G.N. Ray, J. - (1.) This appeal is directed against the judgment dated June 28, 1985 passed by the learned Subordinate Judge, 7th Court, Alipore in Title Suit No. 58 of 1983 under the Arbitration Act.
(2.) The plaintiff appellant Sree Traders is a partnership firm and it is the case of the said partnership firm that the firm undertook storing and distribution agency of foodstuff and gunny bags under the respondent Food Corporation of India and an agreement incorporating the terms and conditions was executed between the parties on June 18, 1969 and the said agreement was terminated on September 8, 1976. A second agreement was executed on June 10, 1976 between the parties on the same terms and conditions which came into force from July 1, 1973. The said terms and conditions were still in force. The plaintiff firm contended that disputes and differences arose between the parties on certain matters and some of the bills presented by the plaintiff firm were retained by the defendant Food Corporation of India and some of the bills were refused and returned. By a registered letter dated August 22, 1977, the plaintiff firm applied for appointment of Arbitrator for adjudication of the disputes between the parties of the Managing Director of the Food Corporation of India in terms of the provisions of the aforesaid agreement. As no Arbitrator was appointed by the Managing Director, the firm made an application in the 5th Court of the learned Munsif at Alipore sometime in October, 1977 for appointment of an Arbitrator. Such proceeding was numbered as Title Suit No. 469 of 1977. The District Manager, Calcutta South of the Food Corporation of India made an application in the said proceeding with a prayer that the Managing Director of F.C.I. should be directed to appoint an Arbitrator to adjudicate of the disputes between the parties. By an order No. 10 dated September 21, 1978 passed in the said Title Suit No. 469 of 1977, the Court passed an order directing the Managing Director to appoint a sole Arbitrator, but no such appointment was made till March 8, 1979. The plaintiff firm then made an application under Section 8 of the Arbitration Act for appointment of the sole Arbitrator for a reference of the disputes before the Arbitrator and on such application under Section 8 of the Arbitration Act, Misc. Case No. 35 of 1981 arose. In the said Misc. case, the defendant Food Corporation of India appeared but did not file any written statement and on an application made by the plaintiff firm on Navember 25, 1980, the court appointed Shri D.P. Chatterjee as an Arbitrator. It is tho case of the plaintiff firm that there was no objection to such appointment of Shri D.P. Chatterjee from the side of the defendant. It is the further case of the plaintiff firm that both the plaintiff firm and the defendant appeared before the learned Arbitrator and filed respective claim petition and written objection. During the hearing, however, the defendant Food Corporation of India did not participate and it does not appear that either of the parties adduced any oral evidence. After considering the documents filed by the plaintiff and the facts and circumstances of the case, the said Arbitrator passed his award on March 22, 1983 and filed the same in court on May 27, 1983. It may be noted that the plaintiff firm made a claim of Rs. 20,37,593.21, but the learned Arbitrator awarded a sum of Rs. 13,80,966.30. The plaintiff firm thereafter initiated the present proceeding for pronouncement of judgment according to the Award under Section 17 of the Arbitration Act and also for interest under Section 29 of the Arbitration Act on the amount as may be decreed from the date of the decree till realisation with costs. The plaintiff firm also made an application under Section 28 of the Arbitration Act praying for condoning the delay in making of the award in question and to extend the time of making of the award retrospectively till March 22, 1983. 2A. The defendant Food Corporation of India contested the said proceeding viz., Title Suit/Case No. 58 of 1983 by filing a written objection under Sections 30 and 33 of the Arbitration Act with a prayer for setting aside the Award, inter alia, on the ground that the Award was invalid because the appointment of Shri D.P. Chatterjee as Arbitrator was bad in law and contrary to the terms of agreement. It was alleged by the defendant F.C.I. that one Shri K.K. Chakraborty had already been appointed as an Arbitrator by the Managing Director, F.C.I. in compliance with the order No. 10 dated September 21, 1978 made in Title Suit No. 469 of 1977 in respect of agreement dated June 10, 1976. It was also contended 'that there was a specific term in the agreement between the parties that the Managing Director of the F.C.I. was the sole and competent authority for appointment of Arbitrator and no person other than the person appointed by the said Managing Director could act as Arbitrator and if for any reason such appointment of Arbitrator by the Managing Director was not possible, there was no occasion to refer the matter to arbitration at all. Accordingly, the appointment of Shri D.P. Chatterjee was not made lawfully. The defendant F.C.I. also questioned the property of the said Award.
(3.) The learned trial Judge inter alia came to the finding that in view of the specific provisions in Clause 41 of the agreement the Managing Director of the F.C.I. could only appoint Arbitrator. Accordingly, the appointment of Shri Chatterjee as Arbitrator by the court under Section 8(2) of the Act was without jurisdiction. Hence, the entire proceeding culminating in the Award was bad-in-law. The learned trial Judge also upheld the contention made on behalf of the defendant F.C.I. that the claims were made in respect of both the agreements dated June 16, 1969 and June 10, 1976 and the first agreement was in force upto September 8, 1976, but the second agreement was still in force. As the claim of the first agreement and the claim of the second agreement had not been made separately the demand for arbitration in respect of the second agreement was premature and could not be made so long the said agreement was in force because such agreement could only be made within one year from the date of completion of the agreement. The learned trial Court overruled the objection of the plaintiff firm that such contention was not made in the application under Section 30 of the Arbitration Act and such ground could not he permitted to he agitated. The learned trial Judge was of the view that as the said ground of objection touches the question of limitation, the same could be gone into. In that view of the matter, the learned trial Judge by the impugned order set aside the award by holding that the appointment of the Arbitrator was made without jurisdiction.;