1. This appeal is directed against the Judgment and Order dated 6th July 2007 passed by the VI Addl. City Civil Judge, Bangalore City in A.S. No.26/2003.

2. The records reveal that the appellant herein – Mysore Minerals Limited (‘MML’ for short) issued tender notice on 18.5.1995 inviting bids from the registered PWD contractors for ‘Handling Earthwork Excavation in certain of its mines in Chromite Sector’. The appellant is a Company registered under the Indian Companies Act engaged in extracting and exporting of minerals and it is a State Government undertaking. The respondent herein participated in the tender process by submitting his bid. A Letter of Intent was issued by the appellant on 4.7.1995 in favour of the respondent entrusting the work at an estimated cost of Rs.7,18,90,682/- (approximately Rs.7.18 crores). An agreement came to be entered in writing between the appellant and the respondent on 10.7.1995 for execution of the work. Clause-3 of the said agreement provides that the work is required to be completed within six months from the date of the agreement. On 11.7.1995 the work order was issued. The work order stipulates that 2,00,000 cubic meters of “loose soil” and 8,00,000 cubic meters of “all other types of strata” has to be excavated at Rs.16.70 and Rs.36.75 per cubic meter respectively in Jambur Chromite Mine. The respondent while informing the difficulties encountered by him in removal of the overburden in one of the Chromite Mines viz., Jambur Chromite Mines, requested for increase of rates on 2.5.1996. On 17.7.1996 the respondent completed the work entrusted to him and he submitted the last running account bill on 25.7.1996. The respondent wrote the letter dated 12.5.2000 to the appellant requesting for settlement of the claim within 30 days and thereby informed the appellant that in the event of failure to settle the claim, the matter would be referred to arbitration. Another letter came to be issued on 29.7.2000 by the respondent to the appellant informing the appellant that since the appellant has failed to settle the accounts, it is presumed that the disputes have arisen between the parties and the matter will be referred to arbitration as per Article-17 of the tender document. Thereafter the respondent submitted the claim statement before the Indian Council of Arbitration (‘ICA’ for short) on 2.3.2001 claiming a sum of Rs.3.10 crores with interest thereon.

Pursuant thereto, the ICA wrote the letter/notice dated 9.4.2001 to the appellant enclosing a copy of the claim statement and requested the appellant to file defence statement/reply on or before 9.5.2001. The appellant replied to the letter of the ICA on 7.5.2001 stating that the agreement dated 10.7.1995 entered into between the parties does not contain the arbitration clause and it only provides for settlement of dispute between the parties in the Civil Court at Bangalore. After receipt of such reply, the ICA wrote back to the appellant on 22.6.2001 stating that the ground relating to existence of the arbitration agreement between the parties may also be raised before the Arbitral Tribunal. Another letter came to be issued by the ICA on 21.12.2001 informing the parties that three Member Arbitral Tribunal has been constituted.

3. The appellant filed preliminary objection on 16.1.2002 before the Arbitral Tribunal regarding non-existence of the arbitration agreement between the parties, thereby the appellant questioned the competence of the Arbitral Tribunal to decide the matter between the parties in arbitration. The reply was filed by the respondent on 15.2.2002 to the preliminary objection raised by the appellant. However the appellant filed objections to the main claim statement also on 13.3.2002 without prejudice to the contention regarding the maintainability of the claim petition and jurisdiction of the Arbitral Tribunal to adjudicate the dispute. Based on the pleadings, the Arbitral Tribunal framed points for determination, which are