Bombay High Court
WELLGROOMED VENTUREversusVISHAL GUPTA
- Decided
- Disposal
- DISPOSED OFF
Holding
The court held that the Section 11 application is within the limitation period and may be granted solely on the basis of the undisputed arbitration agreement, leaving any limitation questions to the arbitral tribunal.
Summary
The applicants, a developer, entered into a 2012 Agreement for Sale for a commercial unit and later claimed arrears of maintenance charges from December 2016 to June 2021, issuing several notices. The respondent denied the claims, arguing that the applicant had not fulfilled its obligations and that the claims were time‑barred. The applicant invoked the arbitration clause on 4 July 2024 and filed a Section 11 application on 7 October 2024 seeking appointment of an arbitrator. The respondent contended that the claims were ex‑facie barred by limitation and that the court should refuse the application. The High Court held that at the Section 11 stage the court’s role is limited to confirming the existence of a valid arbitration agreement and that the application was within the three‑year limitation for seeking an arbitrator, leaving any limitation issues to be decided by the arbitral tribunal. Consequently, the court appointed Mr. Nirav Shah as sole arbitrator and issued procedural directions.
Issues considered
- Whether the Section 11 application for appointment of an arbitrator is time‑barred.
- Whether the court must examine the limitation of the substantive claims at the Section 11 stage.
- Whether the existence of a valid arbitration agreement suffices to grant the application.
Legislation cited
Subjects
- Arbitration
- Section 11 application
- Limitation period
- Maintenance charges
- Arbitration agreement
- Cost of arbitration
- Time‑barred claims
Judgment
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
ARBITRATION APPLICATION NO.75 OF 2026
Wellgroomed Venture.
An association of persons formed by:
(i) Akruti Kailash Construction and
(ii) Solidity Developers Pvt. Ltd. .. Applicants
Vs.
Vishal Gupta .. Respondent
Mr. Manoj P. Mhatre, Advocate for the Applicants.
Mr. Anuj Pande with Mr. Rohan Surve, Advocates for the Respondent.
CORAM : GAUTAM A. ANKHAD, J.
Closed for Order : 3rd September, 2026.
For Pronouncement of Order : 8th September, 2026.
P.C. :
1. The Applicant is a Developer who has executed an Agreement for Sale
dated 26th December, 2012 (“Agreement”) in respect of Commercial Unit no.
316 on 3rd Floor of “Hubtown Viva” at Jogeshwari (East), Mumbai – 400 060.
Disputes have arisen between the parties in respect of the arrears for
maintenance and other charges which the Applicant claims are payable from
31st December, 2016 until 30th June, 2021.
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2. The Applicant by its notices dated 27 th May, 2017, 20th August, 2019 and
8th January, 2022 raised the demands for arrears of the maintenance charges.
On 11th January, 2022, the Respondent by its e-mail replied to the notice of 8 th
January, 2022 and denied the claims of the Applicant. The Respondent stated
that as the Applicant had not fulfilled its obligations, in terms of providing
promised amenities and since the Society had already been incorporated, the
Applicant had no right or authority to ask for any dues. Further correspondence
was exchanged in 2022-2023 between the parties. Finally on 4 th July, 2024, the
Applicant invoked arbitration under Clause no. 51 of the said Agreement and
called upon the Respondent to confer on the name of the proposed arbitrator.
3. The Respondent has neither disputed the existence of the arbitration
clause nor the receipt of the notice invoking arbitration.
4. Apart from merits, a preliminary objection raised by Mr. Pande, learned
counsel for the Respondent, is that the claims from January, 2017 until June,
2021, that are sought to be referred to arbitration, are ex-facie time barred and
constitute dead claims. He submits that repeated demands do not extend
limitation and this is a fit case for the Court to reject the reliefs claimed in this
Application. In support of the above submissions, he relies upon the judgments
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of the Hon’ble Supreme Court in Bharat Sanchar Nigam Ltd. v. Nortel
Networks (India) (P) Ltd.1 and Arif Azim Co. Ltd. v. Aptech Ltd.2
5. I have heard the learned counsels and perused the record. It is now well
settled that, at the stage of considering an Application under Section 11, the
referral Court is required to undertake only a limited examination as to the
existence of a valid arbitration agreement. The Court cannot adjudicate on the
merits of the disputes or conduct a detailed examination into the limitation
applicable to the substantive claims. The judgments relied upon by the
Respondent in Bharat Sanchar Nigam Ltd. and Arif Azim Co. Ltd. have
subsequently been considered by the Hon'ble Supreme Court in the Three-
Judge Bench judgment in Aslam Ismail Khan Deshmukh v. ASAP Fluids (P)
Ltd.3. The judgment draws a distinction between:
(i) the limitation applicable to the claims which are to be
adjudicated on merits by the Arbitral Tribunal; and
(ii) the limitation applicable to an application under Section 11
seeking appointment of an Arbitrator.
6. The position is also consistent with the subsequent development of the
1 (2021) 5 SCC 738
2 (2024) 5 SCC 313
3 (2025) 1 SCC 502
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law by the Hon'ble Supreme Court, including the judgment of the Seven-Judge
Bench in Interplay between Arbitration Agreements under Arbitration and
Conciliation Act, 1996 and Stamp Act, 1899, in Re 4 and the subsequent
decision in SBI General Insurance Company v. Krish Spinning5.
7. The Applicant invoked arbitration by its notice dated 4th July, 2024 and
the present Application was filed on 7th October, 2024. The Section 11
Application is consequently within the period of limitation of 3 years for
seeking appointment of an Arbitrator. There is, therefore, no impediment to the
exercise of jurisdiction under Section 11 of the Act on this ground.
8. As regards the Respondent’s contention that the claims are ex-facie
barred by limitation, I do not intend to adjudicate the same. The question as to
when the cause of action in respect of each individual claim arose, whether the
correspondence and demands exchanged between the parties have any bearing
on the computation of limitation and whether the claims, or any part thereof,
are barred by limitation, are matters which require examination of the factual
and contractual matrix. At paragraph 50 of Aslam Ismail Khan Deshmukh the
Hon’ble Supreme Court held that “this Court cannot conduct and interpret
4 (2024) 6 SCC 1
5 (2025) 3 SCC (Civ) 567
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evidenciary enquiry into the question of when the cause of action can be said to
have arisen between the parties and whether the claim raised by the Petitioner
is time barred”. Whether the claims are barred by limitation, in whole or in
part, are matters which can appropriately be considered by the Arbitral Tribunal
upon pleadings and material being placed before it. The Respondent's objection
on limitation is, therefore, expressly kept open. The Tribunal shall be at liberty
to consider the same in accordance with law.
9. Learned Counsel for the Respondent further submits that referring such
allegedly time-barred claims to arbitration would unnecessarily compel the
Respondent to incur substantial costs and participate in proceedings which
ought not to have been initiated. The Hon'ble Supreme Court in Aslam Ismail
Khan Deshmukh has recognised this concern and after reiterating the limited
scope of the referral Court's jurisdiction, held as follows:-
“51. It is now well-settled law that, at the stage of Section 11 application,
the referral Courts need only to examine whether the arbitration
agreement exists — nothing more, nothing less. This approach
upholds the intention of the parties, at the time of entering into the
agreement, to refer all disputes arising between themselves to
arbitration. However, some parties might take undue advantage of
such a limited scope of judicial interference of the referral Courts
and force other parties to the agreement into participating in a
time-consuming and costly arbitration process. This is especially
possible in instances, including but not limited to, where the
claimant canvasses either ex facie time-barred claims or claims
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which have been discharged through “accord and satisfaction”, or
cases where the impleadment of a non-signatory to the arbitration
agreement is sought, etc.
52. In order to balance such a limited scope of judicial interference
with the interests of the parties who might be constrained to
participate in the arbitration proceedings, the Arbitral Tribunal may
direct that the costs of the arbitration shall be borne by the party
which the Tribunal ultimately finds to have abused the process of
law and caused unnecessary harassment to the other party to the
arbitration.”
10. In view of the above, if the Tribunal ultimately finds that the Applicant
has pursued claims which were barred by limitation or has otherwise abused
the arbitral process, it would be open to the Tribunal to make an appropriate
order as to costs, including directing the Applicant to bear full costs occasioned
by such claims.
11. In the circumstances, the existence of the arbitration agreement being
undisputed, the invocation of arbitration being duly made, and the present
Section 11 Application being within limitation, Arbitration Application
no. 75 of 2026 is allowed in the following terms:
[A]. Mr. Nirav Shah, learned Advocate is hereby appointed as
the sole Arbitrator to adjudicate upon the disputes and
differences between the parties arising out of and in
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connection with the Agreement for Sale referred to above.
The contact details of the sole Arbitrator, are as under:
Office Address : 1/1, Kothari House, 1st Floor,
5/7 Oak Lane, Fort, Mumbai 400 001.
Mobile Number : 9820770788
E-mail ID : [email protected]
[B]. A copy of this order will be communicated to the learned
Arbitrator by the Advocate for the Applicant within a
period of one week from the date on which this order is
uploaded on the website of this Court. The Applicant shall
provide the contact and communication particulars of the
parties to the Arbitrator along with a copy of this order;
[C]. The learned Arbitrator is requested to forward the statutory
Statement of Disclosure under Section 11(8) read with
Section 12(1) of the Act to the Advocate for the Applicant
so as to enable them to file the same in the Registry of this
Court. The Registry of this Court shall retain the said
Statement on the file of this Application and a copy of the
same shall be furnished by the Advocate for the Applicant
to the Respondent;
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[D]. The parties shall appear before the learned Arbitrator on
such date either on V.C. mode or at such place as indicated
to obtain appropriate directions with regard to conduct of
the arbitration including fixing schedule for pleadings,
examination of witnesses, schedule of hearings etc.
[E]. The fees of the learned Arbitrator shall be as per the Fourth
Schedule of the Act read with the Bombay High Court (Fee
Payable to Arbitrators) Rules, 2018.
[F]. All issues, claims and counterclaims are kept open to be
agitated before the Tribunal.
[G]. The arbitration shall be held at Mumbai.
[ GAUTAM A. ANKHAD, J. ]
Digitally
signed by
SNEHA SNEHA 8/8
ABHAY
ABHAY DIXIT
Date:
1-ARBAP-75-2026.doc Dixit
DIXIT 2026.09.08
12:03:44
+0530
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