Page 1 Reportable

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 4424 OF 2014

(Arising out of S.L.P. (C) No. 20558 of 2013

Karnataka Power Transmission

Corporation Limited and another ... Appellants

Versus

M/s. Deepak Cables (India) Ltd. ...Respondent

With

CIVIL APPEAL NO. 4425 OF 2014

(Arising out of S.L.P. (C) No. 29008 of 2013)

With

CIVIL APPEAL NO. 4426 OF 2014

(Arising out of S.L.P. (C) No. 29009 of 2013)

With

CIVIL APPEAL NO. 4427 OF 2014

(Arising out of S.L.P. (C) No. 29010 of 2013)

With

CIVIL APPEAL NO. 4428 OF 2014

(Arising out of S.L.P. (C) No. 29011 of 2013)

With

CIVIL APPEAL NO. 4429 OF 2014

(Arising out of S.L.P. (C) No. 29012 of 2013)

With

Page 2 CIVIL APPEAL NO. 4430 OF 2014

(Arising out of S.L.P. (C) No. 29013 of 2013)

With

CIVIL APPEAL NO. 4431 OF 2014

(Arising out of S.L.P. (C) No. 29014 of 2013)

J U D G M E N T

Dipak Misra, J.

Leave granted in all the special leave petitions.

2.The controversy involved in these appeals, preferred

by special leave, being similar, they were heard

together and are disposed of by a common judgment.

For the sake of convenience, we shall state the facts

from Civil Appeal arising out of Special Leave Petition

29011 of 2013.

3.The appellant No. 1 is a company wholly owned by

the Government of Karnataka and, being a State

transmission utility, is a deemed licencee in the State.

2

Page 3 It invited tenders for establishing 2x8 MVA, 66/11

Sub-stations at Tavarekere in Channagiri Taluk,

Davanagere District, which included the supply

materials, erection and civil works on partial turnkey

basis. The respondent-company participated in the

bid and it was successful in the tender and,

accordingly, a letter of intent was sent to it. After

taking recourse to certain procedural aspects, a

contract was entered into between the appellant-

company and the respondent. During the

performance of the contract, the respondent raised a

claim before the engineer as per clause 48 of the

general conditions of the contract and called upon the

engineer to settle certain disputes arising in

connection with the contract. As the concerned

engineer did not do anything within the prescribed

period of thirty days as provided under clause 48.2,

the respondent filed CMP No. 62 of 2011 under

Section 11(5) and (6) of the Arbitration and

Conciliation Act, 1996 (for brevity “the Act”) before

3

Page 4 the High Court of Karnataka at Bangalore for

appointment of an arbitrator.

4.The said application was resisted by the present

appellants on the singular ground that clause 48 does

not provide for arbitration and the same, under no

circumstances, could be construed as an arbitration

clause. To substantiate the said submission, reliance

was placed on clause 4.1 of the agreement. It was

put forth that as there is no arbitration clause, no

arbitrator could be appointed. The designated Judge

of the Chief Justice placed reliance on the proceedings

in W.P. No. 28710/09 (M/s. Subhash Projects &

Marketing Limited v. Karnataka Power Transmission

Corporation Limited) disposed of on 10.6.2010

wherein the appellant-company, being a State owned

Corporation, had not disputed clause 48.2 as an

arbitration clause and, on that foundation, opined that

it was precluded from denying the same in the case

under consideration. The learned designated Judge

interpreted clauses 48 and 4.1 of the agreement and

came to hold that a plain reading of clause 48 would

4

Page 5 indicate that it partakes the character of an

arbitration clause and, accordingly, appointed a sole

arbitrator to adjudicate the matters in dispute.

5.We have heard Mr. K.V. Vishvanathan, learned senior

counsel appearing for the appellants, and Mr.

Dushyant Dave and Mr. Shyam Divan, learned senior

counsel appearing for the respondents.

6.Mr. Vishvanathan, learned senior counsel appearing

for the appellants, assailing the impugned order, has

submitted that clause 48 of the agreement cannot be

remotely construed as an arbitration clause and

hence, the designated Judge could not have invoked

the power under Section 11(5) & (6) of the Act for

appointment of an arbitrator. It is urged by him that

an order passed in a writ petition, which was

instituted in a different context, could not have been

placed reliance upon for construing the said clause as

an arbitration clause. It is submitted by him that in

the absence of an express intention for referring the

matter to an arbitrator, it cannot be so inferred from

such a clause and, more so, when there is a specific

5

Page 6 clause, i.e., clause 4 in the agreement which provides

for settlement of disputes that stipulates that all the

references and disputes arising out of the agreement

or touching the subject-matter of the agreement shall

be decided by a competent court at Bangalore. To

bolster his contentions, he has commended us to the

decisions rendered in M.K. Shah Engineers &

Contractors v. State of M.P.

1

, Wellington

Associates Ltd. v. Kirit Mehta

2

and Jagdish

Chander v. Ramesh Chander and others

3

.

7.Mr. Dushyant Dave and Mr. Shyam Divan, learned

senior counsel appearing for the respondents in all

the appeals, in oppugnation, have submitted that

when clause 48 is read as a whole, it is clear as

crystal that the intention of the parties is to get the

matter referred to an arbitrator and clause 4.1 only

determines the place of territorial jurisdiction and has

nothing to do with any stipulation for arbitration. It

has been strenuously urged that clause 48 has to be

interpreted on the touchstone of the language

1

(1999) 2 SCC 594

2

(2000) 4 SCC 272

3

(2007) 5 SCC 719

6

Page 7 employed in Section 7 of the Act and when it is

scrutinized on that anvil, there remains no trace of

doubt that clause 48 has all the attributes and

characteristics of an arbitration agreement. Learned

senior counsel have placed reliance on Smt.

Rukmanibai Gupta v. Collector, Jabalpur and

others

4

and Punjab State and others v. Dina

Nath

5

.

8.Before we advert to the rival submissions advanced at

the Bar, we think it appropriate to refer to Section 7 of

the Act and what it conveys and, thereafter, refer to

few authorities to understand what constitutes an

arbitration clause in an agreement entered into

between two parties. Section 7 of the Act reads as

follows:

“7.Arbitration agreement. – (1) In this Part,

“arbitration agreement” means an agreement by

the parties to submit to arbitration all or certain

disputes which have arisen or which may arise

between them in respect of a defined legal

relationship, whether contractual or not.

(2)An arbitration agreement may be in the

form of an arbitration clause in a contract

or in the form of a separate agreement.

4

(1980) 4 SCC 556

5

(2007) 5 SCC 28

7

Page 8 (3)An arbitration agreement shall be in

writing.

(4)An arbitration agreement is in writing if it is

contained in –

(a)a document signed by the parties;

(b)an exchange of letters, telex, telegrams or

other means of telecommunication which

provide a record of the agreement; or

(c)an exchange of statement of claim and

defence in which the existence of the

agreement is alleged by one party and not

denied by the other.

(5)The reference in a contract to a document

containing an arbitration clause constitutes an

arbitration agreement if the contract is in writing

and the reference is such as to make that

arbitration clause part of the contract.”

9.From the aforesaid provision, it is graphically clear

that unless an arbitration agreement stipulates that

the parties agree to submit all or certain disputes

which have arisen or which may arise in respect of

defined legal relationship, whether contractual or not,

there cannot be a reference to an arbitrator. To

elaborate, it conveys that there has to be intention,

expressing the consensual acceptance to refer the

disputes to an arbitrator. In the absence of an

arbitration clause in an agreement, as defined in sub-

section (4) of Section 7, the dispute/disputes arising

8

Page 9 between the parties cannot be referred to the arbitral

tribunal for adjudication of the dispute.

10.In Smt. Rukmanibai Gupta (supra), while

considering Clause 15 of the agreement therein, a

two-Judge Bench opined that the clause spelt out an

arbitration agreement between the parties. The said

clause was as follows:-

“Whenever any doubt, difference or dispute

shall hereafter arise touching the construction

of these presents or anything herein contained

or any matter or things connected with the said

lands or the working or non-working thereof or

the amount or payment of any rent or royalty

reserved or made payable hereunder in the

matter in difference shall be decided by the

lessor whose decision shall be final.”

The learned Judges, to appreciate the tenor and

purport of the said clause, referred to Section 2(a) of the

1940 Act and reproduced a passage from Russell on

Arbitration, 19

th

Edn., P. 59 which reads as follows: -

“If it appears from the terms of the agreement

by which a matter is submitted to a person’s

decision that the intention of the parties was

that he should hold an inquiry in the nature of a

judicial inquiry and hear the respective cases of

the parties and decide upon evidence laid

before him, then the case is one of an

arbitration”

9

Page 10 11.The Court also referred to Chief Conservator of

Forest v. Rattan Singh

6

and ruled that:

“In the clause under discussion there is a

provision for referring the disputes to the lessor

and the decision of the lessor is made final. On

its true construction it spells out an arbitration

agreement.”

12.At this juncture, it is apposite to refer to a three-Judge

Bench decision in State of U.P. v. Tipper Chand

7

where the Court was interpreting Clause 22 in the

agreement which was under consideration so as to

find out whether the stipulations therein spelt out an

arbitration clause. The clause involved in the said

case read as follows:-

“Except where otherwise specified in the

contract the decision of the Superintending

Engineer for the time being shall be final,

conclusive and binding on all parties to the

contract upon all questions relating to the

meaning of the specifications, design, drawing

and instructions hereinbefore mentioned. The

decision of such Engineer as to the quality of

workmanship, or materials used on the work, or

as to any other question, claim, right, matter or

things whatsoever, in any way arising out of or

relating to the contract, designs, drawing

specifications, estimates, instructions, orders, or

these conditions, or otherwise concerning the

works, or the execution or failure to execute the

same, whether arising during the progress of

the work, or after the completion or

6

AIR 1967 SC 166 : 1966 Supp SCR 158

7

(1980) 2 SCC 341

10

Page 11 abandonment of the contract by the contractor,

shall also be final, conclusive and binding on the

contractor.”

Interpreting the said clause, the Court opined thus:-

“Admittedly the clause does not contain any

express arbitration agreement. Nor can such an

agreement be spelled out from its terms by

implication, there being no mention in it of any

dispute, much less of a reference thereof. On

the other hand, the purpose of the clause

clearly appears to be to vest the Superintending

Engineer with supervision of the execution of

the work and administrative control over if from

time to time.”

13.In that context, the three-Judge Bench approved the

decisions of the High Courts in Governor-General v.

Simla Banking and Industrial Company Ltd.

8

,

Dewan Chand v. State of Jammu and Kashmir

9

and Ram Lal v. Punjab State

10

wherein the clauses

were different. In that context, it was opined that the

High Courts had rightly interpreted the clause

providing for arbitration. We think it apt to reproduce

the delineation by the learned Judges:-

“In the Jammu and Kashmir case the relevant

clause was couched in these terms:

“For any dispute between the contractor

and the Department the decision of the

Chief Engineer PWD Jammu and Kashmir,

8

AIR 1947 Lah 215 : 226 IC 444

9

AIR 1961 J & K 58

10

AIR 1966 Punj 436 : 68 Punj LR 522 : ILR (1966) 2 Punj 428

11

Page 12 will be final and binding upon the

contractor.”

The language of this clause is materially

different from the clause in the present case

and in our opinion was correctly interpreted as

amounting to an arbitration agreement. In this

connection the use of the words “any dispute

between the contractor and the Department”

are significant. The same is true of the clause in

Ram Lal case which ran thus:

“In matter of dispute the case shall be

referred to the Superintending Engineer of

the Circle, whose order shall be final.”

We need hardly say that this clause refers not

only to a dispute between the parties to the

contract but also specifically mentions a

reference to the Superintending Engineer and

must therefore be held to have been rightly

interpreted as an arbitration agreement.”

14.At this stage, it is useful to refer to a three-Judge

Bench decision in State of Orissa and another etc.

v. Sri Damodar Das

11

wherein the Court posed the

question whether there was an agreement for the

resolution of disputes as enshrined under Clause 25 of

the agreement. The said clause read as follows:-

“25. Decision of Public Health Engineer to be

final. — Except where otherwise specified in this

contract, the decision of the Public Health

Engineer for the time being shall be final,

conclusive and binding on all parties to the

contract upon all questions relating to the

meaning of the specifications; drawings and

11

AIR 1996 SC 942

12

Page 13 instructions hereinbefore mentioned and as to

the quality of workmanship or materials used on

the work, or as to any other question, claim,

right, matter or thing, whatsoever in any way

arising out of, or relating to, the contract,

drawings, specifications, estimates, instructions,

orders or these conditions, or otherwise

concerning the works or the execution or failure

to execute the same, whether arising during the

progress of the work or after the completion or

the sooner determination thereof of the

contract.”

The three-Judge Bench referred to the principles

stated in Tipper Chand (supra) and observed as follows:-

“We are in respectful agreement with the above

ratio. It is obvious that for resolution of any

dispute or difference arising between two

parties to a contract, the agreement must

provide expressly or by necessary implication, a

reference to an arbitrator named therein or

otherwise of any dispute or difference and in its

absence it is difficult to spell out existence of

such an agreement for reference to an

arbitration to resolve the dispute or difference

contracted between the parties. The ratio in

Smt. Rukmanibai Gupta v. Collector does

not assist the respondent.”

15.In K.K. Modi v. K.N. Modi and others

12

, a two-

Judge Bench was interpreting Clause 9 of the

agreement which read as follows:-

“Implementation will be done in consultation

with the financial institutions. For all disputes,

clarification etc. in respect of implementation of

this agreement, the same shall be referred to

the Chairman, IFCI or his nominees whose

12

(1998) 3 SCC 573

13

Page 14 decisions will be final and binding on both the

groups.”

The court referred to a passage from Russell on

Arbitration, 21

st

Edn., at p. 37, para 2-014 and the

decisions in Rukmanibai Gupta (supra) and M.

Dayanand Reddy v. A.P. Industrial Infrastructure

Corporation Limited And Others

13

and came to hold

that the said clause was not an arbitration clause and

hence, the proceedings before the Chairman, IFCI could not

have been treated as arbitration proceedings. It was so

held on the following ground:-

“Undoubtedly, in the course of correspondence

exchanged by various members of Groups A

and B with the Chairman, IFCI, some of the

members have used the words “arbitration” in

connection with clause 9. That by itself,

however, is not conclusive. The intention of the

parties was not to have any judicial

determination on the basis of evidence led

before the Chairman, IFCI. Nor was the

Chairman, IFCI required to base his decision

only on the material placed before him by the

parties and their submissions. He was free to

make his own inquiries. He had to apply his own

mind and use his own expertise for the purpose.

He was free to take the help of other experts.

He was required to decide the question of

valuation and the division of assets as an expert

and not as an arbitrator. He has been

authorised to nominate another in his place. But

the contract indicates that he has to nominate

13

(1993) 3 SCCC 137

14

Page 15 an expert. The fact that submissions were made

before the Chairman, IFCI, would not turn the

decision-making process into an arbitration.”

16.In Bharat Bhushan Bansal v. U.P. Small

Industries Corporation Ltd., Kanpur

14

, clauses 23

and 24 of the agreement were projected to make the

foundation of an arbitration clause. That read as

follows:-

“Decision of the Executive Engineer of the

UPSIC to be final on certain matters.

23. Except where otherwise specified in the

contract, the decision of the Executive Engineer

shall be final, conclusive and binding on both

the parties to the contract on all questions

relating to the meaning, the specification,

design, drawings and instructions hereinbefore

mentioned, and as to the quality of

workmanship or materials used on the work or

as to any other question whatsoever in any way

arising out of or relating to the designs,

drawings, specifications, estimates, instructions,

orders or otherwise concerning the works or the

execution or failure to execute the same

whether arising during the progress of the work,

or after the completion thereof or abandonment

of the contract by the contractor shall be final

and conclusive and binding on the contractor.

Decision of the MD of the UPSIC on all other

matters shall be final

24. Except as provided in clause 23 hereof, the

decision of the Managing Director of the UPSIC

shall be final, conclusive and binding on both

the parties to the contract upon all questions

14

AIR 1999 SC 899

15

Page 16 relating to any claim, right, matter or thing in

any way arising out of or relating to the contract

or these conditions or concerning abandonment

of the contract by the contractor and in respect

of all other matters arising out of this contract

and not specifically mentioned herein.”

Interpreting the said clauses, the Court opined thus:-

“In the present case, reading clauses 23 and 24

together, it is quite clear that in respect of

questions arising from or relating to any claim

or right, matter or thing in any way connected

with the contract, while the decision of the

Executive Engineer is made final and binding in

respect of certain types of claims or questions,

the decision of the Managing Director is made

final and binding in respect of the remaining

claims. Both the Executive Engineer as well as

the Managing Director are expected to

determine the question or claim on the basis of

their own investigations and material. Neither of

the clauses contemplates a full-fledged

arbitration covered by the Arbitration Act.”

17.In Bihar State Mineral Development Corporation

and another v. Encon Builders (I) (P) Ltd.

15

,while

dealing with the arbitration clause of an arbitration

agreement under the Act the Court stated thus:

“(1) There must be a present or a future

difference in connection with some

contemplated affair.

(2) There must be the intention of the parties to

settle such difference by a private tribunal.

15

(2003) 7 SCC 418

16

Page 17 (3) The parties must agree in writing to be

bound by the decision of such tribunal.

(4) The parties must be ad idem”.

In the said case, it has also been opined that the Act

does not prescribe any form of an arbitration agreement.

The term ‘arbitration’ is not required to be specifically

mentioned in the agreement but what is required is to

gather the intention of the parties as to whether they have

agreed for resolution of the disputes through arbitration.

18.In Dina Nath (supra), the clause in the agreement

read as follows: -

“4. Any dispute arising between the department

and the contractor/society shall be referred to the

Superintending Engineer, Anandpur Sahib, Hydel

(Construction) Circle No. 1, Chandigarh for orders

and his decision will be final and

acceptable/binding on both parties.”

The two-Judge Bench, basically relying on Tipper

Chand (supra) which has approved the view of Jammu and

Kashmir High Court in Dewan Chand (supra), treated the

aforesaid clause as providing for arbitration because it

categorically mentioned the word “dispute” which would

be referred to the Superintending Engineer and further

17

Page 18 that his decision would be final and acceptable to/binding

on both the parties.

19.In Jagdish Chander (supra), the Court, after referring

to the earlier decisions, culled out certain principles

with regard to the term “arbitration agreement”. The

said principles basically emphasize on certain core

aspects, namely, (i) that though there is no specific

form of an arbitration agreement, yet the intention of

the parties which can be gathered from the terms of

the agreement should disclose a determination and

obligation to go to arbitration; (ii) non-use of the

words “arbitration” and “arbitral tribunal” or

“arbitrator” would not detract from a clause being

interpreted as an arbitration agreement if the

attributes or elements of arbitration agreement are

established, i.e., (a) The agreement should be in

writing. (b) The parties should have agreed to refer

any disputes (present or future) between them to the

decision of a private tribunal. (c) The private tribunal

should be empowered to adjudicate upon the disputes

in an impartial manner, giving due opportunity to the

18

Page 19 parties to put forth their case before it. (d) The parties

should have agreed that the decision of the private

tribunal in respect of the disputes will be binding on

them; and (iii) where there is specific exclusion of any

of the attributes of an arbitration agreement or

contains anything that detracts from an arbitration

agreement, it would not be an arbitration agreement.

In this context, the two-Judge Bench has given some

examples and we think it apt to reproduce the same: -

“For example, where an agreement requires or

permits an authority to decide a claim or

dispute without hearing, or requires the

authority to act in the interests of only one of

the parties, or provides that the decision of the

authority will not be final and binding on the

parties, or that if either party is not satisfied

with the decision of the authority, he may file a

civil suit seeking relief, it cannot be termed as

an arbitration agreement.”

20.In State of Orissa and others v. Bhagyadhar

Dash

16

, the Court, while discussing about the non-

requirement of a particular form for constituting an

arbitration agreement and ascertainment of the

intention for reference to arbitration, as has been

16

(2011) 7 SCC 406

19

Page 20 stated in Rukmanibai Gupta (supra), observed thus:

-

“16. While we respectfully agree with the

principle stated above, we have our doubts as

to whether the clause considered in Rukmanibai

Gupta case would be an arbitration agreement

if the principles mentioned in the said decision

and the tests mentioned in the subsequent

decision of a larger Bench in Damodar Das are

applied. Be that as it may. In fact, the larger

Bench in Damodar Das clearly held that the

decision in Rukmanibai Gupta was decided on

the special wording of the clause considered

therein: (Damodar Das case, SCC p. 224, para

11)

“11. … The ratio in Rukmanibai Gupta v.

Collector does not assist the respondent.

From the language therein this Court

inferred, by implication, existence of a

dispute or difference for arbitration.”

21.Keeping in mind the principles laid down by this Court

in the aforesaid authorities relating to under what

circumstances a clause in an agreement can be

construed as an arbitration agreement, it is presently

apposite to refer to clause 48 of the agreement. The

said clause reads as follows: -

“48.0 Settlement of disputes:

48.1Any dispute(s) or difference(s) arising out of

or in connection with the Contract shall, to

the extent possible, be settled amicable

between the parties.

20

Page 21 48.2If any dispute or difference of any kind

whatsoever shall arise between the owner

and the Contractor, arising out of the

Contract for the Performance of the Works

whether during the progress of the Works or

after its completion or whether before or

after the termination, abandonment or

breach of the contract, it shall, in the first

place, be referred to and settled by the

Engineer, who, within a period of thirty (30)

days after being requested by either party

to do so, shall give written notice of his

decision to the owner and the contractor.

48.3Save as hereinafter provided, such decision

in respect of every matter so referred shall

be final and binding upon the parties until

the completion of the works and shall

forthwith be given effect to by the

contractor who shall proceed with the works

with all the due diligence.

48.4During settlement of disputes and Court

proceedings, both parties shall be obliged to

carry out their respective obligations under

the contract.”

22.On a careful reading of the said clause, it is

demonstrable that it provides for the parties to

amicably settle any disputes or differences arising in

connection with the contract. This is the first part.

The second part, as is perceptible, is that when

disputes or differences of any kind arise between the

parties to the contract relating to the performance of

the works during progress of the works or after its

21

Page 22 completion or before or after the termination,

abandonment or breach of the contract, it is to be

referred to and settled by the engineer, who, on being

requested by either party, shall give notice of his

decision within thirty days to the owner and the

contractor. There is also a stipulation that his

decision in respect of every matter so referred to

shall be final and binding upon the parties until the

completion of works and is required to be given effect

to by the contractor who shall proceed with the works

with due diligence. To understand the intention of

the parties, this part of the clause is important. On a

studied scrutiny of this postulate, it is graphically

clear that it does not provide any procedure which

would remotely indicate that the concerned engineer

is required to act judicially as an adjudicator by

following the principles of natural justice or to

consider the submissions of both the parties. That

apart, the decision of the engineer is only binding

until the completion of the works. It only casts a

burden on the contractor who is required to proceed

22

Page 23 with the works with due diligence. Besides the

aforesaid, during the settlement of disputes and the

court proceedings, both the parties are obliged to

carry out the necessary obligation under the contract.

The said clause, as we understand, has been

engrafted to avoid delay and stoppage of work and

for the purpose of smooth carrying on of the works. It

is interesting to note that the burden is on the

contractor to carry out the works with due diligence

after getting the decision from the engineer until the

completion of the works. Thus, the emphasis is on

the performance of the contract. The language

employed in the clause does not spell out the

intention of the parties to get the disputes

adjudicated through arbitration. It does not really

provide for resolution of disputes.

23.Quite apart from the above, clause 4.1 of the

agreement is worthy to be noted. It is as follows: -

“4.1It is specifically agreed by and between

the parties that all the differences or disputes

arising out of the Agreement or touching the

subject matter of the Agreement, shall be

decided by a competent Court at Bangalore.”

23

Page 24 24.Mr. Vishwanathan, learned senior counsel for the

appellants, laying immense emphasis on the same,

has submitted that the said clause not only provides

the territorial jurisdiction by stating a competent

court at Bangalore but, in essence and in effect, it

stipulates that all the differences or disputes arising

out of the agreement touching the subject-matter of

the agreement shall be decided by a competent court

at Bangalore. Mr. Dave, learned senior counsel for

the respondents, would submit that it only clothes the

competent court at Bangalore the territorial

jurisdiction and cannot be interpreted beyond the

same. The submission of Mr. Dave, if properly

appreciated, would convey that in case an award is

passed by the arbitrator, all other proceedings under

any of the provisions of the Act has to be instituted at

the competent court at Bangalore. This construction,

in our opinion, cannot be placed on the said clause. It

really means that the disputes and differences are

left to be adjudicated by the competent civil court.

Thus, clause 48, as we have analysed, read in

24

Page 25 conjunction with clause 4.1, clearly establishes that

there is no arbitration clause in the agreement. The

clauses which were interpreted to be arbitration

clauses, as has been held in Ram Lal (supra) and

Dewan Chand (supra) which have been approved in

Tipper Chand (supra), are differently couched. As

far as Rukmanibai Gupta (supra) is concerned, as

has been opined in Damodar Das (supra) and also in

Bhagyadhar Dash (supra), it has to rest on its own

facts. Clause in Dina Nath (supra) is differently

couched, and clause 48, which we are dealing with,

has no similarity with it. In fact, clause 48, even if it

is stretched, cannot be regarded as an arbitration

clause. The elements and attributes to constitute an

arbitration clause, as has been stated in Jagdish

Chander (supra), are absent. Therefore, the

irresistible conclusion is that the High Court has fallen

into grave error by considering the said clause as

providing for arbitration.

25.Consequently, the appeals are allowed and the

judgments and orders passed by the High Court are

25

Page 26 set aside. However, regard being had to the facts

and circumstances of the case, there shall be no

order as to costs.

…..…………………………….J.

[Anil R. Dave]

…………… ..………………….J.

[Dipak Misra]

New Delhi;

April 07, 2014.

26