SURENDRANATH PAUL Vs. UNION OF INDIA

JUDGEMENT

(1.) THIS is an appeal from an order of Mallick, J. dated the 19th July 1963 staying a suit under Section 34 of the Arbitration Act, 1940.

(2.) THE appellant who is a contractor under the Controller of Stationery, Government of India, entered into certain contracts with the Controller of Printing and Stationery, Calcutta representing the respondent Union of India for the supply of envelopes, flaps ungummed of different sizes and for the supply of exercise books etc. and deposited a sum of Rs. 12,777/- as security money. THE contracts contained an arbitration clause being Clause XVII of the general conditions of contract. THE said arbitration clause is as follows: (XVII). Arbitration--"Except where herein otherwise provided any dispute or difference arising; during or after the subsistence of this contract touching any clause, matter or thing herein contained, or the operation or construction hereof, or the rights, duties or liabilities of either party under or in connection therewith shall be referred to the arbitration of the Secretary to the Government of India, Ministry of Works, Housing and Supply and if the Secretary to the Government of India, Ministry of Works, Housing and Supply is unable or unwilling to act to the sole arbitration some other person appointed by the Secretary to the Government of India, Ministry of Works, Housing and Supply willing to act as such Arbitrator. It will be no objection to any such appointment that the Arbitrator so appointed is a Government servant, that he had to deal with matters to which this agreement relates and that in course of his duties as such Government servant he had expressed views on all or any of the matter in dispute or difference. THE Award of the Arbitrator so appointed shall be final, conclusive and binding on all parties to this contract.

(3.) THE first point which has been urged by the learned counsel for the appellant is that the power of appointment which was conferred by the arbitration clause upon the Secretary, Ministry of Works, Housing and Supply, was extinguished after it was once exercised and the Secretary having appointed Sri Desai, his power was exhausted by this single execution and he was not competent to make a second appointment. Reliance is placed in support of this argument on a passage in Russell on Arbitration (17th Edition) p. 215 and on the case of Oliver v. Coilings, (1809) 11 East 367: (sic) ER 1045 and on the case of Reynolds v. Gray, (1697) 91 E R 1045. THE passage in Russel is as follows :