3.1. Precedents Cited

The judgment references several key legal precedents:

• Kamlesh Babu v. Lajpat Rai Sharma: Highlighted the judiciary's duty to dismiss suits barred by limitation even if the defense isn't explicitly raised.
• Darshan Singh Case (2004) 1 SCC 328: Emphasized the non-acceptance of claims beyond the limitation period, reiterating Section 3(1) of the Limitation Act.
• Mukund Limited v. Hindustan Petroleum Corporation Limited: Addressed the necessity of proving the quantum of claims in arbitration, underlining that mere settlement decrees cannot substantiate claims without supporting evidence.
• State of Rajasthan v. Ferro Concrete Construction Private Limited: Stressed the importance of evidence in determining the quantum of damages, declaring awards without evidence as illegal and unsustainable.
• Union of India through Dy. Controller of Stores v. MAA Agency: Reinforced the obligation of courts to consider limitations in arbitration proceedings.

3.2. Legal Reasoning

The court meticulously dissected the arbitration proceedings, identifying that the plea of limitation was neither raised nor considered during arbitration. Under Section 3 of the Limitation Act, every suit filed after the prescribed period should be dismissed, irrespective of whether the defense was invoked. The court opined that the arbitrator failed to recognize the barred claims due to the lapse of the limitation period, thereby rendering part of the award invalid.

Additionally, the court scrutinized the Respondents' counterclaims, noting the absence of conclusive evidence to support the quantum of Rs. 30,29,677/-. The settlement between Kin-Ship and Gujarat Ambuja did not extend any liability towards Sealand Shipping, making the Respondents' subsequent claims impermissible.

Furthermore, the court emphasized the principle that waiver or acquiescence cannot override statutory limitations or foundational legal principles. The Arbitrator's failure to address the limitation defense was a procedural oversight warranting the quashing of the award.

3.3. Impact

This judgment underscores the paramount importance of adhering to procedural norms within arbitration. It serves as a precedent that failure to raise critical defenses, such as limitation, during arbitration proceedings can lead to unfavorable outcomes on judicial review. Moreover, it reinforces the judiciary's role in rectifying oversights in arbitration awards, ensuring that substantive and procedural laws are meticulously observed.

For practitioners, this case highlights the necessity of thoroughly presenting all pertinent defenses during arbitration to preclude potential derailments in subsequent judicial reviews. It also elucidates the limits of arbitration in circumventing statutory provisions, thereby preserving the integrity of the legal framework.

4.1. Arbitration Petition under Section 34

Section 34 of the Arbitration and Conciliation Act, 1996, allows parties to challenge an arbitration award in court on specific grounds, such as incapacity, invalid agreement, improper constitution of the arbitral tribunal, or exceeding the scope of arbitration.

4.2. Limitation Act, 1963

The Limitation Act sets time frames within which parties must initiate legal proceedings. For instance, under Section 3, any suit filed after the prescribed period (three years for many civil cases) is dismissed, even if the defense is not explicitly raised.

4.3. Consensus Facit Jus

A Latin phrase meaning "consent makes law," it signifies that agreements made by parties are binding as long as they do not contravene statutory laws or public policy. In arbitration, while parties can agree on various terms, they cannot waive fundamental legal protections.

4.4. Seaworthiness

Under the Merchant Shipping Act, seaworthiness refers to the vessel's materials, construction, crew qualifications, and equipment being fit for the intended voyage. Failure to ensure seaworthiness can lead to liability for damages caused by such negligence.