The main legal point established in the judgment is that a petition under S.8 of the Arbitration Act may not be maintainable if the power to appoint or nominate the arbitrator is given to a designated person under the Arbitration Clause, as it does not fall under the provisions of S.8(1)(a) or S.8(1)(b).

S. Sankarasubban, J.

The above Civil Revision petition is filed against the order passed in O.P. 66/83 on the-file of the Subordinate Judge's Court, Kozhikode. The first respondent in the CRP, M/s. Salam Traders, was the petitioner in the O.P. which was filed under S.8 of the Arbitration Act. The petitioners in the C.R.P. are the Food Corporation of India and its Officers. The case of the petitioner in the O.P. is as follows:- The petitioner had entered into an agreement with the Food Corporation of India for the work of Clearing and forwarding-cum-handling and transporting of various food articles at Calicut Port and FCI godown for a period of two years from 11.8.79. It had deposited with the respondents a sum of Rs. 50,000/- by way of security for the due performance of the work. According to petitioner, an amount of Rs. 4,26,707.96 was due to the petitioner for the work done during the period of contract. Disputes and differences arose between the parties regarding the claim of the petitioner. The agreement entered into between the parties contained an Arbitration Clause. As per the Arbitration Clause, the Managing Director of the Food Corporation of India has to appoint an arbitrator to decide the disputes and difference arising out of the agreement. The petitioner on 27.7.82 sent a notice to the Managing Director to appoint an arbitrator to decide the disputes and differences between the parties. Excepting saying that the matter is under consideration, no arbitrator has been appointed by the Managing Director. Hence the petitioner filed a petition under S.8(2) of the Arbitration Act for appointment of arbitrator to settle the disputes between the parties.

2. The respondents in the O.P. filed a counter. They challenged the maintainability of the petition. According to them, there were no disputes or differences between parties it was contended that the petition was "barred by limitation. As per the terms of the contract, no person other than the person appointed by the Managing Director of the Food Corporation of India can be the arbitrator for the disputes. A petition under S.8 is not maintainable in the facts of the case. The Sub-Court considered the questions and found that the petition under S.8 was maintainable and appointed the second respondent as the arbitrator. It is against the above order of the Sub Court, the Food Corporation of India and its officers have come up in revision. When the CRP came up originally for hearing before John Mathew, J. his Lordship, after hearing the parties, was of the view that the matter requires consideration by a Bench of two Judges. Before his Lordship the revision petitioners contended that the revision has to be allowed in view of the decision of this Court in Food Corporation of India v. A. Mohammed Yunus (AIR 1987 Kerala 231). But the respondents submitted that a Full Bench decision of the Delhi High Court in Veil Prakash Mithal v. Union of India & Ors. AIR 1984 Delhi 325 has taken a view which is opposite to the view taken by the Division Bench in AIR 1987 Kerala 231. It was also contended that the decision in M/s. Rai Bhadur Basakha Singh & Sons (Contractors) Pvt. Ltd. v. M/s. Indian Drugs & Pharmaceutical Ltd. AIR 1979 Delhi 220 which was relied on in the Kerala decision has been overruled by the latter Full Bench decision of the Delhi High Court. Before the learned single judge the F.C.I, contended that in any event the petition under S.8 was not maintainable and referred to various decisions in support of that-contention, Because of the importance of the question raised, the learned single judge referred the matter to a Division Bench.

3. The matter came up before the Division Bench consisting of K.T. Thomas & K.S. Radhakrishnan, JJ. The Division Bench referred to the decision in Food Corporation of India v. Mohammed Yunus AIR 1987 Ker. 231 and in Ved Prakash Mithal v. Union of India & Ors. AIR 1984 Delhi 325. It also took into consideration that the petition was