JUDGMENT : 1. This case has been filed under Section 11(6) of the Arbitration and Conciliation Act, 1996 for the purposes of appointment of Arbitrator. 2. The petitioner-company and the respondents have entered into an agreement for the construction of Boys Hostel. The petitioner-Company completed the construction work, accordingly the respondents, whatever amount was due, have been paid to the petitioner-company by way of full and final settlement, nothing left for further dispute. 3. The petitioner-company demanded the cost incurred in „carriage of materials? amounting to Rs.63,18,345.49/-. The Registrar of respondent-Chankya National Law University informed the petitioner-company that the representation was referred to the consultant M/s Gherzi Eastern Ltd. Kolkata, it has opined, unless or otherwise, specially mentioned in the BOQ of civil work, extra claim for carriage is not admissible and vide letter dated 09.08.2012 it was informed to the petitioner-Company that claim for extra carriage is not admissible to the petitioner-company, in view of earlier communication vide letter dated 12.10.2011, henceforth no correspondence in this regard will be entertained. 4. The petitioner-company vide letter dated 03.03.2012 has demanded the interest on the amount of Security Deposit. Finally, the petitioner-company vide letter dated 07.05.2013 requested the respondents for appointment of Arbitrator in terms of the contract that was replied by the respondent-Chankya National Law University vide letter dated 18.05.2013, where it has been mentioned about Clause-25 of the Contract, which stipulates 45 days time limit for making demand for appointment of Arbitrator in respect of any claim from the date of intimation of final bill ready for payment. It has further been informed that the claim of the petitioner-company shall be deemed to have been waived and absolutely barred and respondent would be treated to have been discharged of all the liabilities as per the terms of stipulation mentioned in the agreement. Accordingly, the demand for appointment of Arbitrator is barred as final payment has been made on 07.1.2012 and within 45 days thereafter no demand for appointment of Arbitrator was made in respect of any claim and as such, the claim does not carry any merit for consideration and rejected. It has further been stated that interest on Security Deposit is also absolutely illusionary and without any substance. 5. It has further been stated that interest on Security Deposit is also absolutely illusionary and without any substance. 5. In such view of the matter, when the respondents have failed to respond positively, the petitioner has filed the present application claiming appointment of Arbitrator, in terms of Clause-25 of the agreement, empowers the petitioner in case respondent does not respond in positive mode within 30 days of the request of the contractor, but before adjudicating this dispute, the Court will be obliged to deal with objection raised by the respondent. 6. Before going to the merit of the case, it will be appropriate to quote Clause-25 of the Contract, which reads as follows:- “Settlement of Dispute & Arbitration. Except where otherwise provided in the contract all questions and disputes relating to the meaning of the specifications, design, drawings and instructions here-in-before mentioned and so to the quality of workmanship of materials used on the work are as to any other question, claim right matter or thing whatsoever in any way arising out of or relating to contract, designs, drawings, specifications, estimates, instructions, orders or these conditions or otherwise concerning the work or the execution or failure to execute the same whether arising during the progress of the work or after the cancellation, termination, completion or abandonment thereof shall be dealt with as mentioned hereinafter. (i) If the contractor considered any work demanded of him to be outside the requirements of the contract, or dispute any drawings, record or decision given in writing by the authorized representative of the Employer or any matter in connection with or arising out of the contract or carrying out of the contract or carrying out of the work, to be unacceptable, he shall promptly within 7 days request the Consultant in writing for written instructions or decisions. There upon, the consultant shall give his written instructions or decisions within a period of 30 days from the receipt of the contractor letter. If the consultant failed to give his instructions or decisions in writing within the aforesaid period or if the contractor is dissatisfied with the instruction or decision of the consultant, the contractor may, within 15 days of the receipt of consultants decision, appeal to the Employer who shall afford an opportunity to the contractor to be heard, of the letter so desires, and to offer evidence in support of his appeal. The Employer shall give his decision within 30 days of receipt of contractors appeal. If the contractor is dissatisfied with this decision, the contractor shall within a period of 30 days from receipt of the decision, give notice to the Employer for appointment of arbitrator failing which the said decision be final binding and conclusive and not referable to adjudication by the arbitrator. (ii) Except where the decision has become final, binding and conclusive in terms of Sub Para (i) above disputes or difference shall be referred for adjudication through arbitrator appointed by Employer. If the arbitrator so appointed is unable or unwilling to act or resign his appointment or vacates his office due to any reason whatsoever another sole arbitrator shall be appointed in the manner aforesaid. Such person shall be entitled to proceed with the reference from the stage at which it was left by his predecessor. It is a term of this contact that the party invoking arbitration shall give a list of disputes with amounts claimed in respect of each such dispute along with the notice for appointment of arbitrator and giving reference to the rejection by the Employer of the approval. It is also a term of this contract no person other than a person appointed by such Employer or the administrative head of the department appointed by such Employer or the administrative head of the department as aforesaid should act as arbitrator and if for any reason that is not possible, the matter shall not be referred to arbitrator at all. It is also a term of this contract that if the contractor does not make any demand for appointment of arbitrator in respect of any claims in writing as aforesaid within 45 days of receiving the intimation from the Employer or his authorized representative that the final bill is ready for payment, the claim of the contractor shall be deemed to have been waived and absolutely barred and the Employer shall be discharged and released of all liabilities under the contract in respect of these claims. The arbitration shall be conducted in accordance with the provisions of the Arbitration and Conciliation Act, 1996 (26 of 1996) or any statutory modification or re-enactment thereof and the rules made there under and for the time being in force shall apply to the arbitration proceeding under this clause. The arbitration shall be conducted in accordance with the provisions of the Arbitration and Conciliation Act, 1996 (26 of 1996) or any statutory modification or re-enactment thereof and the rules made there under and for the time being in force shall apply to the arbitration proceeding under this clause. It is also a term of the contract that if any fees are payable to the arbitrator these shall be paid equally by both the parties. It is also a term of the contract that the arbitrator shall be deemed to have entered on the reference on the date he issues notice to both the parties calling them to submit their statement of claims and counter statement of claims. The venue of the arbitration shall be such place as may be fixed by the arbitrator in his sole discretion. The fees, if any, of the arbitrator shall, if required to be paid before the award is made and published, be paid half by each of the parties. The cost of the reference and of the award (including the fees, if any, or the arbitrator) shall be in the discretion of the arbitrator who may direct to any by whom and in what manner such costs or any part thereof shall be paid and fix or settle the amount of costs to be so paid. All arbitration shall be held at PATNA and at no other place.” 7. Learned counsel for the petitioner submits that any condition mentioned in the agreement, putting clause of time within which the party has to take remedy is void, further submitted that any clause in the agreement, which postulates forfeiture of right is also bad in law. It has been submitted that, any clause in the agreement would not be able to extinguish the right and remedy of petitioner before the period prescribed in statutory provision; to that extent that clause is void in view of Section 28(1) (b) of the Contract Act and would be treated to have been deleted. 8. It has been submitted that, any clause in the agreement would not be able to extinguish the right and remedy of petitioner before the period prescribed in statutory provision; to that extent that clause is void in view of Section 28(1) (b) of the Contract Act and would be treated to have been deleted. 8. Whereas, learned counsel for the respondents submits that as all the liabilities arising from the terms of the contract have been discharged as full and final payment has been made and within 45 days of payment of final bill the petitioner has not sought for appointment of Arbitrator, hence, it will be treated that all the liabilities have been discharged or waived, in such circumstances, it is no longer the matter to be referred for arbitration as it does not remain arbitral issue. 9. The second issue is required to be decided as to whether the right of adjudication by Arbitrator has extinguished on account of expiry of specified period in terms of the agreement as the claim for appointment of Arbitrator was not made within prescribed time limit, so it will be deemed that the claim has been discharged. 10. In this case, it has to be decided whether the claim arising from the agreement or whether the claim made by the petitioner-Company for referring the dispute, has already extinguished on account of discharge of the contract as the petitioner-Company has received entire amount arising out of the work contract without any objection. 11. The third issue has to be adjudicated regarding the limit of adjudication by this Court while deciding the issue of appointment of Arbitrator and referring the dispute to the Arbitrator as well as the payment of amount by the respondents and received by the petitioner without demur, will be treated that no longer dispute exist for arbitration, in such view of the matter, the dispute raised in the present case is no longer an arbitral issue. 12. 12. The respondents have taken the plea that the right of appointment of Arbitrator has extinguished on account of terms of the agreement, which stipulates that if the contractor does not make any demand for appointment of arbitrator in respect of any claim, in writing, as aforesaid, within 45 days from the date of receiving the intimation from the employer or his authorized representative that final bill is ready for payment, the claim of the contractor shall be deemed to have been waived and absolutely barred and the employer shall be discharged / released from all the liabilities under the contract in respect of all the claims. So, the period of 45 days? time, within which, to make a claim for appointment of arbitrator, in failure, the claim of the contractor will be deemed to have been waived and absolutely barred, employer shall be treated to have been discharged or released from all the liabilities under the Contract. 13. To understand the different facets of provisions, this Court will have to examine the different angles of provisions of Section 28 of the Contract Act and its affect on contract, prior to its amendment and post amendment. It has been claimed by the petitioner-Company that prior to amendment of Section 28 of the Contract Act, the clause in agreement stipulating extinguishment of remedy has been held by the Hon?ble Supreme Court to be void as it operates against the provisions of Section 28 of the Contract Act, which provides that any agreement, restricting absolutely from enforcing his right under or in respect of any contract by usual legal proceeding in the ordinary Tribunal or reducing the period of limitation other than the limitation provided under the statute to that extent is void, but there is no bar prohibiting the parties to enter into an agreement relating to extinguishment of the right if it is claimed within period mentioned in the agreement. The extinguishment of remedy is one thing and extinguishment of right is another thing. 14. To understand this issue, it will be relevant to quote Section 28 of the Contract Act, prior to its amendment:- “28. The extinguishment of remedy is one thing and extinguishment of right is another thing. 14. To understand this issue, it will be relevant to quote Section 28 of the Contract Act, prior to its amendment:- “28. Every agreement by which any party thereto is restricted absolutely from enforcing his right under or in receipt of any contract by the usual legal proceedings in the ordinary tribunals or which limits the time which he may thus enforce the right is void to that extent.” 15. This portion of Section is prior to amendment, which is relevant to understand the ultimate effect of amendment. Prior to amendment of Section 28 of the Contract Act can be dissected in two parts; first part which prohibits the terms of agreement by which party thereto is restricted absolutely from enforcing his right under on receipt of any contract by usual proceeding in ordinary Tribunal. Meaning thereby, there cannot be any restriction absolutely from enforcing his right in respect of contract by usual legal proceeding, the Tribunal created under the ordinary law. Second restriction has been imposed that the parties to an agreement are not allowed to substitute their own period of limitation in place of the period laid down in the General Law. But the parties to an agreement are allowed to insert the clause in agreement in the nature of prescription that is to say, they are free to provide that if a party does not enforce his right within a specified period, then the rights accruing under the contract shall be forfeited or extinguished or that a party shall be discharged from all liabilities under the Contract. In other words, a clause limiting the time for enforcing a remedy has been prohibited, but a clause limiting the duration upto which the rights remain alive, and extinguishing those rights at the end of such period, is permissible. In sense, an agreement which limits the party within which a party to an agreement may enforce his right under any contract by a proceeding in a Court of law is void to that extent. But the Section does not invalidate any clause in the agreement in nature of stipulating their own period of prescription that is to say, an agreement which mentions that at the end of specified period, if the rights there under are not enforced the right itself will cease to exist. 16. But the Section does not invalidate any clause in the agreement in nature of stipulating their own period of prescription that is to say, an agreement which mentions that at the end of specified period, if the rights there under are not enforced the right itself will cease to exist. 16. This issue came for consideration before the Hon?ble Supreme Court and different High Courts, in which the Court has considered the stipulation which provides the period within which the right is not claimed, will be treated to have been forfeited / extinguished or party would be treated to have been discharged from all the liabilities under the contract. 17. The issue of extinguishment of right on account of the provisions in the terms of agreement came for consideration before the Bombay High court in the case of the New India Assurance Co. Ltd. vs. Radheshyam Motilal Khandelwal, reported in AIR 1974 Bombay, 228. The aforesaid case is related to incorporation of the terms of contract on insurance. There was clear condition forfeiture of in case of fraudulent claim or failure to bring an action within the stipulated period on repudiation of claim by the insurer. It was held that condition mentions terms clause of policy in question and was binding on parties. Further it was held that the condition did not violate the provisions of Section 28 of the Contract Act. 18. Similar issue came for consideration before the Kerala High court in Kerala Electrical and Allied . vs Canara Bank And Ors. reported in AIR 1980 Kerela 151 . In that case, a clause in the bank guarantee provided that suit or action to enforce claim under the guarantee was to be filled within six months from the date of expiry of guarantee, is not sustainable but the condition in agreement postulates the party will be forfeited or released if he does not assert his right within the time. In that case, a clause in the bank guarantee provided that suit or action to enforce claim under the guarantee was to be filled within six months from the date of expiry of guarantee, is not sustainable but the condition in agreement postulates the party will be forfeited or released if he does not assert his right within the time. The question arose whether the clause was valid with reference to section 28 of the Contract Act, the claim stipulating forfeiture of right has been held to be valid and the court held that right of claimant and liability of the bank will remain alive only for a period of six months after the expiry of the period of duration of the guarantee and that right of the person in whose favour the guarantee was executed were extinguished on expiry of that period. In other words, there is an extinction of the right of the plaintiff under the contract and discharge of the defendants from liability. The Court held that time limit imposed in contractual clause keeping right and liability alive was not hit by Section 28 of the Contract Act, conclusion so reached is of course is in harmony with the earlier decisions. 19. The same issue came for consideration before the Hon?ble supreme court in the case of Vulcan Insurance Co. Ltd vs. Maharaj Singh & Another , reported in AIR 1976, page-287. In that case, the Vulcan Insurance Company was engaged itself in the general insurance business. After nationalization, it was named as United India Fire and General Insurance Company Ltd. The respondent-Maharaj Singh, the insurer, was carrying the business of manufacturing Bone Manure etc. in his mills at Khatauli. He entered into an arrangement with respondent No. 2 for taking advance of money on the security of the factory premises, machineries and the stock of goods. A mortgage deed was executed by him in favour of the respondent bank for that purpose. The Bank insured the mortgage properties from time to time with the appellant company under three insurance policies, the terms governing the same being identical. A fire broken out in the factory premises, caused a loss, informed the Insurance Company about the fire, whereupon the representative of the Bank and the Insurance Company and some surveyors visited the factory premises. Respondent no. A fire broken out in the factory premises, caused a loss, informed the Insurance Company about the fire, whereupon the representative of the Bank and the Insurance Company and some surveyors visited the factory premises. Respondent no. 1 claimed that due to fire he had suffered a loss on account of damage to the fixed assets as well as to the stock of goods. The amount of damage was assessed to the tune of Rs. 4,620/- The respondent No.1 wrote a letter dated 1.1.1963 as the claim has been repudiate, under Clause-13 of the Insurance Policy, a difference had arisen between the parties and hence respondent no. 1 proposed to appoint a sole arbitrator to resolve the dispute and if the company was not agreeable to the appointment of sole arbitrator, he may be treated as a nominee of respondent no. 1. The Insurance Company replied that as it had repudiated his claim the arbitration clause in the policies was rendered inoperative and no arbitration proceeding could be commenced by appointment of any arbitrator. An application under Section 20 of the Arbitration Act, 1940 was filed in the Civil Court, Muzaffarnagar (Uttar Pradesh). The appellant took an objection to the jurisdiction of the Court to entertain the application in view of special clause in the policies excluding the jurisdiction of courts other than the court at Delhi. The Muzaffarnagar Civil court allowed that objection and directed the return of the application. The Delhi High Court dismissed the application holding that the dispute arising out of the repudiation of the liability under clause 13 by the Insurance Company was within the scope of the arbitration agreement contained in clause 18 and a reference to arbitration could be made, but, as per clause 19, the petition was barred by limitation. The matter reached to the Hon?ble Supreme Court. Clause 19 of the agreement with the Insurance Company provides that “in no case whatever shall the company be liable for any loss or damage after the expiration of twelve months from the happening of the loss or damage unless the claim is the subject of pending action or arbitration." 20. This cause deals with the extinguishment of the right. The Hon?ble Supreme Court ultimately held that such clause 19 does not violate section 28 of the Contract Act. This cause deals with the extinguishment of the right. The Hon?ble Supreme Court ultimately held that such clause 19 does not violate section 28 of the Contract Act. The clause of Insurance Company provided that all the benefit under the Insurance Policy shall be forfeited if the claim was not brought with specified period. The insertion of clause-19 has been held to be valid. 21. It will be relevant to quote paragraph No.19 and 23 of the said judgment, which read as follows:- 19. Following the decision of the House of Lords in Jureidini's case (1915) AC 499 (supra) a Bench of the Bombay High Court in the Eagle Star and British Dominions Insurance Co. v. Dinanath, ILR 47 Bom 509 = (AIR 1923 Bom 249) while interpreting an identical Clause 13 said at p. 521 (of ILR) = (at p. 252 of AIR): "But in clause 13 there are various contingencies set out which is established entitle the insured to bring an action without an award having been made by arbitrators. One of these contingencies is "if the claim be made and rejected" which if established gives a right of action, the period of limitation provided for the suit being filed at three months from the date of the rejection. While it is also provided that where arbitration takes place in pursuance of condition 18 of the policy, three months' time should be allowed for a suit to be brought after the award has been made. Therefore it is quite obvious that a right of action accrued after the company rejected the claim. Naturally that question would have first to be decided by suit as under clause 18 that question could never have been referred to arbitration." We approve the law so enunciated by the Bombay High Court. 23. We do not propose, as it is not necessary, to decide whether the action commenced by respondent no. 1 under Section 20 of the Act for filing of the arbitration agreement and for appointment of arbitrators was barred under clause 19 of the policy. It has been repeatedly held that such a clause is not hit by Section 28 of the Contract Act and is valid; vide-The Baroda Spinning and Weaving Company Limited v. The Satyanarayan Marine and Fire Insurance Company Limited, ILR 39 Bom 344 = (AIR 1914 Bom 225 (2); Dawood Tar Mahomed Bros. v. Queensland Insurance Co. It has been repeatedly held that such a clause is not hit by Section 28 of the Contract Act and is valid; vide-The Baroda Spinning and Weaving Company Limited v. The Satyanarayan Marine and Fire Insurance Company Limited, ILR 39 Bom 344 = (AIR 1914 Bom 225 (2); Dawood Tar Mahomed Bros. v. Queensland Insurance Co. Ltd., AIR 1949 Cal 390 and The Ruby General Insurance Co. Ltd. v. The Bharat Bank Ltd. AIR 1950 (East)Punj 352. Clause 19 has not prescribed a period of 12 months for the filing of an application under Section 20 of the Act. There was no limitation prescribed for the filing of such an application under the Indian Limitation Act, 1908 or the Limitation Act, 1963. Article 181 of the former did not govern such an application. The period of three years prescribed in Article 137 of the Act of 1963 may be applicable to an application under section 20. Nor are we concerned in this case to decide whether the time taken by respondent no. 1 in prosecuting his application in Muzaffar nagar court could be excluded under section 14(2) of the Limitation Act, 1963. Nor do we propose to decide whether the application under section 20 could be defeated on the ground of the extinction of the liability of the company under clause 19. We may, however, observe in passing that in view of the decision on this Court in Wazirchand Mahajan and another v. Union of India, (1967) 1 SCR 303 at p. 308 = ( AIR 1967 SC 990 at p. 993) if the difference which had arisen between the parties was the one to which the arbitration clause applied then the application under Section 20 of the Act could not be dismissed on the ground that the claim would not ultimately succeed either on facts or in law. The matter will have to be left for the decision of the arbitrator. Without any discussion we may just state that the High Court is not right in its view that respondent no. 1's claim was not barred under clause 19 because of the provision of law contained in Section 37(3) of the Act.” (Emphasis supplied) 22. The matter will have to be left for the decision of the arbitrator. Without any discussion we may just state that the High Court is not right in its view that respondent no. 1's claim was not barred under clause 19 because of the provision of law contained in Section 37(3) of the Act.” (Emphasis supplied) 22. The dispute of extinguishment of right in terms of the agreement came for consideration before the Hon?ble Supreme Court in the case of East and West Steamship Co., Georgetown, Madras, vs. S.K. Ramalingam Chettiar, reported in A.I.R. 1960, S.C.C. 1058, there the ship was to bring consignments from Kerla, destitution was fixed at Bombay port trust. The petitioner-company took delivery of consignments and goods packed in bags, which bore their distinctive and identifying marks, but were unable to obtain delivery of 164 bags, out of the consignment sent by consigner. In the agreement there was a clause that “in any event the carrier and the ship shall be discharged from all liability in respect of loss or damage unless suit is brought within one year after the delivery of the goods or the date when the goods should have been delivered”. One of the defence was taken that in terms of the agreement which provides the limitation with respect to extinction of right unless the suit is brought within the time prescribed. The Court held that there is distinction between the extinction of a right and the extinction of a remedy for the enforcement of that right though fine distinction character, is of greater importance. The Court has considered the discharge from the liability and held that “ordinary grammatical sense of "discharged from liability" does not connote "free from the remedy as regards liability" but are more apt to mean a total extinction of the liability following upon an extinction of the right.” The Court further held that it is difficult to draw a reasonable distinction between the words "absolved from liability" and "discharged from liability" and think that these words "discharged from liability" were intended to mean and do mean that the liability has totally disappeared and not only that the remedy as regards the liability has disappeared”. 23. It will be relevant to quote paragraph Nos. 25 and 31 of the said judgment, which read as follows:- “25. 23. It will be relevant to quote paragraph Nos. 25 and 31 of the said judgment, which read as follows:- “25. On the next question whether this clause prescribes only a rule of limitation or provides for the extinction of a right to compensation, it will be observed that the Bombay High Court has not discussed it at all, apparently because on the facts of the case before it would have mattered little whether the provision was one of limitation or of extinction of right. The question is however of some importance in the facts of the Madras case. For if the provision is one of limitation there would be some scope for argument in the facts of that case that the period was extended by acknowledgments of liability within the meaning of Article 19 of the Limitation Act. The question we have to decide is whether in saying that the ship or the carrier will be “discharged from liability ", only the remedy of the shipper or the consignee was being barred or the right was also being terminated. It is useful to remember in this connection the international character of these rules, as has been already emphasized above. Rules of limitation are likely to vary from country to country. Provisions for extension of periods prescribed for limitation would similarly vary. We should be slow therefore to put on the word “discharged from liability” an interpretation which would produce results varying in different countries and thus keeping the position uncertain for both the shipper and the shipowner. Quite apart from this consideration, however, we think that the ordinary grammatical sense of "discharged from liability" does not connote “freed from the remedy as regards liability " but are more apt to mean a total extinction of the liability following upon an extinction of the right. We find it difficult to draw any reasonable distinction between the words "absolved from liability" and " discharged from liability " and think that these words " discharged from liability" were intended to mean and do mean that the liability has totally disappeared and not only that the remedy as regards the liability has disappeared. We find it difficult to draw any reasonable distinction between the words "absolved from liability" and " discharged from liability " and think that these words " discharged from liability" were intended to mean and do mean that the liability has totally disappeared and not only that the remedy as regards the liability has disappeared. We are unable to agree with the learned Judge of the Madras High Court that these words merely mean that "that even though the right may inhere in the person who is entitled to the benefits, still the liability in the opposite party is discharged by the impossibility of enforcement." The distinction between the extinction of a right and the extinction of a remedy for the enforcement of that right, though fine, is of great importance. The Legislature could not but have been conscious of this distinction when using the words “discharged from all liability “in an article purporting to prescribe rights and immunities of the ship-owners. The words are apt to express an intention of total extinction of the liability and should, especially in view of the international character of the legislation, be construed in that sense. It is hardly necessary to add that once the liability is extinguished under this clause, there is no scope of any acknowledgment of liability thereafter. 31. It cannot be seriously disputed that the stipulation under consideration does directly offend against the provisions of the 8th paragraph. For it seeks at least to "lessen", otherwise than provided in the rules in the Schedule the liability of the ship or carrier for loss or damage to goods or in connection with goods caused by the failure to deliver. This stipulation requiring claim for compensation being made within one month from the date of arrival of the ship is therefore null and void.” 24. Similar issue came for consideration before the Hon?ble Supreme Court in the case of National Insurance Co. Ltd. vs. Sujir Ganesh Nayak & Co. and Another, reported in (1997) 4 S.C.C., 366. In that case, the Sujir Ganesh Nayak & Company was carrying on business in import and export of cashew. The respondent-company has taken insurance relating to riot and strike. Ltd. vs. Sujir Ganesh Nayak & Co. and Another, reported in (1997) 4 S.C.C., 366. In that case, the Sujir Ganesh Nayak & Company was carrying on business in import and export of cashew. The respondent-company has taken insurance relating to riot and strike. As there was a labour dispute, the strike was called by the worker, physically obstructed the movement of goods, on that account the respondent-Company sustained loss, which was refused by the appellant-Insurance Company as condition No.19 of the Insurance policy stipulates that “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”. The plea was contested in view of Section 28 of the Contract Act that the right to seek relief has been shortened the time which was prescribed by the common law and as such it would fall within the mischief of the provisions. The Hon?ble Supreme Court has considered the judgment of the Punjab High Court, where it was held that “such a clause did not limit the time within which the insured enforce his right, but only limits the period during which the contract will remain alive”. The Court after considering the judgments passed in large number of cases held 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, but there could be an agreement which do not seek to curtail the time for enforcement of the right, but which provide for forfeiture of the waiver of the right itself. If no action is made within the period stipulated by the agreement, such clause in the agreement would not fall within the mischief of section 28 of the Contract Act”. It has further been held that curtailment of period of limitation to approach the Court is not permissible, but the extinction of the right itself unless exercised within the specified time limit is permissible, in such situation, right cannot be enforced. 25. It will be relevant to quote paragraph Nos. 15 and 16 of the said judgment, which read as follows:- “15. 25. It will be relevant to quote paragraph Nos. 15 and 16 of the said judgment, which read as follows:- “15. Sahai, J. who wrote a separate but concurring judgment extracted the clause of the Fidelity Insurance Guarantee (which we have extracted earlier) and then posed the question 'what does it mean? What is the impact of Section 28 of the Contract act on such clause? Pointing out the said Section 28 was a departure from the English law (there is no such statutory bar in English law) the learned Judge observation that: (SCC P. 330, para 3) "Even though the phraseology of Section 28 is explicit and strikes at the very root by declaring any agreement curtailing the normal statutory period of limitation to be void the courts have been influenced by the distinction drawn by English Courts in extinction of right by agreement and curtailment of limitation". Referring to the language of the various terms of the agreement, the learned judge holds in paragraph 8 thus: (SCC p.335) "From the agreement it is clear that it does not contain any clause which could be said to be contrary to Section 28 of the Contract Act nor it imposes any restriction to file a suit within six months from the date of determination of the contract as claimed by the company and held by the High Court. What was agreed was that the appellant would not have any right under this bond after the expiry of six months from the date of the termination of the contract. This cannot be construed as curtailing the normal period of limitation provided for filing of the suit. If it is construed so it may run the risk of being violative of Section 28 of the Contract Act. It only puts embargo on the right of the appellant to make its claim known not later of contract. It is in keeping with the principle with has been explained in English decisions and by our own court that the insurance companies should not be kept in dark for long and they must be apprised of their liabilities immediately both for facility and certainty. The High Court erroneously construed it as giving up the right of enforceability of its claim after six months." 16. The High Court erroneously construed it as giving up the right of enforceability of its claim after six months." 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 provide 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 can 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.” 26. Identical issue came for consideration before the Hon?ble Supreme Court in the case of Food Corporation of India vs. New India Assurance Co. Ltd. and Others., reported (1994) 3 S.C.C. 324 , there also Section 28 of the Contract Act vis-a-vis the terms of Contract providing the period for the existence of the right for a particular period and subsequent to that lead to the forfeiture or extinction of the right was under consideration. In this case, the suit was filed after six months by the Public Sector Undertaking against the Insurance Company for recovery of money. In this case, the suit was filed after six months by the Public Sector Undertaking against the Insurance Company for recovery of money. There was an agreement between the appellant-Food Corporation of India and the rice miller, giving guarantee honest accounting and refund of money received by the supplier for supplying rice to the appellant- Food Corporation of India. The Insurance Company has given guarantee to indemnify for any loss directly from the Company. There was a stipulation in the guarantee that in the guarantee agreement that the appellant would lose all the claims as against the Insurance Company if it was not claimed within six months from the date of expiry of the contract of fidelity. The Court has considered that there is distinction between extinguishment of right and extinguishment of the remedy, fixing the shorter period for remedy, i.e. approaching the Court of Law, violates the provisions of Section 28 of the Contract Act, holding that Section 28 is explicit and strikes at the very root by declaring any agreement curtailing the normal statutory period of limitation to be void, but the provision stipulating for the extinction of right, there is no violation of Section 28 of the Contract Act. 27. It will be relevant to quote paragraph Nos. 3, 8, 17 and 18 of the said judgment, which read as follows:- “3. Both the courts below thus found as a fact that an agreement was entered between the appellant and the company on March 24, 1970 stipulating period of guarantee from February 15, 1970 to February 15, 1971, that the default occurred on July 1, 1970, that the demand was made on June 17, 1971 and the suit was filed on January 20, 1973 but they differed as a matter of law on the effect of Section 28 of the Contract Act on such agreement. Section 28 is extracted below : "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." The section is a departure from English law as there is no such statutory bar restraining parties from entering into such agreement. In Rehmatunnisa Begum v. Price it was observed as a general principle that, "no man can exclude himself from the protection of the courts". The rationale obviously is to ensure protection against fair dealing even between unequal bargaining parties. The intention and objective being clear the courts' primary responsibility is to construe and interpret it in a manner so as to advance the objective and protect the interest of the party who might be frustrated by too technical and expensive approach in such matters. Further it is trite saying that the courts should lean in favour of construction which keeps the remedy alive, that is if two constructions are possible then the one favouring continuance of the suit is to be preferred than the one barring the remedy. Even though the phraseology of Section 28 is explicit and strikes at the very root by declaring any agreement curtailing the normal statutory period of limitation to be void the courts have been influenced by the distinction drawn by English Courts in extinction of right by agreement and curtailment of limitation. For instance in Baroda Spg. and Wvg. Co. Ltd. v. Satyanarayen Marine and Fire Insurance Co. Ltd. the agreement providing, "if the claim to be made and rejected, an action or suit be not commenced within three months after such rejection ... all benefits under the policy shall be forfeited" was construed as extinguishing right and not the remedy. Reliance for this was placed on numerous English decisions and the Court was of opinion that, "what the plaintiff was forbidden to do under the agreement was to limit the time within which he was to enforce the right but what he had actually done was to limit the time within which he was to have any rights to enforce and that appears to be very different thing". In Vulcan Insurance Co. v. Maharaj Singh this Court, incidentally, in a different context referred to the decision in Baroda Spg. And observed that a clause like the one which provided that: "In no case whatever shall the company be liable for any loss or damage after the expiration of twelve months from the happening of the loss or damage unless the claim is the subject of pending action or arbitration" was not hit by Section 28 of the Contract Act. Similar clause was considered in Pearl Insurance Co. Similar clause was considered in Pearl Insurance Co. v. Atma Ram on which reliance was placed by the High Court. Since the Bombay decision in Baroda Spg.2 has been referred, even though incidentally in Vulcan Insurance and it has been observed that clause like the one which came up for consideration in that case was not hit by Section 28 of the Contract Act the distinction drawn by the Bombay High Court on strength of English decisions between agreements giving up the right to enforce and the one curtailing limitation may be assumed to be valid. The occasion to draw such distinction flows from the anxiety of the courts to interfere as less as possible in agreements unless it is unconscionable or against public policy etc. Where statutory prohibition is placed on agreements and they are declared to be void the provision has to be construed strictly and applied restrictively confining to only those situations which are squarely covered in it. It is for this reason that any agreement which was not specifically covered in Section 28 was not held to be invalid. When this Court observed in Vulcan Insurance that clause like 19, in that, case was not violative of Section 28 it, obviously, meant that where filing of suit within specified time agreed between parties is made dependent on any consideration precedent then such agreement would not be void. And probably, rightly, as then it is not an agreement curtailing limitation but providing for doing one or other thing and filing the suit only after condition precedent was complied. Some of such decisions which were relied by the High Court were Kasim Ali Bulbul v. New India Assurance Co. Girdharilal Honuman Bux v. Eagle Star and British Dominions Insurance Co. Ltd.; G. Rainey v. Burma Fire and Marine Insurance Co. Ltd.; Pt. Prithvi Nath Mulla v. Union of India and Ramji Karamsi v. Unique Motor and General Insurance Co. Ltd. In all these the filing of the suit within stipulated period was dependent on rejection of claim. It could be validly said that it was not violative of Section 28 of the Contract Act as the agreement did not curtail limitation but provided for that if the suit was not filed within the stipulated period after rejection of clause the plaintiff shall lose all rights or benefits. It could be validly said that it was not violative of Section 28 of the Contract Act as the agreement did not curtail limitation but provided for that if the suit was not filed within the stipulated period after rejection of clause the plaintiff shall lose all rights or benefits. No further is necessary to be said as it shall be explained later that it was not necessary for the High Court to enter into this aspect at all. As regards the decision in South British Fire & Marine Insurance Co. of New Zealand v. Brajanath Shaha on which reliance was placed by the High Court, it itself observed that it was not very relevant as the effect of Section 28 of the Contract Act on such agreement was not expressly considered. Yet it placed reliance on observations to the effect "it was considered in argument that in England the agreement in clause (18) would be perfectly valid; and it cannot, I think, be contended that insurance companies in India have less need than such companies in England of the protection afforded by an agreement for the acceleration of legal proceedings to be brought against them. That being so, there is no less reason to suppose that the legislature intended Section 28 to have far-reaching effect for which the plaintiff contended". But what the High Court lost sight of was that there was no provision like Section 28 of the Contract Act in English law and, therefore, any agreement curtailing the period of limitation than that what was provided under the ordinary law was not void. The various English decisions, adverted to by the High Court, namely, Bank of England v. Vagliano Brothers, Ford v. Baron, Thimbley v. Barton, Walker v. Nevil therefore, do not appear to be appropriate for deciding either the effect of Section 28 or for the construction of the Fidelity Insurance Guarantee clause. The various English decisions, adverted to by the High Court, namely, Bank of England v. Vagliano Brothers, Ford v. Baron, Thimbley v. Barton, Walker v. Nevil therefore, do not appear to be appropriate for deciding either the effect of Section 28 or for the construction of the Fidelity Insurance Guarantee clause. The High Court further placed reliance on the following passage from Porter's Law of Insurance : "In Porter's Law of Insurance (6th Edn.) page 195 it is stated that insurance may lawfully limit the time within which an action may be brought to a period less than that allowed by the statute of limitation and that the true ground, on which the clause limiting the time of claim rests and is maintainable is that, by the contract of the parties the right to indemnity in case of loss and the liability of the Company therefor do not became absolute, unless the remedy is sought within the time fixed by the condition in the policy." It is indeed doubtful if the time-limit for bringing an action can be lawfully limited and brought to a period less than that allowed by the Statute. By lawful limit the author appeared to mean by a valid and legal agreement. But no agreement could be entered against statute. The statement was made in context of English law and not Section 28 of the Contract Act. The only extent to which it could be helpful could be in the sense explained in various decisions. That is if curtailment of limitation is dependent on happening or otherwise of some other agreement it may not be strictly in the mischief of Section 28. 8. From the agreement it is clear that it does not contain any clause which could be said to be contrary to Section 28 of the Contract Act nor it imposes any restriction to file a suit within six months from the date of determination of the contract as claimed by the company and held by the High Court. What was agreed was that the appellant would not have any right under this bond after the expiry of six months from the date of the termination of the contract. This cannot be construed as curtailing the normal period of limitation provided for filing of the suit. What was agreed was that the appellant would not have any right under this bond after the expiry of six months from the date of the termination of the contract. This cannot be construed as curtailing the normal period of limitation provided for filing of the suit. If it is construed so it may run the risk of being violative of Section 28 of the Contract Act. It only puts embargo on the right of the appellant to make its claim known not later than six months from the date of termination of contract. It is in keeping with the principle which has been explained in English decisions and by our own court that the insurance companies should not be kept in dark for long and they must be apprised of their liabilities immediately both for facility and certainty. The High Court erroneously construed it as giving up the right of enforceability of its claim after six months. Since the period is provided under the agreement the appellant had to move within this period asserting its right and apprising the company of the breach or violation by the miller to enable it either to pay or to persuade the miller to pay itself. It does not directly or indirectly curtail the period of limitation nor does it anywhere provide that the Corporation shall be precluded from filing suit after expiry of six months. It can utmost be construed as a condition precedent for filing of the suit that the appellant should have exercised the right within the period agreed to between the parties. The right was enforced under the agreement when notice was issued and the company was required to pay the amount. Assertion of right is one thing than enforcing it in a court of law. The agreement does not anywhere deal with enforcement of right in a court of law. It only deals with assertion of right. The assertion of right, therefore, was governed by the agreement and it is imperative as well that the party concerned must put the other side on notice by asserting the right within a particular time as provided in the agreement to enable the other side not only to comply with the demand but also to put on guard that in case it is not complied it may have to face proceedings in the court of law. Since admittedly the Corporation did issue notice prior to expiry of six months from the termination of contract, it was in accordance with the Fidelity Insurance clause and, therefore, the suit filed by the appellant was within time. 17. Indisputably, under the material clauses of the respective bonds (contracts) of Fidelity Insurance Guarantee which we have reproduced earlier as contained in a representative bond, the Insurance Company concerned therein has in unequivocal terms undertaken to make good the sum of money up to the limit specified therein, when claimed by the Corporation (appellant) as the loss suffered by it on account of breaches committed by the rice miller concerned of the terms of the agreement entered into with it. But that undertaking of the Insurance Company to make good the sum of money claimed by the Corporation is made, as seen from the said clauses, subject to the restriction which reads : "... that the Corporation shall have no rights under this bond after the expiry of (period) six months from the date of termination of the contract." 18. Contract, the termination of which is envisaged in the above restriction is the contract (agreement) which had been entered into by the rice miller with the Corporation cannot be disputed and in fact does not appear to have been disputed, both in the trial court and the High Court. Since the restriction says that the Corporation shall have no rights under the bond after the expiry of six months from the date of termination of the contract, the rights of the Corporation under the contract continue to exist for six months beyond the period during which the contract could be in force unless the dues of the Corporation under the contract are paid or satisfied in the manner provided for in the clauses of the bond itself, as could be seen there from. Therefore, what is envisaged by the 'restriction' is that the Corporation, if wants to exercise or enforce the rights given to it under the Fidelity Insurance Guarantee Bond, it could present before the Insurance Company, the claim for its loss under the contract entered into with the rice miller even up to the period of six months from the date of termination of the contract and not beyond. None of the clauses nor the restriction in the bond, to which we have adverted, require that a suit or legal proceeding should be instituted by the Corporation for enforcing its right under the bond against the Insurance Company within a period of six months from the date of termination of the contract. Therefore, the restriction adverted to in the clauses of the bond, envisages the need for the Corporation to lodge a claim based on the bond, before the Insurance Company within a period of six months from the date of termination of the contract as becomes clear from the express language of the clause in which that restriction is imposed and the express language of the clauses which have preceded it. In fact the period of limitation for filing a suit or instituting a legal proceeding by the Corporation for recovery of the claim made against the Insurance Company could also be regarded as commencing from the date when the Insurance Company expressly refuses to honour the claim or from a date when its conduct amounts to refusal to honour the claim, in that, such default could also give rise to the cause of action for the institution of the suit or legal proceeding by the Corporation against the Insurance Company. Hence, it would not be correct to say that suits filed by the Corporation out of which the present appeals arise were barred under the restriction adverted to, in that, they were not filed within six months envisaged in that restriction. From this, it follows that the High Court was not right in holding that the „restriction' in the clause of the bond did not enable the Corporation to file its suit against the Insurance Company for non-honouring of its claims, after the lapse of the period of six months from the date of termination of the contract and consequently in setting aside the decrees of the trial courts on that account”. 28. In the case of Himachal Pradesh State Forest Company Limited vs. United India Insurance company Limited, reported in (2009) 2 S.C.C. 252 , the question of extinguishment of right in terms of the agreement between the parties came for consideration as in that case there was a insurance with respect to the timber, but on account of heavy rains the insured timber was washed away and the appellant-Forest Company Limited suffered a loss. Claim was made to the Insurance Company, which was repudiated. The Hon?ble Supreme Court has considered the issue fixing a period of limitation extinguishing the right unless suit or complaint is filed within certain stipulated period which could be less than that prescribed by the Limitation Act, which held not violative of Section 28 of the Contract Act. The Court has considered the large number of judgments and approved the principle that the agreement fixing the period of existence of right less than the period prescribed in the Limitation Act is a proper agreement does not violate any provisions of law, in such a case, the Court has considered the decision passed in Sujir Ganesh Nayak Case (supra) and approved the proposition and quoted paragraph Nos. 15, 16, 19, 21 and 23 of the said judgment. In approval, the Court has also considered the decision of Food Corporation of India case (supra). 29. It will be relevant to quote paragraph No. 15 of the said judgment, which reads as under:- 15. In Sujir Ganesh Nayak's case, this Court was called upon to consider condition 19 of the policy which was in the following terms :(S.C.C. p.370, para 5 ) "5. …Condition- 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." While construing this provision vis-`a-vis Section 28 of the Contract Act and the cases cited above and several other cases, in addition, this is what the Court ultimately concluded: (Sujir Ganesh Nayak case, S.C.C. pp.375-77, paras 16, 19 and 21) "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 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. That is because such 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 provide for the forfeiture or waiver of the right itself if no action is commenced within 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 can 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. 19. The clause before this Court in Food Corpn. case extracted hereinbefore can instantly be compared with the clause in the present case. The contract in that case said that the right shall stand extinguished after six months from the termination of the contract. The clause was found valid because it did not proceed to say that to keep the right alive the suit was also required to be filed within six months. Accordingly, it was interpreted to mean that the right was required to be asserted during that period by making a claim to the Insurance Company. It was therefore held that the clause extinguished the right itself and was therefore not hit by Section 28 of the Contract Act. Such clauses are generally found in insurance contracts for the reason that undue delay in preferring a claim may open up possibilities of false claims which may be difficult of verification with reasonable exactitude since memories may have faded by then and even ground situation may have changed. Such clauses are generally found in insurance contracts for the reason that undue delay in preferring a claim may open up possibilities of false claims which may be difficult of verification with reasonable exactitude since memories may have faded by then and even ground situation may have changed. Lapse of time in such cases may prove to be quite costly to the insurer and therefore it would not be surprising that the insurer would insist that if the claim is not made within a stipulated period, the right itself would stand extinguished. Such a clause would not be hit by Section 28 of the Contract Act. 21. Clause 19 in terms said that in no case would the insurer be liable for any loss or damage after the expiration of twelve months from the happening of loss or damage unless the claim is subject of any pending action or arbitration. Here the claim was not subject to any action or arbitration proceedings. The clause says that if the claim is not pressed within twelve months from the happening of any loss or damage, the Insurance Company shall cease to be liable. There is no dispute that no claim was made nor was any arbitration proceeding pending during the said period of twelve months. The clause therefore has the effect of extinguishing the right itself and consequently the liability also. Notice the facts of the present case. The Insurance Company was informed about the strike by the letter of 28-4-1977 and by letter dated 10-5-1977. The insured was informed that under the policy it had no liability. This was reiterated by letter dated 22-9-1977. Even so more than twelve months thereafter on 25-10-1978 the notice of demand was issued and the suit was filed on 2-6-1980. It is precisely to avoid such delays and to discourage such belated claims that such insurance policies contain a clause like clause 19. That is for the reason that if the claims are preferred with promptitude they can be easily verified and settled but if it is the other way round, we do not think it would be possible for the insurer to verify the same since evidence may not be fully and completely available and memories may have faded. That is for the reason that if the claims are preferred with promptitude they can be easily verified and settled but if it is the other way round, we do not think it would be possible for the insurer to verify the same since evidence may not be fully and completely available and memories may have faded. The forfeiture Clause 12 also provides that if the claim is made but rejected, an action or suit must be commenced within three months after such rejection; failing which all benefits under the policy would stand forfeited. So, looked at from any point of view, the suit appears to be filed after the right stood extinguished. That is the reason why in Vulcan Insurance case while interpreting a clause couched in similar terms this Court said: (SCC p. 952, para 23) “23) … It has been repeatedly held that such a clause is not hit by Section 28 of the Contract Act…." Even if the observations made are in the nature of obiter dicta we think they proceed on a correct reading of the clause." In the light of the fact that Food Corpn. case has been considered in Sujir Nayak case, no further argument remains in the present matter, as Clause 6(ii) and Condition 19 are, in their essence, pari materia.” 30. Same issue came for consideration before the Hon?ble Supreme Court in the case of Wild Life Institute of India, Dehradun vs. Vijay Kumar Garg, reported in (1997) 10 S.C.C. 528 . In that case, the Wild Life Institute of India entered into a contract with private respondent for construction of building of Dehradun on the terms of contract set out in the Contract. According to the Wild Life Institute several extensions were granted to complete the construction. Ultimately, the Contract was terminated and payments were made. In that case as per the written agreement claim was to be made within 90 days, otherwise claim of the Contractor will be deemed to have been waived and absolutely barred and the Wild Life Institute of India will be treated to have been discharged and released from all the liabilities, has been held to be a legal term of the agreement, does not violate the provisions of law, which has been discussed in paragraph No.6 of the said judgment. It will be useful to quote paragraph No.6 of the said judgment, which reads as under:- “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 time by the contractor 10 months after the receipt of the amount under the final bill.” 31. The Law Commission of India was constituted to examine the justification of clause stipulated in the agreement, extinguishing the right less then the period stipulating in common law. The Law Commission considered the formulation of provision of Section 28 of the Contract Act and its fall out on the general public, who generally enter into an agreement especially with respect to the insurance matter, was found are at the receiving end. Looking to the financial capacity of insurance company vis-à-vis the general public and on account of the high bargaining power of the Insurance Company they though had no alternative but to accept the conditions provided in the Contract. The Law Commission found itself in anomalous situation that prevail under the present law in regard to prescription clause in contract extinguishing right under the contract on expiry of specified period. The point of consideration, an agreement which limits time within which a party to an agreement may enforce his right under any contract by proceeding in a Court of law is void to that extent. The point of consideration, an agreement which limits time within which a party to an agreement may enforce his right under any contract by proceeding in a Court of law is void to that extent. But the Section does not invalidate an agreement in the nature of prescription, that is to say, an agreement which provides that, at the end of specified period, if the right there under is not enforced, the right shall cease to exist. The Law Commission of India has considered the judgment of the Bombay, Kerla and Pubjab High Courts and the Hon?ble Supreme Court. The Law Commission has posed a question whether in the present position requires reform in the interest of justice in connection with Section 28 of the Contract Act. The Law Commission in paragraph No.3.2 has taken the following view:- “3.2. …But we are not impressed by this argument. The barring of remedy affects only the adjective part of the legal system, while extinction of the right may cause serious hardship and injustice. It is difficult to understand why the parties should be allowed to invent their own rules of prescription, when they are not allowed to invent something lesser – their own rules of limitation. This position is prima facie illogical, and we have not been able to thing of any countervailing or overriding consideration that may justify the illogicality.” 32. In paragraph Nos. 3.7, 5.1, 5.2 and 5.3 the Law Commission has taken the views in the following terms:- “3.7. A revision of the law, by invalidating even prescriptive contractual clauses, is not only required on the merits (for the reasons mentioned above), but will also make the law simplier. At present, in every case, a subtle distinction has to be applied as to whether a clause merely bars a remedy or extinguishes the right. The decision hangs on a fine distinction that is not easy of application, creating uncertainty in the minds of parties for a conflict of approach in actual cases in courts. For example, it has been held that a condition in a life insurance policy that no suit shall be brought on the policy after one year from the death of the insured is void. For example, it has been held that a condition in a life insurance policy that no suit shall be brought on the policy after one year from the death of the insured is void. But a condition in a fire insurance policy that the company shall not be liable for loss or damage after the expiry of twelve months from the happening of the loss or damage, unless the claim was the subject of a pending action of arbitration, does not contravene section 28. 5.1. We now come to the changes that are needed in the present law. In our opinion, the present legal position as to prescriptive clauses in contracts cannot be defended as a matter of justice, logic commonsense or convenience. When accepting such clauses, consumers either do not realize the possible adverse impact of such clauses, or are forced to agree because big corporations are not prepared to enter into contracts, except on these onerous terms. “Take it or leave it all”, is their general attitude, and because of their superior bargaining power, they naturally have the upper hand. We are not, at present, dealing with the much wider field of “standard from contracts” or “standard” terms. But confining ourselves to the narrow issue under discussion, it would appear that the present legal position is open to serious objection from the common man’s point of view. Further, such clauses introduce an element of uncertainty in transactions which are entered into daily by hundreds of persons. 5.2. It is hardly necessary to repeat all that we have said in the proceeding Chapters about the demerits of the present law. Briefly, one can say that the present law, which regards prescriptive clauses as valid while invalidating time limit clauses which merely bar the remedy, suffers from the following principal defects:- (a) It causes serious hardship to those who are economically disadvantaged and is violative of economic justice. (b) In particular, in harms the interest of the consumer, dealing with big corporations. (c) It is illogical, being based on a distinction which treats the more sever flaw as valid, while invalidating a lesser one. (d) It rests on a distinction too subtle and refined to admit of easy application in practice. It thus, throws a cloud on the rights of parties, who do not know with certainly where they stand, ultimately leading to avoidable litigation. 5.3. (d) It rests on a distinction too subtle and refined to admit of easy application in practice. It thus, throws a cloud on the rights of parties, who do not know with certainly where they stand, ultimately leading to avoidable litigation. 5.3. On a consideration of all aspects of the matter, we recommend that section 28 of the Indian Contract Act, 1872, should be suitably amended so as to render invalid contractual clauses which purport to extinguish, on the expiry of a specified terms, rights accruing from the contract. Here is a suggestion for re-drafting the main paragraph of section 28. Revised Section 28, main paragraph, contract act as recommended. 28. 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 (b) Which limits the time within which he may thus enforce his rights, or (c ) which extinguishes the right of any party thereto under or in respect of any contract on the expiry of a specified period or on failure to make a claim or to institute a suit or other legal proceeding within a specified period , or (d) which discharges any party thereto from any liability under or in respect of any contract in the circumstances specified in clause (c), is void to that extent.” 33. The Parliament of India on the basis of the recommendation of the Law Commission of India has amended the provisions of Section 28 of the Contract Act and declared that any condition reducing the period with respect to extinguishment of right or discharging the party from liability apart from the common law has been declared void to that extent. 34. It will be relevant to quote the amended provisions of Section 28 of the Contract Act. “28. Agreements in restraint of legal proceedings, void:- (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 he may thus enforce his rights? “28. Agreements in restraint of legal proceedings, void:- (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 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.” 35. All the judgments, as stated hereinabove, were decided by the Hon?ble Supreme Court and the different High Courts prior to the amendment in Section 28 of the Contract Act, but after the amendment the matter again came for considerations before the different High Courts. 36. In Delhi High Court the issue came for consideration in the case of D. Pal & Co. vs. M.C.D., I.L.R. (2007) Supp (6) Delhi 75. In that case, amended provisions of Section 28 of the Contract Act came for consideration and Delhi High Court has held that there is an agreement between the parties to the effect that if the Contractor does not make any demand for appointment of arbitrator in respect of any claim, in writing, as aforesaid, within 90 days of receiving the initiation that final bill is ready for payment, the claim of the contractor shall be deemed to be waived and absolutely barred, ignoring such clause in view of Section 28 of the Arbitration Act appointed the arbitrator and referred the matter for consideration. 37. The Delhi High Court further held that Section 28(b) of the Contract Act declared that every agreement which discharges a party from any liability or extinguishes right of any party by prescribing in a contract a specific restrictive period for enforcing the right shall be void. In view of Section 28(a) of the Contract Act by an agreement, parties cannot prescribe a shorter period of limitation than the one prescribed by the law to seek remedy in the Court of Law. Period of limitation prescribed by the statute cannot be reduced and restricted by an agreement. In view of Section 28(a) of the Contract Act by an agreement, parties cannot prescribe a shorter period of limitation than the one prescribed by the law to seek remedy in the Court of Law. Period of limitation prescribed by the statute cannot be reduced and restricted by an agreement. Similarly, in view of section 28(b) of the Contract Act, identical ratio will equally apply and there cannot be an agreement providing for release or forfeiture of right prescribing the shorter period than the period prescribed under the Limitation Act or under any Statute. 38. It will be relevant to quote paragraph No.11 and 12 of the said judgment, which read as under:- “11. The aforesaid observations of the Supreme Court in National Insurance and Company Ltd. (Supra) have now to be read and understood in light of Section 28(b) of the Contract Act. Section 28(b) of the Contract Act declares that every agreement which discharges a party from any liability or extinguishes right of any party by prescribing in a contract a specified restrictive period for enforcing rights shall be void. Thus in view of Section 28(a) of the Contract Act 1872, by an agreement, parties cannot prescribe a shorter period of limitation than the one prescribed by law. Period of limitation prescribed by the statute cannot be reduced and restricted by an agreement. Similarly, in view of Section 28(b) of the Contract Act, 1872, the said ration will equally apply where an agreement provides for release or forfeiture of rights by prescribing a shorter period than the period prescribed under the Limitation Act, 1963 or under any statute. By a contract, the statutory period for making a claim cannot now be reduced by prescribing forfeiture or discharge, if a claim is not made within a specified time. By the aforesaid amendment, prescriptive clauses which extinguish or provide for forfeiture of rights or discharge of liability for failure by a party to sue within a prescribed time, have been held to be void. The aforesaid amendment has been considered by this court in Expore Computers Pvt. Ltd. Vs. Cals Ltd. and Anr. MANU/DE/2914/2006:131 (2006) DLT 477, M/s Naresh Kumar Gupta Vs.The Vice Chairman/Engineer Member D.D.A and Ors. 2000 II AD (Del) 628 and J.K. Anand vs. Delhi Development Authority and Anr. MANU/DE/0555/2001 : 2001 (2) Arb. LR 663 (Delhi) and has been interpreted in the manner stated above. 12. Cals Ltd. and Anr. MANU/DE/2914/2006:131 (2006) DLT 477, M/s Naresh Kumar Gupta Vs.The Vice Chairman/Engineer Member D.D.A and Ors. 2000 II AD (Del) 628 and J.K. Anand vs. Delhi Development Authority and Anr. MANU/DE/0555/2001 : 2001 (2) Arb. LR 663 (Delhi) and has been interpreted in the manner stated above. 12. In the case of Expllore Computers Pvt. Ltd. (Supra), it has been held that:- “On a conspectus of the aforesaid judgments, two aspects have to be noted. The first is that it is the terms of the bank guarantee which have to be given due weight and the second is the distinction which is sought to be carved out in National Insurance Company case (supra) between a clause curtailing the period of limitation being void under Section 28 of the Contract Act and a clause which provides for a forfeiture or waiver of a right if no action is commenced within the period stipulated by the agreement. Insofar as the second aspect is concerned, it cannot be lost sight of that the judgment in National Insurance Company case (supra) was delivered on 23.3.1997 and thus related to the provisions of Section 28 as it stood prior to the amendment because that was the substantive law in force at the time when the cause of action had arisen. The amendment to Section 28 was made with effect from 8.1.1997 and it is not disputed that the cause of action in respect of the subject matter in the present suit arose after the amendment. Sub-clause (b) of the amended Section 28 deals with the clauses which extinguish the rights of any party thereto or discharge any party from any liability begin void under the said Section. Thus the scope of Section 28 has been widened whereby Clause (a) deals with the position prior to the amendment alone and Clause (b) is in addition.” 39. Again the matter came for consideration in the case of JSW Steel Ltd. vs. AI Ghurir Iron and Steel LLC, reported in 2015(2) Arb. Thus the scope of Section 28 has been widened whereby Clause (a) deals with the position prior to the amendment alone and Clause (b) is in addition.” 39. Again the matter came for consideration in the case of JSW Steel Ltd. vs. AI Ghurir Iron and Steel LLC, reported in 2015(2) Arb. L.R. 373 (Bombay) and the same issue has been dealt with in paragraph No.17 and 25 of the said judgment, there also the Court has taken into consideration the effect of the amendment in section 28 of the Contract Act and the Court has in paragraph No.25 has declared that the contract to extent limiting shorter period with respect to discharge from liability and extinguishment of right will be void in view of section 28 and the award was held to be valid. 40. It will be relevant to quote paragraph Nos. 18, 19, 20, 24 and 25 of the said judgment, which read as under:- “18. The learned arbitrators have considered the parameters of Section 28. A reading of the section becomes material as the learned arbitrators must be seen to have passed an award in accordance with law. Section 28, as it initially stood, consisted of only the first part of the aforesaid section which is now shown to be Section 28(a). That part dealt with contracts which restricted absolutely a party enforcing any right in any legal proceeding or which limited the time to enforce such right. The first part of the section dealt with such contracts which did not allow one party to at all sue. If the restriction was absolute the contract would be void. Certain contracts only conferred a time less than time which would otherwise be available under the Limitation Act, 1963 to a party to sue. Such contracts which limited the time to enforce the rights were also void to the extent of such limitation. If the contract, therefore, provided that no claim could be made (in a court of law or in any alternate forum such an arbitration) after 30 days from a given date when the law of limitation would allow 3 years within which a party can sue, the contract would be void to the extent of the provision of the period of 30 days. The remainder of the contract would, of course, be effectuated. 19. The remainder of the contract would, of course, be effectuated. 19. The legislature amended the section by the addition of clause (b) to Section 28. This amendment was made for specific reasons. The reasons have been set out in the Statement of objects and Reasons (SOR) of the gazetted amendment. The SOR has been shown to court by Mr. Seervai upon the argument of law requiring the court to consider whether clause such as Clause 4.2(b) could be considered void under Section 28(b). It would be material to see the SOR to understand the legal position which prevailed by the judge made law prior to the amendment and for which the legislature considered it necessary to amend the law. The SOR runs thus:- “Statement of Objects and Reasons- (1) The Law Commission of India has recommended in its 97th Report that Section 28 of the Indian Contract Act, 1872 may be amended so that the anomalous situation created by the existing section may be rectified. It has been held by the courts that the said Section 28 shall invalidate only a clause in any agreement which restricts any party thereto from enforcing his rights absolutely or which limits the time within which he may enforce his rights. The courts have, however, held that this section shall not come into operation when the contractual term spells out an extinction of the right of a party to sue or spells out the discharge of a party from all liability in respect of the claim. What is thus hit by Section 28 is an agreement relinquishing the remedy only, i.e. where the time limit specified in the agreement is shorter than the period of limitation provided by law. A distinction is assumed to exist between remedy and right and this distinction is the basis of the present position under which a clause barring a remedy is void, but a clause extinguishing the rights is valid. This approach may be sound in theory but, in practice it causes serious hardship and might even be abused. (2) It is felt that Section 28 of the Indian Contract Act, 1872 should be amended as it harms the interests of the consumer dealing with big corporations and causes serious hardship to those who are economically disadvantaged. (3) The Bill seeks to achieve the above objects.” 20. (2) It is felt that Section 28 of the Indian Contract Act, 1872 should be amended as it harms the interests of the consumer dealing with big corporations and causes serious hardship to those who are economically disadvantaged. (3) The Bill seeks to achieve the above objects.” 20. This would show that there was an anomalous situation created upon the interpretation of Section 28 as it then prevailed. That was under Section 28(a) cited above. The SOR states that it has been held by the courts that the unamended Section 28 would invalidate only a clause which would restrict the party from absolutely enforcing its rights or from limiting the time to sue. The SOR further states that the courts have held that this section would not come into operation when any contractual term sets out the extinction of the right to sue or discharges a party from the liability when sued. The legislature considered that, therefore, even when a remedy was relinquished, the agreement would be hit by Section 28. This would be on the basis of reasonableness of agreements. However, the legislature thought that though this would be sound in theory, it caused serious hardship to parties and could be abused specially if they were consumers dealing with large corporations. The legislature, therefore, did the act of power balancing. The law came to be amended. The amended law, therefore, caused all contracts where the remedy was relinquished as also where the right to sue was extinguished or a discharge was claimed. All the aforesaid 3 types of agreements would be void and, therefore, unenforceable under the amended law. Mr. Seervai would argue that the learned arbitrators held that consequently Clause 4.2(b) is void as falling within the mischief of Section 28(b) of the Contract Act. 24. In fact, it may be seen that the right of examination of the goods and the consequent right of rejection of the goods which are two statutory rights of the respondent as they buyer would be defeated because the respondent would not have reasonable opportunity of examining the goods and a reasonable time to reject the goods outside the period of 30 days specified in Clause 4.2(b) of the contract. Such an agreement would be void under Section 23 of the Contract Act because if permitted it would defeat the provisions contained in Section 41 and 42 of the Sale of Goods Act. 25. It is, therefore, clear that such a contract would be void under Section 28. The arbitrators have so held. The award is, therefore, in accordance with law as seen from the statute.” 41. The Delhi High court in the case of Chander Kant and Co. vs. The Vice Chairman, D.D.A. and Ors. MANU/DE/2221/2009, considered the effect of amendment in Section 28 of the Contract Act. In the aforesaid case, there was a provision stipulating 90 days for raising the claim, otherwise, it will be deemed to have been waived and absolutely barred and the authority shall be treated to have been discharged from all the liabilities under the Contract in respect of all claims. The Court has held that the effect of amendment in Section 28 of the Contract Act will be that any clause extinguishing the right of any party thereto, or discharge of any party from any liability under or in respect of any contract on the expiry of a specified period less than the period prescribed in the limitation Act so as to restrict the time period is void. 42. It will be relevant to quote paragraph No.8 and 9 of the said judgment, which reads as under:- “8. The 1997 Amendment to the Section now also prohibits clauses which seek to extinguish the rights of any party thereto, or discharge any party 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. The amendment gave effect to the 97th report of the Law Commission of India. The effect of the amended Section 28 was considered by the learned single judges of this Court in Hindustan Construction Company Vs. DDA; Kalyan Chand Goyal Vs. Delhi Development Authority (supra); J.K. Anand Vs. DDA & Anr.; MANU/DE/0555/2001: 2001(59) DRJ 380 and Union of India Vs. Simplex Concrete Piles India (P) Ltd.;MANU/DE/1119/2003; 2003 (3) Arb. LR 536 (Delhi) in which similar causes were held to be not valid in view of the amended provisions of Section 28 (b) of the Contract Act. In Explore Computers Pvt. Ltd. Vs. Cals Ltd. & Anr. DDA & Anr.; MANU/DE/0555/2001: 2001(59) DRJ 380 and Union of India Vs. Simplex Concrete Piles India (P) Ltd.;MANU/DE/1119/2003; 2003 (3) Arb. LR 536 (Delhi) in which similar causes were held to be not valid in view of the amended provisions of Section 28 (b) of the Contract Act. In Explore Computers Pvt. Ltd. Vs. Cals Ltd. & Anr. (supra), Sanjay Kishan Kaul, J considered the decision of Supreme Court in National Insurance Co. Ltd. Vs. Sujir Ganesh Nayak & Co. (supra) and other decisions and held as follows :- "48. The effect of the amendment of Section 28 thus made it clear that any clause extinguishing the right of a party or discharging any party from the liability in respect of any contract on expiry of specific period so as to restrict the time period would be void. 53. On a conspectus of the aforesaid judgments, two aspects have to be noted. The first is that it is the terms of the bank guarantee which have to be given due weight and the second is the distinction which is sought to be carved out in National Insurance Company Ltd. Case between a clause curtailing the period of limitation being void under Section 28 of the Contract Act and a clause which provides for forfeiture or waiver of a right if no action is commenced within the period stipulated by the agreement. Insofar as the second aspect is concerned, it cannot be lost sight of that the judgment in National Insurance Company Ltd. Case was delivered on 23.3.1997 and thus related to the provisions of Section 28 as it stood prior to the amendment because that was the substantive law in force at the time when the cause of action had arisen. The amendment to Section 28 was made with effect from 8.1.1997 and it is not disputed that the cause of action in respect of the subject matter in the present suit arose after the amendment. Sub-clause (b) of the amended Section 28 deals with the clauses which extinguish the rights of any party thereto or discharge any party from any liability being void under the said section. Thus, the scope of Section 28 has been widened whereby clause (a) deals with the position prior to the amendment alone and clause (b) is in addition. 54. Sub-clause (b) of the amended Section 28 deals with the clauses which extinguish the rights of any party thereto or discharge any party from any liability being void under the said section. Thus, the scope of Section 28 has been widened whereby clause (a) deals with the position prior to the amendment alone and clause (b) is in addition. 54. In view of the amended section coming into force, the distinction sought to be carved out earlier by the legal pronouncements would not hold good. 55. In my considered view it is not open for defendant no.2 to contend that if any suit or claim is not filed within one month of the expiry of the bank guarantee, the right of the plaintiff to institute any legal proceedings itself is extinguished. Such a plea would fly in the face of the amended Section 28 as defendant no.2 cannot be discharged from the liability nor can the rights of the plaintiff be extinguished by inclusion of the clause providing so. I am thus of the considered view that to the extent there is restriction on any suit or claim being filed by the plaintiff beyond a period of one month from the expiry of the bank guarantee, the said clause would not prohibit the plaintiff from instituting the suit as it would be barred by the provisions of the amended Section 28 of the Contract Act." 9. We are in respectful agreement with the view taken by the learned Judge. In our opinion, in view of the amendment, the distinction which was drawn earlier has been obliterated and the clauses providing for extinction or discharge of the rights of the parties on the expiry of the specified period are also covered by inserting Clause (b) in Section 28 of the Contract Act.” 43. In the Madras High Court again identical issue came for consideration in the case of the Oriental Insurance Company Limited vs. Karur Vysya Bank Limited, reported in AIR 2001 Mad.489. In the Madras High Court again identical issue came for consideration in the case of the Oriental Insurance Company Limited vs. Karur Vysya Bank Limited, reported in AIR 2001 Mad.489. In the aforesaid case, the Court has considered the effect of amendment in Section 28 of the Contract act and held that “however, the law as it now stands after this amendment not only the curtailment of limitation period is impermissible, but also the extinction of right, if sought to be brought by the agreement within a specified period, which period is less than the period of limitation prescribed for the suit under the contract in question is also rendered void”. 44. In the Karnataka High Court same issue came for consideration in the case of Central Ware Housing Corporation vs. Ravi Constructions, (AIR 2013 Kant 18), there the question was raised with respect to referring the matter to the arbitrator. In the aforesaid case, there was a clause which stipulates that if the respondent-company does not invoke arbitration clause within 90 days from the date of stipulated therein, claim was deemed to have been waived and barred as per Clause-25 of the Contract. The High Court has also considered the effect of amendment and held that the agreement which restricts the period of limitation within which claims could be referred, as also agreements which extinguish the right of a party to prefer a claim or discharges any party from any liability under a contract on expiry of a specified period, are void to the aforesaid extent. Lastly, it has been held that in view of the amendment to Section 28 of the Contract Act Clause 25 of the Contract which seeks to extinguish the right to claim on expiry of the specified period, less then the period provided under the Common Law, offends Section 28(b) of the Contract Act and hence the same is void. 45. It will be relevant to quote paragraph Nos.5 and 6 of the said judgment, which read as under:- “5. 45. It will be relevant to quote paragraph Nos.5 and 6 of the said judgment, which read as under:- “5. Before the amendment of Section 28 in 1997, the agreements reducing the period of limitation were distinguished from those which did not limit the time within which a party might enforce his rights, but which provided for a release or forfeiture of rights, if no suit was brought within the period stipulated in the agreement; and the latter class of agreements, being outside the scope of the section, were held to be binding between the parties. Thus, in National Insurance Co. Ltd. v. Sujir Ganesh Nayak & Co. (MANU/SC/0491/1997 : AIR 1997 SC 2049 ), the Supreme Court drew a clear distinction between an agreement which curtails the period of limitation and an agreement which provides for forfeiture or waiver of the right itself, if no action is commenced within the period stipulated by the agreement. The first was held to be void as offending Section 28 but the later was held not falling within the mischief of Section 28. It was, thus, held that curtailment of the period of limitation was not permissible in view of Section 28 but extinction of the right itself, unless exercised within the specified time, was permissible and can be enforced. 6. After the 1997 amendment to Section 28 of the Indian Contract Act, 1872, not only the curtailment of the period of limitation is void, but also the extinction of right, if sought to be brought by the agreement within a specific period, which period is less than the period of limitation prescribed for the suit under the Contract in question, is also rendered void. In other words, after the amendment to Section 28 of the Indian Contract Act, 1872 by Act 1 of 1997, the distinction between curtailing of the period of limitation and extinction of the right itself, after the specified period, no longer exists.” 46. In view of the aforesaid provisions, the amendment made in Section 28 of the Contract Act specifically states that the period other than the prescribed in the Limitation Act or any other Statutory provisions, within which the claim has to be made, otherwise it will be treated to have been extinguished, waived and partly relieved from all liabilities, has been declared to be void in view of Section 28 (i)(b) the Contract Act. 47. 47. In the present case, an agreement has been reached between the parties, which stipulates that if the contractor does not make any demand for appointment of arbitrator in respect of any claim in writing, as aforesaid, within 45 days from receiving the intimation from the employer or his authorized representative that final bill is ready for payment, the claim of the contractor shall be deemed to have been waived and absolutely barred and the employer shall be discharged or released from all the liabilities under the Contract in respect of his claims, is declared to be void on account of the amendment in Section 28(i)(b) of the Contract Act and it should be ignored to be a part of the agreement as the period which has been provided has been reduced than the period stipulated in the Limitation Act. In such circumstances, ignoring this provision, this Court holds that parties who have a dispute have a right to get adjudication of the said dispute through an arbitrator. In the present case the Chankya National Law University did not respond by appointing the arbitrator. Hence, this Court in exercise of power under Section 11(6) of this Arbitration Act has power and jurisdiction for appointment of Arbitrator to adjudicate the dispute involved in the present case. 48. The second point has been raised by the respondents that as the final payment has been received by the petitioner company without demur will be treated that all the liabilities have been discharged and no contract between the parties subsists and it is no longer remain an arbitral issue and does not require to appoint an arbitrator for adjudication of the dispute. 49. It will be proper to examine the facts at hand, under what limit this Court will have to exercise its own jurisdiction to entertain the request for appointment of arbitrator vis-à-vis the objection raised by the respondents taking a plea that in view of acceptance of final bill, it is no longer an arbitral dispute for reference. 50. This aspect has been dealt with by the Constitution Bench of the Hon?ble Supreme Court in the case of S.B.P. & Co. vs. Patel Engineering Ltd. and Another, reported in (2005) 8 S.C.C. page 618, there the Hon?ble Supreme Court has considered the circumstances where the Court has to form an opinion before passing the order in reference considering the situation. vs. Patel Engineering Ltd. and Another, reported in (2005) 8 S.C.C. page 618, there the Hon?ble Supreme Court has considered the circumstances where the Court has to form an opinion before passing the order in reference considering the situation. There have been some cases where the appointment of an arbitrator has been sought, after the parties had settled the dispute and the party concerned had certified that he had no further claims against the other contracting party. In other words, there have been occasions when dead claims are sought to be resurrected and there have been cases where assertions are made of the existence of arbitration agreements when, in fact, such existence is strongly disputed by the other side, who appears on issuance of notice. The controversies are also raised as to whether the claim that is sought to be put forward comes within the purview of the arbitration clause. The Chief Justice or his designate has necessarily to apply his mind to these aspects before coming to conclusion, one way or the other and before proceeding to appoint an arbitrator or declining to appoint an arbitrator. The Court has also directed that the Chief Justice or his designate has to examine as to whether there is an arbitration agreement, as defined in the Act and whether the person who has made the request before him, is a party to such an agreement. It is further held that it is necessary to indicate that he can also decide the question whether the claim was a dead one; or a long-barred claim that was sought to be resurrected and whether the parties have concluded the transaction by recording satisfaction of their mutual rights and obligations or by receiving the final payment without objection. It may not be possible at that stage, to decide whether a live claim made, is one which comes within the purview of the arbitration clause. It will be proper to leave that question to be decided by Arbitral Tribunal on taking evidence, along with the merits of the claims involved in the arbitration. 51. It will be relevant to quote paragraph Nos. 36, 37, 39, 47 of the Patel Engineering Case (supra):- “36. It will be proper to leave that question to be decided by Arbitral Tribunal on taking evidence, along with the merits of the claims involved in the arbitration. 51. It will be relevant to quote paragraph Nos. 36, 37, 39, 47 of the Patel Engineering Case (supra):- “36. Going by the above test it is seen that at least in the matter of deciding his own jurisdiction and in the matter of deciding on the existence of an arbitration agreement, the Chief Justice when confronted with two points of view presented by the rival parties, is called upon to decide between them and the decision vitally affects the rights of the parties in that, either the claim for appointing an Arbitral Tribunal leading to an award is denied to a party or the claim to have an arbitration proceeding set in motion for entertaining a claim is facilitated by the Chief Justice. In this context, it is not possible to say that the Chief Justice is merely exercising an administrative function when called upon to appoint an arbitrator and that he need not even issue notice to opposite side before appointing an arbitrator. 37. …There have been cases where the appointment of an arbitrator has been sought, after the parties had settled the accounts and the concerned party had certified that he had no further claims against the other contracting party. In other words, there have been occasions when dead claims are sought to be resurrected. There have been cases where assertions are made of the existence of arbitration agreements when, in fact, such existence is strongly disputed by the other side who appears on issuance of notice. Controversies are also raised as to whether the claim that is sought to be put forward comes within the purview of the concerned arbitration clause at all. The Chief Justice has necessarily to apply his mind to these aspects before coming to a conclusion one way or the other and before proceeding to appoint an arbitrator or declining to appoint an arbitrator. Obviously, this is an adjudicatory process. An opportunity of hearing to both parties is a must…. 39. It is necessary to define what exactly the Chief Justice, approached with an application under Section 11 of the Act, is to decide at that stage. Obviously, this is an adjudicatory process. An opportunity of hearing to both parties is a must…. 39. It is necessary to define what exactly the Chief Justice, approached with an application under Section 11 of the Act, is to decide at that stage. Obviously, he has to decide his own jurisdiction in the sense whether the party making the motion has approached the right High Court. He has to decide whether there is an arbitration agreement, as defined in the Act and whether the person who has made the request before him, is a party to such an agreement. It is necessary to indicate that he can also decide the question whether the claim was a dead one; or a long-barred claim that was sought to be resurrected and whether the parties have concluded the transaction by recording satisfaction of their mutual rights and obligations or by receiving the final payment without objection. It may not be possible at that stage, to decide whether a live claim made, is one which comes within the purview of the arbitration clause. It will be appropriate to leave that question to be decided by the arbitral tribunal on taking evidence, along with the merits of the claims involved in the arbitration. The Chief Justice has to decide whether the applicant has satisfied the conditions for appointing an arbitrator under Section 11(6) of the Act. For the purpose of taking a decision on these aspects, the Chief Justice can either proceed on the basis of affidavits and the documents produced or take such evidence or get such evidence recorded, as may be necessary. We think that adoption of this procedure in the context of the Act would best serve the purpose sought to be achieved by the Act of expediting the process of arbitration, without too many approaches to the court at various stages of the proceedings before the Arbitral Tribunal. 47….(iv)The Chief Justice or the designated judge will have the right to decide the preliminary aspects as indicated in the earlier part of this judgment. These will be his own jurisdiction to entertain the request, the existence of a valid arbitration agreement, the existence or otherwise of a live claim, the existence of the condition for the exercise of his power and on the qualifications of the arbitrator or arbitrators. These will be his own jurisdiction to entertain the request, the existence of a valid arbitration agreement, the existence or otherwise of a live claim, the existence of the condition for the exercise of his power and on the qualifications of the arbitrator or arbitrators. The Chief Justice or the judge designated would be entitled to seek the opinion of an institution in the matter of nominating an arbitrator qualified in terms of Section 11(8) of the Act if the need arises but the order appointing the arbitrator could only be that of the Chief Justice or the designated judge…” 52. In the case of Ambica Construction vs. Union of India, reported in (2006) 13, S.C.C., page- 475, there the dispute was that the Railway has issued a tender for new works, additions, alterations, repair and maintenance. The appellant-Company submitted its tender, which was accepted and work Orders were issued accordingly and Contract was executed between the parties. As the appellant- Company could not complete the work within the time framed, made a prayer for extension of time, but his request was turned down and certain deductions were made from the running bill submitted by the appellant-Company. As per the claim of appellant-Company, the Railway administration refused to refund even the security deposit unless the appellant submitted a no-claim certificate in terms of Clause 43(2) of the General Conditions of Contract. The appellant-company called upon to appoint an arbitrator. In view of failure to give proper response filed an application under Section 11 of the Arbitration Act before the High Court of Calcutta. Accordingly, the arbitrator was appointed, who passed an award with cost to the appellant. Feeling aggrieved, challenged the award before the learned Single Bench of the Calcutta High Court. The High Court set aside the award and appointed a new arbitrator. Plea was taken that in view of the submissions of no claim certificate in terms of Clause 43(2) of the General Conditions of Contract the dispute have been settled and it is no longer an arbitral issue. The appellant-Company pleaded that that the Railway administration has obtained no objection certificate under coercion and duress. The Hon?ble Supreme Court has taken into consideration the age-old maxim necessitas non habet legem which means, necessity knows no law. The appellant-Company pleaded that that the Railway administration has obtained no objection certificate under coercion and duress. The Hon?ble Supreme Court has taken into consideration the age-old maxim necessitas non habet legem which means, necessity knows no law. In paragraph No.18 of the said judgment, the Hon?ble Supreme Court has held that it is apparent that unless a discharge certificate is given in advance, payment of bills are generally delayed. Although, Clause 43(2) has been included in the General Conditions of Contract, the same is meant to be a safeguard as against frivolous claims after final measurement. Having regard to the decision in Reshmi Constructions 2004(2) S.C.C.663, it can no longer be said that such a clause in the contract would be an absolute bar to a contractor raising claims which are genuine, even after the submission of such no-claim certificate. 53. It will be relevant to quote paragraph Nos. 13, 14 and 18 of the said judgment, which read as under:- “13. Mr.Mehta also urged that wrong reliance had been placed by the Division Bench on the decision of this Court in the case of P.K. Ramaiah and Co. vs. Chairman & MD, National Thermal Power Corpn.. According to Mr. Mehta the Division Bench should have, on the other hand, taken into consideration the age old maxim Necessitas non habet legem which means that necessity knows no law. According to Mr. Mehta it was out of necessity, namely, to recover its security deposit, that a no-claim certificate had been submitted by the appellant and the same ought not to be held as a bar against the appellant for raising claims in respect of its lawful duties. 14. In support of the aforesaid submissions, Mr.Mehta referred to and relied upon the decision of this Court in Chairman and MD, NTPC Ltd. vs. Reshmi Constructions, wherein the aforesaid maxim had been explained and applied to a similar situation where a question had arisen for decision as to whether an arbitration clause in a contract agreement continues to survive despite the purported satisfaction thereof. This Court while adverting to various decisions on the subject, including the decision in P.K. Ramaiah's case (supra), came to the conclusion that notwithstanding the submission of a no-demand Certificate, the arbitration agreement continued to subsist because of the several reasons indicated in the judgment. Having regard to the views expressed in the aforesaid judgment, Mr. This Court while adverting to various decisions on the subject, including the decision in P.K. Ramaiah's case (supra), came to the conclusion that notwithstanding the submission of a no-demand Certificate, the arbitration agreement continued to subsist because of the several reasons indicated in the judgment. Having regard to the views expressed in the aforesaid judgment, Mr. Mehta submitted that the Division Bench of the Calcutta High Court had erred in relying solely on Clause 43(2) of the General Conditions of Contract and the no- Claim Certificate submitted by the appellant in arriving at a conclusion that no further dispute existed for determination in arbitration and the judgment and orders under appeal were liable to be set aside. 18. From the submissions made on behalf of the respective parties and in particular from the submissions made on behalf of the appellant, it is apparent that unless a discharge certificate is given in advance, payment of bills are generally delayed. Although, Clause 43(2) has been included in the General Conditions of Contract, the same is meant to be a safeguard as against frivolous claims after final measurement. Having regard to the decision in Reshmi Constructions, it can no longer be said that such a clause in the contract would be an absolute bar to a contractor raising claims which are genuine, even after the submission of such no-claim certificate.” 54. In the case of Indian Oil Corporation Limited vs. SPS Engineering Limited, reported in (2011) 3 S.C.C. page- 507, similar issue has been raised how far the Chief Justice or his designate however would chose to decide whether the claim is a dead claim or whether the parties have, by recording satisfaction, exhausted all rights, obligations and remedies under the contract, so that neither the contract nor the arbitration agreement survived. When it is said that the Chief Justice or his designate may choose to decide whether the claim is a dead claim, it is implied that he will do so only when the claim is evidently and patently a long time barred claim and there is no need for any detailed consideration of claims. When it is said that the Chief Justice or his designate may choose to decide whether the claim is a dead claim, it is implied that he will do so only when the claim is evidently and patently a long time barred claim and there is no need for any detailed consideration of claims. Illustration was given that if a contractor makes a claim a decade or so after completion of the work without referring to any acknowledgement of a liability or other factors that kept the claim alive in law, and the claim is patently long time barred, the Chief Justice or his designate will decide the issue whether it is a dead claim or still is a alive claim, but if the claim has been made beyond three years of completion of work, but say within five years i.e. from the date of completion of work, bill was drawn up and payments were made within three years before the claim, the Court will not enter into a disputed question, the Court will leave the matter to the decision of the tribunal. There is distinction between apparent and obvious dead claims, and claims involving disputed issues of limitation is not kept in view, the Chief Justice or his designate will end up deciding the question of limitation in all applications under Section 11 of the act. 55. It will be relevant to quote paragraph Nos. 15 and 16 of the said judgment, which reads as under:- “15. An application under Section 11 of the Act is expected to contain pleadings about the existence of a dispute and the existence of an arbitration agreement to decide such dispute. The applicant is not expected to justify the claim or plead exhaustively in regard to limitation or produce documents to demonstrate that the claim is within time in proceedings under Section 11 of the Act. That issue should normally be left to the Arbitral Tribunal. If the Chief Justice or his designate is of the view that in addition to examining whether there is an arbitration agreement between the parties, he should consider the issue whether the claim is a dead one (long time barred) or whether there has been satisfaction of mutual rights and obligation under the contract, he should record his intention to do so and give an opportunity to the parties to place their materials on such issue. Unless parties are put on notice that such an issue will be examined, they will be under the impression that only questions of jurisdiction and existence of arbitration agreement between the parties will be considered in such proceedings. 16. The question whether a claim is barred by Respondent judicata, does not arise for consideration in a proceedings under Section 11 of the Act. Such an issue will have to be examined by the arbitral tribunal. A decision on res judicata requires consideration of the pleadings as also the claims/issues/points and the award in the first round of arbitration, in juxtaposition with the pleadings and the issues/points/claims in the second arbitration. The limited scope of Section 11 of the Act does not permit such examination of the maintainability or tenability of a claim either on facts or in law. It is for the arbitral tribunal to examine and decide whether the claim was barred by res judicata. There can be no threshold consideration and rejection of a claim on the ground of res judicata, while considering an application under Section 11 of the Act.” 56. Similar issue came for consideration in the case of Chairman and M.D., N.T.P.C. Ltd. vs. Reshmi Constructions, Builders and contractors, reported in (2004) 2 S.C.C. 663 . In that case, the respondent-Reshmi Constructions has entered into an agreement with the N.T.P.C. for a project at Kayamkulam. After completion of the work, the respondent-Reshmi Constructions submitted the final bill, which was allegedly not accepted by the N.T.P.C., whereafter they themselves prepared the final bill and forwarded the same along with a printed format of “No-Demand Certificate”. The said No-Demand Certificate was signed by the respondent-Reshmi Constructions. However, on the same date the respondent-Reshmi Construction raised objection, mentioning therein that the alleged final bill was signed under coercion, under undue influence and under protest only without prejudice to rights and claims whatsoever. There was no accord and satisfaction between the contracting parties. Respondent-Reshmi Construcitons invoked the arbitration Clause for reference, which was resisted on the ground that total amount of payment has been made and the final bill has been settled without protest and “No Dues Certificate in the standard Performa has been submitted by the Contractor. The respondent- Reshmi Constructions filed an application under Section 20 of the Arbitration Act before the Subordinate Court, which was dismissed. The respondent- Reshmi Constructions filed an application under Section 20 of the Arbitration Act before the Subordinate Court, which was dismissed. The same was challenged before the Kerala High Court, which was allowed. The matter went to the Hon?ble Supreme Court where plea was taken that the application under Section 20 of the Arbitration Act was not sustainable to be taken into consideration as the respondent-Reshmi Constructions did not raise the plea that they have submitted the “No Demand Certificate” under coercion and the High Court committed an error in passing the impugned order. In paragraph no. 13, the Hon?ble Supreme Court has framed following questions, which are as follows:- “(i) Whether after the contract comes to an end by completion of the contract work and acceptance of the final bill in full and final satisfaction and after issuing a No- Demand Certificate by the contractor, can any party to the contract raise any dispute for reference to arbitration? (ii) Whether in view of letter dated 20-12-1990 sent by the respondent contractor the arbitration clause contained in the agreement can be invoked? (iii) Whether the arbitration clause in the agreement has perished with the contract?” 57. Discussing the same the Hon?ble Supreme Court held that the issues required to be adjudicated by the Arbitrator, placing reliance on several judgments and applied the principle that on completion of the work, the right to get the payment normally arise and it is also true that on settlement of the final bill, the right to get further payment gets weakened, but claims subsists or does not subsist, it is an arbitral issue. 58. It will be relevant to quote paragraphs Nos. 17-22 and 39 of the said judgment which read as under:- 17. In Damodar Valley Corporation vs. K.K. Kar this Court held : ( SCC p. 144, para 6 ): "6. It appears to us that the question whether there has been a full and final settlement of a claim under the contract is itself a dispute arising 'upon' or 'in relation to' or 'in connection with' the contract. These words are wide enough to cover the dispute sought to be referred." 18. Normally, an accord and satisfaction by itself would not affect the arbitration clause but if the dispute is that the contract itself does not subsist, the question of invoking the arbitration clause may not arise. These words are wide enough to cover the dispute sought to be referred." 18. Normally, an accord and satisfaction by itself would not affect the arbitration clause but if the dispute is that the contract itself does not subsist, the question of invoking the arbitration clause may not arise. But in the event it be held that the contract survives, recourse to the arbitration clause may be taken. (See Union of India v. Kishorilal Gupta and Naihati Jute Mills Ltd. v. Khyaliram Jagannath.) 19. In Bharat Heavy Electricals Limited this Court observed that whether there was discharge of the contract by accord and satisfaction or not is a dispute arising out of a contract and is liable to be referred to arbitration. 20. Yet again in L.K. Ahuja Sabyasachi Mukharji, J., as the learned Chief Justice then was, laid down the ingredients of Section 20 of the Arbitration Act stating SCC p. 80, para 6) “6. It appears that these questions were discussed in the decision of the Calcutta High Court in Jiwnani Engineering Works Pvt. Ltd. v. Union of India where one of us (Sabyasachi Mukharji, J.) was a party and which held after discussing all these authorities that the question whether the claim sought to be raised was barred by limitation or not, was not relevant for an order under Section 20 of the Act. Therefore, there are to aspects. One is whether the claim made in the arbitration is barred by limitation under the relevant provisions of the Limitation Act and secondly, whether the claim made for application under Section 20 is barred. In order to be a valid claim for reference under Section 20 of the Arbitration Act, 1940, it is necessary that there should be an arbitration agreement and secondly differences must arise to which the agreement in question applied and, thirdly, that must be within time as stipulated in Section 20 of the Act.” 21. It was held that having regard to the fact that the existence of an arbitration agreement was not denied and there had been an assertion of claim and denial thereof, the matter would be arbitrable. It was observed: ( SCC p. 81, para 8 ) “In order to be entitled to ask for a reference under Section 20 of the Act, there must be an entitlement to money and a difference or dispute in respect of the same. It was observed: ( SCC p. 81, para 8 ) “In order to be entitled to ask for a reference under Section 20 of the Act, there must be an entitlement to money and a difference or dispute in respect of the same. It is true that on completion of the work, right to get payment would normally arise and it is also true that on settlement of the final bill, the right to get further payment gets weakened but the claim subsists and whether it does subsist, is a matter which is arbitrable.” (emphasis supplied) 22. This aspect of the matter has also been considered in Jayesh Engineering Works, wherein following L.K. Ahuja it was held: ( SCC p. 179, para 1) "Whether any amount is due to be paid and how far the claim made by the appellant is tenable are matters to be considered by the arbitrator. In fact, whether the contract has been fully worked out and whether the payments have been made in full and final settlement are questions to be considered by the arbitrator when there is a dispute regarding the same." 39. The fact situation in the present case, would lead to the conclusion that the arbitration agreement subsists because: (i) Disputes as regards final bill arose prior to its acceptance thereof in view the fact that the same was prepared by the respondent but was not agreed upon in its entirety by the appellant herein; (ii) The appellant has not pleaded that upon submission of the final bill by the respondent herein any negotiation or settlement took place as a result whereof the final bill, as prepared by the appellant, was accepted by the respondent unequivocally and without any reservation therefor; (iii) The respondent herein immediately after receiving the payment of the final bill, lodged its protest and reiterated its claims. (iv) Interpretation and/or application of clause 52 of the agreement would constitute a dispute which would fall for consideration of the arbitrator. (v) The effect of the correspondences between the parties would have to be determined by the arbitrator, particularly as regard the claim of the respondent that the final bill was accepted by it without prejudice. (vi) The appellant never made out a case that any novation of the contract agreement took place or that the contract agreement was substituted by a new agreement. (vi) The appellant never made out a case that any novation of the contract agreement took place or that the contract agreement was substituted by a new agreement. Only in the event, a case of creation of new agreement is made out the question of challenging the same by the respondent would have arisen. (vii) The conduct of the appellant would show that on receipt of the notice of the respondent through its advocate dated 21.12.1991 the same was not rejected outright but existence of disputes was accepted and the matter was sought to be referred to the arbitration. (viii) Only when the clarificatory letter was issued the plea of settlement of final bill was raised. (ix) The finding of the High Court that a prima facie in the sense that there are triable issues before the Arbitrator so as to invoke the provisions of Section 20 of the Arbitration Act, 1940 cannot be said to be perverse or unreasonable so as to warrant interference in exercise of extraordinary jurisdiction under Article 136 of the Constitution of India. (x) The jurisdiction of the arbitrator under the 1940 Act although emanates from the reference, it is trite, that in a given situation the arbitrator can determine all questions of law and fact including the construction of the contract agreement. (See Pure Helium India Pvt. Ltd. Vs. Oil and Natural Gas Commission). (xi) The cases cited by the learned counsel for the appellant (P.K. Ramaiah and Company and Nathani Steels) would show that the decisions therein were rendered having regard to the finding of fact that the contract agreement containing the arbitrator clause was substituted by another agreement. Such a question has to be considered and determined in each individual case having regard to the fact situation obtaining therein.” 59. In the case of National Insurance Company Ltd. vs. Boghara Polyfab Pvt. Ltd. reported in 2009(1) SCC 267 , the Hon?ble Supreme Court has delineated what dispute can be gone into and what dispute can be left for Arbitrator to decide. In this case the respondent-Boghara Polyfab Private Limited obtained a standard fire and special perils (with a floater) policy from the appellant- Insurance Company. The sum insured was rupees three crores, subsequently; it was increased to rupees six crores. The respondent-Company has requested the insurer to increase the sum insured by another rupees six crores for a period of two months. The sum insured was rupees three crores, subsequently; it was increased to rupees six crores. The respondent-Company has requested the insurer to increase the sum insured by another rupees six crores for a period of two months. Accordingly, the appellant-Insurance Company issued an additional endorsement increasing the sum insured amount. It was alleged by the respondent- Company that the additional endorsement cover issued by the appellant-Insurance Company was for a period of 69 days, whereas, the appellant-Insurance Company claimed that the period was for 60 days only. The respondent- Company suffered a loss on account of heavy rains and flooding, the surveyor assessed the amount of loss to the tune of Rs. 3,18,00000/- and odd. The respondent- Company informed the surveyor about the wrong assessment, the same was modified to Rs. 3,34,00000/- and odd, which was resisted by the respondent- Company and made an application that the appellant-Insurance Company forced the respondent-Company to accept a lower settlement. The appellant-Insurance Company again informed the respondent- Company that unless and until the Company issued an undated “discharge voucher-in- advance” in full and final settlement, no payment will be released towards the claim that in that behalf, the appellant company sent the format of the discharge voucher to be signed by the respondent, on account of non-release of the claim, it was a dire financial condition and it had no alternative, but to yield to the coercion and pressure applied by the appellant. Simultaneously, raised the objection and sought for appointment of arbitrator for adjudication of the issue, which was rejected. The matter came for consideration before the Bombay High Court for appointment of arbitrator. The matter was referred to the arbitrator, which was challenged before the Hon?ble Supreme Court. The Hon?ble Supreme Court has framed the following questions for considerations:- “In what circumstances, a court will refuse to refer a dispute relating to quantum to arbitration, when the contract specifically provides for reference of disputes and differences relating to the quantum to arbitrator? In particular, what is the position when a respondent in an application under Section 11 of the Act, resists reference to arbitration on the ground that the petitioner has issued a full and final settlement discharge voucher and the petitioner contends that he was constrained to issue it dues to coercion, undue influence and economic compulsion?” 60. In particular, what is the position when a respondent in an application under Section 11 of the Act, resists reference to arbitration on the ground that the petitioner has issued a full and final settlement discharge voucher and the petitioner contends that he was constrained to issue it dues to coercion, undue influence and economic compulsion?” 60. The Hon?ble Supreme Court has considered the decision passed in Patel Engineering Limited case (supra). In paragraph No. 22 the Hon?ble Supreme Court has categorized the issues which the Chief Justice or his designate is bound to decide and the issues which should be left out for the arbitral tribunal to decide. 61. It will be relevant to quote paragraph No. 22 of the said judgment, which reads as under:- “22. Where the intervention of the court is sought for appointment of an Arbitral Tribunal under section 11, the duty of the Chief Justice or his designate is defined in SBP & Co. This Court identified and segregated the preliminary issues that may arise for consideration in an application under section 11 of the Act into three categories, that is (i) issues which the Chief Justice or his Designate is bound to decide;(ii) issues which he can also decide, that is issues which he may choose to decide; and (iii) issues which should be left to the Arbitral Tribunal to decide. 22.1. The issues (first category) which Chief Justice/his designate will have to decide are: (a) Whether the party making the application has approached the appropriate High Court. (b) Whether there is an arbitration agreement and whether the party who has applied under Section 11 of the Act, is a party to such an agreement. 22.2. The issues (second category) which the Chief Justice/his designate may choose to decide (or leave them to the decision of the arbitral tribunal) are: (a) Whether the claim is a dead (long barred) claim or a live claim. (b) Whether the parties have concluded the contract/ transaction by recording satisfaction of their mutual rights and obligation or by receiving the final payment without objection. 22.3. The issues (third category) which the Chief Justice/his designate should leave exclusively to the arbitral tribunal are : (i) Whether a claim made falls within the arbitration clause (as for example, a matter which is reserved for final decision of a departmental authority and excepted or excluded from arbitration). 22.3. The issues (third category) which the Chief Justice/his designate should leave exclusively to the arbitral tribunal are : (i) Whether a claim made falls within the arbitration clause (as for example, a matter which is reserved for final decision of a departmental authority and excepted or excluded from arbitration). (ii) Merits or any claim involved in the arbitration.” 62. In the aforesaid judgment the Hon?ble Supreme Court also considered the effect of acceptance of final amount and effect of “No Dues Certificate. It will be relevant to quote paragraph Nos. 27, 28, 29, 34, 36, 38 and 52 of the said judgment:- “27. While discharge of contract by performance refers to fulfillment of the contract by performance of all the obligations in terms of the original contract, discharge by `accord and satisfaction' refers to the contract being discharged by reason of performance of certain substituted obligations. The agreement by which the original obligation is discharged is the accord, and the discharge of the substituted obligation is the satisfaction. A contract can be discharged by the same process which created it, that is, by mutual agreement. A contract may be discharged by the parties to the original contract either by entering into a new contract in substitution of the original contract; or by acceptance of performance of modified obligations in lieu of the obligations stipulated in the contract. 28. The classic definition of the term `accord and satisfaction' given by the Privy Council in Payana Reena Saminathan vs. Pana Lana Palaniappa (reiterated in Kishorilal Gupta) is as under: (I.A. PP. 145-46) "…The `receipt' given by the appellants and accepted by the respondent, and acted on by both parties proves conclusively that all the parties agreed to a settlement of all their existing disputes by the arrangement formulated in the `receipt'. It is a clear example of what used to be well known as common law pleading as `accord and satisfaction by a substituted agreement'. No matter what were the respective rights of the parties inter se they are abandoned in consideration of the acceptance by all of a new agreement. The consequence is that when such an accord and satisfaction takes place the prior rights of the parties are extinguished. No matter what were the respective rights of the parties inter se they are abandoned in consideration of the acceptance by all of a new agreement. The consequence is that when such an accord and satisfaction takes place the prior rights of the parties are extinguished. They have in fact been exchanged for the new rights; and the new agreement becomes a new departure, and the rights of all the parties are fully represented by it.” [Emphasis supplied]” 29. It is thus clear that the arbitration agreement contained in a contract cannot be invoked to seek reference of any dispute to arbitration, in the following circumstances, when the contract is discharged on account of performance, or accord and satisfaction, or mutual agreement, and the same is reduced to writing (and signed by both parties or by the party seeking arbitration) : (a) Where the obligations under a contract are fully performed and discharge of the contract by performance is acknowledged by a full and final discharge voucher/receipt. Nothing survives in regard to such discharged contract. (b) Where the parties to the contract, by mutual agreement, accept performance of altered, modified and substituted obligations and confirm in writing the discharge of contract by performance of the altered, modified or substituted obligations. (c) Where the parties to a contract, by mutual agreement, absolve each other from performance of their respective obligations (either on account of frustration or otherwise) and consequently cancel the agreement and confirm that there is no outstanding claims or disputes. 34. What requires to be noticed is that in Nav Bharat Builders and Nathani Steels, this Court on examination of facts, was satisfied that there were negotiations and voluntary settlement of all pending disputes, and the contract was discharged by accord and satisfaction. In P. K. Ramaiah, the Court was satisfied that there was a voluntary acceptance of the measurements and full and final payment of the amount found due, resulting in discharge of the contract, leaving no outstanding claim or pending dispute. In those circumstances, this Court held that after such voluntary accord and satisfaction or discharge of the contract, there could be no arbitrable disputes. 36. In those circumstances, this Court held that after such voluntary accord and satisfaction or discharge of the contract, there could be no arbitrable disputes. 36. In Damodar Valley Corporation, the question that arose for consideration of this Court was as follows: "…where one of the parties refers a dispute or disputes to arbitration and the other party takes a plea that there was a final settlement of all claims, is the Court, on an application under Sections 9(b) and 33 of the Act, entitled to enquire into the truth and validity of the averment as to whether there was or was not a final settlement on the ground that if that was proved it would bar a reference to the arbitration inasmuch as the arbitration clause itself would perish." In that case the question arose with reference to a claim by the supplier. The purchaser required the supplier to furnish a full and final receipt. But the supplier did not give such a receipt. Even though there was no discharge voucher, the purchaser contended that the payments made by it were in full and final settlement of the bills. This Court rejected that contention and held that the question whether there has been a settlement of all the claims arising in connection with the contract also postulates the existence of the contract which would mean that the arbitration clause operates. This Court held that the question whether there has been a full and final settlement of a claim under the contract is itself a dispute arising `upon' or `in relation to' or `in connection with' the contract; and where there is an arbitration clause in a contract, notwithstanding the plea that there was a full and final settlement between the parties, that dispute can be referred to arbitration. It was also observed that mere claim of accord and satisfaction may not put an end to the arbitration clause. It is significant that neither P.K. Ramaiah nor Nathani Steels disagreed with the decision in Damodar Valley Corporation but only distinguished it on the ground that there was no full and final discharge voucher showing accord and satisfaction in that case. 38. In Union of India vs. L.K. Ahuja & Co. this Court observed: ( SCC p.81, para 8) : "8. 38. In Union of India vs. L.K. Ahuja & Co. this Court observed: ( SCC p.81, para 8) : "8. …In order to be entitled to ask for a reference under section 20 of the Act, there must be an entitlement to money and a difference or dispute in respect of the same. It is true that on completion of the work, right to get payment would normally arise and it is also true that on settlement of the final bill, the right to get further payment gets weakened but the claim subsists and whether it does subsist, is a matter which is arbitrable." There was no full and final discharge or accord and satisfaction in that case. 52. Some illustrations (not exhaustive) as to when claims are arbitrable and when they are not, when discharge of contract by accord and satisfaction are disputed, to round up the discussion on this subject are : (i) A claim is referred to conciliation or a prelitigation Lok Adalat. The parties negotiate and arrive at a settlement. The terms of settlement are drawn up and signed by both the parties and attested by the Conciliator or the members of the Lok Adalat. After settlement by way of accord and satisfaction, there can be no reference to arbitration. (ii) A claimant makes several claims. The admitted or undisputed claims are paid. Thereafter negotiations are held for settlement of the disputed claims resulting in an agreement in writing settling all the pending claims and disputes. On such settlement, the amount agreed is paid and the contractor also issues a discharge voucher/no claim certificate/full and final receipt. After the contract is discharged by such accord and satisfaction, neither the contract nor any dispute survives for consideration. There cannot be any reference of any dispute to arbitration thereafter. (iii) A contractor executes the work and claims payment of say Rupees Ten Lakhs as due in terms of the contract. The employer admits the claim only for Rupees six lakhs and informs the contractor either in writing or orally that unless the contractor gives a discharge voucher in the prescribed format acknowledging receipt of Rupees Six Lakhs in full and final satisfaction of the contract, payment of the admitted amount will not be released. The employer admits the claim only for Rupees six lakhs and informs the contractor either in writing or orally that unless the contractor gives a discharge voucher in the prescribed format acknowledging receipt of Rupees Six Lakhs in full and final satisfaction of the contract, payment of the admitted amount will not be released. The contractor who is hard pressed for funds and keen to get the admitted amount released, signs on the dotted line either in a printed form or otherwise, stating that the amount is received in full and final settlement. In such a case, the discharge is under economic duress on account of coercion employed by the employer. Obviously, the discharge voucher cannot be considered to be voluntary or as having resulted in discharge of the contract by accord and satisfaction. It will not be a bar to arbitration. (iv) An insured makes a claim for loss suffered. The claim is neither admitted nor rejected. But the insured is informed during discussions that unless the claimant gives a full and final voucher for a specified amount (far lesser than the amount claimed by the insured), the entire claim will be rejected. Being in financial difficulties, the claimant agrees to the demand and issues an undated discharge voucher in full and final settlement. Only a few days thereafter, the admitted amount mentioned in the voucher is paid. The accord and satisfaction in such a case is not voluntary but under duress, compulsion and coercion. The coercion is subtle, but very much real. The `accord' is not by free consent. The arbitration agreement can thus be invoked to refer the disputes to arbitration. (v) A claimant makes a claim for a huge sum, by way of damages. The respondent disputes the claim. The claimant who is keen to have a settlement and avoid litigation, voluntarily reduces the claim and requests for settlement. The respondent agrees and settles the claim and obtains a full and final discharge voucher. Here even if the claimant might have agreed for settlement due to financial compulsions and commercial pressure or economic duress, the decision was his free choice. There was no threat, coercion or compulsion by the respondent. Therefore, the accord and satisfaction is binding and valid and there cannot be any subsequent claim or reference to arbitration.” 63. Here even if the claimant might have agreed for settlement due to financial compulsions and commercial pressure or economic duress, the decision was his free choice. There was no threat, coercion or compulsion by the respondent. Therefore, the accord and satisfaction is binding and valid and there cannot be any subsequent claim or reference to arbitration.” 63. The Hon?ble Apex Court held that, where the obligation under a contract are fully performed and discharged of contract by performance is acknowledged by full and final discharge/receipt nothing survives in regard to such discharged contract, where the parties to the contract, by mutual agreement, accept performance of altered, modified and substituted and confirm in writing the discharge of contract by performance of the altered, modified or substituted obligation, where the parties to a contract, by mutual agreement, a solve each other from performance of their respective obligation and consequently cancel the agreement and confirmed that there is no outstanding claim and dues. 64. Ultimately, the Hon?ble Supreme Court has refused to interfere with the order of reference and held that nothing stated any final opinion on the issue whether there was accord and satisfaction nor discharge of contract and held that any thing stated or any expression will not be taken into consideration with respect to merits of any claim or contentions of the parties. 65. In the case of Union of India and Others vs. Master Construction Company, reported in (2011) 12 S.C.C., page 349, challenge was made of the order of the High Court; thereby the matter was referred under Section 11(6) of the Arbitration Act for adjudication of the dispute by the arbitrator. In that case, the respondent-Master Construction Company was awarded a contract by the Union of India for construction of the building within specified time. There was a provision for adjudication of the dispute through arbitrator. Work was completed by the respondent- Company albeit belatedly. The petitioner-Company furnished no claim certificate and the final bill was signed. The final bill was released to the respondent-Company including the bank guarantee. Thereafter, the respondent-Company withdrew no claim certificate and lodged certain claims, in such circumstances, the plea was taken by the respondent-company that no claim certificate was issued under the financial constrain and coercion, claimed that the appellant-Union of India has arbitrarily withheld the payment. The final bill was released to the respondent-Company including the bank guarantee. Thereafter, the respondent-Company withdrew no claim certificate and lodged certain claims, in such circumstances, the plea was taken by the respondent-company that no claim certificate was issued under the financial constrain and coercion, claimed that the appellant-Union of India has arbitrarily withheld the payment. The Hon?ble Supreme Court has considered the large number of references and extensively quoted the different paragraphs of Bhargo Polyfab case (supra) in paragraph Nos. 2 to 17 and held that in a case where the claimant contends that discharge voucher or no claim certificate has been obtained by fraud, coercion, duress or undue influence and the other side contends the correctness thereof, the Chief Justice or his designate must look into this aspect to find out at least, prima facie, whether or not the dispute is bona fide and genuine. The dispute raised by the claimant with regard to validity of discharge voucher or no-claim certificate or settlement agreement, if prima facie, appears to be lacking in credibility, there may not be necessary to refer the dispute for arbitration at all in view of the fact. In that case, the Hon?ble Supreme Court arrived to finding that “No Claim Certificates” were given voluntarily and set aside the order of High Court, refused to send the matter for arbitration. 66. It will be relevant to quote paragraph Nos. 12 to 17 of the said judgment, which read as under:- 12. With regard to the jurisdiction of the Chief Justice/his designate in the proceedings under Section 11 of the 1996 Act, this Court culled out the legal position in paragraph 51 of the report as follows: (Bhoghara Polyfab (P) Ltd. case, S.C.C. p. 294) "51. The Chief Justice/his designate exercising jurisdiction under Section 11 of the Act will consider whether there was really accord and satisfaction or discharge of contract by performance. If the answer is in the affirmative, he will refuse to refer the dispute to arbitration. On the other hand, if the Chief Justice/his designate comes to the conclusion that the full and final settlement receipt or discharge voucher was the result of any fraud/coercion/ undue influence, he will have to hold that there was no discharge of the contract and consequently, refer the dispute to arbitration. On the other hand, if the Chief Justice/his designate comes to the conclusion that the full and final settlement receipt or discharge voucher was the result of any fraud/coercion/ undue influence, he will have to hold that there was no discharge of the contract and consequently, refer the dispute to arbitration. Alternatively, where the Chief Justice/his designate is satisfied prima facie that the discharge voucher was not issued voluntarily and the claimant was under some compulsion or coercion, and that the matter deserved detailed consideration, he may instead of deciding the issue himself, refer the matter to the Arbitral Tribunal with a specific direction that the said question should be decided in the first instance." 13. The Bench in Boghara Polyfab Private Limited in S.C.C. paras 42 and 43 (p.291), with reference to the cases cited before it, inter alia, noted that there were two categories of the cited cases; (one) where the Court after considering the facts found that there was a full and final settlement resulting in accord and satisfaction, and there was no substance in the allegations of coercion/undue influence and, consequently, it was held that there could be no reference of any dispute to arbitration and (two) where the court found some substance in the contention of the claimants that `no dues/claim certificates' or `full and final settlement discharge vouchers' were insisted and taken (either in printed format or otherwise) as a condition precedent for release of the admitted dues and thereby giving rise to an arbitrable dispute. 14. In Boghara Polyfab Private Limited, the consequences of discharge of the contract were also considered. In S.C.C. para 25 (p. 284), it was explained that when a contract has been fully performed, then there is a discharge of the contract by performance and the contract comes to an end and in regard to such a discharged contract, nothing remains and there cannot be any dispute and, consequently, there cannot be reference to arbitration of any dispute arising from a discharged contract. It was held that the question whether the contract has been discharged by performance or not is a mixed question of fact and law, and if there is a dispute in regard to that question, such question is arbitrable. 15. The Court in Boghara Polyfab case, however, noted an exception to this proposition. It was held that the question whether the contract has been discharged by performance or not is a mixed question of fact and law, and if there is a dispute in regard to that question, such question is arbitrable. 15. The Court in Boghara Polyfab case, however, noted an exception to this proposition. The exception noticed is that where both the parties to a contract confirm in writing that the contract has been fully and finally discharged by performance of all obligations and there are no outstanding claims or disputes, courts will not refer any subsequent claim or dispute to arbitration. Yet another exception noted therein is with regard to those cases where one of the parties to the contract issues a full and final discharge voucher (or no-dues certificate, as the case may be) confirming that he has received the payment in full and final satisfaction of all claims, and he has no outstanding claim. It was observed that issuance of full and final discharge voucher or no-dues certificate of that kind\ amounts to discharge of the contract by acceptance or performance and the party issuing the discharge voucher/certificate cannot thereafter make any fresh claim or revive any settled claim nor can it seek reference to arbitration in respect of any claim. 16. In SCC para 26 (pp. 284-85), this Court in Boghara Polyfab Private Limited held that if a party which has executed the discharge agreement or discharge voucher, alleges that the execution of such document was on account of fraud/coercion/undue influence practised by the other party, and if that party establishes the same, then such discharge voucher or agreement is rendered void and cannot be acted upon and consequently, any dispute raised by such party would be arbitrable. 17. In S.C.C. para 24 (p. 284) in Boghara Polyfab Private Limited1, this Court held that a claim for arbitration cannot be rejected merely or solely on the ground that a settlement agreement or discharge voucher has been executed by the claimant. The Court stated that such dispute will have to be decided by the Chief Justice/his designate in the proceedings under Section 11 of the 1996 Act or by the Arbitral Tribunal.” 67. In the case of Bharat Rasiklal Ashra vs. Gautam Rasiklal Ashra and another, reported in (2012) 2 S.C.C. 144 , the Hon?ble Supreme Court in paragraph No.10 has framed the following issue for consideration:- 10. In the case of Bharat Rasiklal Ashra vs. Gautam Rasiklal Ashra and another, reported in (2012) 2 S.C.C. 144 , the Hon?ble Supreme Court in paragraph No.10 has framed the following issue for consideration:- 10. Therefore, the following question arises for consideration in this appeal: "Where the arbitration agreement between the parties is denied by the respondent, whether the Chief Justice or his designate, in exercise of power under section 11 of the Act, can appoint an arbitrator without deciding the question whether there was an arbitration agreement between the parties, leaving it open to be decided by the arbitrator?" 68. Placing reliance on the judgment of Patel Engineering Limited (supra and the National Insurance Company Limited (supra) held that an arbitrator can be appointed only if there is an arbitration agreement in regard to the contract in question. If there is an arbitration agreement in regard to contract with A and no arbitration agreement in regard to contract with B, obviously a dispute relating to contract B cannot be referred to arbitration on the ground that contract A has an arbitration agreement. The Hon?ble Supreme Court further held that the Chief Justice or his designate is required to examine the allegations of fabrication and forgery made by a party in regard to the contract containing the arbitration agreement, before appointing an arbitrator under Section 11 of the Act, the proceedings under the said section will cease to be summary proceedings. 69. It will be relevant to quote paragraph Nos. 12, 16 and 17 of the said judgment, which read as under:- “12. Following the decision in S.B.P. & Co., this court in National Insurance Co. Ltd. held as follows: (National Insurance Co. Ltd. case, SCC p. 283, paras 22 & 22.1-22.3) "22. Where the intervention of the court is sought for appointment of an Arbitral Tribunal under section 11, the duty of the Chief Justice or his designate is defined in SBP & Co. This Court identified and segregated the preliminary issues that may arise for consideration in an application under section 11 of the Act into three categories, that is (i) issues which the Chief Justice or his Designate is bound to decide; (ii) issues which he can also decide, that is issues which he may choose to decide; and (iii) issues which should be left to the Arbitral Tribunal to decide. (22.1) The issues (first category) which Chief Justice/his designate will have to decide are: (a) Whether the party making the application has approached the appropriate High Court. (b) Whether there is an arbitration agreement and whether the party who has applied under section 11 of the Act, is a party to such an agreement. (22.2) The issues (second category) which the Chief Justice/his designate may choose to decide (or leave them to the decision of the arbitral tribunal) are: (a) Whether the claim is a dead (long barred) claim or a live claim. (b) Whether the parties have concluded the contract/ transaction by recording satisfaction of their mutual rights and obligation or by receiving the final payment without objection. (22.3) The issues (third category) which the Chief Justice/his designate should leave exclusively to the arbitral tribunal are : (i) Whether a claim made falls within the arbitration clause (as for example, a matter which is reserved for final decision of a departmental authority and excepted or excluded from arbitration). (ii) Merits or any claim involved in the arbitration." 16. The learned counsel for the first respondent next submitted that if the Chief Justice or his designate is required to examine the allegations of fabrication and forgery made by a party in regard to the contract containing the arbitration agreement, before appointing an arbitrator under section 11 of the Act, the proceedings under the said section will cease to be a summary proceedings, and become cumbersome and protracted, necessitating recording of evidence, thereby defeating the object of the Act. In our considered view this apprehension has no relevance or merit. Existence of a valid and enforceable arbitration agreement is a condition precedent before an arbitrator can be appointed under section 11 of the Act. When serious allegations of fraud and fabrication are made, it is not possible for the Court to proceed to appoint an arbitrator without deciding the said issue which relates to the very validity of the arbitration agreement. Therefore the fact that the allegations of fraud, forgery and fabrication are likely to involve recording of evidence or involve some delay in disposal, are not grounds for refusing to consider the existence of a valid arbitration agreement. 17. Therefore the fact that the allegations of fraud, forgery and fabrication are likely to involve recording of evidence or involve some delay in disposal, are not grounds for refusing to consider the existence of a valid arbitration agreement. 17. The apprehension that such contentions are likely to be raised frequently to protract the proceedings under section 11 of the Act or to delay the arbitration process, thereby defeating the purpose of section 11 of the Act is also without basis. Where agreements have been performed in part, such a contention will not be entertained. It is only in a very few cases, where an agreement which had not seen the light of the day is suddenly propounded, or where the agreement had never been acted upon or where sufficient circumstances exist to doubt the genuineness of the agreement, the Chief Justice of his designate will examine this issue. This course has repeatedly held that on the ground of termination, performance or frustration of the contract, arbitration agreement cannot be avoided. The legislature has entrusted the power of appointment of an arbitrator to the holders of high judicial offices like the Chief Justice or Judge of the Supreme Court/High Court, with a view that they can identify and effectively deal with false or vexatious claims made only to protract the proceedings or defeat arbitration. If a party is found to have falsely contended that the contract was forged/fabricated, the Chief Justice or his designate may subject such part to heavy costs so that such false claims are discouraged. Be that as it may.” 70. On conspectus of the aforesaid facts and circumstances of the case with judicial circumspection, it has to be looked into as to arbitral dispute fit for reference before the Arbitrator. From aforesaid discussion, the principle that has been derived and culled out, has to be applied and has to be decided in the present case whether it is desirable for this Court to appoint an arbitrator and refer the matter for adjudication of the dispute as it appears that from the record that there was an agreement between the parties for construction of the boys hostel. Claim was all through made by the petitioner-Company for cost incurred in “carriage of materials”, amounting to Rs.63,18,345.40/-. Claim was made by 22.02.2009, 24.08.2009, 02.09.2010, 24.12.2010, 24.2.2011, 5.5.2011, 02.09.2011 and 14.09.2011. Claim was all through made by the petitioner-Company for cost incurred in “carriage of materials”, amounting to Rs.63,18,345.40/-. Claim was made by 22.02.2009, 24.08.2009, 02.09.2010, 24.12.2010, 24.2.2011, 5.5.2011, 02.09.2011 and 14.09.2011. The respondent-Chankya National Law University replied by letter dated 21.02.2011, mentioning that the representation has been referred to the consultant M/s. Gherzi Estern Ltd., Kolkata and vide letter dated 09.08.2012 refused to entertain the claim of extra carriage charge and stated that no further correspondence in this regard will be entertained. 71. The petitioner-company made additional claim for interest against accumulated security deposit. Correspondence was again made vide letter dated 03.03.2012 and vide letter dated 07.05.2013 the petitioner-company requested the respondents to appoint an arbitrator to settle the dispute, which was responded by the respondent-Chankya National Law University vide letter dated 18.05.2013, stating therein that Clause-25 of the agreement prescribed 45 days time limit for making demand for appointment of arbitrator or in respect of any claim from the date of intimation of final bill ready for payment. If the claim is not made within stipulated period, the claim of the contractor shall be deemed to have been waived and absolutely barred and the institution shall be discharged of all the liabilities under the contract in respect of these claims. Accordingly, the demand for appointment of Arbitrator is absolutely barred and as such rejected as the final order bill was paid on 7.1.2012 and within 45 days no demand was made in respect of any claim. It has further been stated that even otherwise the claim of carriage material does not have any merit and rejected with intimation on 12.10.2011 itself and so far the claim of interest on security deposit is concerned, the same is absolutely imaginary, hostile and without substance. 72. It appears from the record that consistent claim has been made by the petitioner-Company for release of the additional amount, which was resisted by the respondent-Chankya National Law University and finally rejected the claim of the petitioner-company for appointment of arbitrator, applying Clause 25 of the agreement, which extinguish the right and treated to have been discharged from all liability, unless the claim for appointment of Arbitrator is made within 45 days is void as it violates the provisions of Section 28 of the Contract Act as discussed hereinabove and same cannot be invoked to the prejudice of the petitioner-company. The respondents have not brought any “No Dues Certificate”, or “Discharge Certificate” only claiming that final payment has been made on 7.1.2012. 73. It has been argued by the respondents that as the payment has been made without demur on that account, it will be treated to have been discharged. However, on perusal of the materials available on record, it cannot be said that the claim of the petitioner-Company is a dead claim as all through the petitioner-company is claiming the additional amount. Whether the petitioner-company is entitled to the payment of additional amount or whether the respondent-Chankya National Law University has discharged from all the liability, are the questions of facts is an arbitrable issue that has to be decided by the Arbitral Tribunal. Hence, this Court holds that the dispute of less payment or entire payment or Chankya National Law University has any liability to pay any amount, is a subject matter of arbitration for adjudication cannot be decided in view of limited jurisdiction and in view of the attending facts and circumstances of the case. This issue is left to be decided by the Arbitral Tribunal. 74. In such view of the matter, the contention of the respondent-Chankya National Law University that this Court should refuse to appoint an arbitrator as the dispute is no longer an arbitral issue is not acceptable to this Court and the same is rejected. Accordingly, this Court is of the view that that the matter is fit to be referred to the arbitrator for adjudication of the dispute. 75. Let this case be listed 29.11.2016 for appointment of the arbitrator.