A. SELVAM, J.

This Original Side Appeal has been directed against the order dated 29-09-2008 passed in O.P.No.625 of 2006 by the learned Single Judge of this Court.

2. The appellant herein, as petitioner, has invoked arbitration proceedings under the Arbitration and Conciliation Act, 1996, wherein the first respondent herein has been shown as first respondent. The arbitrator, after considering the rival contentions raised on either side, has allowed the same in part to the tune of Rs.1,07,88,075.59 by way of passing the impugned award. Against the award passed by the arbitrator, the respondents one and two herein, as petitioners, have filed Original Petition No.625 of 2006 on the file of this Court.

3. It is averred in the petition that the first respondent is a finance company. The first respondent and the petitioners have entered into a hire purchase agreement dated 28.3.1997, wherein the first respondent has agreed to let machinery on hire to the first petitioner and subsequently, a supplementary agreement has been executed on 28.3.1997 and thereby, the first petitioner has agreed to honour the terms and conditions of the hire purchase agreement. The second petitioner has stood as a guarantor for the amount payable to the first respondent. A letter of guarantee dated 28.3.1997 has also been executed in favour of the first respondent. In the hire purchase agreement, it has been agreed to pay the entire amounts, within a period of 34 months, commencing from 1.6.1997. Since the petitioners have failed to pay the amount as per agreement, a notice dated 7.1.1998 has been issued to them by the first respondent and thereby called upon to pay a sum of Rs.21,84,486 as on 31.12.1997, within a period of 21 days of receipt of the notice and subsequently a Memorandum of Understanding dated 1.4.1998 has come into existence and subsequently a deed of assignment dated 23.7.1998 has been entered into betwixt parties. Thereafter, an Application No.316 of 2003 has been filed, wherein an Advocate Commissioner has been appointed for taking possession of machinery. Subsequently various proceedings have come into existence and finally, the first respondent, as petitioner, has invoked arbitration proceedings before the second respondent herein, wherein the impugned award has been passed in favour of the first respondent and in order to quash the same, present petition has been filed at the instance of the petitioners.

4. The learned Single Judge, after contemplating the rival submissions made on either side, has allowed O.P.No.625 of 2006 and thereby set aside the award passed by the arbitrator. Against the order passed by the learned Single Judge, the present Original Side Appeal has been preferred at the instance of the first respondent as appellant.

5. Before analyzing the rival submissions made on either side, for better adjudication, the Court has to narrate the following admitted factual aspects.

It is an admitted fact that in between the appellant herein and the first respondent, a hire purchase agreement has come into existence on 28.3.1997. The second respondent herein has stood as a guarantor. In the hire purchase agreement, it has been agreed that the first respondent herein should pay the entire amount to the appellant, within a period of 34 months. Since the first respondent herein has failed to pay the amount, a legal notice has been issued and subsequently a Deed of Assignment has also come into existence betwixt parties on 23.7.1998 and thereafter various legal proceedings have become emanated and finally, the appellant, as petitioner, has invoked Arbitration and Conciliation Act, 1996, wherein the third respondent has been appointed as an arbitrator. The third respondent, after considering the divergent contentions raised on either side, has partly allowed the arbitration petition and thereby passed an award in favour of