ORDER

Leave granted. Substitution allowed.

2. These appeals, by special leave, arise from the judgment of the Madras High Court, dated December 20, 1990, made in O.S.A. Nos. 109 and 110 of 1988.

3. The admitted facts are that the respondents had entered into an agreement with the appellant to construct inter-connecting tunnels for Suruliyar Hydroelectric Project as per specification No. 1138 Schedule-B to the agreement. The initial value of the tender to be awarded was Rs. 47 lakhs and it was revised to Rs. 69 lakhs on January 16, 1975. In the course of execution of the contract, a sum of Rs. 92 lakhs was paid to the respondent. The contract was to be completed within a period of 24 months from the date of taking over of the site, i.e., January 18, 1975; thus, it was completed after the expiry of the term, on August 25, 1978. Resultantly, there had arisen a dispute as to the entitlement to further amount towards the work done by the respondent.

4. On a notice issued by the respondent for appointment of an arbitrator in terms of clause 50 of the contract (arbitration clause), there was a delay on the part of the appellant in nomination of the arbitrator. When the respondent exercised