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TMI Blog1970 (10) TMI 78X X X X Extracts X X X X X X X X Extracts X X X X ..... er its decision has been otherwise provided for and whether it has been finally decided accordingly or whether the contract should be terminated or has been rightly terminated and as regards the rights and obligations of the parties as the result of such termination be referred for arbitration to the Judicial Commissioner, Himachal Pradesh, and his decision shall be final and binding and where the matter involves a claim for or the payment or recovery or deduction of money, only the amount, if any awarded in such arbitration shall be recoverable in respect of the matter so referred. 2. The parties are agreed that no other clause in the agreements is relevant for our present purpose. Disputes arose between the appellants and the respondents in respect of some claims arising from the said contracts. The appellants requested the respondents to refer the disputes to the arbitration of the Judicial Commissioner, Himachal Pradesh. The respondents declined to agree to make the reference in question. Thereafter the appellants moved the Senior Sub Judge, District Sirmur Nihan under Section 20 of the Indian Arbitration Act, 1940 (to be hereinafter referred to as the Act) for ordering the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; or (b) if any appointed arbitrator or umpire neglects or refuses to act, or is incapable of acting, or dies, and the arbitration agreement does not show that it was intended that the vacancy should not be filled and the parties or the arbitrators, as the case may be, do not supply the vacancy. (c) where the parties or the arbitrators are required to appoint an umpire, and do not appoint him; any party may serve the other parties or the arbitrators, as the case may be, with a written notice to concur in the appointment or appointments or in supplying the vacancy. Section 20 reads thus: (1) Where any persons have entered into a arbitration agreement before the institution of any suit with respect to the subject-matter of the agreement or any part of it, and where a difference has arisen to which the agreement applies, they or any of them, instead of proceeding under Chapter II, may apply to a Court having jurisdiction in the matter to which the agreement relates, that the agreement be filed in Court. (2) The application shall be in writing and shall be numbered and registered as a suit between one or more of the parties interested or claiming to be interested as pla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... intend to supply the vacancy'. In other words if the agreement is silent as regards supplying the vacancy, the law presumes that the parties intended to supply the vacancy. To take the case out of Section 8(1)(b) what is required is not the intention of the parties to supply the vacancy but their intention not to supply the vacancy. We have now to see whether the agreements before us indicate such an intention. 6. As mentioned earlier the only relevant provision in the agreements before us is the provision relating to arbitration. The other provisions in the agreements do not throw any light as regards the intention of the parties. We have earlier mentioned that the Judicial Commissioner, Himachal Pradesh could not have been appointed as the arbitrator for any specialised knowledge possessed by him relating to any dispute that may arise under the agreement. What the Judicial Commissioner could have competently done if he had acted as an arbitrator could certainly be done by an independent and impartial person possessing adequate knowledge of law. In our opinion the language of Section 8(1)(b) is plain and unambiguous and the terms of the agreement before us do not in the le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt laid down that a perusal of Clause (4) of Section 20 of the Act indicates that there are three courses open to the court under that provision of law. After the arbitration agreement has been ordered to be filed the court shall proceed to make a reference firstly to the arbitrator appointed by the parties in the agreement; secondly to the arbitrator not named in the agreement, but with regard to whom the parties agree otherwise; and thirdly when the parties cannot agree upon an arbitrator, to an arbitrator appointed by itself. 11. The respondents, in support of their case that the vacancy could not be filled up relied on the decision of the Rajasthan High Court in Chief Engineer, Building's and Roads, Jaipur and Anr. v. Harbans Singh A.I.R. 1955 Raj. 30. Therein Wanchoo C.J. (as he then was) after referring to the various clauses in the agreement and particularly to the clause which said that the Chief Engineer shall be the sole arbitrator and judge in case of dispute.... came to the conclusion that the parties to the agreement intended that the vacancy should not be filled up if the Chief Engineer refused or failed to act. The said decision turned on the facts of tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the decision of the Rajasthan High Court and the principles of law enunciated by him are not borne out by the provisions of Section 8(1)(b). 15. Lastly reference was made on behalf of the respondents to the decision of the Punjab High Court in Isherdass Sahni and Bros. v. Union of India and Ors . 68, P.L.R. 325 wherein one of us (Grover J.) after referring to the various decisions rendered under Section 8(1)(b) and Section 20(4) of the Act and noticing the conflict of the judicial opinion rejected the revision petition solely on the ground that he would not be justified in the exercise of his revisional powers in setting aside the view taken by the lower court. In fact in the course of his judgment he observed : If the matter were res integra I might have agreed with one view or the other but in my opinion the court below has on a consideration of the material facts and relevant law came to the conclusion that the arbitration agreement in question showed that there was no intention to fill up the vacancy. I would not be justified in Revision in setting aside that finding even if I was disposed not to concur with the decision of the trial court on this point. 16. For the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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