III. THE INDIAN LAW OF LIMITATON
Its Applicability
1. In respect of Territory
The Act extends to the whole of British India— Section 1 (2).
The Act applies to every suit instituted, appeal preferred and application made in Courts functioning in British India.
It does not matter where the cause of action, whether in British India or outside British India, it does not matter where the transaction took place, whether in British India or outside British India, if the suit is instituted or appeal is preferred or application is made in a Court in British India, the Law of Limitation that will apply will be the Indian Law of Limitation and not Foreign Law of Limitation.
There is one exception to this rule which is enacted in section 11 (2) which says : A Foreign Rule of Limitation shall be a defence to suit in British India on a contract entered into in a foreign country if the rule has extinguished the contract and that the parties were domiciled in such country during the period prescribed by such rule.
2. In respect of Proceedings
I. S PECIAL P ROCEEDINGS
(1) Arbitration Proceedings
It was at one time doubted if the Limitation Act applied to proceedings before an Arbitrator on the ground that it applied only to suits, appeals and applications to the Court and that the Arbitrator was not a Court. This doubt has now been resolved by the Privy Council which has held that where persons have referred their disputes to arbitration, the arbitrator must decide the dispute according to the existing law and that he must recognize and give effect to every defence of limitation, unless that defence has been excluded by agreement between the parties.
(1929) 56 I. A. 128.