Hemant Gupta, J. - (1.) The challenge in the present revision petition is to the order passed by the learned trial Court on 31.7.1979 declining the application filed by the petitioner under Sec. 33 of the Indian Arbitration Act, 1940 challenging the existence and validity of an Arbitration agreement and the reference to the Arbitrator. The challenge is also to the order passed by the learned First Appellate Court dated 3.2.1992 affirming the order passed by the learned trial Court.
(2.) The respondent No.1 had taken two insurance policies for the sum of Rs. 25000/ -and Rs. 22000/ -from the Indian Mutual General Insurance Society and Union Cooperative Insurance Society Limited respectively for burglary in respect of its stocks and trade. Both the aforesaid companies stand merged with the petitioner. Respondent No.1 alleged that there was a theft in their shop on the intervening night of 7/8.8.1973. The claim in respect of such theft was lodged with the petitioner, but on 14.1.1975, the petitioner repudiated the claim of respondent No.1. Subsequently, respondent No.1 sought the appointment of an Arbitrator, but the petitioner did not agree to the appointment of an Arbitrator in terms of Condition No.14 of the policy. Subsequently, respondent No.2 issued a notice calling upon the petitioner to appear before him on the ground that he had entered upon a reference as sole Arbitrator at the instance of respondent No.1, which action was challenged by the petitioner.
(3.) The petitioner challenged the authority of respondent No.2 to continue with the reference, on the ground that in view of total denial of the liability and repudiation of the claim, the clause regarding the arbitration in the policies does not subsists and that there was no point of difference which can be referred to an Arbitrator. On behalf of respondent No.1, the stand was taken by way of filing of the written statement that burglary in respect of stock and trade was committed in the shop on the intervening night of 7/8.8.1973. The mere fact that respondent No.1 has used the word 'theft' instead of 'burglary' would not in any way relieve the petitioner of its liability under the Insurance policies. The repudiation of the claim by the petitioner was said to be illegal and against the policy conditions.;