) 3 SCC 572 (para 18). i) The petitioner had never disputed its liability to pay to the respondent no.2 but had only requested for waiver of interest. The learned arbitrator has interpreted the correspondence exchanged between the parties and has held that the petitioner had admitted and acknowledged its liability. The learned arbitrator has considered all the submissions made by the parties and had rendered a reasonable and valid award. 18. Learned counsel placed reliance on the judgment of the Supreme Court in the case of Dr. Indramani Pyarelal Gupta and Ors. The learned arbitrator has considered all the submissions made by the parties and had rendered a reasonable and valid award. 18. Learned counsel placed reliance on the judgment of the Supreme Court in the case of Dr. Indramani Pyarelal Gupta and Ors. Vs.W.R. Natu and Ors., reported in AIR 1963 SC 274 in support of his submission that the amendment to Section 28 of the Indian Contract Act would apply with retrospective effect. 19. Learned counsel for respondent no.2 also placed reliance on the judgment of Delhi High Court in the case of D.D.A. Vs. Pandit Construction Co., delivered on 19th April 2012 in FAO(OS) 382 of 2007. 20. Learned counsel placed reliance on the objects and reasons of amendment to Section 28 of the Indian Contract Act, 1872 in support of the submission that the said amendment was made effective with retrospective effect. Learned counsel also placed reliance on the Ninety- Seventh Report of the Law Commission of India on the amendment to Section 28. 21. Learned counsel distinguished the judgments relied upon by Mr. Seksaria, learned counsel for the petitioner on the ground that all the judgments referred to and relied upon by the petitioner had considered the unamended provision of Section 28 of the Indian Contract Act, 1872 and not the amended provision. The facts in this matter are totally different and those judgments would not assist the case of the petitioner. It is submitted that in so far as the judgment of the Division Bench of this Court in the case of Dr. Indramani Pyarelal Gupta and Ors. (supra) is concerned, the Division Bench of this Court has considered the judgment of the Supreme Court in the case of Food Corporation of India Vs. New India Assurance Co. Ltd. & Ors. (supra) in which the Supreme Court has considered unamended Section 28 of the Indian Contract Act, 1872. Learned counsel submits that the learned Single Judge of this Court in the case of Axios Navigation Co. Ltd. Vs. Indian Oil Corporation Limited (supra) also considered the judgment of the Division Bench of this Court in the case of Dr. Indramani Pyarelal Gupta and Ors. (supra) and thus that judgments would not assist the case of the petitioner. It is submitted that in the judgment of the Division Bench of this Court, the Court was considering the validity period of a bank guarantee. Indramani Pyarelal Gupta and Ors. (supra) and thus that judgments would not assist the case of the petitioner. It is submitted that in the judgment of the Division Bench of this Court, the Court was considering the validity period of a bank guarantee. The facts of that case were totally different and the said judgment is thus not applicable to the facts of this case. 22. Learned counsel placed reliance on the judgment of this Court delivered on 20th August 2014 in the case of JSW Steel Ltd. Vs. AI Ghuriar Iron & Steel LLC passed in Arbitration Petition No.398 of 2014 and would submit that the judgment of the Division Bench of this Court relied upon by the petitioner had already been interpreted by the learned Single Judge of this Court. 23. It is submitted that in view of plain language of Section 28 (b) of the Indian Contract Act, the said provision applies to 'every agreement' and 'any contract' subsisting on that date and entered into thereafter. Section 28 (b) of the Indian Contract Act applies to the contracts which are subsisting as on 8th January 1997 and those which were not discharged, such as the present agreement, where the claims made by the petitioner against the respondent no.2 were outstanding. Reliance is placed on the judgment of the Delhi High Court in the case of Chander Kant and Co. Vs. the Vice Chairman DDA and Ors. (supra) and would submit that the applicability of Section 28 (b) of the Contract Act would not be determined by the date of the contract. Reliance is also placed on the judgment of the Division Bench of the Delhi High Court in the case of Delhi Development Authority Vs.Pandit Construction Co. (supra). 24. It is submitted that the purpose of enacting Section 28(b), was to overcome the situation wherein the liability was extinguished because of clause like clause 10.2 and to get over such mischief. Reliance is placed on Section 37 of the Contract Act by the learned counsel. Reliance is also placed on the judgment in the case of East and West Steamship Co., Georgetown, Madras Vs. Reliance is placed on Section 37 of the Contract Act by the learned counsel. Reliance is also placed on the judgment in the case of East and West Steamship Co., Georgetown, Madras Vs. S.K. Ranalingam Chettiar, reported in AIR 1960 SC 1058 which explains what is 'discharge of liability.' The discharge of liability takes place only when there was no response to the demand within 90 days of the demand and the arbitration proceedings were not initiated within 365 days from the date of date of delivery. Reliance is also placed on the judgment of the Supreme Court in the cases of Thyssen Stahlunion Gmbh Vs. Steel Authority of India Ltd., reported in (1999) 9 SCC 334 and Commissioner of Income Tax (Central)-I, New Delhi Vs. Vatika Township Private Limited, decided on 15th September 2014 in Civil Appeal No.8750 of 2014 and other connected matters. 25. In rejoinder, Mr.Sekseria, learned counsel for the petitioner submits that an amendment to a substantive law is never retrospective and is presumed not to have retrospective operation unless the same is expressly provided or it follows by necessary implication. It is submitted that any amendment, which modifies accrued rights or imposes obligations, or imposes new duties or attaches new disability has to be treated as prospective unless and until the legislature's intention is so clear that it intended to give the enactment retrospective effect. It is submitted that the presumption in favour of a legislation giving retrospective effect is only when the legislation seeks to confer benefit on some person but without inflecting corresponding detriment on some other person or the public generally. It is submitted that the expression 'discharged from liability' has been interpreted by the Supreme Court in the case of East and West Steamship Co., Georgetown, Madras Vs. S.K. Ranalingam Chettiar (supra) and followed by this Court in the case of Reliance Industries Limited Vs. P & O Containers Limited and Anr., reported in AIR 2005 Bom 65 . The expression 'discharged from liability' would mean a total extinction of liability following upon the extinction of right. The words 'absolved from liability' and 'discharged from liability' do not bear any distinction and that the expression 'discharged from liability' was intended to mean and do mean the liability has totally disappeared. 26. The expression 'discharged from liability' would mean a total extinction of liability following upon the extinction of right. The words 'absolved from liability' and 'discharged from liability' do not bear any distinction and that the expression 'discharged from liability' was intended to mean and do mean the liability has totally disappeared. 26. It is submitted by the learned counsel that in this case, the tenure of the agreement came to an end on 5th July 1996. The goods were delivered by the respondent no.2 to the petitioner between 22nd August 1995 and 29th February 1996. The period of 150 days for assertion of right by the respondent no.2 to a claim for demurrage expired on or before 28th July 1996 which is calculated as 150 days from the last delivery date. The period of 90 days within which the petitioner had to accept the claim as contemplated under clause 10.2 expired on 26th October 1996. The notice invoking arbitration agreement was issued on 6th June 1997 which was barred by law of limitation. The petitioner stood discharged of its liability accordingly which was much prior to the amendment to Section 28 of the Indian Contract Act, 1872. Learned counsel distinguished the judgments of the Supreme Court relied upon by the respondent no.2. It is submitted that since the liability of the petitioner stood discharged/ extinguished before the amendment, there was no right available to the respondent no.2 that could be enforced by it whether before or after the amendment. There was no question of any outstanding obligation to pay alleged subsisting dues under the said agreement on the date of amendment. 27. In so far as the submission of the learned counsel for the respondent no.2 that there was an admission of the liability on the part of the petitioner is concerned, the learned counsel for the petitioner placed reliance on the judgment of the Supreme Court in the case of East and West Steamship Company (supra) and submits that once the liability of the petitioner stood discharged, no acknowledgement of liability could have resurrected such a dead liability. Reliance is also placed on the judgment of this Court in the case of Reliance Industries Limited (supra). 28. Reliance is also placed on the judgment of this Court in the case of Reliance Industries Limited (supra). 28. In so far as the reliance placed by the respondent no.2 on Section 37 of the Contract Act is concerned, it is submitted that Section 37 of the Contract Act itself is qualified by the words 'unless such performance is dispensed with or excused under the provisions of this Act, or of any other law.' It has been held that a contracting party is bound by termination clauses, exemption clauses and clauses entitling forfeiture. It is submitted that reliance placed on Section 37 of the Indian Contract Act, 1872 by the respondent no.2 is thus misplaced. Learned counsel distinguished the judgments relied upon by the respondent no.2 including the judgment of the learned Single Judge of this Court in the case of JSW Steel Ltd. Vs. AI Ghuriar Iron & Steel LLC (surpa) on the ground that the learned Single Judge could not have declared the judgment of the Division Bench of this Court as per incurium. 29. In so far as the submission of the learned counsel for the respondent no.2 that in view of retrospective effect of Section 28 of the Indian Contract Act, the learned arbitrator could have declared clause 10.2 of the agreement as void is concerned, it is submitted by the learned counsel for the petitioner that the learned arbitrator could not re-write the contract between the parties and had no jurisdiction to sever part of the agreement by declaring clause 10.2 of the agreement as void. The learned arbitrator could not construe a part of the clause as offending the amended provisions of Section 28 of the Contract Act to render the said clause as void and retain the rest of the agreement. It is submitted that a contract must be read as a whole and it is not open to dissect it by taking out a part treating it to be contrary to law and by ordering enforcement of the rest if otherwise it is not permissible. REASONS AND CONCLUSIONS :- 30. I have heard the learned counsel appearing for the parties at length and have given anxious consideration to the rival submissions made by the learned counsel. REASONS AND CONCLUSIONS :- 30. I have heard the learned counsel appearing for the parties at length and have given anxious consideration to the rival submissions made by the learned counsel. The following issues arise for consideration in this matter : a) Whether the amendment to Section 28 (b) of the Indian Contract Act, 1872 effective from 8th January 1997 is prospective or retrospective? b) If the amendment to Section 28 (b) of the Indian Contract Act, 1872 is not with retrospective effect, whether the claims made by the respondents were barred by limitation? c) Whether the learned arbitrator has power to declare any part of the contract as void and opposed to Section 28 of the Indian Contract Act, 1872? d) Whether the petitioner had admitted its alleged liability by letter dated 10th June 1997 or any other correspondence? e) Whether the learned arbitrator had acted with any official bias of the matter? 31. I shall now deal with the issue whether amendment to Section 28 of the Indian Contract Act, 1872 would apply with retrospective effect or prospective effect. 32. Prior to 8th January 1997, the unamended Section 28 of the Indian Contract Act, 1872 is extracted as under :- “Section 28. Agreements in restraint of legal proceedings void – Every agreement, by which any party thereto is restricted absolutely from enforcing his rights under or in respect of any contract, by the usu0al legal proceedings in the ordinary tribunals, or which limits the time within which he may thus enforce his rights, is void to that extent.” Amendment to Section 28 of the Indian Contract Act, 1872 reads thus :- “Section 28. Agreements in restraint of legal proceedings void : Every agreement, -- (a) by which any party thereto is restricted absolutely from enforcing his rights under or in, respect of any contract, by the usual legal proceedings in the ordinary tribunals, or which limits the time within which he may thus enforce his rights; or (b) which extinguishes the rights of any party thereto, or discharges any party thereto from any liability, under or in respect of any contract on the expiry of a specified period so as to restrict any party from enforcing his rights, is void to that extent...” 33. A perusal of the record indicates that the agreement entered into between the petitioner and the respondent no.2 was extended till 6th July 1995. A perusal of the record indicates that the agreement entered into between the petitioner and the respondent no.2 was extended till 6th July 1995. During the period between 22nd August 1995 and 29th February 1996, the goods were delivered by the respondent no.2 to the petitioner in accordance with the said agreement. The period of 150 days for assertion of right by the respondent no.2 to a claim for demurrage expired on or before 28th July 1996 which was calculated at 150 days from the last delivery date of the goods. The period of 90 days within which the petitioner could accept the claim as contemplated under clause 10.2 expired on 26th October 1996. The respondent no.2 invoked arbitration agreement on 6th June 1997. The amendment to Section 28 of the Indian Contract Act, 1872 was brought into effect on 8th January 1997. 34. It is the submission of the learned counsel for the petitioner that since the liability of the petitioner stood discharged much prior to the amendment to Section 28 of the Indian Contract Act, 1872, there was no right available to the respondent no.2 which could be enforced by it before or after the amendment, the respondent no.2 could not claim any benefit of the amendment to Section 28 of the Indian Contract Act, 1872 brought into effect from 8th January 1997. It is also the case of the petitioner that once the liability of the petitioner stood discharged prior to the letter of 10th June 1997 addressed by the petitioner requesting to waive the interest which was in any event the conditional letter, the alleged claims of the respondents did not revive and a fresh period of limitation did not commence. 35. Per contra, the submission of the learned counsel for the respondents on this issue is that the amendment to Section 28 of the Indian Contract Act, 1872 would apply with retrospective effect to all the existing contracts on the date of the amendment. The expression “any agreement/contract” would not mean that such agreement/contract was to be entered into only after the date of amendment for the purpose of attraction of Section 28 (b) of the Indian Contract Act, 1872. Claims of the respondents were not barred by limitation under the provisions of Limitation Act, 1963. The expression “any agreement/contract” would not mean that such agreement/contract was to be entered into only after the date of amendment for the purpose of attraction of Section 28 (b) of the Indian Contract Act, 1872. Claims of the respondents were not barred by limitation under the provisions of Limitation Act, 1963. Since the petitioner failed to comply with its obligation to pay price for supplies effected, the term of the agreement for the purpose of payment/obligation continued and was in place on the date of amendment to Section 28 of the Indian Contract Act, 1872. Under clause 10.2 of the agreement, the claims were kept alive for the period of 360 days from the date of delivery and not from the date of execution of the contract. 36. Both the learned counsel placed reliance on the several judgments of the Supreme Court, this Court and other High Courts in support of their respective submissions on the issue whether the amendment to Section 28 of the Indian Contract Act, 1872 would apply with retrospective effect or prospective effect. 37. The Supreme Court in the case of Wild Life Institute of India, Dehradun Vs. Vijay Kumar Garg, reported in (1997) 10 SCC 528 construed an arbitration clause which provided that if the contractor does not make any demand for arbitration in respect of any claim in writing within 90 days of receiving the intimation from other party that the bill is ready for payment, the claim of the contractor would be deemed to have been waived and absolutely barred and the owner shall be discharged and released of all liabilities under the contract. The Supreme Court held that such clause operates to discharge the liability of the owner on expiry of 90 days as set out therein and was not merely a clause providing a period of limitation. Paragraph 6 of the said judgment in the case of Wild Life Institute of India, Dehradun (supra) reads thus :- “6. The Supreme Court held that such clause operates to discharge the liability of the owner on expiry of 90 days as set out therein and was not merely a clause providing a period of limitation. Paragraph 6 of the said judgment in the case of Wild Life Institute of India, Dehradun (supra) reads thus :- “6. It is also necessary to refer to the arbitration clause under the contract which clearly provides that if the contractor does not make any demand for arbitration in respect of any claim in writing within 90 days of receiving the intimation from the appellants that the bill is ready for payment, the claim of the contractor will be deemed to have been waived and absolutely barred and the appellants shall be discharged and released of all liabilities under the contract in respect of these claims. The liability, therefore, of the appellants ceases if no claim of the contractor is received within 90 days of receipt by the contractor of an intimation that the bill is ready for payment. This clause operates to discharge the liability of the appellants on expiry of 90 days as set out therein and is not merely a clause providing a period of limitation. In the present case, the contractor has not made any claim within 90 days of even receipt of the amount under the final bill. The dispute has been raised for the first by the contractor 10 months after the receipt of the amount under the final bill.” 38. The Supreme Court in case of National Insurance Co. Ltd. Vs. Sujir Ganesh Nayak & Co. and Anr., reported in (1997) 4 SCC 366 has considered a case under unamended Section 28 of the Indian Contract Act and has held that such a clause in the agreement would not fall within the mischief of Section 28 of the Contract Act. It is held that to put it differently, curtailment of the period of limitation is not permissible in view of Section 28 but extinction of the right itself unless exercised within a specified time is permissible and can be enforced. It is held that if the policy of insurance provides that if a claim is made and rejected and no action is commenced within the time stated in the policy, the benefits flowing from the policy shall stand extinguished and any subsequent action would be time barred. It is held that if the policy of insurance provides that if a claim is made and rejected and no action is commenced within the time stated in the policy, the benefits flowing from the policy shall stand extinguished and any subsequent action would be time barred. Paragraphs 5, 7, 8, 13 and 16 of the said judgment of the Supreme Court in the case of National Insurance Co. Ltd.(supra) read thus :- “5. The appellants contested the suit inter alia on the ground that the suit was barred by limitation as well as by condition No. 19 of the policy and on the ground that the claim made by the respondent No.1 was not covered by the policy. Condition 19 of the policy which was set up by way of defence runs as under: "Condition No. 19 - In no case whatever shall the company be liable for any loss or damage after the expiration of 12 months from the happening of loss or the damage unless the claim is the subject of pending action or arbitration." 7. In the present appeal, the appellant contended that condition No. 19 extinguishes the right of the assured as the suit was not filed within 12 months from the day when the loss or damage had occurred. It is further reiterated in the appeal that special Condition 5(i)(b) of the Riot and Strike Endorsement excludes the claim of the respondent No.1 from the scope of two Insurance Policies. 8. Section 28 of the contract Act may be quoted now before going into further discussion : "Section 28. Every agreement, by which any party thereto is restricted absolutely from enforcing his rights under or in respect of any contract, by the usual legal proceedings in the ordinary tribunals, or which limits the time within which he may thus enforce his rights, is void to that extent." 13. The next case we would like to notice is the Food Corporation of India (supra); the abridged factual matrix is that it, as principal, had appointed millers for procuring, hulling and supplying rice on certain conditions. On behalf of these millers the respondent insurance company executed fidelity Insurance Guarantee in favour of the appellant hereunder the former undertook to indemnify the latter for any loss suffered by the appellant by reason of branch of agreement. On behalf of these millers the respondent insurance company executed fidelity Insurance Guarantee in favour of the appellant hereunder the former undertook to indemnify the latter for any loss suffered by the appellant by reason of branch of agreement. Under the terms of the guarantee when the appellant found that it had suffered losses on account of breach of terms and conditions of their respective contracts by the millers it made demands on the insurance company to indemnify it. These demands were made well before the expiry of six months from the date of termination of the contract with the concerned miller. The insurance company did not satisfy the demands which led the appellants to file suits to recover the losses. Those suits were decreed in favour of the appellants against the respondents including the insurance companies. The insurance companies filed appeals in the High Court which were allowed holding that the terms of the guarantee concerned in each case did not entitle the appellant to sue the insurance companies after 'six month' period from the date of termination of the respective contracts with the rice millers. The matter was therefore carried in appeal to this Court. 16. From the case law referred to above the legal position that emerges is that an agreement which in effect seeks to curtail the period of limitation and prescribes a shorter period than that prescribed by law would be void as offending section 28 of the Contract Act. That is because such a an agreement would seek to restrict the party from enforcing his right in Court after the period prescribed under the agreement expires even though the period prescribed by law for the enforcement of his right has yet not expired. But there could be agreements which do not seek to curtail the time for enforcement of the right but which provides for the forfeiture or waiver of the right itself if no action is commenced with in the period stipulated by the agreement. Such a clause in the agreement would not fall within the mischief of section 28 of the Contract Act. To put it differently, curtailment of the period of limitation is not permissible in view of Section 28 but extinction of the right itself unless exercised within a specified time is permissible and ca be enforced. Such a clause in the agreement would not fall within the mischief of section 28 of the Contract Act. To put it differently, curtailment of the period of limitation is not permissible in view of Section 28 but extinction of the right itself unless exercised within a specified time is permissible and ca be enforced. If the policy of insurance provides that if a claim is made and rejected and no action is commenced within the time stated in the policy, the benefits flowing from the policy shall stand extinguished and any subsequent action would be time barred. Such a clause would fall outside the scope of Section 28 of the Contract Act. This, in Brief, seems to be the settled legal position. We may now apply it to the facts of this case.” 39. The Supreme Court in the case of Himachal Pradesh State Forest Company Limited Vs. United India Insurance Company Limited, reported in (2009) 2 SCC 252 has considered its earlier judgment in the case of National Insurance Co. Ltd. Vs.Sujir Ganesh Nayak & Co. and Anr. (supra). The judgment of the Supreme Court in the case of Food Corporation of India Vs. New India Assurance Co. Ltd. and Ors., reported in (1994) 3 SCC 324 and several other judgments and applied the principles laid down even to the case arising under amendment to Section 28 of the Indian Contract Act, 1872. Paragraphs 13, 14 and 15 of the said judgment in the case of Himachal Pradesh State Forest Company Limited (supra) read thus :- “13. In Sujir Nayak's case (supra) to which primary reference has been made by the learned counsel for the parties while dealing with an identical situation where a contract contained a provision prescribing a period of limitation shorter than that prescribed by the Limitation Act, it was held that the contractual provision was not hit by Section 28 as the right itself had been extinguished. 14. Mr. Sharma has, however, submitted that in view of the observations in some paragraphs in Food Corporation of India's case, the observations in Sujir Nayak's case were liable to reconsideration. We, however, find no merit in this plea for the reason that in Sujir Nayak's case, Food 12 Corporation of India's case (supra) has been specifically considered and Vulcan Insurance Company's case (supra) too had been relied upon. JUDGMENT :. We, however, find no merit in this plea for the reason that in Sujir Nayak's case, Food 12 Corporation of India's case (supra) has been specifically considered and Vulcan Insurance Company's case (supra) too had been relied upon. JUDGMENT :. By this petition filed under Section 34 of the Arbitration and Conciliation Act, 1996 (for short “the said Arbitration Act”), the petitioner has impugned the arbitral award dated 30th March 2000 made by the learned arbitrator allowing the claims made by respondent no.2 and directing the petitioner to pay a sum of Rs.48,11,103/- to the respondent no.2 with interest @7% p.a. from the date of claim till the date of award and @18% p.a. from the date of award till the date of payment. Some of the relevant facts for the purpose of deciding this petition are as under :- 2. The petitioner was the original respondent in the arbitration proceedings whereas the respondent no.2 was the original claimant. On 6th July 1993, respondent no.2 entered into an agreement for sale/supply of kerosene oil on the terms and conditions set out therein. It was provided in the said agreement that the said agreement shall come into force on 6th July 1993 and shall remain for a period of one year during which period the buyer shall get the requirements of superior kerosene oil (SKO) through Indian Oil Corporation Ltd. (IOC); provided nothing contained in clause 1 shall prejudice the rights of IOC to terminate this agreement earlier on the happening of any of the events specified in clause 10.7 of the said agreement. Under clause 4.1 of the agreement, it was provided that sale of SKO will be made by IOC from time to time through import. 3. Under clause 5.1 of the agreement, it was agreed that for each import parcel that may be required by the buyer, the IOC shall establish provisional cost and freight (C & F) price in Indian Rupees which was required to be worked out in accordance with the said clause. Demurrage was payable @100/ MT. Under clause 5.2 of the said agreement, it was provided that IOC will work out the final price for each parcel sold to the buyer on the basis mentioned therein by including the elements set out therein within a period of 45 days from the date on which the provisional price was established for the same. Under clause 5.2 of the said agreement, it was provided that IOC will work out the final price for each parcel sold to the buyer on the basis mentioned therein by including the elements set out therein within a period of 45 days from the date on which the provisional price was established for the same. Under clause6.1 of the agreement, it was provided that the buyer shall open a confirmed irrevocable letter of credit without recourse to drawers 30 days in advance of the expected arrival of the cargo in favour of IOC through SBI duly confirmed by its commercial branch, Bombay. The letter of credit to be opened by the buyer shall be in a format as advised by IOC and acceptable to IOC. 4. Under clause 6.2 of the agreement, it was agreed that the payment under the letter of credit shall be based on the bill of lading quantity. Clause 10.2 of the said agreement which is relevant for the purpose of deciding this matter is extracted as under :- “10.2 CLAIMS : Any claim regarding quality, quantity, demurrage, non-delivery or otherwise which either party may have against the other party shall be filed with that other party within 150 days from the date of delivery of the product to the buyer or the last date on which such delivery should have been made (hereinafter referred to as “the Delivery date”). If such claim is not admitted in full within 90 days of its being filed with the other party, it shall automatically lapse and be forfeited and the other party against whom it is made shall be discharged of all liability with regard thereto unless arbitration proceedings in respect thereof are commenced and notice thereof is given within 360 days of the delivery date to the party against whom the claim is made.” Clause 11 of the agreement provides an arbitration clause. 5. By letter dated 20th December 1993, the respondent no.2 informed the petitioner about revision in settled terms of the original agreement dated 6th July 1993 and informed that the said revision shall constitute as an integral part of the agreement dated 6th July 1993 and that all other clauses of the agreement dated 6th July 1993 shall remain unaltered. 6. By letter dated 20th December 1993, the respondent no.2 informed the petitioner about revision in settled terms of the original agreement dated 6th July 1993 and informed that the said revision shall constitute as an integral part of the agreement dated 6th July 1993 and that all other clauses of the agreement dated 6th July 1993 shall remain unaltered. 6. On 6th July 1994, the petitioner and respondent no.2 signed an agreement thereby reviving and extending the said agreement dated 6th July 1993 for a further period of 12 months commencing from 6th July 1994, however, on the same terms and conditions as contained in the agreement dated 6th July 1993. On 6th July 1995, the petitioner and respondent no.2 entered into an another agreement thereby reviving and extending the said agreement dated 6th July 1994 for a further period of 12 months commencing from 6th July 1995, however, on the same terms and conditions as contained in the agreement dated 6th July 1994. 7. It is the case of the petitioner that though the sale of superior kerosene oil in favour of the petitioner is supposed to have been completed on High Seas, the petitioner had to take actual possession of the product only from the share tank which was in complete possession of respondent no.2. The petitioner was required to rely upon the assistance of respondent no.2 in all matters relating to receipt, storage and handling of the product purchased from the petitioner on High Seas basis. It is the case of the petitioner that respondent no.2, however, did not extend any help to the petitioner in the matter of receipt, storage and handling of SKO purchased from the petitioner on High Seas basis under clause 10.1 of the amended agreement. 8. During the course of the arguments, learned counsel for the petitioner tendered a statement showing relevant dates of the delivery of SKO and under clause 10.2 of the agreement, respondent no.2 was liable to make a claim, if any, against the petitioner and when the arbitration proceedings commenced. It is submitted that the details mentioned in the said statement are not disputed. It is the case of the petitioner that the admitted dates of delivery of SKO from respondent no.2 to the petitioner were during the period from 10th October 1995 to 23rd January 1996. It is submitted that the details mentioned in the said statement are not disputed. It is the case of the petitioner that the admitted dates of delivery of SKO from respondent no.2 to the petitioner were during the period from 10th October 1995 to 23rd January 1996. The respondent no.2 by its letter dated 6th June 1997 invoked arbitration agreement by addressing a letter to the Director (M) of IOC Ltd. alleging that a sum of Rs.38,58,107.86 became due and payable by the petitioner to respondent no.2 on account of the supplies made. It is stated in the said letter that the petitioner was requested to clear the outstanding vide letter dated 17th May 1997 with interest accrued thereon. The petitioner, however, failed to pay the said amount and interest accrued thereon despite the said notice served upon it and as a result thereof, the dispute had arisen in terms of the agreement dated 6th July 1995 and the amendments thereto. By the said letter, respondent no.2 requested the Director (M) of the respondent no.2 to appoint his nominee in case the said Director (M) himself was unable to act as a sole arbitrator for adjudication of the claims of the respondent no.2. Copy of the said notice was forwarded to the petitioner. 9. The petitioner vide its letter dated 10th June 1997 requested the respondent no.2 to waive-off the interest on the dues and allow it to pay the outstanding amount in parts, along with every parcel of SKO in future. The petitioner stated in the said letter that as the petitioner was desirous of reviving the import of SKO through respondent no.2 forthwith, the petitioner requested the respondent no.2 to allow the petitioner to clear the outstanding amount as suggested in the said letter. 10. The Director (M) appointed one Mr. G.R. Menon as a sole arbitrator who resigned subsequently. The Director (M) thereafter appointed Mr. B.L. Bansal, Dy. General Manager (LPG-OPS), HO of respondent no.2 as a sole arbitrator. Pursuant to the directions issued by the learned arbitrator, the parties filed their respective pleadings along with copies of the documents. None of the parties led any oral evidence. The learned arbitrator framed 15 issues for consideration. 11. The Director (M) thereafter appointed Mr. B.L. Bansal, Dy. General Manager (LPG-OPS), HO of respondent no.2 as a sole arbitrator. Pursuant to the directions issued by the learned arbitrator, the parties filed their respective pleadings along with copies of the documents. None of the parties led any oral evidence. The learned arbitrator framed 15 issues for consideration. 11. On the issue of limitation raised by the petitioner herein that the claims were barred under clause 10.2 of the agreement, the learned arbitrator rendered a finding and answered the said issue in negative holding that the claims of respondent no.2 were not barred by limitation under clause 10.2 of the agreement. The learned arbitrator also held that the petitioner had not discharged all its liability in respect of the claims made by respondent no.2 though the arbitration proceedings had not been commenced and notice thereof had not been given within 360 days of the delivery date to the petitioner. The learned arbitrator also held that respondent no.2 (original claimant) could be permitted to urge that clause 10.2 of the agreement was void as opposed to Section 28 of the Indian Contract Act, 1872. 12. The learned arbitrator rejected the allegations of official bias made against him by the petitioner. It is held by the learned arbitrator that the elements of demurrage could be included in the price structure. On merits of the claim, the learned arbitrator held that the petitioner was liable to pay demurrage charges at actual due to the congestion at berthing which was beyond the control of the petitioner and for which it was not at all responsible. It is held by the learned arbitrator that the petitioner was not entitled to refund of the demurrages at actual paid by the petitioner with interest. The learned arbitrator rendered a finding that respondent no.2 was right in contending that the petitioner had admitted to the claim. The learned arbitrator accordingly allowed the claims made by the respondent no.2 with interest. This award has been impugned by the petitioner in this petition under Section 34 of the said Arbitration Act. 13. Mr. Seksaria, learned counsel for the petitioner made the following submissions :- a) In the impugned award, the learned arbitrator had declared the clause 10.2 of the agreement as allegedly opposed to Section 28 of the Indian Contract Act. This award has been impugned by the petitioner in this petition under Section 34 of the said Arbitration Act. 13. Mr. Seksaria, learned counsel for the petitioner made the following submissions :- a) In the impugned award, the learned arbitrator had declared the clause 10.2 of the agreement as allegedly opposed to Section 28 of the Indian Contract Act. The learned arbitrator could not have declared any provision of the agreement as void as the same was beyond the scope and powers of the learned arbitrator. The award shows patent illegality on the face of the award. b) Under clause 10.2 of the agreement, the claim regarding quality, quantity, demurrage, non-delivery or otherwise was required to be made within 150 days from the date of delivery of the product to the buyer or the last date on which such delivery should have been made and if such claim was not admitted in full within 90 days of its being filed with the other party, such claim shall automatically lapse and be forfeited and the other party would be discharged of all its liability with regard thereto unless the arbitration proceedings in respect thereof were commenced and notice thereof was given within 360 days of the delivery date to the party against whom the claim was made. Since, the claim has not been preferred by respondent no.2 within the period stipulated in clause 10.2 of the agreement and since the arbitration clause was not invoked in respect of such claim within 360 days from the date of delivery of the product to the petitioner in each instance, the claims made by respondent no.2 were barred by limitation and liability of the petitioner, if any, stood discharged. The respondent no.2 invoked the arbitration agreement only on 6th June 1997 by addressing a letter to the Director (M) which was long after 360 days from the date of delivery of the product to the petitioner in each case. The respondent no.2 invoked the arbitration agreement only on 6th June 1997 by addressing a letter to the Director (M) which was long after 360 days from the date of delivery of the product to the petitioner in each case. c) It was the case of the respondent no.2 itself in the claim filed before the learned arbitrator that the provisional cost and freight price was required to be worked out in Indian Rupees as provided in clause 5.1 and final price for each parcel sold to the buyer which was required to be worked out by respondent no.2 as provided in clause 5.2 of the said agreement within 45 days from the date of establishing the provisional price. In respect of 9 invoices, respondent no.2 had furnished final invoices much after 45 days from the date of provisional invoice and all the final invoices had been furnished beyond 116 days. d) The letter of 10th June 1997 addressed by the petitioner to respondent no.2 did not amount to an admission of its alleged liability in paying the alleged outstanding amount to the respondent no.2. The said letter was a conditional letter and was issued as and by way of counter offer to the respondent no.2 stating that if the respondent no.2 would waive the interest then the petitioner would pay the outstanding amount which offer was not accepted by respondent no.2. There was no binding contract arrived at between the parties based on Exhibit-H. Acknowledgement of liability has to be during the subsistence of the liability and not after the claim having become time barred. The letter dated 10th June 1997 at Exhibit-H could not revive the time barred claim. There was no fresh promise of the petitioner to pay to the respondent no.2 as contemplated under Section 25(3) of the Indian Contract Act, 1872. The finding of the learned arbitrator that the petitioner had acknowledged its liability is thus contrary to Section 25 (3) of the Indian Contract Act and also by misinterpreting the letter of the petitioner dated 10th June 1997. The finding of the learned arbitrator that the petitioner had acknowledged its liability is thus contrary to Section 25 (3) of the Indian Contract Act and also by misinterpreting the letter of the petitioner dated 10th June 1997. The agreement entered into between the petitioner and the respondent no.2 duly amended came to an end on 5th July 1996 which was prior to the amendment to Section 28 of the Indian Contract Act notified on 8th January 1997, which amendment declared any contract that extinguishes the rights of any party or discharges any party from any liability after the expiry of a specified period to be void. The amendment to Section 28 of the Indian Contract Act is not retrospective in operation. Clause 10.2 did not seek to curtail the period of limitation for enforcement but stipulates the forfeiture or extinguishment of the rights itself. e) The learned arbitrator appointed by the Director (M) was an employee of respondent no.2 and was bound to follow the instructions of the Director (M) of respondent no.2 who was involved in the dealings with the petitioner on several occasions in the past before the matter was referred to the arbitration. The learned arbitrator has, therefore, clearly shown an official bias. The petitioner vide its letter dated 28th December 1996 raised certain complaints to the Director (M) in respect of demurrage charges. The learned arbitrator thus appointed by the Directior (M) would be obviously obliged to follow the instructions of the superior and could not permit to act as an independent arbitrator. 14. In support of the submission that the amendment to Section 28 notified on 8th January 1997 was not with retrospective effect, learned counsel for the petitioner relied upon the following Judgments:- 1. M/s. Continental Construction Ltd. Vs. Food Corporation of India and Ors., reported in AIR 2003 DELHI 32; 2. The Oriental Insurance Company Limited Vs. Karur Vysya Bank Limited, reported in AIR 2001 MADRAS 489; 3. Food Corporation of India Vs. New India Assurance Co.Ltd. & Ors., reported in (1994) 3 SCC 324 ; 4. National Insurance Co. Ltd. Vs. Sujir Ganesh Nayak & Co. & Anr., reported in (1997) 4 SCC 366 ; 5. Wild Life Institute of India, Dehradun Vs. Vijay kumar Garg, reported in (1997) 10 SCC 528 ; 6. Himachal Pradesh State Forest Company Limited Vs. New India Assurance Co.Ltd. & Ors., reported in (1994) 3 SCC 324 ; 4. National Insurance Co. Ltd. Vs. Sujir Ganesh Nayak & Co. & Anr., reported in (1997) 4 SCC 366 ; 5. Wild Life Institute of India, Dehradun Vs. Vijay kumar Garg, reported in (1997) 10 SCC 528 ; 6. Himachal Pradesh State Forest Company Limited Vs. United India Insurance Company Limited, reported in (2009) 2 SCC 252 ; 7. Judgment of the Division Bench of this Court in the case of M/s. Indusind Bank Ltd. Vs. Union of India & Ors., delivered on 20th April 2011 passed in Appeal No.258 of 2008; 8. Axios Navigation Co. Ltd. Vs. Indian Oil Corporation Limited, reported in 2012 (2) Bom.C.R. 271 ; 9. Unreported judgment of this Court in the case of M/s.Mascon Multiservices & Consultants Pvt. Ltd. Vs. Bharat Oman Refineries Ltd., delivered on 11st August 2014 passed in Arbitration Petition No.1088 of 2010; and 10. Judgment of the Delhi High Court in the case of M/s. Chander Kant & Co. Vs. The Vice Chairman, DDA & Ors., delivered on 26th May 2009 passed in Arbitration Petition No.246 of 2005. 15. Relying upon the aforesaid judgments, learned counsel for the petitioner submits that since the last date of delivery under the contract was 23rd January 1996 and the entire cause of action had arisen much prior to the date of amendment i.e. 8th January 1997, unamended Section 28 of the Indian Contract Act, 1872 would apply to the dispute between the parties and not amended Section 28 as sought to be canvassed by respondent no.2. 16. In support of the submission that there was an official bias on the part of the learned arbitrator who was an employee of respondent no.2 and the award is vitiated on that ground alone is concerned, learned counsel for the petitioner placed reliance on the judgment of the Supreme Court in the case of Indian Oil Corporation Limited Vs. Raja Transport Private Limited, reported in (2009) 8 SCC 520 and it is submitted that there can be a justifiable apprehension about the independence or impartiality of an employee arbitrator, if such person was the controlling or dealing authority in regard to the subject contract or if he is a direct subordinate to the officer whose decision was the subject matter of the dispute. 17. 17. Mr.Jagtiani, learned counsel for respondent no.2, on the other hand, supported the reasonings and conclusions in the impugned award. Learned counsel for the respondent no.2 made the following submissions: a) Amendment to Section 28 of the Indian Contract Act, 1872 notified on 8th January 1997 would apply with retrospective effect to all the existing contracts on the date of amendment. It would also apply to the contracts entered into prior to the date of amendment. The expression“any agreement/contract” would not mean that such agreement/contract was to be entered into only after the date of amendment for the purpose of attraction of Section 28 (b) of the Indian Contract Act, 1872 and if such argument of the petitioner is accepted, it would be in violation of the words “any agreement/contract.” b) The period of 360 days mentioned in clause 10.2 would not mean that the contractual obligation/right of the parties would not survive after expiry of 360 days. It is not the case of the petitioner that under the provisions of the Limitation Act, 1963, the claims of the respondent no.2 have become barred. If such argument is accepted, the whole purpose of Section 28(b) of the Indian Contract Act, 1872 would be defeated. c) Since the dispute between the parties was governed by the amended provision of Section 28 of the Indian Contract Act, the learned arbitrator was entitled to consider such amended provision applicable to the parties and was empowered to declare clause 10.2 of the agreement as void in view of the amended Section 28 (b) of the Indian Contract Act. The learned arbitrator has not exceeded his jurisdiction and that the award does not show any illegality on this ground. d) Since the petitioner had not complied with its obligation to pay price for supplies effected by the respondent no.2, the term of the agreement/contract for the purpose of payment/obligation continued and was in place. The petitioner had not disputed its liability on merits, but had opposed the claim only on the ground of limitation under clause 10.2 of the agreement. e) Under clause 10.2 of the agreement, the purchase by the petitioner was required to be completed within one year. The petitioner had not disputed its liability on merits, but had opposed the claim only on the ground of limitation under clause 10.2 of the agreement. e) Under clause 10.2 of the agreement, the purchase by the petitioner was required to be completed within one year. In so far as the payment/ obligation of the petitioner under the agreement was concerned, the same was required to be continued even beyond the expiry of one year and such obligation was not discharged till such payment was made by the petitioner. It is submitted that under clause 10.2 of the agreement, the claims were kept alive for a period of 360 days from the date of delivery and not from the date of execution of the contract. There were various dates on which the delivery was effected by respondent no.2 to the petitioner. The agreement/contract would not come to an end on 8th January 1997. f) The petitioner cannot be permitted to urge that obligation of the petitioner to make payment to the respondent no.2 also was required to be made within one year i.e. during the contractual period. It is submitted that by letter dated 3rd July 1996, the petitioner had informed the respondent no.2 that the petitioner had made a representation to the Chairman of respondent no.2 for considering its claim for waiver and it was in the process of making arrangement for drawal of the product from the respondent no.2. The Director of the petitioner was planning to visit the office of respondent no.2 to explain the problems faced by the petitioner and also with regard to the upliftment of the product. The said letter was addressed three days prior to 3rd July 1996. The respondent no.2 vide its letter dated 26th July 1996 addressed to the petitioner in response to the said letter dated 6th July 1996 called upon the petitioner to settle the dues of Rs. 39,31,674.35 at the earliest. g) On 17th May 1997, the respondent no.2 called upon the petitioner to pay the outstanding dues within 15 days from the date of receipt of the said notice and threatened to take legal action. The said notice was followed by notice for invoking arbitration agreement on 6th June 1997. 39,31,674.35 at the earliest. g) On 17th May 1997, the respondent no.2 called upon the petitioner to pay the outstanding dues within 15 days from the date of receipt of the said notice and threatened to take legal action. The said notice was followed by notice for invoking arbitration agreement on 6th June 1997. On 10th June 1997, the petitioner requested the respondent no.2 to waive-off the interest on the dues and to allow the petitioner to pay the outstanding amount in parts along with every parcel of SKO in future and requested to permit the petitioner to clear the outstanding amount as suggested in the said letter. The respondent no.2 in response to the said letter informed the petitioner that it was not possible for respondent no.2 to waive the interest and called upon the petitioner to pay the outstanding amount immediately. Relying upon the aforesaid correspondence, it is submitted that the demand made by the respondent no.2, refusal on the part of the petitioner to pay the amount as demanded and request for waiver of the interest, raised a fresh cause of action. The respondent no.2 had not given up its request made by letter dated 26th July 1996. h) On the allegations of bias made by the petitioner against the learned arbitrator, it is submitted that no such allegations of bias were made before the learned arbitrator. No application under Sections 12 and 13 was made before the learned arbitrator. The petitioner has not even raised any such ground under Section 34 of the said Arbitration Act in this petition and thus cannot be allowed to urge such ground across the bar. In support of this submission, learned counsel placed reliance on the judgment of the Supreme Court in the case of Narayan Prasad Lohia Vs. Nikunj Kumar Lohia and Ors., reported in (2002) 3 SCC 572 (para 18). i) The petitioner had never disputed its liability to pay to the respondent no.2 but had only requested for waiver of interest. The learned arbitrator has interpreted the correspondence exchanged between the parties and has held that the petitioner had admitted and acknowledged its liability. The learned arbitrator has considered all the submissions made by the parties and had rendered a reasonable and valid award. 18. Learned counsel placed reliance on the judgment of the Supreme Court in the case of Dr. Indramani Pyarelal Gupta and Ors. The learned arbitrator has considered all the submissions made by the parties and had rendered a reasonable and valid award. 18. Learned counsel placed reliance on the judgment of the Supreme Court in the case of Dr. Indramani Pyarelal Gupta and Ors. Vs.W.R. Natu and Ors., reported in AIR 1963 SC 274 in support of his submission that the amendment to Section 28 of the Indian Contract Act would apply with retrospective effect. 19. Learned counsel for respondent no.2 also placed reliance on the judgment of Delhi High Court in the case of D.D.A. Vs. Pandit Construction Co., delivered on 19th April 2012 in FAO(OS) 382 of 2007. 20. Learned counsel placed reliance on the objects and reasons of amendment to Section 28 of the Indian Contract Act, 1872 in support of the submission that the said amendment was made effective with retrospective effect. Learned counsel also placed reliance on the Ninety- Seventh Report of the Law Commission of India on the amendment to Section 28. 21. Learned counsel distinguished the judgments relied upon by Mr. Seksaria, learned counsel for the petitioner on the ground that all the judgments referred to and relied upon by the petitioner had considered the unamended provision of Section 28 of the Indian Contract Act, 1872 and not the amended provision. The facts in this matter are totally different and those judgments would not assist the case of the petitioner. It is submitted that in so far as the judgment of the Division Bench of this Court in the case of Dr. Indramani Pyarelal Gupta and Ors. (supra) is concerned, the Division Bench of this Court has considered the judgment of the Supreme Court in the case of Food Corporation of India Vs. New India Assurance Co. Ltd. & Ors. (supra) in which the Supreme Court has considered unamended Section 28 of the Indian Contract Act, 1872. Learned counsel submits that the learned Single Judge of this Court in the case of Axios Navigation Co. Ltd. Vs. Indian Oil Corporation Limited (supra) also considered the judgment of the Division Bench of this Court in the case of Dr. Indramani Pyarelal Gupta and Ors. (supra) and thus that judgments would not assist the case of the petitioner. It is submitted that in the judgment of the Division Bench of this Court, the Court was considering the validity period of a bank guarantee. Indramani Pyarelal Gupta and Ors. (supra) and thus that judgments would not assist the case of the petitioner. It is submitted that in the judgment of the Division Bench of this Court, the Court was considering the validity period of a bank guarantee. The facts of that case were totally different and the said judgment is thus not applicable to the facts of this case. 22. Learned counsel placed reliance on the judgment of this Court delivered on 20th August 2014 in the case of JSW Steel Ltd. Vs. AI Ghuriar Iron & Steel LLC passed in Arbitration Petition No.398 of 2014 and would submit that the judgment of the Division Bench of this Court relied upon by the petitioner had already been interpreted by the learned Single Judge of this Court. 23. It is submitted that in view of plain language of Section 28 (b) of the Indian Contract Act, the said provision applies to 'every agreement' and 'any contract' subsisting on that date and entered into thereafter. Section 28 (b) of the Indian Contract Act applies to the contracts which are subsisting as on 8th January 1997 and those which were not discharged, such as the present agreement, where the claims made by the petitioner against the respondent no.2 were outstanding. Reliance is placed on the judgment of the Delhi High Court in the case of Chander Kant and Co. Vs. the Vice Chairman DDA and Ors. (supra) and would submit that the applicability of Section 28 (b) of the Contract Act would not be determined by the date of the contract. Reliance is also placed on the judgment of the Division Bench of the Delhi High Court in the case of Delhi Development Authority Vs.Pandit Construction Co. (supra). 24. It is submitted that the purpose of enacting Section 28(b), was to overcome the situation wherein the liability was extinguished because of clause like clause 10.2 and to get over such mischief. Reliance is placed on Section 37 of the Contract Act by the learned counsel. Reliance is also placed on the judgment in the case of East and West Steamship Co., Georgetown, Madras Vs. Reliance is placed on Section 37 of the Contract Act by the learned counsel. Reliance is also placed on the judgment in the case of East and West Steamship Co., Georgetown, Madras Vs. S.K. Ranalingam Chettiar, reported in AIR 1960 SC 1058 which explains what is 'discharge of liability.' The discharge of liability takes place only when there was no response to the demand within 90 days of the demand and the arbitration proceedings were not initiated within 365 days from the date of date of delivery. Reliance is also placed on the judgment of the Supreme Court in the cases of Thyssen Stahlunion Gmbh Vs. Steel Authority of India Ltd., reported in (1999) 9 SCC 334 and Commissioner of Income Tax (Central)-I, New Delhi Vs. Vatika Township Private Limited, decided on 15th September 2014 in Civil Appeal No.8750 of 2014 and other connected matters. 25. In rejoinder, Mr.Sekseria, learned counsel for the petitioner submits that an amendment to a substantive law is never retrospective and is presumed not to have retrospective operation unless the same is expressly provided or it follows by necessary implication. It is submitted that any amendment, which modifies accrued rights or imposes obligations, or imposes new duties or attaches new disability has to be treated as prospective unless and until the legislature's intention is so clear that it intended to give the enactment retrospective effect. It is submitted that the presumption in favour of a legislation giving retrospective effect is only when the legislation seeks to confer benefit on some person but without inflecting corresponding detriment on some other person or the public generally. It is submitted that the expression 'discharged from liability' has been interpreted by the Supreme Court in the case of East and West Steamship Co., Georgetown, Madras Vs. S.K. Ranalingam Chettiar (supra) and followed by this Court in the case of Reliance Industries Limited Vs. P & O Containers Limited and Anr., reported in AIR 2005 Bom 65 . The expression 'discharged from liability' would mean a total extinction of liability following upon the extinction of right. The words 'absolved from liability' and 'discharged from liability' do not bear any distinction and that the expression 'discharged from liability' was intended to mean and do mean the liability has totally disappeared. 26. The expression 'discharged from liability' would mean a total extinction of liability following upon the extinction of right. The words 'absolved from liability' and 'discharged from liability' do not bear any distinction and that the expression 'discharged from liability' was intended to mean and do mean the liability has totally disappeared. 26. It is submitted by the learned counsel that in this case, the tenure of the agreement came to an end on 5th July 1996. The goods were delivered by the respondent no.2 to the petitioner between 22nd August 1995 and 29th February 1996. The period of 150 days for assertion of right by the respondent no.2 to a claim for demurrage expired on or before 28th July 1996 which is calculated as 150 days from the last delivery date. The period of 90 days within which the petitioner had to accept the claim as contemplated under clause 10.2 expired on 26th October 1996. The notice invoking arbitration agreement was issued on 6th June 1997 which was barred by law of limitation. The petitioner stood discharged of its liability accordingly which was much prior to the amendment to Section 28 of the Indian Contract Act, 1872. Learned counsel distinguished the judgments of the Supreme Court relied upon by the respondent no.2. It is submitted that since the liability of the petitioner stood discharged/ extinguished before the amendment, there was no right available to the respondent no.2 that could be enforced by it whether before or after the amendment. There was no question of any outstanding obligation to pay alleged subsisting dues under the said agreement on the date of amendment. 27. In so far as the submission of the learned counsel for the respondent no.2 that there was an admission of the liability on the part of the petitioner is concerned, the learned counsel for the petitioner placed reliance on the judgment of the Supreme Court in the case of East and West Steamship Company (supra) and submits that once the liability of the petitioner stood discharged, no acknowledgement of liability could have resurrected such a dead liability. Reliance is also placed on the judgment of this Court in the case of Reliance Industries Limited (supra). 28. Reliance is also placed on the judgment of this Court in the case of Reliance Industries Limited (supra). 28. In so far as the reliance placed by the respondent no.2 on Section 37 of the Contract Act is concerned, it is submitted that Section 37 of the Contract Act itself is qualified by the words 'unless such performance is dispensed with or excused under the provisions of this Act, or of any other law.' It has been held that a contracting party is bound by termination clauses, exemption clauses and clauses entitling forfeiture. It is submitted that reliance placed on Section 37 of the Indian Contract Act, 1872 by the respondent no.2 is thus misplaced. Learned counsel distinguished the judgments relied upon by the respondent no.2 including the judgment of the learned Single Judge of this Court in the case of JSW Steel Ltd. Vs. AI Ghuriar Iron & Steel LLC (surpa) on the ground that the learned Single Judge could not have declared the judgment of the Division Bench of this Court as per incurium. 29. In so far as the submission of the learned counsel for the respondent no.2 that in view of retrospective effect of Section 28 of the Indian Contract Act, the learned arbitrator could have declared clause 10.2 of the agreement as void is concerned, it is submitted by the learned counsel for the petitioner that the learned arbitrator could not re-write the contract between the parties and had no jurisdiction to sever part of the agreement by declaring clause 10.2 of the agreement as void. The learned arbitrator could not construe a part of the clause as offending the amended provisions of Section 28 of the Contract Act to render the said clause as void and retain the rest of the agreement. It is submitted that a contract must be read as a whole and it is not open to dissect it by taking out a part treating it to be contrary to law and by ordering enforcement of the rest if otherwise it is not permissible. REASONS AND CONCLUSIONS :- 30. I have heard the learned counsel appearing for the parties at length and have given anxious consideration to the rival submissions made by the learned counsel. REASONS AND CONCLUSIONS :- 30. I have heard the learned counsel appearing for the parties at length and have given anxious consideration to the rival submissions made by the learned counsel. The following issues arise for consideration in this matter : a) Whether the amendment to Section 28 (b) of the Indian Contract Act, 1872 effective from 8th January 1997 is prospective or retrospective? b) If the amendment to Section 28 (b) of the Indian Contract Act, 1872 is not with retrospective effect, whether the claims made by the respondents were barred by limitation? c) Whether the learned arbitrator has power to declare any part of the contract as void and opposed to Section 28 of the Indian Contract Act, 1872? d) Whether the petitioner had admitted its alleged liability by letter dated 10th June 1997 or any other correspondence? e) Whether the learned arbitrator had acted with any official bias of the matter? 31. I shall now deal with the issue whether amendment to Section 28 of the Indian Contract Act, 1872 would apply with retrospective effect or prospective effect. 32. Prior to 8th January 1997, the unamended Section 28 of the Indian Contract Act, 1872 is extracted as under :- “Section 28. Agreements in restraint of legal proceedings void – Every agreement, by which any party thereto is restricted absolutely from enforcing his rights under or in respect of any contract, by the usu0al legal proceedings in the ordinary tribunals, or which limits the time within which he may thus enforce his rights, is void to that extent.” Amendment to Section 28 of the Indian Contract Act, 1872 reads thus :- “Section 28. Agreements in restraint of legal proceedings void : Every agreement, -- (a) by which any party thereto is restricted absolutely from enforcing his rights under or in, respect of any contract, by the usual legal proceedings in the ordinary tribunals, or which limits the time within which he may thus enforce his rights; or (b) which extinguishes the rights of any party thereto, or discharges any party thereto from any liability, under or in respect of any contract on the expiry of a specified period so as to restrict any party from enforcing his rights, is void to that extent...” 33. A perusal of the record indicates that the agreement entered into between the petitioner and the respondent no.2 was extended till 6th July 1995. A perusal of the record indicates that the agreement entered into between the petitioner and the respondent no.2 was extended till 6th July 1995. During the period between 22nd August 1995 and 29th February 1996, the goods were delivered by the respondent no.2 to the petitioner in accordance with the said agreement. The period of 150 days for assertion of right by the respondent no.2 to a claim for demurrage expired on or before 28th July 1996 which was calculated at 150 days from the last delivery date of the goods. The period of 90 days within which the petitioner could accept the claim as contemplated under clause 10.2 expired on 26th October 1996. The respondent no.2 invoked arbitration agreement on 6th June 1997. The amendment to Section 28 of the Indian Contract Act, 1872 was brought into effect on 8th January 1997. 34. It is the submission of the learned counsel for the petitioner that since the liability of the petitioner stood discharged much prior to the amendment to Section 28 of the Indian Contract Act, 1872, there was no right available to the respondent no.2 which could be enforced by it before or after the amendment, the respondent no.2 could not claim any benefit of the amendment to Section 28 of the Indian Contract Act, 1872 brought into effect from 8th January 1997. It is also the case of the petitioner that once the liability of the petitioner stood discharged prior to the letter of 10th June 1997 addressed by the petitioner requesting to waive the interest which was in any event the conditional letter, the alleged claims of the respondents did not revive and a fresh period of limitation did not commence. 35. Per contra, the submission of the learned counsel for the respondents on this issue is that the amendment to Section 28 of the Indian Contract Act, 1872 would apply with retrospective effect to all the existing contracts on the date of the amendment. The expression “any agreement/contract” would not mean that such agreement/contract was to be entered into only after the date of amendment for the purpose of attraction of Section 28 (b) of the Indian Contract Act, 1872. Claims of the respondents were not barred by limitation under the provisions of Limitation Act, 1963. The expression “any agreement/contract” would not mean that such agreement/contract was to be entered into only after the date of amendment for the purpose of attraction of Section 28 (b) of the Indian Contract Act, 1872. Claims of the respondents were not barred by limitation under the provisions of Limitation Act, 1963. Since the petitioner failed to comply with its obligation to pay price for supplies effected, the term of the agreement for the purpose of payment/obligation continued and was in place on the date of amendment to Section 28 of the Indian Contract Act, 1872. Under clause 10.2 of the agreement, the claims were kept alive for the period of 360 days from the date of delivery and not from the date of execution of the contract. 36. Both the learned counsel placed reliance on the several judgments of the Supreme Court, this Court and other High Courts in support of their respective submissions on the issue whether the amendment to Section 28 of the Indian Contract Act, 1872 would apply with retrospective effect or prospective effect. 37. The Supreme Court in the case of Wild Life Institute of India, Dehradun Vs. Vijay Kumar Garg, reported in (1997) 10 SCC 528 construed an arbitration clause which provided that if the contractor does not make any demand for arbitration in respect of any claim in writing within 90 days of receiving the intimation from other party that the bill is ready for payment, the claim of the contractor would be deemed to have been waived and absolutely barred and the owner shall be discharged and released of all liabilities under the contract. The Supreme Court held that such clause operates to discharge the liability of the owner on expiry of 90 days as set out therein and was not merely a clause providing a period of limitation. Paragraph 6 of the said judgment in the case of Wild Life Institute of India, Dehradun (supra) reads thus :- “6. The Supreme Court held that such clause operates to discharge the liability of the owner on expiry of 90 days as set out therein and was not merely a clause providing a period of limitation. Paragraph 6 of the said judgment in the case of Wild Life Institute of India, Dehradun (supra) reads thus :- “6. It is also necessary to refer to the arbitration clause under the contract which clearly provides that if the contractor does not make any demand for arbitration in respect of any claim in writing within 90 days of receiving the intimation from the appellants that the bill is ready for payment, the claim of the contractor will be deemed to have been waived and absolutely barred and the appellants shall be discharged and released of all liabilities under the contract in respect of these claims. The liability, therefore, of the appellants ceases if no claim of the contractor is received within 90 days of receipt by the contractor of an intimation that the bill is ready for payment. This clause operates to discharge the liability of the appellants on expiry of 90 days as set out therein and is not merely a clause providing a period of limitation. In the present case, the contractor has not made any claim within 90 days of even receipt of the amount under the final bill. The dispute has been raised for the first by the contractor 10 months after the receipt of the amount under the final bill.” 38. The Supreme Court in case of National Insurance Co. Ltd. Vs. Sujir Ganesh Nayak & Co. and Anr., reported in (1997) 4 SCC 366 has considered a case under unamended Section 28 of the Indian Contract Act and has held that such a clause in the agreement would not fall within the mischief of Section 28 of the Contract Act. It is held that to put it differently, curtailment of the period of limitation is not permissible in view of Section 28 but extinction of the right itself unless exercised within a specified time is permissible and can be enforced. It is held that if the policy of insurance provides that if a claim is made and rejected and no action is commenced within the time stated in the policy, the benefits flowing from the policy shall stand extinguished and any subsequent action would be time barred. It is held that if the policy of insurance provides that if a claim is made and rejected and no action is commenced within the time stated in the policy, the benefits flowing from the policy shall stand extinguished and any subsequent action would be time barred. Paragraphs 5, 7, 8, 13 and 16 of the said judgment of the Supreme Court in the case of National Insurance Co. Ltd.(supra) read thus :- “5. The appellants contested the suit inter alia on the ground that the suit was barred by limitation as well as by condition No. 19 of the policy and on the ground that the claim made by the respondent No.1 was not covered by the policy. Condition 19 of the policy which was set up by way of defence runs as under: "Condition No. 19 - In no case whatever shall the company be liable for any loss or damage after the expiration of 12 months from the happening of loss or the damage unless the claim is the subject of pending action or arbitration." 7. In the present appeal, the appellant contended that condition No. 19 extinguishes the right of the assured as the suit was not filed within 12 months from the day when the loss or damage had occurred. It is further reiterated in the appeal that special Condition 5(i)(b) of the Riot and Strike Endorsement excludes the claim of the respondent No.1 from the scope of two Insurance Policies. 8. Section 28 of the contract Act may be quoted now before going into further discussion : "Section 28. Every agreement, by which any party thereto is restricted absolutely from enforcing his rights under or in respect of any contract, by the usual legal proceedings in the ordinary tribunals, or which limits the time within which he may thus enforce his rights, is void to that extent." 13. The next case we would like to notice is the Food Corporation of India (supra); the abridged factual matrix is that it, as principal, had appointed millers for procuring, hulling and supplying rice on certain conditions. On behalf of these millers the respondent insurance company executed fidelity Insurance Guarantee in favour of the appellant hereunder the former undertook to indemnify the latter for any loss suffered by the appellant by reason of branch of agreement. On behalf of these millers the respondent insurance company executed fidelity Insurance Guarantee in favour of the appellant hereunder the former undertook to indemnify the latter for any loss suffered by the appellant by reason of branch of agreement. Under the terms of the guarantee when the appellant found that it had suffered losses on account of breach of terms and conditions of their respective contracts by the millers it made demands on the insurance company to indemnify it. These demands were made well before the expiry of six months from the date of termination of the contract with the concerned miller. The insurance company did not satisfy the demands which led the appellants to file suits to recover the losses. Those suits were decreed in favour of the appellants against the respondents including the insurance companies. The insurance companies filed appeals in the High Court which were allowed holding that the terms of the guarantee concerned in each case did not entitle the appellant to sue the insurance companies after 'six month' period from the date of termination of the respective contracts with the rice millers. The matter was therefore carried in appeal to this Court. 16. From the case law referred to above the legal position that emerges is that an agreement which in effect seeks to curtail the period of limitation and prescribes a shorter period than that prescribed by law would be void as offending section 28 of the Contract Act. That is because such a an agreement would seek to restrict the party from enforcing his right in Court after the period prescribed under the agreement expires even though the period prescribed by law for the enforcement of his right has yet not expired. But there could be agreements which do not seek to curtail the time for enforcement of the right but which provides for the forfeiture or waiver of the right itself if no action is commenced with in the period stipulated by the agreement. Such a clause in the agreement would not fall within the mischief of section 28 of the Contract Act. To put it differently, curtailment of the period of limitation is not permissible in view of Section 28 but extinction of the right itself unless exercised within a specified time is permissible and ca be enforced. Such a clause in the agreement would not fall within the mischief of section 28 of the Contract Act. To put it differently, curtailment of the period of limitation is not permissible in view of Section 28 but extinction of the right itself unless exercised within a specified time is permissible and ca be enforced. If the policy of insurance provides that if a claim is made and rejected and no action is commenced within the time stated in the policy, the benefits flowing from the policy shall stand extinguished and any subsequent action would be time barred. Such a clause would fall outside the scope of Section 28 of the Contract Act. This, in Brief, seems to be the settled legal position. We may now apply it to the facts of this case.” 39. The Supreme Court in the case of Himachal Pradesh State Forest Company Limited Vs. United India Insurance Company Limited, reported in (2009) 2 SCC 252 has considered its earlier judgment in the case of National Insurance Co. Ltd. Vs.Sujir Ganesh Nayak & Co. and Anr. (supra). The judgment of the Supreme Court in the case of Food Corporation of India Vs. New India Assurance Co. Ltd. and Ors., reported in (1994) 3 SCC 324 and several other judgments and applied the principles laid down even to the case arising under amendment to Section 28 of the Indian Contract Act, 1872. Paragraphs 13, 14 and 15 of the said judgment in the case of Himachal Pradesh State Forest Company Limited (supra) read thus :- “13. In Sujir Nayak's case (supra) to which primary reference has been made by the learned counsel for the parties while dealing with an identical situation where a contract contained a provision prescribing a period of limitation shorter than that prescribed by the Limitation Act, it was held that the contractual provision was not hit by Section 28 as the right itself had been extinguished. 14. Mr. Sharma has, however, submitted that in view of the observations in some paragraphs in Food Corporation of India's case, the observations in Sujir Nayak's case were liable to reconsideration. We, however, find no merit in this plea for the reason that in Sujir Nayak's case, Food 12 Corporation of India's case (supra) has been specifically considered and Vulcan Insurance Company's case (supra) too had been relied upon.