Unsigned goods receipts failed to establish a binding arbitration agreement due to lack of proper notification of terms to plaintiffs.

1. F. A. F. O. No. 470 of 1978 and F. A. F. O. No. 471 of 1978 are between the same parties and respectively arise out of two separate orders both dated 5-4-1978 of Shri Phool Singh, Additional Civil Judge, Ghaziabad, passed in two separate Suits Nos. 86 of 1976 and 85 of 1976 respectively.

2. Plaintiff 1 is a company carrying on business of general insurance with its registered office at Jiwan Udyog, A - 25/27, Asir Ali Road, New Delhi and nationalised by U.P. Government under Act No. 57 of 1972. Shri S. S. Bakshi is the Manager of the said insurance company and as such competent and authorised to file the suits by power of attorney.

3. Plaintiff 2 is a partnership firm duly registered under the Partnership Act and Daya Kishan Gupta is its partner. The said firm carries on business under the name and style of M/s. Anand Industrial at Gandhi Road. Pilkhuwa, Ghaziabad.

4. The defendant M/s. New Suraj Transport Company (P) Ltd., carries on business at various places in India, including Pilkhuwa with its registered office at Amritsar.

5. In suit No. 86 of 1976,34 bales of cotton cloth and in suit No. 85 of 1976, 6 bales of cotton cloth were consigned by plaintiff 2 at Pilkhuwa with M/s. New Suraj Transport Company (P) Ltd. defendant to be carried to Calcutta and to be delivered there to plaintiff 2 or its endorsee. The freight was to be paid at the time of delivery by plaintiff 2, consignee. The goods were insured with M/s. Oriental Fire and General Insurance Company Limited, plaintiff 1 before they were booked for carriage with the defendant. At the time of booking of the consignments the transport company, defendant, had issued goods receipts (C.Rs.). The goods never reached their destination and thus were not delivered to plaintiff 2 at Calcutta despite repeated presentations of the respective G.Rs. A notice about the claim dated 9-7-1973 was sent by plaintiff 2 to the defendant transport company demanding the price of the goods but the defendant transport company, on 17-2-1973 made an endorsement on the G.Rs. at Calcutta that the goods were not received. Finally on 18-11-1973, intimation was received by plaintiff 2 saying that the goods had not been received at Calcutta.

6. Accordingly suit No. 86 of 1976 was filed for the recovery of Rs. 46780.70 being the price of the consigned goods plus Rs. 16,847.40 towards interest at the rate of 12% per annum total Rs. 63,628.10.

7. Similarly suit No. 85 of 1976 was filed for the recovery of Rs. 9715.85 being the price of the consigned goods plus Rs. 3,508.50 towards the interest at 12% per annum total Rs. 13,223.85.

8. The defendant transport company filed applications in both the suits under S.34, Arbitration Act , 1940, wherein he set up an arbitration agreement between the parties and prayed that the suit be stayed and the matter in dispute be directed to be referred to arbitration (so that the matter could be got decided in arbitration). It was specifically contended by transport company defendant that the alleged contract of carriage was complied and executed, inter se, vide G.Rs. issued by the defendant to plaintiff 2. The said G.Rs. were even referred to and relied upon by the plaintiffs on the basis of which suits were filed. It was contended that the said G.Rs. under which the consigned goods were booked contained terms and conditions which were clearly set forth and printed on the reverse of the said G.Rs. The plaintiffs had categorically accepted those terms and conditions and it was only then that the defendant Transport Company undertook to accept the goods for carriage. It was asserted that had the consigner not accepted those term