Arbitration proceedings commenced before the Arbitration and Conciliation Act, 1996 came into force are governed by the Arbitration Act, 1940.

( 1 ) IN these matters, two common decisions rendered by the Division bench of the High court of Bombay in four arbitration proceedings have been brought on the anvil of scrutiny.

( 2 ) BEFORE dealing with the merits of these proceedings, one point which, in our view, requires to be decided at the threshold is to the effect whether , the present arbitration proceedings are governed by the earlier Arbitration , Act, 1940 or by the Arbitration and Conciliation Act, 1996 (hereinafter to be referred to as "the new Act" ). For resolving this question, a few relevant facts will have to be mentioned at the outset. In Special Leave Petitions (C) Nos. 1238-39 of 1997, according to the petitioner, the dispute was sought to be referred to arbitration by lodging a claim in that connection by the petitioner-contractor with the respondent-authorities on 6/3/1995 pursuant to the earlier demand dated 20/11/1994. A further letter in support of the earlier demand dated 6/3/199595 was also submitted on 29/5/1995 and thereafter an arbitration suit was filed in the High court of Bombay on 24/8/1995 invoking the jurisdiction of the court under Section 8 read with Section 20 of the Arbitration Act, 1940. So far as Special Leave Petitions (C) Nos. 1240-41 of 1997 are concerned, a demand for arbitration was lodged with the respondents on 24/4/1995. That was with reference to the earlier claim lodged, according to the petitioner under clause 62 of the Arbitration Agreement on 5/1/1995. This demand for arbitrationcame to be rejected by the respondent-authorities on 5/7/1995 and that resulted into another arbitration suit which was filed on even date, i. e. , 24/8/199595 invoking the very same provisions of the Arbitration Act, 1940. In a slps (C) Nos. 1242-43 of 1997, according to the petitioner clause 62 of the arbitration Agreement was invoked on 30/11/1994. The petitioners case is that the said claim was rejected on 2/1/1995 and then a demand was made for referring the dispute for arbitration as per clause 63 of the Arbitration agreement on 6/3/1995. A reminder was sent on 29/5/1995. Ultimately, that demand came to be rejected on 25/7/1995 by the authorities and that is how b the third suit came to be filed on 24/8/1995 invoking the same Section 8 read with Section 20 of the Arbitration Act, 1940. The last two SLPs, i. e. , slps (C) Nos. 1244-45 of 1997 pertain to a claim which was lodged, according to the petitioner, on 30/12/1994 and that claim was rejected on 24/1/1995 and the petitioner made a demand for referring the dispute for arbitration on 15/3/1995 and thereafter as there was no response from the respondents, arbitration suit was filed on 24-8-1995 under Section 8 read with Section 20 of the Arbitration Act, 1940.

( 3 ) IN the light of the aforesaid factual data about the dates on which such claims were rejected the present question will have to be decided. The High court in the impugned judgment has proceeded on the ground that the demands lodged under clause 63 of the Arbitration Agreement, were premature. We are not concerned with that controversy at this stage. Therefore, without expressing any opinion on the merits of that ground we proceed to decide this short question whether the new Act applies or the old act applies on the facts of the present proceedings. The answer to this question is found from Section 85 of the new Act which reads as under:

"85. Repeal and savings.- (1 The Arbitration (Protocol and convention) Act, 1937 (6 of 1937, the Arbitration Act, 1940 (10 of 1940 and the Foreign Awards (Recognition and Enforcement) Act, 1961 (45 of 1961 are hereby repealed.

(2 Notwithstanding such repeal,-

(A) the provisions of the said enactments shall apply in relation to arbitral proceedings which commenced before this Act came into force unless otherwise agreed by the parties but this Act shall apply in relation to arbitral proceedings which commenced on or after this Act comes into force;

(B) all rules made and notifications published,