The main legal point established in the judgment is the significance of parties' consent in appointing arbitrators and the consequences of their conduct in adhering to the arbitration agreement.

JUDGMENT :

1. Heard Sri Mata Prasad alongwith Sri Baleshwar Chaturvedi learned counsels for the appellants and Sri Rahul Agarwal learned counsel for the respondent.

2. The above noted two appeals have arisen out of the order passed in Original Suit No. 425 of 1983 by the Civil Judge, Aligarh making the arbitral award Rule of the Court and the order in execution case arising out of the said decree. The executing court passed orders of attachment of the bank account of the appellants in execution of the award. By the order dated 17.5.1985 passed by this Court, the operation of the impugned attachment order had been stayed. As a result of dismissal of these appeals for non-prosecution, a fresh attachment order dated 6.3.2019 had been passed.

The ground pressed to challenge the aforesaid orders are that the arbitral award was void-ab-initio, inasmuch as, the Arbitrator lacked jurisdiction. The subsequent proceeding in execution of the award, therefore, are liable to be set aside.

3. Brief facts of the case relevant to decide the controversy, admitted to the parties, are that an agreement was entered into between the appellant and the respondent no. 2 on 9th May, 1964, whereby the appellant had agreed to supply power to the Mill.

The said agreement contained an arbitration clause which is pertinent to be noted herein-under:

“All disputes and differences (the settlement or adjustment of which is not hereinabove provided for) as to the interpretation or construction of any of the provisions of the agreement or the rights and obligations of the responsive parties hereto or as to any other matter shall be referred to a single arbitrator if the parties agree upon one, otherwise to two arbitrators, one to be appointed by the Board and one by the consumer, which arbitrators shall appoint an umpire before proceeding with the reference and the decision of the sole arbitrator be final and binding on the parties and this clause shall in all respects be deemed and construed as a reference to arbitration within the meaning of the Indian Arbitration Act, 1940 and the provisions of the said Act or any statutory modification or re-enactment thereof for the time being in force shall apply to such reference.”

Pursuant to a dispute, the respondent no. 2 served the notice dated 9.9.1970 upon the appellant asking to agree for appointment of the sole arbitrator in terms of the first part of the arbitration clause 18. The appellant had agreed to the said proposal and on 29.9.1970, Mr. Justice T.P. Mukherji, a retired Judge of this Court had become the sole arbitrator. However, before the arbitrator could enter upon the reference, unfortunately he died. A notice dated 6.7.1982/3.8.1982 under Section 8 of the Arbitration Act, 1940 was then served upon the appellant proposing Shri A.C. Bansal, a retired District & Sessions Judge to be the sole arbitrator.

4. It is contended on behalf of the appellant that since the said notice did not contain the details of the claim and hence by the letter dated 28th December, 1982, the details were required from the respondent no. 2 which were to be intimated to the Board to enable it to proceed further. The respondent no. 2 by the letter dated 8.2.1983 replied that the amount of losses and damages claimed by them will be put before the arbitrator or the arbitrators who had to adjudicate the dispute. It was then stated therein that the appellant had failed to appoint an arbitrator on its behalf within the statutory period, so the arbitrator nominated by the respondent no. 2 namely Shri A.C. Bansal had become the sole arbitrator under the Arbitration Act, 1940. It was then intimated that a request was made to the sole arbitrator to proceed with the matter and fix a date for hearing. On 10th February, 1983, the arbitrator put both the parties to notice intimating that he had entered into the reference and that 7th March,1983 was the date fixed for striking of issues and preliminary hearing.

It is contended by the appellant that sinc