( 1 ) THIS appeal is directed against the order of Joint Civil Judge (S. D.) Baroda directing to file the arbitration agreement contained in the contract of supply of December 1x 1970 executed by and between the parties hereto since the disputes and differences had arisen in the matter of the price of supply of liquid ammonia by the defendant-Corporation to the plaintiff-Company and for appointment of arbitrators to arbitrate upon the said disputes and for certain other incidental reliefs in the matter. In order to appreciate the grievance of the appellant-defendant-Corporation in its proper perspective it would be profitable to advert to a few facts which led to the suit between the parties.

( 2 ) THE respondent-plaintiff. Company was incorporated somewhere between June and August 1969. However one Shri S. S. Agrawal who happens to be the director of the plaintiff-Company was before the incorporation of the Company carrying on business under the firm name and style as Frontier Chemical Works. FIe was desirous of promoting a Company for purposes of carrying on the business of manufacture of Sodium Nirate having regard to its heavy internal market demand on account of short supply of its import. Said Shri Agrawal therefore applied for a Letter of Intent for the purpose of establishing a factory in Gujarat for manufacturing Sodium Nitrate and Sodium Nitrite. Therefore in 1967 negotiations commenced between the said promoter of the plaintiff-Company on one hand and the defendant-Corporation on another for assured supply of liquid ammonia which is the basic raw material for the manufacture of Sodium Nitrite etc. Accordingly a request was made by the aforesaid firm Frontier Chemical Works by its letter of May 8 1967 to the defendant-Corporation to draw and forward a draft agreement containing the terms and conditions under which he said Corporation would supply liquid ammonia to the proposed Company. It is claimed by the plaintiff-Company that the defendant-Corporation under the cover of their letter of May 15 1967 forwarded a draft agreement to the aforesaid firm. It is claimed on behalf of the plaintiff-Company that Clause 3 of the draft agreement inter alia provided the price at which the liquid ammonia would be supplied and the basis of the price offered subject to the firm final sale price to be varied according to the fluctuations in the prices of the raw materials of liquid ammonia which would be exclusive of all taxes duties and incidental charges. On the eve of the incorporation of the plaintiff-Company the aforesaid firm Frontier Chemical Works addressed a letter to the defendant-Corporation on May 2 1969 inquiring as to what the price of ammonia was. The defendant-Corporation by their letter of May 10 1969 stated that the price was Rs. 1050. 00 per M. T. ex-factory for quantity of over 1000 M. T. per annum. The aforesaid Shri Agrawal thereupon contacted the then General Manager of the defendant-Corporation one Shri B. C. Dalal and inquired whether the Corporation would be able to supply to the Company with about 10 M. T. of ammonia per day as the Company intended to start immediately the Sodium Nitrite Unit in the State of Gujarat. The defendant-Corporation therefore by their letter of June 14 1969 expressed their readiness to satisfy the proposed Companys requirements. After the incorporation of the Company somewhere about August 1969 a letter was addressed on behalf of the plaintiff-Company to the defendant-Corporation on August 30 1969 informing the defendant-Corporation about the registration of the Company and requesting them to give a Letter of Assurance that they would be supplying the requirements of ammonia so as to enable the plaintiff-Company to apply for conversion of the Letter of Intent into an Industrial Licence. The defendant-Corporation by their letter of September 15 1969 gave the required assurance. On October 2 1970 a draft agreement was handed over to one Shri Adi Amroliwala who happen