Judgment:
A.A. Desai, J.
1. These appeals are directed against orders dated 20-2-1987 rejecting the applications purported to be under section 8 of the Arbitration Act. The appeals raise a common question arising out of common facts and hence proposed to be disclosed of by this common judgment.
2. The appellants is a partnership firm and entered into a contract with the respondent for construction of canal. The work orders were issued in favour of the appellants. According to the appellants, dispute arose between the parties due to certain breach committed by the non-applicant. According to them, Clause 30 of the agreement provides for arbitration of dispute. Therefore, they have served with a notice on the non-applicant to submit a dispute for arbitration of the Superintending Engineer. It was contended that the Arbitrator-the Superintending Engineer entered into arbitration proceedings but subsequently has abandoned the same without completing. The appellants, therefore, applied under section 8 of the Arbitration Act to the Civil Court for appointment of an Arbitrator.
3. The respondents resisted the application. According to them Clause 30 is not an Arbitration Clause and there were never any arbitration proceedings. The learned trial Court placing reliance on the decision reported in State of U.P. v. Tipper Chand, : AIR1980SC1522 held that Clause 30 of the contract is not an Arbitration Clause. Hence the trial Court has rejected the application under section 8 of the Arbitration Act.
4. The learned trial Court reproduced Clause 30 of the agreement in para 5 of the impugned order. Precisely this clause provides that on all questions relating to the matters specified in the clause, the decision of the Superintending Engineer of the circle shall be final, conclusive and binding on all parties to the contract. Their Lordships of the Supreme Court in the case, cited supra, considered the Clause 22 of U.P. Government which is in substance synonymous and analogous to Clause 30 provided in the contract in these proceedings. The Supreme Court has held on interpretation of Clause 22 of the U.P. Government, did not mean as an Arbitration clause. It did not contain any express Arbitration agreement nor it could be implied. According to their Lordships, the clause has merely vested in the Superintending Engineer, powers of supervision and administrative control over the work. Their Lordships, while considering Clause 22, observed that such agreement even by implication cannot be construed as an Arbitration Clause in the absence of any mention in it of any dispute and reference thereof. According to me, the Supreme Court has emphasised that the dispute and reference thereof are essential ingredients of any clause to construe the same as an arbitration clause.
5. Mr. Manohar, the learned Counsel appearing for the appellants, made a submission before me that Clause 22 which was before. Their Lordships of the Supreme Court for consideration in the case cited supra, is not analogous to Clause 30 of the contract of the State of Maharashtra. Mr. Manohar pointed out that title of clause 22 reads as 'Direction of work'. As such, according to Mr. Manohar, Clause 22 of the U.P. Government, as has been held, were providing supervisory and administrative power to the Superintending Engineer. Mr. Manohar, therefore, made a submission that Clause 30 does not have any such title. As such, the intention, as can be gathered from the wording of Clause 30, necessarily leads to the conclusion that the same is an agreement of Arbitration. I am unable to agree with this submission. Excepting the title as referred, textually and substantially and in operation both these clauses are substantially similar. Absence of the title, in fact, does not change the nature or character of Clause 30.
6. Mr. Manohar then made a submission that Clause 22 of U.P. Government does not provide binding effect on all the parties to the agreement which is in contradiction with Clause 30 of the agreement. Clause 22 is divided in two parts. In the first part, decision of the Superintending Engineer on all questions relating to the means of the specifications, designs, drawings and instructions, has been made final, conclusive and binding on all parties to the contract. However, the decision on other questions specify in the later part in binding on the contractor only. Mr. Manohar invited my attention to the decision delivered by this Court an 5th March 1987 in State of Maharashtra v. M/s. Kumar Constructions Company, Civil Revision Application No. 590 of 1986. This Court in the said revision had an occasion to consider Clause 30 of the State Government. This Court, in view of the binding effect of Clause 22 of U.P. Government only on the contractor, has held that Clause 30 is not analogous to Clause 22. This Court has further observed that the State Government by Circular Memorandum dated 9th May, 1977 clarified that Clause 30 is an Arbitration Clause and Superintending Engineer acts as an Arbitrator. This Court has, therefore, held that the State Government has accepted Clause 30 as an agreement of Arbitration. Mr. Manohar, therefore, made a submission before me that the learned trial Court acted erroneously in rejecting their application. He further submitted that Circular dated 9th May, 1977 is binding on the respondent and it is not open for them to contend anything otherwise.
7. As discussed above, the Supreme Court has emphasised that the dispute and reference thereof are the ingredients which are decisive in construing whether particular clause is an Arbitration Clause. As pointed out by me, the first part of Clause 22 of U.P. Government provides the binding effect of the decision of the Superintending Engineer on all the parties. However, even this part of the clause since does not refer to any dispute or a reference thereon, the Supreme Court has held that it cannot be construed as an Arbitration agreement. As such, whether the decision binds both the parties of contract or either of them, is not decisive. It is also not germane to lead any conclusion either way.
8. According to me, the construction of a particular clause mainly depends upon the words used in that clause. Intention of a draftsman solely depends on that. The Court cannot have an aid from the subsequent attitude approach or relied on of either of the parties in the matter of rendering treatment to a particular clause. Circular of 1977 issued by the State Government, no doubt, clarifies that Clause 30 is an Arbitration Clause and Superintending Engineer acts as an Arbitrator. This Circular is reported to have been withdrawn. However, such clarification cannot be taken as a guide to understand the initial intention of a draftsman. The State Government by way of clarification may make an attempt to give colour to Clause 30 of an Arbitration agreement. However, the same is not of any avail for the Court for interpreting the clause to ascertain its real nature and purpose. In view of the ratio laid down by the Supreme Court in the case cited supra, Clause 30 cannot be construed to mean as an Arbitration Clause, for want of essential ingredients.
9. Mr. Manohar invited my attention to the decision reported in State of Maharashtra v. Ranjeet Construction, 1986 Mh.L.J. 401. This Court has also considered the said Circular of 1977 of the Government. This Court has observed that the State as well as the Contractors always understood this Clause 30 as an Arbitration clause and referred the disputes arising in respect of these contracts to the arbitration of the Superintending Engineer. In view of this, the clarification vide Circular dated 9th May, 1977 came to be issued. The parties understood the clause as an Arbitration agreement and acted thereupon by referring the matter to the Arbitrator. This Court in the case, cited supra, has held that whether that reference was made under misapprehension of law or otherwise, when in fact parties have referred the dispute to Arbitration and the Arbitrator had acted upon the reference, then the arbitration proceedings must proceed until it is concluded by an award. In the case before me, the parties have not agreed or acted upon Clause 30 as an Arbitration agreement. Moreover, one of the parties is seriously disputing that Clause 30 is not an Arbitration agreement and parties have not acted upon nor they have treated the same as an Arbitration Clause nor entered into Arbitration proceedings. As such, the decision of this Court in 1986 Mh.L.J. 401 (cited supra) does not, in any manner, advance the contention of Mr. Manohar. On persual of Clause 30, as per the test laid down by Their Lordships of the Supreme Court in a case reported in : AIR1980SC1522 (cited supra), Clause 30 cannot be held to be an Arbitration Clause.
10. The appellants, therefore, are not entitled to relief under section 8 of the Arbitration Act. The reasonings in the impugned orders are just and proper. The appeals are without any merit. I dismiss both these appeals. No order as to costs.