The court upheld the importance of arbitration clauses in contracts and directed the appointment of an arbitrator to resolve disputes arising from the construction contract.

( 1 ) BY this petition under Section 8 and 20 of the Arbitration Act the petitioner seeks direction to the respondents to file the arbitration agreement in court and for reference of the disputes for arbitration.

( 2 ) THE petitioner was awarded the work for the construction of Library Block at M. A. M. C. , New Delhi (balance work) by agreement No. 31/ee/public Witness D-2/82-83. The work was completed on 18-9-1985. The respondent prepared the final bill on 30-7-1986 in respect of the work done by the petitioner which was accepted by the petitioner under protest. The case of the petitioner is that the respondents made certain recoveries from the bill and besides that certain payments had not been made for the work done. The claims for the payments was repudiated by the respondents. According to the petitioner certain disputes have arisen between the parties which are enumerated in para 7 of the petition. It is further stated that the agreement contain an arbitration clause which provides that all questions and disputes relating to claim or right arising out of the contract shall be referred to the sole arbitration of the person appointed by the Chief Engineer C. P. W. D. It is further stated that the disputes are covered under the arbitration clause and the respondents by letter dated 25. 7. 1986 were called upon to appoint an arbitrator which they have not done. The respondents acknowledged the receipt of the letter but informed the petitioner that the matter regarding appointment of an Arbitrator was under consideration. The respondents further informed the petitioner that all the claims were general in nature and were vague. Under these premises it is claimed that the respondents be directed to file the arbitration agreement in court and reference of the disputes for arbitration.

( 3 ) REPLY has been filed on behalf of Union of India. It is stated that no dispute was raised by the petitioner and he did not submit any list of claims to the department. The petitioner submitted various ambiguous and vague claims and he was informed by the department to elaborate certain claims before those claims could be referred to the arbitrator for adjudication. It is further stated that the respondents are willing to refer the matter to arbitration if the claims are clarified.

( 4 ) IN the rejoinder filed on behalf of the petitioner it has been denied that the claims were general in nature and were vague. However, the petitioner was directed by this court to give the details of the disputes mentioned in para 7 of the petition. The petitioner has filed the details of the claims. No other plea was taken by the respondents.

( 5 ) IN the result the petition is allowed. The respondents are directed to file the arbitration agreement in court. The Chief Engineer, C. P. W. D. is directed to appoint an arbitrator within 2 months from the date of communication of this order and refer the disputes mentioned in para 7 of the petition for arbitration. The Arbitrator shall make his award within 4 months from the date of entering upon reference. The petition is disposed of leaving the parties to bear their own costs.