Judgment

J.B. PARDIWALA, J.

1. This petition under Article 227 of the Constitution of India is at the instance of unsuccessful defendants in a Civil Suit No. 83 of 2005, filed in the Court of City Civil Judge, Ahmedabad, and is directed against order passed by the Chamber Judge, Court No.13 dated 22nd January, 2007, below Exh.24, preferred by the original defendants, by which the learned Chamber Judge rejected the application Exh.24 filed under Section 8 of the Arbitration and Conciliation Act, 1996.

2. At the outset, I may state that although the present petition has been labelled as one under Article 226 of the Constitution of India and a writ of certiorari has been prayed for to set aside the order dated 22nd January, 2007, rendered by the Chamber Judge, Court No.13, City Civil Court, Ahmedabad, I am of the view that having regard to the nature of the dispute and the contentions raised, the petition is one under Article 227 of the o Constitution of India. It is a settled principle of law that in a petition under. Article 226 of the Constitution of India wherein a writ of certiorari is prayed for, then the Court whose order is sought to be quashed, is a necessary party and if the Court whose order is sought to be quashed by praying a writ of certiorari is not made a party, the petition would not be maintainable as one for the relief of certiorari, but the same may be treated as one under Article 227 of the Constitution of India.

3. Case of the petitioners:

3.1 The petitioner No.2 Metal and Steel Factory, Ishapore, is a steel producing unit functioning under the Ministry of Defence catering to the needs of the Ministry for the purpose of manufacture of items to 38 Ordnance Factories throughout India, apart from supplying the finished products to the Army at the right hour to meet their growing demand.

3.2 For the purpose of production, the said Factory initiated procurement action for 9.00 metric Ton of Ferro Molybdenum by way of floating Tender Inquiry No.T-0285G2P304 dated 3.6.2004. On 25th June, the said Tender was opened on Limited Tender basis.

3.3 Total three firms had responded to the Tender Enquiry floated by the petitioner No.2 and on opening of the tenders, it was found that the offer by the respondent herein was the lowest at the rate of Rs.1125.00 per Kg. excluding Excise duty at the rate of 8%. The total tender cost was Rs.1,09,35,000/-. The respondent firm in its offer dated 22nd June, 2004 mentioned that the offer was valid for acceptance for a period of ten days from the date of opening of the tender and thereafter subject to their reconfirmation.

3.4 In view of the aforesaid facts, a Letter of Intent bearing No.SP/0285/G2/04-P3, dated 5.7.04 was issued to the respondent firm stating therein inter alia that their offer was accepted and supply order for the same would be issued separately after observing all the requisite formalities. A specific condition of arbitration clause attached to the letter of intent provided that "any dispute or difference arising in the interpretation of application of the provisions of a contract, settlement of which is not herein before provided for, shall be referred to the sole arbitration of the Arbitrator or his successor in office". The award of the arbitration shall be final and binding on both the parties.

3.5 The respondent herein filled in his tender document, which, amongst other terms contained arbitration clause, which itself could be said to be an act of submitting to all the terms including the arbitration clause.

3.6 In view of the fact that the offer of the respondent herein was the lowest, a letter of in tent was issued on 5.7.2004. After the letter of intent was issued, the same was accepted and a separate supply order was issued on 14.7.2004 on completion of all requisite o formalities. Under the terms thereof, the total quantity of 9.00 M.T of Ferro Molybdenum was to