Mrs. SUJATA V. MANOHAR, J. - (1.) The appellant had entered into a contract with the respondent under which the appellant had undertaken the work of construction of factory and allied buildings of the respondent at India Complex, Rae Bareilly. The agreement is dated 19-1-1973. Clauses 23 and 24 of the agreement are as follows:"Decision of the Executive Engineer of the UPSIC to be final on certain matters: Clause 23:Except where otherwise specified in the contract, the decision of the Executive Engineer shall be final, conclusive and binding on both the parties to the contract on all questions relating to the meaning, the specification, design, drawings and instructions hereinbefore mentioned, and as to the quality of workmanship or materials used on the work or as to any other question whatsoever in any way arising out of or relating to the designs, drawings, specifications, estimates, instructions, orders or otherwise concerning the works or the execution or failure to execute the same whether arising during the progress of the work, or after the completion thereof or abandonment of the contract by the contractor shall be final and conclusive and binding on the contractor. Decision of the M.D. of the U.P.S.I.C. on all other matters shall be final: Clause-24:Except as provided in Clause 23 hereof the decision of the Managing Director of the U.P.S.I.C. shall be final, conclusive and binding on both the parties to the contract upon all questions relating to any claim, right, matter or thing in any way arising out of or relating to the contract or these conditions or concerning abandonment of the contract by the contractor and in respect of all other matter arising out of this contract and not specifically mentioned herein."
(2.) There were disputes between the appellant and the respondent in connection with the payments to be made under the terms of the said contract and in connection with the work of the said contract. The appellant made an application under Section 8 of the Indian Arbitration Act, 1940 before the Civil Judge, Kanpur. He applied for the appointment of an independent arbitrator in the place of the Managing Director. The respondent denied that there was any arbitration clause in the said contract. The Court, however, allowed the petition of the appellant under Section 8 of the Arbitration Act and appointed one D.D. Sharma, Executive Engineer, as arbitrator. In appeal, the High Court, while upholding the finding that there was an arbitration held that the Court below had no jurisdiction under Section 8 to appoint another arbitrator in the place of Managing Director since none of the clauses of Section 8 was attracted in the present case. The High Court, therefore, set aside the order of the Court below and dismissed the application of the appellant under Section 8. From this judgment the appellant had filed the present appeal.
(3.) The first question that requires consideration is whether there is any clause in the contract which provides for arbitration between the parties. The relevant clauses are Clauses 23 and 24. Under Clause 23, the decision of the Executive Engineer is final, conclusive and binding on both the parties to the contract on all questions relating to the meaning, specifications, designs etc. and as to the quality of workmanship or material used or relating to any other question whatsoever in any way arising out of or relating to the designs, drawings, specifications etc. or otherwise concerning the execution or failure to execute the same. Under Clause 24, except as provided in Clause 23, the decision of the Managing Director of the respondent shall be final, conclusive and binding on both the parties to the contract upon all questions relating to any claim, right, matter or thing in any way arising out of or relating to the contract and in respect of all other matters arising out of the contract and not specifically mentioned in the said clause. Therefore, in respect of certain claims the decision of the Executive Engineer is final and binding on both the parties to the contract. While in respect of the remaining matters, the decision of the Managing Director of the respondent is final, conclusive and binding on both the parties to the contract. Clause 24 does not mention that any dispute can be referred to the arbitration of the Managing Director. Clause 24 also does not spell out any duty on the part of the Managing Director to record evidence or to hear both parties before deciding the questions before him. From the wording of Clause 24 it is difficult to spell out any intention of the parties to leave any disputes to the adjudication of the Managing Director of the respondent as an arbitrator.;