Bishan Narain, J. - (1.) THE facts relevant for the decision of the present appeal are briefly stated, as follows. Messrs. R. Prince and Company contracted on 7 -12 -1944 to supply five tons of almond kernels to the Government at the rate of Rs. 215/ - per 100 Ibs on terms, conditions and specifications agreed to between the parties. One of the terms of the agreement was that "conditions of contract governing Department of Supply Contract form W.S.B. 133" apply to this agreement. The suppliers tendered the goods at Karachi on 23 -12 -1944 but the same were rejected on the payment on the ground that the specifications and suppliers were informed of the rejection on 9 -1 -1945. The suppliers contended that the rejection was illegal and unjustified but the purchasers refused to accept the goods. The suppliers then sold the goods in the market at the rate of Rs. 95/ - per maund and claimed damages from the Government. The Government did not accept the claim made by the claimants. Thus the dispute which had arisen between the parties was referred to the arbitration of Mr. R.N. Tandan and Shri Azmatullah Advocates in accordance with cl. 21 of the Conditions of Contract Form W.S.B. 133. The arbitrators appointed; Mr. Tara Chand Aggarwal Sub Judge as an umpire. The claimant before the arbitrators claimed Rs. 18 459/10/6 as damages under the following headings: 1 Difference between the contract and sale price Rs. 11.747/3/6.
(2.) OTHER damages and expenses Rs. 462/7/ - Damages for loss of reputation Rs. 5,000/ -.
(3.) REFUND of security deposited with the Government Rs. 1.250/ -. Total: Rs. 18.459/10/6. The claimant also claimed interest from the date of breach of the contract till the date of the payment on the ground that the goods tendered were in accordance with the specifications and rejection of goods was mala fide as the Government did not require them and wanted to get out of the contract somehow or other. It is to be noticed that in this petition of claim made before the arbitrators the claimant did not allege that Capt. Bristow. Assistant Inspector of Food -stuffs. Sind Area. Karachi, was not authorized to reject the goods. The Government replied by urging that the decision of the Inspector was final under cl. 13 (v) of general Conditions of Contract and the arbitrators have no jurisdiction in going into the matter or the correctness of the order of the Inspector and that in any case the goods were rightly rejected as they were not in accordance with the specifications. The arbitrators framed nine issues and the one material issue is issue No. 4 reading - Whether the decision of the Inspector in rejecting the goods is final and cannot be challenged. The arbitrators disagreed on this matter and gave a different award on 25 -6 -1947. The High Court refused permission to Shri Tara Chand Agarwal to act as an umpire an the case and therefore an application had to be made under S. 8 Arbitration Act. The Court of this application appointed Shri Jamil -ul -Rahman to act as an umpire. He however, left India before deciding the matter the claimant then suggested names of three persons and requested the Government by letter dated 16 -1 -1948 to appoint any one of those person to act as an umpire. The Government accepted the nomination of Shri Jaspal Rai Kapur as is contemplated in S. 8(1) (c) Arbitration Act. The parties appeared before the umpire without any objection having been raised by any of the parties to the authority of this umpire to act as such and after hearing the parties the umpire came to the conclusion that Mr. Bristow was not empowered within the terms of the contract and that in any case he did not apply his mind when rejecting the goods and On both these grounds his decision rejecting the goods cannot be considered to be final. The umpire further held that according to the terms of the contract the goods could not be rejected on the ground of "excessive damaged pieces" and holding the Government guilty of the breach of the contract awarded Rs. 10,964/11/6 to the claimant by his award dated 21 -6 -1948. The award was filed in Court and the Government prayed that the award be set aside under S. 30, Arbitration Act on various grounds including the ground that the arbitrators and the umpire had no jurisdiction to adjudicate upon the correctness or otherwise of the rejection of the goods by the Inspector under cl. 13 of the agreement. The claimant in reply urged that the umpire was entitled to give his decision on the finality of rejection of the goods by the Inspector as the matter had been referred to him for decision. The parties produced evidence before the Court and stated that all he evidence produced before the arbitrators and the umpire may be treated as -evidence in these proceedings. The trial Court held that the umpire had exceeded his jurisdiction in going into the matter of rejection of the goods by the Inspector and therefore the award must be set aside and that the Government was not stopped from raising this plea. The trial Court further held that Mr. Bristow was the Assistant Inspector and was acting on behalf of the' Inspector and rejection of goods by him was final under cl. 13 (v) of the agreement. It was also held by the trial Court that Shri Jaspat Rai Kapur was appointed an umpire within the terms of cl. 21 of the contract and was bound by its terms. On these findings the award was held not to be valid and was set aside. The claimant has appealed to this Court under S. 39 (i) Arbitration Act. 2. Shri A.N. Grover, the Learned Counsel for the appellant, has contended before me that the findings of the umpire to the effect that the goods were not rejected by the Inspector as provided in cl. 13 of the agreement and the rejection was not in accordance with Condition of Contract can not be questioned in the present proceedings in Court and the Court was not entitled to go into the correctness of this decision as it was not a Court of appeal against the award given by the umpire and for this purpose he has relied on - 'A. M. Mair and Co. v. Gordhandass Sagarmaul',, AIR 1951 SO 9 (A); 'Ruby General insurance Co. Ltd. v. Pearey Lal Kumar', : AIR 1952 SC 119 (B) and 'Mohindra Supply Co. Delhi v. Governor -General -in -Counsel, AIR 1954 P&H 211 (C) in support of his contention. In the alternative the Learned Counsel argued that in any case the question whether the decision was that of the Inspector or not was placed before the umpire inviting MB decision thereon and therefore he had jurisdiction to decide that matter. It was also argued that the finding of the trial Court that the rejection of the goods was by the Inspector whose decision was final was not borne out by the evidence on the record as Mr. Bristow was nether the Inspector nor did he apply his mind to the matter. 3. Sri Daya Krishan Mahajan, the Learned Counsel for the respondent, in reply argued that the cases cited by Shri A.N. Grover supported the contention that the arbitrators cannot decide his matter and for this reason the award was bad and was rightly set aside. He then raised two points which had not been raised in the trial Court, namely (1) the alleged contract was not executed in accordance with the provisions of S. 175 (3), Government of India Act, 1935 and therefore there was no valid contract and no valid arbitration agreement and (2) the umpire was not appointed by the arbitrators and therefore Shri Jaspat Rai Kapur had no jurisdiction to act as such and therefore the entire arbitration proceedings were bad and illegal. 4. I shall first deal with the new point raised by the Learned Counsel for the respondent. The first of those two point relates to S. 175 (3), Government of India Act, 1935 which has been incorporated in substance in Art. 299 of the Constitution of India. It is argued that the contract for supply of five tons of almond kernels was not executed in the manner laid down in S. 175 (3), Government of India Act and as there is valid contract for supply of these goods, therefore the Form W.S.B. 133 has no application to it and for this reason cl. 21 which, is the arbitration agreement is not binding between the parties. Now, there is no evidence on the record whether as matter of fact any formal document regarding the supply of these goods was - executed between the Parties or not for simple reason that this point was not raised either before the arbitrators or before the umpire or before the Trial Court. Before the point was raised before me it appears that the Government tad considered the contract and the arbitration agreement to be valid and binding between the parties. Two arbitrators were appointed as contemplated in cl. 21 of the agreement. Objections regarding the scope of the jurisdiction of the arbitrators were raised but it was never suggested that there was no valid arbitration agreement at all. When the arbitrators had differed and the umpire was appointed with the agreement of the parties the Government did not suggest before the umpire that as there was no valid arbitration agreement he had no jurisdiction to hear the dispute. The umpire made an award in favour of the claimant and under Art. 158, Indian Limitation Act the Government had thirty days from the date of the service of the notice of the filing of the award within which to file objections to the award. Rejections were filed but no objection was made regarding the validity or existence of the arbitration agreement. No application was lade under S. 33, Arbitration Act during all this Time challenging the existence and the validity of the arbitration agreement. It appears to me too late ? now long after the expiry of one month under Art. 158 of the Limitation Act to raise, this objection in appeal i.e at the time of the arguments when the Claimant had had no opportunity to adduce any evidence upon the question of fact whether agreement between the parties was executed or signed in accordance with S, 175(3), Government of India Act. 1935, vide - 'Kalvanpur Lime Works Ltd. v. State of Bihar', : AIR 1954 S.C. 165 (D). In fact it is very surprising that the Government should have instructed the counsel to raise this point which involves questions of fact and law at the time of arguments in appeal when it had not been taken at any stage of the proceedings that had been going on since 1945 or 1946. I therefore hold that it is not open to the respondent to raise this point at this stage of the proceedings for the first time.;