( 1 ) THIS petition filed on 21st July, 1980 under Sections 5, 11, 12 and 33 of the Arbitration Act, 1940 is for a declaration that the unilateral reference to arbitration in case No. 3-B/77 is void ab initio and unilateral nomination and appointment of Shri P. S. Kaicker respondent No. 3 as Sole Arbitrator is invalid and without jurisdition. The petitioners further pray for revocation of the authority of the said Arbitrator and to supersede the reference. ( 2 ) THE petitioner firm is a partnership concern having its factory at Yamuna Nagar (Haryana ). The petitioners are manufacturers of laminated springs and leaves. They submitted a tender for the supply of bear ing springs in Nov. , 1972. The respondent No. 2 accepted the quotation of the petitioners by a letter dated 31st January, 1973 and the detailed running contract dated 12th February, 1973. This contract is for the supply of 8400 Nos. + 25% of bearing spring (BC) 16 tonne Axle 4 wheeled wagons according to the specifications detailed in the contract. The price settled was Rs. 400. 00 less 1% rebate i. e. Rs. 396. 00 each for first 5000 Nos. and Rs. 400. 00 each for remaining 3000 Nos. This price was f. o. b Jagadhri. The petitioners allege that the alleged acceptance of the tender by means of the said letters did not create any valid binding and concluded contract; the respondents have no right of cancellation of the contract which was never concluded and as such the cancellation letter dated 19th July, 1974 was unauthorised and illegal; the threat of the respondents to encash the bank guarantee of Rs. 27,000. 00 by means of the letter dated 19th July, 1974 was illegal. The petitioners served a notice dated 12th Nov. , 1974 under Section 80. of the C. P. C. upon respondent No. 1 challenging the contract and for cancellation of the demand for encashment of the security deposit of Rs. 27,000. 00. The petitioners on 6th Jan. , 1975 filed Civil Writ No. 24 of 1975 for quashing the letter dated 19th July, 1974, forfeiting the security amount of Rs. 27,000. 00 and encashing the bank guarantee. An interim order was passed restraining the respondent from encashing the bank guarantee. On 10th Jan. , 1975 the respondent issued a demand letter claiming a sum of Rupees 11,59,129. , 1975 filed Civil Writ No. 24 of 1975 for quashing the letter dated 19th July, 1974, forfeiting the security amount of Rs. 27,000. 00 and encashing the bank guarantee. An interim order was passed restraining the respondent from encashing the bank guarantee. On 10th Jan. , 1975 the respondent issued a demand letter claiming a sum of Rupees 11,59,129. 53 on account of damages purported to have been suffered by it for the alleged risk purchase of the store. On 22nd Feb. , 1975 the petitioners filed a suit (original Suit No. 108/75) for a declaration that there was no valid, binding and concluded contract between the parties in terms of the alleged acceptance letters dated 31st Jan. , 1973 or 12tb Feb. , 1973, that the cancellation letter dated 19th July, 1974 and the alleged risk purchase was null and void and of no effect. By an interim order in the civil suit the respondents were restrained from giving effect to their letter of demand dated 10th January, 1975. ( 3 ) THE petitioners submit that in the aforesaid legal proceedings the respondent Union of India did not file any application under Section 34 of the Arbitration Act for stay of those legal proceedings and therefore, the arbitration agreement, if any, in the said contract has been rendered void under Section 35 of the Arbitration Act and as such the matter could not be referred to arbitration. The petitioners further allege that the respondents ignoring the said legal proceedings by letter dated 3rd Dec. , 1975 unilaterally appointed Shri N. S. Mehta, Additional Legal Adviser to the Government of India in the Ministry of Law as Sols Arbitrator to hear and determine the disputes and differences arising out of the said contract, that the reference to arbitration was unilateral vague and void ab initio, that by a further letter dated 21st Mar. , 1977 the respondent appointed Dr. Bakshish Singh, Additional Legal Adviser to the Government of India in the Ministry of Law as Sole Arbitrator in substitution of Shri N. S. Mehta, that Dr. Bakshish Singh entered upon the reference on 12th April, 1977 but the respondent Union of India failed to submit its statement of claim either before Shri N. S. Mehta or before Dr. Bakshish Singh. Bakshish Singh entered upon the reference on 12th April, 1977 but the respondent Union of India failed to submit its statement of claim either before Shri N. S. Mehta or before Dr. Bakshish Singh. The petitioners further allege that the respondent Union of India filed a petition under Section 28 of the Arbitration Act (O. M. P. 55/78 dated 17th Mar. , 1978), but the arbitration proceedings were invalid and as such there was no question of any extension of time, that the said petition under Section 28 of the Arbitration Act is still pending. ( 4 ) THE petitioners further allege that the respondent again by letter dated llth Dec. , 1979 unilaterally nominated and appointed Shri P. S. Kaicher, Additional Legal Adviser to the Government of India in the Ministry of Law, (respondent No. 3) to be the Sole Arbitrator in place of Dr. Bakshish Singh on the ground that he had since resigned, that respondent No. 3 Arbitrator entered upon reference on 31st Dec. , 1979 and required the parties to file their respective claims and appear before him on 28th Jan. , 1980, that the Union of India filed its statement of claim before the said Arbitrator claiming damages Rs. 11,59,129. 53. ( 5 ) THE respondents Nos, 1 and 2 in reply submit that the petition is barred by tune; it is barred under Order 2, Rule 2 of the Civil P. C. also; there was a concluded contract which was acted upon; the petitioners supplied 1805 Nos. of springs; they defaulted in supplying the remaining stores; the respondents vide letter dated 19th July, 1974 cancelled the remaining quantity and purchased the unsupplied quantity at the risk of the petitioners under the terms and conditions of the contract within six months from the date of breach. The respondents further submit that application under Section 34 of the Arbitration Act was not filed as the civil suit was for declaration that the contract in question was not concluded and was void; that there were no circumstances requiring the respondents to file any application under S. 34 of the Arbitration Act. The respondents further allege that S. 35 of the Arbitration Act is not attracted in the circumstances of the present case. They allege that Shri N. S. Mehta was appointed as Sole Arbitrator vide letter dated 3rd December, 1975 but he resigned and Dr. The respondents further allege that S. 35 of the Arbitration Act is not attracted in the circumstances of the present case. They allege that Shri N. S. Mehta was appointed as Sole Arbitrator vide letter dated 3rd December, 1975 but he resigned and Dr. Bakshish Singh was appointed as Sole Arbitrator. It is admitted that the respondents filed their statement of claim before that before the proceedings in O. M. P. 55 of 1978 could mature. Dr. Bakshish Singh resigned and he could not be deemed to have entered upon reference. ( 6 ) THE following issues were framed on 24th April, 1981 :- 1. Is the present petition barred by limitation ? 2. Is the present petition barred by the provisions of. Order 2, Rule 2, C. P. C. ? 3. Was there no valid, binding and concluded contract including the arbitration agreement, between the parties? 4. Is the appointment of Shri P. S, Kaicher invalid and without jurisdiction? 5. Is the authority of the arbitrator liable to be revoked or his appointment liable to be cancelled? 6. Is the arbitration reference liable to be superseded and arbitration agreement declared inoperative as alleged by the petitioner ? 7. Relief. ( 7 ) SHRI Bapandra Singh Jauhar, partner of the petitioners has filed affidavit in support of the petition deposing about almost all the facts pleaded in the petition. Shri A. K. Aggarwal, Assistant Director of Supplies in the Office of the Director General Supplies and Disposal, New Delhi has fited a counter-affidavit in support of the defence. ISSUE No. 1: ( 8 ) 1. Is the present petition barred by limitation ? The present petition was filed on 21st July, 1980 seeking relief under Sections 5, 11, 12 and 33 of the Arbitration Act for a declaration that the appointment of Shri P. S. Kaicker, respondent No. 3 is invalid, without jurisdiction and for revocation of his authority and for supersession of the reference. Learned counsel for the respondents submits that Shri N S. Mehta was the first Arbitrator who was appointed on 3rd Dec. , 1975, that the petitioners did not take any action for removal of Shri Mehta or Dr. Bakshish Singh who was appointed on 21st March, 1977. His submission is that the petition ought to have been filed within three years from the date when the right to apply accrued to the petitioners. , 1975, that the petitioners did not take any action for removal of Shri Mehta or Dr. Bakshish Singh who was appointed on 21st March, 1977. His submission is that the petition ought to have been filed within three years from the date when the right to apply accrued to the petitioners. According to him, right to apply accrued on 3rd Dec. , 1975 when the first Arbitrator was appointed and as the present petition was filed on 21st July, 1980 the same is barred by time. ( 9 ) LEARNED counsel for the petitioners on the other hand submits that Shri N. S. Mehta and Dr. Bakshish Singh who were appointed as Arbitrators did not enter upon reference. They did not take any action under the reference, that they resigned and Shri P. S. Kaicker respondent No. 3 was appointed as Sole Arbitrator on llth Dec. , 1979. His submission is that right toapply for removal of the Arbitrator respondent No. 3 at the earliest arose on llth Dec. , 1979 when he was appointed. He therefore, submits that the present petition is within time under Article 137 of the Limitation Act. In my view the. submission of the counsel for the petitioners is correct. The petitioners are claiming the removal of Shri P. S. Kaicker, Arbitrator appointed on llth Dec. , 1979. As Shri Mehta or Dr. Bakshish Singh had not entered upon the reference there was no occasion for the petitioners to approach the Court for the removal or revocation of their authority. It is admitted on behalf of the respondents that Shri Mehta and Dr. Bakshish Singh did not enter upon the reference. Shri Kaicker, respondent No. 3 was appointed on llth Dec. , 1979 and the present application having been filed on 21st July, 1980 for the revocation of his authority or his removal must be held to be within time under Article 137 of the Limitation Act. ISSUE No. 2: ( 10 ) 2. Is the present petition barred by the provisions of Order 2, Rule 2, C. P, C. ? , 1979 and the present application having been filed on 21st July, 1980 for the revocation of his authority or his removal must be held to be within time under Article 137 of the Limitation Act. ISSUE No. 2: ( 10 ) 2. Is the present petition barred by the provisions of Order 2, Rule 2, C. P, C. ? Order 2, Rule 2 of the Civil P. C. provides that every suit shall include the whole of the claim which a plaintiff is entitled to make in respect of the cause of action and if a plaintiff omits to sue in respect of any portion of his claim, he is not entitled to sue in respect of the portion so omitted. Learned counsel for the respondents submits that admittedly petitioners previously filed a writ petition seeking a declaration that the action of the respondents forfeiting the security amount of Rs. 27,000. 00 was without jurisdiction. He further submits that in the civil suit the petitioners sought a declaration that there was no valid, binding and concluded contract, that the cancellation of the contract and the alleged risk purchase were null and void. His submission is that the petitioners ought to have included the relief now claimed in the present petition in the previous legal proceedings i. e. " the writ proceedings and the civil suit. His submission is that as the petitioners have failed to claim the relief in the earlier proceedings, they are now debarred from instituting the present petition under Order 2, Rule 2 of the Civil P. C. Learned counsel for the petitioners on the other hand submits that the civil writ was filed on 6th Jan. , 1975 and the civil suit was filed on 22nd Feb. , 1975 on which dates these petitioners had no cause of action for the removal of Shri P. S. Kaicker, respondent No. 3 and therefore, provisions of Order 2, Rule 2 of the Civil P. C. are not applicable. Shri Kaicker, respondent No. 3 was appointed as Arbitrator on llth Dec. , 1979 and therefore, I do not appreciate how the petitioners were in a position to seek relief for revocation of his authority or his removal at the time when the writ petition or the civil suit was filed. Shri Kaicker, respondent No. 3 was appointed as Arbitrator on llth Dec. , 1979 and therefore, I do not appreciate how the petitioners were in a position to seek relief for revocation of his authority or his removal at the time when the writ petition or the civil suit was filed. The objection of the respondents is not sustainable and I hold that the present petition is not barred under Order 2, Rule 2 of the Civil P. C. ISSUE NO. 3: ( 11 ) 3. Was there no valid, binding and concluded contract including the arbitration agreement between the parties? ( 12 ) THE admitted facts are that the petitioners submitted the tender in question on 13th Nov. , 1972. The respondents issued advance acceptance of the tender by letter dated 31st Jan. , 1973 and regular contract was issued under letter dated 12th Feb. , 1973. The petitioners supplied springs numbering 1805. The respondents by letter dated 19th July, 1974 cancelled the contract and by letter dated 6th January, 1975 claimed damages on account of risk purchase. ( 13 ) LEARNED counsel for the petitioners submits that the alleged acceptance of the tender as contained in letters dated 31st Jan. , 1973 and 12th Feb. , 1973 was void on the ground that the meaning of the agreement is not certain. He submits that on account of the uncertainty of the delivery clause in the said letters, the agreement is void within the meaning of Section 29 of the Contract Act. This section reads as under:- 29. Agreements, the meaning of which is not certain, or capable of being made certain, are void. Illustrations a. A agrees to B "a hundred tons of oil". There is nothing whatever to show what kind of oil was intended. The agreement is void for uncertainty. b. A agrees to sell to B one hundred tons of oil of a specified description, known as an article of commerce. There is no uncertainty here to make the agreement void. c. A, who is a dealer in coconut-oil only, agrees to sell to B "one hundred tons of oil. " the nature of A s trade affords an indication of the meaning of the words, and A has entered into a contract for the sale of one hundred tons of cocoanut-oil. c. A, who is a dealer in coconut-oil only, agrees to sell to B "one hundred tons of oil. " the nature of A s trade affords an indication of the meaning of the words, and A has entered into a contract for the sale of one hundred tons of cocoanut-oil. d. A agrees to sell to B "all the grain in my granary at Ramnagar". There is a no uncertainty here to make the agreement void. e. A agrees to sell to B "one thousand maunds of rice at a price to be fixed by C. " As the price is capable to being made certain, there is no unceitainty here to make the agreement void. f. A agrees to sell to B "my white horse for rupees five hundred or rupees one thousand". There is nothing to show which of the two prices was to be given. The agreement is void. ( 14 ) UNDER this section one has to determine whether the agreement on question is certain or not. Further if She meaning is not capable of being made certain the agreement would be void. The delivery clause in the acceptance of tender reads as under:- " (10) Terms of delivery a. F. O. R. Jagadhri b. DELIVERY: Item No. 1 (WA/8): 1,800 Nos. to be supplied from stock materials, supply to commence after 6-8 weeks from the date of receipt of order i. e. from 15-4-1973@ 500 Nos. per month i- e. completion by 15-7-1973 approximately Balance to be supplies thereafter @ 650/750 Nos. per month i. e. supplies to be finally completed by 15-5-1974 or earlier. The above delivery is guaranteed and is subject to DGSandd Standard Force Majeure Clause (enclosed ). In terms of the Cl. 14 of the General Conditions of contract, time for and the date of delivery of the stores stipulated herein should be deemed to be the essence of the contract and delivery must be completed not later thanthe dates specified. (c), (d), (e)and (f ). . . . . . . . . . . . . . . . . . . " ( 15 ) LEARNED counsel for the petitioners submits that according to the delivery schedule as stated above the petitioners were required to supply 500 Nos. (c), (d), (e)and (f ). . . . . . . . . . . . . . . . . . . " ( 15 ) LEARNED counsel for the petitioners submits that according to the delivery schedule as stated above the petitioners were required to supply 500 Nos. every month for the first three months commencing from l5th April, 1973 and thereafter the petitioners were required to supply 650/750 Nos. per month till the supplies were finally completed. His submission is that clause also means that 1500 Nos. were to be supplied by l5th July, 1973 and the balance quantity was to be supplied by l5th May, 1974 or earlier. His argument is that this delivery schedule is uncertain and ambiguous. According to him the meaning of the delivery schedule cannot be made certain. His argument is that the delivery schedule is uncertain on account of the fact that it gives the petitioners to make monthly supply and also on or before l5th July, 1973 and l5th May, 1974 (sic ). He refers to Clause 14 (7) of the General Conditions of Contract relating to failure and termination of the contract applicable to the contract in suit. Under this clause the contractor is liable for any loss which the purchaser i. e. Union of India may sustain on account of the cancellation of the contract provided the purchase is made within six months from the date of failure of the contractor to supply the stores. He submits that as there are different dates of delivery with respect to the stores and the dates are uncertain, the dates of purchase at the risk of the petitioners would also be uncertain and therefore, the meaning of the agreement is uncertain and void under Section 29 of the Contract Act. I do not agree the simple meaning of the delivery schedule is that the petitioners were commencing supply from l5th April, 1978 and ending by l5th July, 1973. There is no ambiguity for the supply of 1500 Nos. The option is with the petitioners to supply either monthly or the entire quantity of 1500 Nos, latest by l5th July, 1973. Similarly with respect to the balance quantity the option was with the petitioners to supply @ 650/750 Nos. There is no ambiguity for the supply of 1500 Nos. The option is with the petitioners to supply either monthly or the entire quantity of 1500 Nos, latest by l5th July, 1973. Similarly with respect to the balance quantity the option was with the petitioners to supply @ 650/750 Nos. per month and in the alternative they had an option to complete the final supply of the balance quantity on or before 15th May, 1974. In other words it means that the petitioners were to supply 1500 Nos. up to 15th July, 1973 or earlier and the balance by 5th May, 1974 or earlier. I do not find any ambiguity in the delivery schedule. The time for delivery no doubt is the essence of the contract but the simple meaning is to give an option to the petitioners. The option is to the extent that they may supply by monthly instalments or they may supply 1500 Nos. by 15th July, 1973 and the balance by 15th May, 1974. On account of this option it cannot be said that the meaning of the agreement is uncertain. The certainty is that the petitioners were to deliver 1500 Nos. by 15th July, 1973 and the balance by 15th May, 1974. The date of breach would be thus 15th July, 1973. The petitioners admittedly supplied 1805 Nos. of the stores. Thus there was non-supply of the balance quantity for which the date of breach according to this clause would be 15th May, 1974 being the last day by which the petitioners were required to complete the supplies. Thus it cannot be said that there was no consequences ad-idem or that the contract was void for uncertainty under Section 29 of the Contract Act. I, therefore, hold that the contract is valid, binding and concluded. This contract includes an arbitration clause which is Clause 24 of the General Conditions of Contract. It is not disputed that in case there was a concluded contract the arbitration Clause No, 24 as contained in the General Conditions of Contract would be applicable to the contract la question. The issues is therefore, decided against the petitioners ISSUE NO. 4: ( 16 ) (4) Is the appointment of Shri P. S. Kaicker invalid and without jurisdiction? It is not disputed that in case there was a concluded contract the arbitration Clause No, 24 as contained in the General Conditions of Contract would be applicable to the contract la question. The issues is therefore, decided against the petitioners ISSUE NO. 4: ( 16 ) (4) Is the appointment of Shri P. S. Kaicker invalid and without jurisdiction? Clause 24 of the General Conditions of contract to arbitration reads as under: ( 24 ) "in the event of any question, dispute or difference arising, under these conditions or any special conditions of contract, or in connection with this contract, (except as to any matters the decision of which is sepecially provided for by these or the special conditions) the same shall be referred to the sole arbitration of an Officer in the Ministry of Law, appointed to be the arbitrator by the Director General of Supplies and Disposals. It will be no objection that the arbitrator is a Government servant, that he had to deal with the matters to which the contract relates or that in the course of his duties as a Government servant he has expressed views on all or any of the matters in dispute or difference. The award of the arbitrator shall be final and binding on the parties to this contract. In the event of the arbitrator dying, neglecting or refusing to act or resigning or being unable to act for any reason, or his award being set aside by the Court for any reason, it shall be lawful for the Director General of Supplies and Disposals to appoint another arbitrator in place of the out-going arbitrator in the mariner aforesaid. It is further a term of this contract that no person other than the person appointed by the Director General of Supplies and Disposals ]as aforesaid should act as arbitrator and that, if for any reason that is not possible, the matter is not to be referred to arbitration at all. The arbitrator may from time to time with the consent of all the parties to the contract enlarge the time for making the award- Upon every and any such reference, the assessment of the costs incidental to thereference and award respectively shall be in the discretion of the arbitrator. Subject as aforesaid, the Arbitration Act. The arbitrator may from time to time with the consent of all the parties to the contract enlarge the time for making the award- Upon every and any such reference, the assessment of the costs incidental to thereference and award respectively shall be in the discretion of the arbitrator. Subject as aforesaid, the Arbitration Act. 1940 and the rules thereunder and any statutory modifications thereof for the time being in force shall be deemed to apply to the arbitration proceedings under this clause. Work under the contract shall, if reasonably possible, continue during the arbitration proceedings and no payment due to or payable by the purchaser shall be withheld on account of such proceedings- The venue of arbitration shall be the place from which the acceptance note is issued or such other place as the arbitrator at his discretion may determine. In this clause the expression "the Director General of Supplies and Disposals" means the Director General of Supplies and Disposals for the time being and included, if there be no Director General of Supplies and Disposals, the officer who is for the time being the administrative head of the Supplies Organisations, whether in addition to other functions or otherwise. " ( 17 ) UNDER this clause in case of dispute or difference the same is to be referred to the sole arbitration of an officer in the Ministry of Law but said officer is to be appointed by the Director General of Supplies and Disposals. Further if the Arbitrator dies, neglects, refuses to act or resigns or is unable to act for any reason, the Director General of Supplies and Disposals is authorised to appoint another arbitrator in place of the outgoing arbitrator. Admittedly there are disputes between the parties. According to the petitioners there was no concluded contract and therefore, the cancellation of the contract and the demand of. damages by the respondents was invalid. According to the respondents, the petitioners committed breach of contract by their failure to supply the balance quantity of stores on account of which the respondents are alleged to have made risk purchase in accordance with clause 14 (7) of the General Conditions of Contract. The respondents demand a sum of Rupees 14,14,292. 54 as damages. Shri N. S. Mehta, Additional Legal Adviser in the Ministry of Law was appointed as Sole Arbitrator by letter dated 3rd Dec. , 1975. The respondents demand a sum of Rupees 14,14,292. 54 as damages. Shri N. S. Mehta, Additional Legal Adviser in the Ministry of Law was appointed as Sole Arbitrator by letter dated 3rd Dec. , 1975. He did not enter upon the reference but resigned and therefore. Dr. Bakshish Singh, Additional Legal Adviser in the Ministry of Law was appointed as Sole Arbitrator by letter dated 21st March, 1977. He also did not enter upon reference but resigned. Consequently Shri P. S. Kaicker who is also Additional Legal Adviser to the Government of India in the Ministry of Law is appointed as Sole Arbitrator by letter dated llth Dec. , 1979. Respondent No. 3 entered upon the reference. He issued notices to the parties to appear before him and file their respective claims. The respondent Union of India filed its statement of claim for Rupees 14,14,292. 54 as damages. When the previous two arbitrators resigned, the Union of India i. e. the Director General of Supplies and Disposals had an authority to appoint another arbitrator in place of the outgoing arbitrator as provided in the Arbitration Clause. I am therefore, of the opinion that the appointment of respondent No. 3 as arbitrator is not invalid. ( 18 ) THE question however, remains whether the respondents had jurisdiction to appoint him in the circumstances of the present case. Learned counsel for the petitioners submits that the civil suit was filed on 22nd Feb. , 1975 seeking various reliefs relating to the contract in suit including the declaration that there was no valid, binding and concluded contract between the parties. Prior to the filing of the civil suit the petitioners had filed on 6th Jan. , 1975 a civil writ for quashing the order of the respondents for encashment of bank guarantee for Rs. 27,000. 00. The argument of the petitioners counsel is that after the filing of the legal proceedings the Union of India did not take any step for stay of proceedings by filing an application under Section 34 of the Arbitration Act. His submission is that failure to file such an application amounts to abandonment of the arbitration. He further submits that Union of India has no power to appoint successive arbitrators. ( 19 ) SECTION 34 of the Arbitration Act reads as under:- "34. His submission is that failure to file such an application amounts to abandonment of the arbitration. He further submits that Union of India has no power to appoint successive arbitrators. ( 19 ) SECTION 34 of the Arbitration Act reads as under:- "34. Where any party to an arbitration agreement or any person claiming under him commences any legal proceedings against any other party to the agreement or any person claiming under him in respect of any matter agreed to be referred, any party to such legal proceedings may, at any time before filing a written statement or taking; any other steps in the proceedings, apply to the judicial authority before which the proceedings are pending to stay the proceedings; and if satisfied that there is no sufficient reason why the matter should not be referred in accordance with the arbitration agreement and that the applicant was, at the time when the proceedings were commenced, and still remains, ready and willing to do all things necessary to the proper conduct of the arbitration, such authority may make an order staying the proceedings. " ( 20 ) IT provides that if a party to an arbitration agreement commences legal proceedings in respect of any matter agreed to be referred, the other party has a right to file an application for stay of proceedings. Thus the first condition for moving an application under the section is that the matter involved in the legal proceedings could have been referred to arbitration. In the present case I am of the opinion that the matters involved in the civil suit filed by the petitioners against the Union of India could not be the subject matter of reference to arbitration. The petitioners in the said civil suit have claimed a declaration that there was no valid, binding and concluded contract on account of the alleged acceptance letters dated 31st Jan. , 1973 and 12th Feb. , 1973. This was the main prayer in the civil suit. Other prayer was that cancellation of the contract and the alleged risk purchase was null and void. These prayers were consequential to the main prayer that the contract was not concluded. The question therefore, is whether there was a binding and concluded contract between the parties which could be the subject matter of reference to arbitration. Other prayer was that cancellation of the contract and the alleged risk purchase was null and void. These prayers were consequential to the main prayer that the contract was not concluded. The question therefore, is whether there was a binding and concluded contract between the parties which could be the subject matter of reference to arbitration. I am of the opinion that such a question cannot be the subject matter of reference to arbitration. In Khardah Co. Ltd. v. Raymon and Co. (India) Pvt. Ltd. , AIR 1962 SC 1810 , it has been observed that a dispute that the contract of which the arbitration clause forms an integral part is illegal and void is not one which the arbitrators are competent to decide under the arbitration clause. In Waverly Jute Mills Co. Ltd. v. Raymon and Co. (India) Pvt. Ltd. , AIR 1963 SC 90 , it has been observed that if a contract is illegal and void, an arbitration clause which is one of the terms thereof, must also perish along with it and a dispute relating to the validity of a contract is in such cases for the Court and not for the arbitrators to decide. Thus in view of the claims of the petitioners in the civil suits the disputes raised by them could not be the subject matter of reference to arbitration. In Gaya Electric Supply Co. Ltd. v. State of Bihar, AIR 1953 SC 182 , it has been observed that the legal proceedings which is sought to be stayed must be in respect of a matter which the parties have agreed to refer and which comes within the ambit of the arbitration agreement, and where a suit is commenced as to a matter which lies outside the submission, the Court is bound to refuse a stay. I am therefore, of the opinion that even if the respondents had filed an application under Section 34 of the Arbitration Act they would not have succeeded. It is therefore, held that failure to file an application under Sec. 34 of the Arbitration Act is immaterial in the facts and circumstances of the present case. ( 21 ) LEARNED counsel for the petitioners next submits that arbitration proceedings pending before Shri P. S. Kaicker, respondent No. 3 shall be invalid in view of Section 35 of the Arbitration Act. This section reads as under: "35. ( 21 ) LEARNED counsel for the petitioners next submits that arbitration proceedings pending before Shri P. S. Kaicker, respondent No. 3 shall be invalid in view of Section 35 of the Arbitration Act. This section reads as under: "35. (1) No reference nor award shall be rendered invalid by reason only of the commencement of legal proceedings upon the subject matter of the reference, but when legal proceedings upon the whole of the subject matter of the reference have been commenced between all the parties to the reference and a notice thereof has been given to the arbitrators or umpire, all further proceedings in a pending reference shall, unless a stay of proceedings is granted under Sec. 34, be invalid. (2) In this section the expression "parties to the reference" included any person claiming under any of the parties and litigating under the same title. " ( 22 ) THIS section is in two parts. The first part provides that the reference shall not be invalid by reason of the commencement of the legal proceedings relating to the subject matter of reference. The second part provides that if legal proceedings have been initiated with respect to the whole of the subject matter of reference between all the parties and notice of the legal proceeding has been served upon the arbitrator, the proceedings before the arbitrator shall be invalid unless the legal proceedings are stayed under Section 34 of the Arbitration Act. In other words this section makes proceedings before the arbitrator invalid in the absence of an order under Section 34 of the Arbitration Act staying the legal proceedings, Thus an arbitrator can continue the proceedings and proceed to make the award on the reference unless the whole of the subject matter of reference is covered by the legal proceedings which have been instituted. In the instant case I have already observed that the subject matter of legal proceedings especially the question whether there was a concluded contract between the parties could not be the subject matter of reference to arbitrator. The crucial point for determination is whether whole of the subject matter of reference before the arbitrator is also the subject matter of civil suit. The statement of claim dated 8th Jan. . 1980 filed before the arbitrator (respondent No. 3) discloses that the Union of India-respondent has claimed Rs. 11,59,129. The crucial point for determination is whether whole of the subject matter of reference before the arbitrator is also the subject matter of civil suit. The statement of claim dated 8th Jan. . 1980 filed before the arbitrator (respondent No. 3) discloses that the Union of India-respondent has claimed Rs. 11,59,129. 03 on account of risk purchase loss a sum of Rupees 26,989. 21 on account of excise duty and another sum of Rs. 2,18,173. 80 on account of rejection of 535 Nos, of the spring besides interest at 12% per annum, which disputes are not pending before any Civil Court. The civil suit relates only to the question whether there was no valid, binding and concluded contract and whether the cancellation of the contract and the risk purchase were invalid. I am therefore, of the opinion that the whole of the subject matter of reference pending before the arbitrator is not included in the civil suit filed by the petitioners. In other words Section 35 of the Arbitration Act would not be applicable and the proceedings before the arbitrator shall not be invalid on account of the institution of the said civil suit and the civil writ against the respondents. ( 23 ) IT is admitted by the learned counsel for the petitioners that the Civil Suit No. 108 of 1975 filed in this Court was transferred to the District Court and was dismissed for default of their appearance on 2nd Dec. , 1980. It is submitted that an application for restoration of the suit was dismissed by order dated 2nd Dec. , 1981, and first appeal (F. A. O. No. 56 of 1982) challenging the order dated 2nd Dec. , 1981 is pending in this Court. Assuming the petitioners succeed in F. A. O. No. 56 of 1982, even the filing of the civil suit does not invalidate the reference proceedings before the arbitrator (respondent No. 3 ). InBanwarilal Garodia v. Joylal Hargulal, AIR 1956 Cal 467 , it has been observed that under Section 35 the mere commencement of a legal proceeding does not ipso facto render invalid the arbitration proceedings. It has been observed that three important and distinct conditions must be satisfied to render the proceedings invalid. InBanwarilal Garodia v. Joylal Hargulal, AIR 1956 Cal 467 , it has been observed that under Section 35 the mere commencement of a legal proceeding does not ipso facto render invalid the arbitration proceedings. It has been observed that three important and distinct conditions must be satisfied to render the proceedings invalid. These arc: (1) that a legal proceeding must be commenced, (2) such legal proceedings must be upon the "whole" and not merely part of the subject matter of the reference, and (3) that a notice of such legal proceeding must be given to the arbitrators. In Shiva Jute Balino Ltd. v. Hindley and Co. Ltd. , AIR 1959 SC 1357 , it has been observed that an arbitrator can continue the proceedings and proceed to make the award on the reference, unless the whole of the subject matter of the reference is covered by the legal proceedings which have been instituted. 5. Learned counsel for the petitioners has referred to Jokhiram Kaya v. Ganshamdas Kedarnath, AIR 1921 Cal 244, wherein it has been observed that after reference to arbitration the institution of a suit consequently invalidated future proceedings but, not former proceedings of arbitrators. Learned counsel has also referred to Sheodatta Lonkaran v. "prakash Distributors", AIR 1954 Nag 289, wherein it has been observed that under S. 35 all further proceedings in a pending reference shall, unless a stay of proceedings is granted under S. 34, be invalid. These precedents cited by the learned counsel for the petitioners are not applicable to the facts of the present case, as I am of the opinion that there was no occasion for the respondents to move a application under S. 34 of the Arbitration Act for stay of the civil suit. Further the whole of the subject matter of reference pending before the arbitrator is not the subject matter of the civil suit. In (Firm) Jai Narain Babu Lal v. (Firm) Narain Das Juini Mal, AIR 1922 Lah 369, it has been observed that where the award deals with matters which are not the subject matter of the action, it cannot be said that the arbitrators in taking cognizance of those disputes encroached upon the jurisdiction of Court. ( 25 ) LEARNED counsel for the petitioners next submits that the respondent have no authority to appoint successive arbitrators. I do not agree. ( 25 ) LEARNED counsel for the petitioners next submits that the respondent have no authority to appoint successive arbitrators. I do not agree. The arbitration clause as set out above provides for the appointment of successive arbitrators as and when the outgoing arbitrator resigns. In the instant case Shri N. S. Mehta and Dr. Bakshisih Singh even without entering upon refcrence resigned their offices as arbitrator and therefore, the appointment of respondent No. 3 cannot be said to be invalid. Further under Section 8 of the Arbitration Act fresh arbitrator can be appointed in place of the outgoing arbitrator if the arbitration agreement does not show an intention not to supply the vacancy. In the arbitration clause as set out above, there is no indication that in case of refusal to at the vacancy is not to be filled in. In Surendranath Paul v. Union of India, AIR 1965 Cal 183 , reference was made to an arbitrator. He entered upon the referenece but resigned subsequently. It was held power to appoint another arbitrator was not exhausted and a new arbitrator could be appointed. It was on the ground that there was no indication in the arbitration clause that vacancy would not be supplied in such a case. ( 26 ) THE learned counsel for the petitioners next submits that respondent No. 3 is in the employment of the Union of India and therefore, his appointment is invalid. Under the arbitration clause, Director General of Supplies and Disposals has been authorised without the consent of the petitioners to appoint an officer in the Ministry of a Law as an arbitrator. The petitioners are parties to this contract, as such they cannot have any grouse against him. The respondent No. 3 who is in the employment of the Government of India in the Ministry of Law could not be said to have favoured the department simply because he is in the employment of the Union of India. ( 27 ) THE next objection is that respondent No. 3 was appointed unilaterally without any notice to the petitioners. The arbitration clause gives power to the Director General of Supplies and Disposals to appoint an officer of the Ministry of Law asan arbitrator. There is thus no warrant for the proposition that the petitioners should have been consulted before any person was appointed as the arbitrator. The arbitration clause gives power to the Director General of Supplies and Disposals to appoint an officer of the Ministry of Law asan arbitrator. There is thus no warrant for the proposition that the petitioners should have been consulted before any person was appointed as the arbitrator. This contention of the petitioners is therefore, also rejected. Issue No. 4 is therefore, decided against the petitioners. Issue No. 5: ( 28 ) IS the authority of the arbitrator liable to revoked or his appointment liable to be cancelled? The learned counsel for the petitioners submits that the respondent No. 3 arbitrator is partial and interested in respondent No. 1 that he has misconducted himself by insisting to proceed with the arbitration in spite of the pendency of the civil suit. He submits that petitioners cannot expect justice from him. I do not find that any case of bias has been made out against respondent No. 3. All that is necessary is to show that there is probability of bias or a reasonable prospect of bias or there is a reasonable apprehension of bias. Whether in fact the arbitrator was so biased is immaterial. No material has been placed on record to show that there is apprehension of bias. Respondent No, 3 is an officer of the Ministry of Law. Arbitration clause provides that an officer of the Ministry of Law alone is to be appointed as an arbitrator. It is also provided in the arbitration clause that no person other than the person appointed by the Director General of Supplies and Disposals is to act as an arbitrator. The contention of the learned counsel for the petitioners is that the civil suit was filed which fact was brought to the notice of the arbitrator respondent No. 3 but he continued to proceed with the reference. This is no ground to bold that there was any apprehension of bias, the arbitrator was within his rights to proceed with the arbitration proceedings. If the subject matter of the reference is covered by the civil proceedings, the entire proceedings would be invalid in view of S. 35 of the Arbitration Act. This is no ground to bold that there was any apprehension of bias, the arbitrator was within his rights to proceed with the arbitration proceedings. If the subject matter of the reference is covered by the civil proceedings, the entire proceedings would be invalid in view of S. 35 of the Arbitration Act. In the present case I have already held that the whole of subject matter of reference to arbitration is not the subject matter of the civil proceedings and therefore, the arbitration proceedings cannot be said to be invalid within the meaning of Section 35 of the Arbitration Act and as such there is no reason of any apprehension of bias. No material has been placed on record to show that the arbitrator has misconducted himself -or that he is partial or interested in the respondents. Under Section 11 of the Arbitration Act the Court is entitled to remove an arbitrator who has misconducted himself or the proceedings. In the instant case there is no material or even apprehension to that effect. I am therefore, of the opinion that there is no ground to cancel the appointment of respondent No. 3 or to revoke his authority. This issue is decided against the petitioners. Issue No. 6: ( 29 ) IS the arbitration reference liable to be superseded and arbitration agreement declared inoperative as alleged by the petitioner ? The arbitrator as already discussed has been validly appointed. Reference to arbitration is also not invalid under Section 35 of the Arbitration Act. There is no ground to supersede the reference or to declare the arbitration clause as invalid. In my opinion the contract was entered into in January, 1973. The petitioners supplied a part of the stores and thereafter it appears they failed and therefore, the respondent-Union of India threatened to forfeit the security and encash the bank guarantee. After the cancellation of the contract the respondent-Union of India is alleged to have made risk purchase and has claimed the loss for that account. Section 19 of the Arbitration Act provides for superseding the reference when an award becomes void or the same has been set aside. In the instant case arbitration proceedings are still pending. The proceedings before the arbitrator were stayed by an order of this Court during the pendency of this petition. Section 19 of the Arbitration Act provides for superseding the reference when an award becomes void or the same has been set aside. In the instant case arbitration proceedings are still pending. The proceedings before the arbitrator were stayed by an order of this Court during the pendency of this petition. I do not find any ground for superseding the reference to arbitration or to declare the arbitration agreement as inoperative. This issue is decided against the petitioners. Issue No. 7 (Relief): ( 30 ) IT is held that there was valid, binding and concluded contract including the arbitration clause the arbitrator has been validly appointed and the reference was not without jurisdiction. The authority of the arbitrator is n6t liable to be revoked. There is no merit in the petition. It is dismissed and the order dated 2nd April, 1981 staying proceedings before the arbitrator stands vacated. The respondents shall be entitled to costs. Petition dismissed.