Multiple choice

‘A’ has lent money to ‘B’ under a written agreement containing an arbitration clause. The agreement does not specify the time of repayment. Rather the money was repayable on demand by ‘A’. ‘A’, after five years of the date when the loan was made, demanded the money which was not repaid by ‘B’. The parties could not arrive at a consensus on the appointment of arbitrator also. ‘A’ filed an application under section 11 of the Arbitration and Conciliation Act, 1996 before the chief justice of the high court for appointment of an arbitrator. ‘B’ in response to the said application contends that the claim of ‘A’ is stale and barred by time and thus, arbitrator be not appointed. The chief justice

  1. is bound to appoint the arbitrator leaving the plea of limitation open for decision in arbitration award

  2. is bound of dismiss the application for appointment of arbitrator since the claim adjudication whereof is sought by arbitration is barred by time

  3. is required to make ‘B’ deposit the money in court and then appoint the arbitrator and refer the parties to arbitration

  4. is required to require ‘A’ to furnish security for actual costs of arbitration to be incurred by ‘B’ and then appoint the arbitrator and refer the parties to arbitration
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

(1) The chief justice is bound to appoint the arbitrator leaving the plea of limitation open for decision in arbitration award.

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