AIRFOAM INDUSTRIES PRIVATE LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) -

(2.) THIS is an application under Section 20 of the Arbitration Act. It was opposed by the respondent and on 6-8-1971, the following issues were framed : 1. Whether in any arbitration agreement was entered into between the parties ? O.P.P. 2. If issue No. is proved in the affirmative whether the said agreement should be filed in this court ?

(3.) IN Alexander Brogden and Others v. The Directors of the Metropolitan Railway Company (1877) 2 A.C. 666, the House of Lords held that the insertion of the name of an arbitrator in the draft of a contract was a matter requiring the approval and assent of the other party. A fortiori, the introduction of an arbitration clause must require the .assent of the other party and is, therefore, a substantial matter. Counsel for the respondent also relied on Bijoy Baliay Kundu and another v. Tapeti Ranjan Kundii A.I.R. 1965 Calcutta 628. There, it was held, that a clause in a Deed of Settlement requiring that disputes between the trustees be referred to arbitration was not binding as an arbitration agreement between the trustees inter se. The basis of the decision was that there was no offer and acccptance of the agreement between the trustees, and hence it could not be regarded as a contract between them. I do not sec how that case is relevant or assists in deciding the present one. IN so far as it emphasises that the proposal of an arbitration agreement needs to be accepted, it is in line with Brogden's case, and goes against the respondent. IN my opinion, the acceptance of tender in this case was not absolute and unqualified as it introduced the arbitration clause contrary to the offer.