Decided on September 14,1970

M.P. Tahilramani Appellant
The Kalakshetra, Represented By Its President, Smt. Rukmani Devi By Power-Of-Attorney Agent K. Sankara Menon Respondents


G. Ramanujam, J. - (1.) This revision is directed against the order of the lower Court rejecting an application, I.A. No. 117 of 1970 filed by the petitioner under Ss. 8 and 33 of the Arbitration Act seeking a reference of the disputes involved in A.S. No. 66 of 1969 on the file of the lower Court to two named arbitrators. The lower Court rejected the said application in the following circumstances.
(2.) The respondent herein instituted O.S. No. 449 of 1965 on the file of the District Munsif's Court, Poonamallee for eviction of the petitioner herein and for recovery of arrears of rent as also future damages for use and occupation. The said suit was transferred to the file of the District Munsif, Kancheepuram and renumbered as O.S. No. 772 of 1967. The petitioner contested the suit on various grounds but the trial Court rejected his defence and decreed the suit with costs as prayed for. The petitioner thereafter filed the said A.S. No. 66 of 1969 before the lower Court against the decree and judgment in O.S. No. 772 of 1967. Pending that appeal in or about 6th August, 1969, Mr. Renganatha Sastri, who was acting as counsel for the respondent in some other proceedings between the parties put forward certain suggestions to Mr. R. Gopalaswami Iyengar, counsel for the petitioner in the other proceedings, to refer the following two outstanding matters, (1) Arundale house and (2) payment for the two 'C type houses built by the petitioner to the same arbitrators for decision, the words same arbitrators meaning the arbitrators appointed for the settlement of the dispute arising out of C.S. No. 18 of 1966. To this suggestion Mr. Gopalaswami Iyengar replied by his letter dated 29th August, 1969, that his client (petitioner) is willing to have the disputes regarding (1) Arundale house and (2) payment for the two 'C' type houses referred to the same arbitrators who are going to decide the dispute arising out of C.S. No. 18 of 1966, provided that the issues to be raised should be the same as were raised in the suit, which was then the subject -matter in the above appeal before the lower Court. Mr. Renganatha Sastri, by his letter, dated 23rd October, 1969 to Mr. R. Gopalaswami Iyengar informed that his client (respondent) agrees to have the issues arising in the suit as well as the appeal A.S. No. 66 of 1969 may be referred to arbitration by the same arbitrators, as also the dispute regarding the "C" type staff quarters and that a formal agreement to refer to arbitration the above two matters had to be entered, before the arbitrators can act and asked for a draft of the agreement from the petitioner. Mr. Gopalaswami Iyengar replied to this letter on 4th March, 1970 enclosing two drafts for the purpose of referring the dispute (1) regarding Arundale house and its annexures and (2) regarding payment to the "G" type staff quarters and sought for the suggestions of Mr. Renganatha Sastri and stated that after the draft is approved by the respondent, he would have the agreements finalised. To this Mr. Renganatha Sastri replied by his letter, dated 6th March, 1970 that in view of the long delay that had elapsed since his proposal, his client, the respondent was not anxious to refer the matter for arbitration resulting in further delay and that he is anxious to have the appeal heard and disposed of on merits. On the basis of this correspondence between Mr. Renganatha Sastry on the one hand and Mr. Gopalaswami Iyengar on the other, the petitioner filed I.A. No. 117 of 1970 and contended that there is a valid and concluded agreement between the parties to refer the disputes arising in the appeal to arbitration and that the Court should therefore make an order referring the disputes involved in the appeal to the two named arbitrators.
(3.) The respondent however contended that the proposal for arbitration was made, as early as 23rd October, 1969, that there was no reply to the said letter till March, 1970, that it was only when the hearing of the appeal was fixed for 23rd March, 1970 an application for reference to arbitration had been filed by the petitioner with a view to delay the hearing of the appeal and that the letter, dated 23rd October, 1969 by Mr. Renganatha Sastri agreeing to have the disputes arising in the appeal to be referred to arbitration was subject to the execution of a formal agreement and as such it cannot be construed as a concluded contract between the parties. As against this the petitioner contended in his reply statement, that the acceptance of Mr. Renganatha Sastri to refer the disputes to arbitration was not meant to be conditional on the execution of the formal agreement and that the absence of a formal agreement will not, in any way, whittle down the effect of the solemn agreement entered into between the parties, the terms of which were unambiguous and unequivocal. The lower Court held, after a due and elaborate consideration of the entire correspondence between the said two advocates, that Mr. Renganatha Sastri had no authority to agree on behalf of the respondent, to refer the disputes arising in the appeal to arbitration, as he was not the counsel appearing in the appeal for the respondent and that in any event, there is no concluded contract between the petitioner and the respondent to refer the disputes to arbitration. The question in this revision is whether the view taken by the lower Court is correct.;

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