HIMACHAL BUILDERS Vs. COSMO FERRITES LTD

JUDGEMENT

(1.) There was an agreement between the parties dated 21.3.1986 in which were there was an arbitration clause. When dispute arose between the parties the petitioner applied to this Court under Sections' 8 and 20 of the Arbitration Act, 1940 for appointment of an Arbitrator. That was taken on file as C.S. No. 33 of 1992. By order dated 5.3.1993 this Court directed the parties to appoint their respective Arbitrators. Pursuant thereto the petitioner appointed one Mr. S.K. Saini as an Arbitrator. The respondent appointed one Mr. C.N. Kaushal as its Arbitrator. Soon after the appointment of Mr. Kaushal, he sent a communication on 8.10.1993 that due to personal reasons he was unable to devote time to deal in the said case and, therefore, he resigned from the office of Arbitrator and requested the termination of his name. That was sent to the Registrar and copies were marked to the respondent and the Arbitrator appointed by the petitioner Mr. S.K. Saini. According to the petitioners they did not receive the said communication from Mr: Kaushal. It is not clear whether Mr. Saini received the communication of Mr. Kaushal. On 19.10.1993 Mr. Saini wrote a letter to both the parties in which he had stated that an Umpire should be appointed by the Court and the parties may take necessary steps to get the Umpire appointed. He had stated very clearly that he cannot enter upon reference unless Umpire was appointed by the Court as it was essential to appoint the Umpire.

(2.) There was a lull in the matter for abgut nearly three years thereafter. In June, 1996 the petitioner's Advocate sent a letter by registered post to the respondent in which the prior history was stated up to the date of the letter dated 19.10.1993 sent by Mr. Saini. After referring to that, the letter says that the Arbitration Act, 1940 stands repealed by Section 85 of the Arbitration and Conciliation Ordinance, 1996 with effect from 25.1.1996 and, therefore, the prior actions stood automatically annulled. In para 6 it was stated as follows

(3.) In reply thereto the respondent sent a letter on 22.7.1996 stating that Mr. Kaushal had already sent his resignation by a letter dated 8.10.1993 addressed to the Registrar of this Court. In the last paragraph it is stated as fallows :