P.C.Mallick, J. - (1.) THIS is an application under Section 33 of the Indian Arbitration Act to determine the existence of an arbitration agreement.
(2.) THE petitioner is a contractor who submitted on 18-7-1952 a tender for the supply of sal and teakwood of twenty different specifications for the supply of which tenders were invited by the Directorate of Supply. THE Directorate of Supply purported to accept the tender submitted by the petitioner on 13-11-1952 and an acceptance note was issued on the same date. THE petitioner contends that there was no concluded contract on the so-called acceptance of tender on 13-11-1952, firstly because the tender was open to acceptance by the Directorate of Supply till 31-10-1952 and could not be accepted on 13-11-1952 and secondly, because the terms contained in the tender are different from the terms issued in the A/T dated 13-11-1952 and hence the parties were not "consensus ed idem". THE respondents contend that the A/T dated 13-11-1952 evidences a concluded contract and that the petitioner has committed a breach thereof and as such is liable in damages to the extent of Rs. 1,69,803/8/-. THE present notice has been taken out by the petitioner on 1-3-1954 to determine the existence of the arbitration agreement. THE arbitration agreement is the usual clause in all Government contracts. Mr. G. P. Kar the learned counsel appearing for the respondent submitted that the petitioner has challenged the contract itself and not merely the arbitration clause. The allegations in the petition attacks the whole contract and not merely the arbitration clause. The Court is invited to declare that there is no concluded contract between the parties. These prayers can only be granted in a declaratory suit. The petition, therefore, should be dismissed and the petitioner should be relegated to a properly constituted suit for declaration and cancellation of the A/T under Sections 42 and 39 of the Specific Relief Act. Mr. Kar has cited a decision or the Appeal Court in the case of State of Bombay v. Adamjee Hajee Dawood and Co., in support of his argument that the question should be agitated in a suit and not in an application under Section 33 of the Arbitration Act. In the cited case the plaintiff instituted a suit claiming a declaration that a contract which contained an arbitration clause was not made between the parties and is not binding on it. The defence inter alia was that having regard to Sections 32 and 33 of the Arbitration Act such a suit does not He. The Appeal Court held that the suit was maintainable and that Section 32 of the Indian Arbitration Act was no bar. Banerjee J. in his judgment at page 148 observed as follows : "I cannot take the view that Section 32 contemplates the case of suits challenging the validity of a contract because it contains an arbitration clause. If the intention of the legislature were that all contracts containing an arbitration clause should come within the purview of Sections 32 and 33 the legislature would have said so in appropriate words. In my view, Sections 32 and 33 have a very limited application, namely, where the existence or validity or an 'arbitration agreement' (and not the contract containing the arbitration agreement) is challenged. Assume for a moment that Sections 32 and 33, Arbitration Act, have repealed Section 39, Specific Relief Act, which section of the Specific Relief Act will apply in such cases to contracts which do not contain an arbitration clause? We cannot take the view either that Section 39, Specific Relief Act, has been partially repealed, that is to say, repealed so far as it relates to contracts containing an arbitration clause. To hold that Section 39 Specific Relief Act has been wholly or partially repealed will lead to absurd results." Harries, C. J. in supporting the view of Banerjee J. made the following observation at page 149 : "I entirely agree with my brother Banerjee that Sections 32 and 33 on their true construction do not purport to deal with suits for declarations that there never was a contract or that a contract is void. The Sections must be confined to attacks on arbitration agreements and awards and the fact that an arbitration agreement may fail with the contract does not prevent the Court declaring in a properly constituted suit that there never was a contract at all or that the contract is void and of no effect." This is no authority for the proposition that if the existence of an arbitration agreement in a contract is to be challenged it cannot be done under Section 33 but must be done by a suit. Certain observations of B. K. Mukharji, J. in the case of Anderson Wright and Co. v. Moran and Co., decided by the Supreme Court and was also referred to and relied on by Mr. Kar. The observation was made in a case under Section 34 of the Indian Arbitration Act and. in my view, has no application to a case under Section 33. The language of Section 33 leaves no doubt that when the existence of an arbitration agreement or its validity is challenged in an application under Section 33, the Court shall decide the question. In my judgment, the Court has no power to dismiss an application under Section 33 on the ground that the arbitration agreement is a clause in a contract and the decision may involve a declaration as to the existence or validity of the contract itself. In the instant case I am only called upon to decide whether the arbitration agreement exists or not and if in doing so I am required to consider the existence of the contract itself, I will have to do it. Declaration I will make in the order would be only as to the existence of the arbitration agreement. I have no power to dismiss the application and ask the petitioner to file a suit under Sections 42 and 39 of the Specific Relief Act.
(3.) THE first point urged by Mr. Subimal Roy, the learned counsel appearing for the petitioner, is that the tender submitted by the petitioner was open for acceptance till 31-10-1952 and the respondent was not entitled to accept the same beyond that date so as to effect a binding contract between the parties. THE tender submitted by the petitioner is Ex. 1. THE first page is a letter in printed form addressed by the contractor to the Director of Supply. THE letter opens with an offer and there are certain blanks intended to be filled up by the contractor. THE blank portion in the letter in which the date up-till which the tender was to be kept open for acceptance has not been filled up. THE annexed pages in type contains the subject matter of the contract, its terms and conditions and the answer to certain questions the contractor is required to give in that page it is expressly stated that the tender shall remain open for acceptance till 18-8-1952. I do not think that there is any substance in the argument of Mr. Kar that the fact that the contractor did not fill up the date in the first page of the tender shows that the contractor intended to keep the tender open for acceptance for an indefinite period. THE tender must be read as a whole containing the offer of the contractor and it has been expressly stated in the tender, though not in the first page, that the tender shall remain open for acceptance till 18-8-1952. By two subsequent letters the contractor at the request of the Government extended the date of acceptance till 31-10-1952. THEre is no further extension in writing, nor is there dependable oral evidence as to whether the Government wanted further extension and the contractor expressly granted such extension. THEre is, however, evidence that even after 31-10-1952 the Government treated the tender not to have lapsed and was still open to acceptance and the contractor's state of mind was the same. According to witness Neogy, the contractor was coming daily to the office to enquire whether the tender had been accepted, though it is not clear from his evidence whether the contractor came after 31-10-1952. THEre is however a letter by the Director of Supply dated 10-11-1952 asking the contractor to send his representative for discussion in connection with the tender. In his reply dated 13-11-1952 the contractor did not intimate that the date having expired the tender had lapsed and there was no point in further discussion. On the other hand he intimates his desire to meet the Director in his office the next day. More important are the letters of the contractor subsequent to the receipt of the A/T dated 13-11-1952. THEse letters clearly indicate that the contractor kept the tender open for acceptance even after the expiry of 31-10-1952. Further the contractor purported to supply goods against the A/T dated 13-11-1952. It is too late for the contractor now to contend that it was not open to acceptance beyond 31-10-1952. THE conduct of the contractor both before November 1952 and after clearly indicates that it was kept open by the contractor for acceptance by the Government till 13-11-1952.;