JUDGMENT

P.K. Balasubramanyan, J.—Leave granted.

1. This appeal arises out of an award made by the arbitrator on a reference made to him under the Arbitration Act, 1940 (for short “the Act”). Though there was controversy between the appellant and the respondent as to whether there existed an arbitration clause justifying reference to an arbitrator, ultimately, the appellant agreed to the appointment of one of the arbitrators suggested by the respondent clarifying that the appellant was agreeing to the appointment of the arbitrator “not under the alleged contract but outside the alleged contract to decide whether there is a concluded contract and in any event can you invoke the arbitration clause under the alleged contract”. Thus, the dispute stood referred to a sole arbitrator. The sole arbitrator while making an award held that there had come into existence a valid contract between the parties; that there was an arbitration clause in the contract and proceeded to adjudicate the claim on merits and passed an award directing the appellant to pay a sum of Rs. 1,26,67,529.10 and costs of Rs. 75,600/- to the respondent on or before 31.07.1994 and failing payment, directed the appellant