JUDGMENT K.S. Varma, J. - The Uttar Pradesh State Electricity Board Was constituted on 1-4-1965 by the State Government in exercise of its powers under Section 5 of the Electricity Supply Act, 1948 (hereinafter to he referred to as, the Supply Act). On 30-9-1963 an agreement was entered into between the State of Uttar Pradesh of the one part and the Kanoria Chemicals and Industries Ltd., a company incorporated under the Companies Act, 1956 of the other part. The terms of the agreement indicate that the Company would construct a factory for the production of Caustic Soda at a site near Riband, District Mirzapur and desired to purchase the, electrical energy from the State Government. For the production of electricity and for its sale, the State of Uttar Pradesh constructed a Dam and Hydro Electric Generating Station and has set up a Sub-Station at Pipri, Riband Dam Site on the Rihand river in District Mirzapur of the State of Uttar Pradesh. 2. Under the said agreement dated 30-9-1963 between the Kanoria Chemicals and the State of U.P., the State agreed to supply and the Company agreed to purchase electrical energy from the Rihand on the terms and conditions indicated in the agreement. It was stipulated in the agreement that the Company shall take electrical energy from the State of U.P. and it undertook to supply the same in the manner indicated in the agreement for a period of 25 years with effect from 1-4-1964. Subject to the provisions of the agreement it was also agreed that the supply of energy by the Government to the Company shall he available continuously during 24 hours of each day and throughout the whole period of the agreement. Under the agreement it was also stipulated that the Company shall utilise the energy supplied under the agreement solely for the purpose of production of Caustic Soda, Sodium Component s, Chloride, Chloride Products, Hydrogen and for all operations ancillary thereto. Under clause 10 of the agreement it was agreed that the Company shall pay during the continuance of the agreement to the State of U.P. for the energy consumed by it for the purposes mentioned above at the following rates : - "I. For Supply of 6500 KW Power from Rihand N.P. 2.50 (Two point five zero) per KW hour consumed. II. For supply of additional 1500 KW power from Inter-connection. II. For supply of additional 1500 KW power from Inter-connection. N.P. 5 (five) per KW hour consumed." 3. At this stage it would be appropriate to clarify the meaning of 'Inter-connection'. From a perusal of the agreement it appears that the State Government was in the process of inter-linking Thermal Stations at Gorakhpur and Mau with each other and with Riband. This arrangement has been described in the agreement as Interconnection. The agreement further provided that the supply of additional 1500 KW power from the Inter-Connection shall also be made available at the Bus-bars of the Pipri Sub-Station and the above mentioned rate of 5 N.P. per KWH shall apply in respect of the units consumed when such additional power is made available from the Inter-connection. This rate, according to the agreement, shall be charged on the KW hours consumed in excess of 13 million KW hours in a quarterly period of three Calendar months and 51.246 KW hours in a period of one year as specified in clause 6(3). 4. The agreement further provided that the State Government has entered into an agreement with the Hindustan Aluminium Corporation Limited for the supply of 55,000 KW power to them from Rihand for their Aluminium Factory. It is stated in the agreement that Messrs Hindustan Aluminium Corporation Limited have indicated that if they expand their Aluminium Plant at Pipri to a capacity of 70,000 tons per annum and instal their own power plant for meeting all the power requirements of their factory, they might release the power which, according to the agreement, is to be supplied to them from Rihand. The agreement further provided that if and when the Hindustan Aluminium Corporation Ltd., released Rihand power, an additional 4,500 KW power, in lieu of 1500 KW power from Inter-connection mentioned in Sub-clause (a) will also he made available from Rihand at a rate of N.P. 2:50 per KW hour. Sub-clause (c) of Clause 10 of the agreement which is relevant for the purposes of this case is reproduced below. "(c) If Messrs Hindustan Aluminium Corporation Ltd., do not release Rihand power then the above mentioned 4,500 KW additional power, of which a part i.e. 1500 KW till completion of the Obra Hydro Electric Project, be supplied from Inter-connection, will be made available, later on from the Obra Hydro Electric Project, when that Project is completed. "(c) If Messrs Hindustan Aluminium Corporation Ltd., do not release Rihand power then the above mentioned 4,500 KW additional power, of which a part i.e. 1500 KW till completion of the Obra Hydro Electric Project, be supplied from Inter-connection, will be made available, later on from the Obra Hydro Electric Project, when that Project is completed. It is not possible at this stage to specify any rate for the additional power of 1,500 KW to be made available from the Obra Hydro Electric Project but such a rate shall be reasonable one taking into account, inter alia, the cost of production of power at the Obra Hydro Electric Project and other factory. Such rate will apply only in respect of KW. hours consumed in excess of KW hours specified in clause 6 (3)." 5. A perusal of sub-clause (c) of clause 10 quoted above indicates that in case Messrs Hindustan Aluminium Corporation Ltd. do not release Rihand power then the power, till completion of the Obra Project, will be supplied from Inter-connection. On the completion of the Obra Hydro Electric Project the supply could be directed from that Project. The other aspect which is clear from the above quotation is that there was no stipulation of any rate for the supply of additional power of 4,500 KW to be made from the Obra Hydro Electrict Project, it was however stipulated that the rate shall be reasonable taking into account the cost of production of power and other factors. Clause 20 of the agreement is headed '"Interpretation and Transfer" and is quoted below : - "20. The expression 'the Governor' and "the Company" hereinbefore used shall unless there be anything repugnant to the subject or content include their respective successors and assigns, and the expression "Governor" shall include the expressions "the Government of Uttar Pradesh." "State Government" and "the Government". The expression 'the Governor' and "the Company" hereinbefore used shall unless there be anything repugnant to the subject or content include their respective successors and assigns, and the expression "Governor" shall include the expressions "the Government of Uttar Pradesh." "State Government" and "the Government". Clause 21 of the agreement contains an arbitration clause which is reproduced below : - "Every dispute, difference or question which may at any time arise between the parties hereto or any persons claiming under them touching or arising out of or in respect of this agreement or the subject matter thereof shall he referred to two arbitrators one to be appointed by each party, under the provisions of the Indian Arbitration Act, 1940 road with Section 52 of the Indian Arbitration Act, 1910, or any statutory modifications for the time being in force and the decision of such arbitrators shall he final and binding on the parties." 6. It is not in dispute between the parties that the Company started the factory in the month of September, 1904. On 1-4-1965 the Rihand Project was transferred to the Electricity Board and on 1-4-1971 the Obra Project was commissioned and started production of electricity. After the Company started functioning, there arose dispute between the parties to the agreement in regard to the rate of electricity charges. On 11-5-1981 the opposite party wrote to the Chairman, U.P. Electricity Board that the dispute and differences had arisen between the Company and the Board in regard to that rate of electricity charges and also on other accounts. In order to resolve the disputes the Company relied upon Clause 21 of the agreement and prayed that the matter be referred to arbitration under the said clause. The Company also pointed out in their letter that they appoint Shri Bhagwati Prasad Khaitan of 9, Old Post Office Street, Calcutta as their arbitrator and the Board was called upon either to concur in the appointment of Mr. Bhagwati Prasad Khaitan as the sole arbitrator or to appoint an arbitrator of their choice within 30 days of the service of the said notice. The applicant nominated Shri G.L. Shukla, Secretary to Government of U.P., Judicial Department as their arbitrator. Bhagwati Prasad Khaitan as the sole arbitrator or to appoint an arbitrator of their choice within 30 days of the service of the said notice. The applicant nominated Shri G.L. Shukla, Secretary to Government of U.P., Judicial Department as their arbitrator. From a perusal of their letter dated 15-4-1982 addressed by the Electricity Board to Shri G.L. Shukla it appears that the following disputes were agreed to between the parties for reference to arbitration : "(i) Rate of supply of 4.5 MW power. The claims are referable only in respect of payments made after May 18, 1978. (ii) Levy of additional charge for 2.5 Raise. (iii) Coal surcharge for the month of April and May, 1976." 7. On 13-12-1982 the opposite party informed the Board that Shri B.P. Khaitan, the arbitrator nominated by it, met Shri G.L. Shukla, the arbitrator nominated by the Board for the purpose of appointing an Umpire and giving directions. Shri Shukla informed Mr. Khaitan that for some unavoidable reasons, he will not be able to act as an arbitrator. The opposite party, accordingly, requested the Board to nominate another arbitrator in place of Shri Shukla. On 21-12-1982 the Law Officer of the Board informed Mr. B.P. Khaitan, arbitrator of the opposite party that a meeting was held on 13-12-1982 wherein the arbitrator for the Board Shri G.L. Shukla expressed his inability to act as an arbitrator and the opposite party had asked him to nominate another arbitrator. On 21-1-1983 the opposite party called upon the Board under Section 9 (b) of the Arbitration Act, 1940 to appoint another arbitrator within the time specified bylaw. By letter dated 2-2-1983 the Board informed the opposite party that it had nominated Shri B.L. Loomba, Legal Remembrancer, U.P. Government, Lucknow as Co-arbitrator in supersession of the earlier order appointing Shri G.L. Shukla as an arbitrator and on 18-4-1983 the sanction from the State Government was obtained for Mr. Loomba to act as an arbitrator on the terms and conditions indicated in the notification of the said date, namely, 18-4-1983- On 17-2-1983 the two arbitrators, namely, Shri B.P. Khaitan and Shri B.L. Loomba met to appoint an Umpire in the case and they appointed Mr. Justice Gur Saran Lal (Rtd.) as an Umpire in the case. 8. Loomba to act as an arbitrator on the terms and conditions indicated in the notification of the said date, namely, 18-4-1983- On 17-2-1983 the two arbitrators, namely, Shri B.P. Khaitan and Shri B.L. Loomba met to appoint an Umpire in the case and they appointed Mr. Justice Gur Saran Lal (Rtd.) as an Umpire in the case. 8. On 30-8-1983 the Board moved an application before the arbitrators that the arbitrators may first decide the question of the scope of arbitration and come to a finding whether all the dispute raised are within the arbitration clause. It was further prayed that this issue may be decided as a preliminary issue before the Board is called upon to file written statement/reply to the statement of the claimants. On 21-10-1983 the arbitrators met and after hearing the counsel for both the parties it was agreed that the question of the scope of arbitration be decided at the time of the final hearing. The parties were directed to file their written statements. On 22-9-1984 the arbitrators after hearing the learned counsel, for both the parties framed issues and one of the issues framed was whether the claims of either of them are not within the scope of the arbitration clause contained in the agreement. It is not in dispute that the opposite party filed documents but the Board did not file any documents and instead on 7-1-1985 moved an application in the Court of the Civil Judge, Lucknow under Section 33 of the Indian Arbitration Act, 1940. In the said application, the prayer made by the Board is that the arbitration clause contained in the agreement dated 30-9-1963 is not binding on it and cannot be enforced in respect of disputes and claims made by the said opposite party. It was also contended that the disputes raised are neither covered by the alleged arbitration clause nor the same have been jointly referred to the learned arbitrators as required by law. The application was registered as Miscellaneous Case No. 18(C) of 1985. The Board also prayed that proceedings before the arbitrators may be stayed. The application for stay was rejected by the learned Civil Judge and against that order Writ Petition No. 1933 of 1985 was filed in this Court. 9. The application was registered as Miscellaneous Case No. 18(C) of 1985. The Board also prayed that proceedings before the arbitrators may be stayed. The application for stay was rejected by the learned Civil Judge and against that order Writ Petition No. 1933 of 1985 was filed in this Court. 9. The Board on 7-5-1985 moved another application in the Court of the Civil Judge, Lucknow in which it was prayed that proceedings before the Umpire be declared null and void as they were illegal and the arbitration be revoked. This application was moved under Section 5 read with Section 33 of the Arbitration Act and was numbered as Civil Miscellaneous Case No. 105(C) of 1985. An application was moved in this Court under Section 24 of the Code of Civil Procedure and by an order of this Court Civil Miscellaneous Case No. 18(C) of 1985 and Civil Miscellaneous Case No. 105(C) of 1985 were transferred to this Court for decision. It is in these circumstances, that these cases have come up for hearing before this Court. These cases have been numbered by this Court as Miscellaneous Cases Nos. 3 and 2 of 1986 respectively. 10. Mr. R.N. Trivedi learned Additional Advocate General representing the Board before proceeding to advance his arguments on merits of the case drew attention of the Court to certain well established principles which govern the applicability of section 33 of the Arbitration Act. The first decision in this respect referred to by the learned counsel is Hindustan Steel Ltd. v. M/s. Kaushal Construction Company (AIR 1966 Madhya Pradesh 249). Reliance was placed on the following observations of Shiv Dayal, J, at page 250 "Section 33 of the Act enacts that :- "Any party to an arbitration agreement desiring to challenge the existence or validity of an arbitration agreement or an award or to have the effect of either determined shall apply to the Court and the Court shall decide the question on affidavits. Provided that where the Court deems it just and expedient it may set down the application for hearing on other evidence also and it may pass such order for discovery and particulars as it may do in a suit." 11. Provided that where the Court deems it just and expedient it may set down the application for hearing on other evidence also and it may pass such order for discovery and particulars as it may do in a suit." 11. It is clear enough that this section contemplates an application for three purposes (i) when it is desired to challenge the existence of an arbitration agreement or the existence of an award, (ii) when it is desired to challenge the validity of an arbitration agreement or the validity of an award and (iii) when it is desired to have the effect of an arbitration agreement or the effect of an award determined. When an application is made under this section for the last mentioned purpose, it is imperative that the Court must determine the effect of the arbitration agreement or the effect of the award, as the case may be. Policy of the law is to encourage arbitration, At the same time, the arbitration cannot exceed the jurisdiction given to them under the arbitration agreement. Where one of the parties contends that a certain dispute which is placed before the arbitration is outside the scope of the arbitration agreement, it is his right to have the question determined by the Court." 12. Another case relied Upon on behalf of the applicant is The Reliable Water Supply Service of India (P) Ltd. v. The Union of India and others (AIR 1971 Supreme Court, 2033) and the observations of Hegde, J. at page 2085 relied upon are quoted below :..... "In our opinion, the application under Section 5 of the Arbitration Act, 1940 was a misconceived application. The controversy in this case is whether the dispute in question is covered by the terms of the agreement. In other words, the dispute is as to the existence of an agreement to refer disputes of the type with which we are concerned in this case, to arbitration. That being so, the case fell within the scope of Section 33 of the Arbitration Act and not Sec ion 5." On the basis of the aforesaid decisions Mr. In other words, the dispute is as to the existence of an agreement to refer disputes of the type with which we are concerned in this case, to arbitration. That being so, the case fell within the scope of Section 33 of the Arbitration Act and not Sec ion 5." On the basis of the aforesaid decisions Mr. R.N. Trivedi contended that in the instant case there is no subsisting agreement which is binding on the Board and the Board challenges the existence and, at any rate, the validity of arbitration clause contained in the agreement and, therefore, is entitled to the benefit of Section 33 of the Arbitration Act. With this background, proceed to examine the contention raised on behalf of the applicant. 13. The first contention raised by Mr. R.N. Trivedi the learned Additional Advocate General representing the Board is that the agreement dated 30-9-1963 did not devolve upon the Board. His contention is that the contract was entered into between the opposite party and the State of Uttar Pradesh. It is contended that on 1-4-1965 Riband was transferred to the Electricity Board and the Obra Project came into operation on 1-4-1971. The agreement, according to the learned counsel for the applicant, provides for the supply of energy from these two main sources. It is maintained that in view of the fact that the supply of electricity from Rihand and from Obra came into existence after the contract, the Board is not bound by the terms of the agreement. 14. The rights and obligations of the State Government after the constitution of the Board are regulated by Section 60 of the Electricity Supply Act, 1948. Section 7 of the U.P. Act 12 of 1983 provides that in section 60 of the principal Act after sub-section (2) other sub-section shall be treated and will be deemed to have been inserted with effect from 1-4-1965. Section 7 of the U.P. Act 12 of 1983 provides that in section 60 of the principal Act after sub-section (2) other sub-section shall be treated and will be deemed to have been inserted with effect from 1-4-1965. Section 60 of the Act in so far as it is amended by U.P. Act 12 of 1983 is reproduced below : - "(1) All debts and obligations incurred, all contracts entered into and all matters and things engaged to be done by, with or for the State Government for any of the purposes of this Act before the first constitution of the Board shall be deemed to have been incurred, entered into or engaged to be done by, with or for the Board ; in all suits or other legal proceedings instituted or which might but for the issue of the notification under sub-section (4) of Section 1 have been instituted by or against the State Government may be continued or instituted by or against the Board. (1-A) .......... (2) ............ (3) ............ (4) The provisions of sub-section (1) and (1-A) shall, subject to the provisions of sub-section (5) apply in relation to the debts and obligations incurred, contracts entered into and matters and things engaged to be done by, with or for the State Government in respect of the Rihand Hydro Power Station after the first constitution of the Board and before the commencement of the sub-section as they apply in relation to debts and obligations incurred, contracts entered into, matters and things engaged to be clone by, with or for the State Government for any of the purposes of the Act before the first constitution of the Board. (5) All such contracts entered into by the State Government for supply of electrical energy based on or connected with the generation of electricity from the Riband Hydro Electric Generation Station to any consumer and any contract entered into by the Board on or after April 1, 1965 for the supply of electrical energy to such consumer shall operate subject to the modifications specified in the following clauses, which shall have effect from the date of the commencement of the Electricity Laws (Uttar Pradesh Amendment) Act, 1983 (hereinafter referred to on the said date) : - (a) the rates to be charged by the Board for the energy supplied by it to any consumer under any contract for which the payment will be due for the first time on or after the said date shall be such as may with the previous approval of State Government be fixed by the Board having due regard to the geographical position of the area of supply, the nature of the supply and purpose for which supply is required and any other relevant factor. (b) if the State Government directs the Board under Section 22 B of the Indian Electricity Act, 1910 or under any other law for the time being enforced to reduce the supply of energy to a consumer and thereupon the Board reduces the supply of energy to such consumer accordingly, the consumer concerned shall not be entitled to any compensation for such reduction, and if the consumer consumes energy in excess of the reduced limit fixed under the said Section 22 B or any other law for the time being enforced as the case may be, then the Board shall have the right to discontinue the supply to the consumers without notice, and without prejudice to the said right of the Board, the consumer shall be liable to pay for such excess consumption at double the normal rate fixed under clause (a) : (c) any arbitration agreement contained in such contract shall be subject to the provisions of ibis sub-section." 15. Section 60(1) read with Section 60(4) of the Act (as amended by U.P. Act 12 of 1983) for purposes of the present case, after omitting the unnecessary words) is to the following effect : - "All contracts entered into with the State Government for any of the purposes of this Act after 1st April, 1959 (the date when the Board was first constituted) and before 1st April, 1965 (the date of commencement of sub-section (4) inserted by U.P. Act 12 of 1983), shall be deemed to have been entered into with the Board." 16. The argument of Mr. R.N. Trivedi, learned counsel for the applicant, is that the agreement is not "for any of the purposes of this Act" as contemplated by Section 60(4) of the Act. The purposes of the Act are enumerated in Section 18 of the Electricity Supply Act and the contract in the instant case does not come within any of the purposes provided for by the Act. It is further contended that Section 49(3) of the Act provides for the fixation of tariff by the Board for the supply of electricity to any person not being a licensee having regard to geographical position of any area, the nature of the supply and purpose for which supply is required and any other relevant factors. It is contended that the power to fix tariff under Section 49(3) of the Act is a statutory power and such a power cannot be modified or regulated by means of any agreement. The right to supply electricity in exercise of the power under Section 49(3) of the Act by the State Government cannot be fettered by anything done by the parties under an agreement and hence, according to the learned counsel for the applicant, the agreement had not devolved on the Board. 17. What has to be seen in the instant case is as to what is the effect of the word "deemed''. This word has been used in a number of statutes and one of the purposes of deeming provisions is to give extended operation to a rule which cannot be given to it without the deeming clause. A deeming provision postulates that a thing deemed to be something is not, in fact, the thing it is deemed to be. This word has been used in a number of statutes and one of the purposes of deeming provisions is to give extended operation to a rule which cannot be given to it without the deeming clause. A deeming provision postulates that a thing deemed to be something is not, in fact, the thing it is deemed to be. When a thing is deemed to be something, it is to be treated as that tiling though, in fact, it is not. A deeming provision creates a legal fiction. The effect of such a fiction is that a position which would otherwise not obtain, is deemed to obtain. The meaning of the word 'deemed' has been explained in the case of Commissioner of Income Tax, Bombay Presidency v. Bombay Trust Corporation Ltd., (AIR 1930 Privy Council, 54). The words of Viscount Dunedin may be quoted as follows : - "When a person is 'deemed to be' something the only meaning possible is that whereas he is not in reality that something, the Act requires him to be treated as if he were." The principle enunciated by the Privy Council was approved by the Supreme Court in K. Kamraj Nadar v. Kunju Thevar, (AIR 1958 Supreme Court 687), Additional Income Tax Officer v. E. Alfred, (AIR 1962 Supreme Court 663), and by a Division Bench of this Court in Narain Bux Singh v. State of U.P. and another (1981 ALJ 649) and by a Full Bench of this Court in (Ram Prasad Chaudhry v. State of U.P. and another, (Writ Petition No. 1557 of 1985). If provisions of Section 60 (1) of the Act are analysed in the light of the decisions referred to above the effect of the deeming provision could be that although the agreement dated 30-9-1963 was entered into between the State of U.P. and the opposite party, the same shall be deemed to have been entered into between the Board and the opposite party with effect from 1st April, 1965. 18. Mr. Raja Ram Agrawal, Senior Advocate for the opposite party made reference to Indian Aluminium Company v. Kerala State Electricity Board, (AIR 1975 Supreme Court, 1967). The provisions of Section 49 and Section 60 of the Supply Act came up for interpretation before the Supreme Court in the said case. 18. Mr. Raja Ram Agrawal, Senior Advocate for the opposite party made reference to Indian Aluminium Company v. Kerala State Electricity Board, (AIR 1975 Supreme Court, 1967). The provisions of Section 49 and Section 60 of the Supply Act came up for interpretation before the Supreme Court in the said case. The facts of the said case indicate that the Indian Aluminium Company entered into a contract with the State of Travancore Cochin on 30-7-1941 for supply of electrical energy for manufacture of aluminium. The agreement was for a period of 34 years with effect from 1-7-1941. On the integration of States, a new State of Travancore Cochin was formed in 1948 and the agreement dated 30-7-1941 was accepted by the new State as binding upon it. After that under Section 5 of the Electricity Supply Act, 1948, Kerala State Electricity board was framed and reliance was placed in that case on Section 50 of the Electricity Supply Act for the purpose of showing that all the contracts entered into by or on behalf of the State Government for any purposes of the Act before the constitution of the Electricity Board shall be deemed to have been entered into by the Board. This conclusion was arrived at by the Supreme Court by embarking upon a detailed investigation into the purposes of the Act. The Supreme Court observed that Section 49(1) of the Act enacts a provision for the sale of electricity by the Electricity Board and sub-section (3) of Section 49 provides that nothing in the said section shall derogate from the power of the Board if it considers it necessary or expedient to fix different tariffs for the supply of electricity to any person not being a licensee. The Supreme Court after discussing the provisions of the Act observed as follows : - "........By reason of Section 60 of the Supply Act, it must be deemed to have been entered into by the appellant with the Board and in view of the legal fiction, all the consequences and incidents must follow as if it were an agreement made with the Board. The learned Solicitor General appearing on behalf of the Board contested the applicability of Section 60 on the ground that the Principal Agreement as modified by the First Supplemental Agreement was not an agreement entered into by the State Government for any of the purposes of this Act but we do not think this contention is sound. One of the primary purposes of the supply Act is to provide inter alia for the supply of electricity. In fact, the Supply Act empowers the Board to supply electricity to any person other than a licensee. An agreement for supply of electricity to a consumer is, therefore, plainly and indubitably an agreement for one of the purposes of the Supply Act and Section 60 has clearly application to such an agreement. The Principal Agreement as modified by the first supplemental Agreement must, therefore, for all the purposes of the Supply Act be treated as an agreement entered into with the Board." 19. The Board was constituted with effect from 1-4-1965 by means of a Government order dated 31-3-1985. (1965?) The Government Order is headed "Transfer of Rihand Project to the U.P. State Electricity Board." The material portion of the Government Order relevant for the purposes of the case is quoted below ; - "...........that consequent on the formation of the D.P. State Electricity Board with effect from April 1, 1959 the administration and control of all the installations of the Electricity Department except Rihand were transferred to the Board from that date. Accordingly, in order to enable the Board to discharge the duty of co-ordinated development of the Power resources of the State generation, supply and distribution of electricity in the State in the most efficient and economical manner, Government have decided to transfer the Rihand Organisation of the electricity Department to the Board with effect from April 1, 1965 i.e. midnight of March 31 and April 1, 1965." Under clause 20 of the agreement dated 30-9-1963 in view of the Government Order dated 31-3-1963 the Hoard has become the successor of the State Government and the expression "Governor" used in the agreement shall include the expression "Government of U.P. 20. In order to meet the argument of Mr. R.N. Trivedi that the agreement dated 30-9-1963 did not devolve upon the Board Mr. In order to meet the argument of Mr. R.N. Trivedi that the agreement dated 30-9-1963 did not devolve upon the Board Mr. Raja Ram Agarwal contended for the opposite party that in the first instance the contract in question has devolved upon the Hoard under clause 20 of the agreement. Apart from clause 20 Mr. Agarwal contended that the agreement is one which would devolve upon the Board. In this respect he placed reliance upon Tolhurst v. Associated Cement Manufacturers Ltd., and another, (1900-1903 All England Reports, 336). The observation of Lord Macnaghten quoted below were relied upon by Mr. Aganwal : - "There may be an element of personal skill or an element of personal confidence to which, for the purposes of the contract, a stranger cannot make any pretentions. But no case, I suppose, would seriously agree that a contract for delivery of chalk from particular quarries for the use of particular cement, works cannot be performed by any person for the time being possessed of the quarries or that it can make the slightest difference to anybody who the proprietors of the cement works or the actual manufacturers may be, provided that they are in a position to carry out the terms of the original contract." 21. The other quotation relied from Lord Macnaghten's judgment is as follows "It seems to me that the contract is to be read and construed as if it contained an interpretation clause saying that the expression "Tolhurst" should include Tolhurst and his heirs, executors, administrators, and assigns, owners and occupiers of the North Meet quarries, that the expression '"company" should include the company and its successors and assigns, owners and occupiers of the North fleet Cement works and that the words "his" and "their" should have a corresponding meaning...............It is well settled that as a general rule the benefit of a contract is assignable in equity and may be enforced by the assignee....." 22. Reference was made to the following observations of Lord Lindley : - "The nature of the agreement of Jan, 5, 1898 and the time it was last negative the idea that it was confuted to the parties to it. The word (assigns) does not occur in the agreement, but this does not show that the benefit of the contract is nor assignable. The word (assigns) does not occur in the agreement, but this does not show that the benefit of the contract is nor assignable. An agreement fora lease and even an option to require a lease or a renewal of a lease is assignable in equity even although there is no mention of executors, administrators or assigns. (See Buckland v. Papillon (1866) LR 1 Eq. 477). If the above agreement had been with an ordinary individual his interest would, on his death, have passed to his executors or administrators, or, if he had become bankrupt, his trustees could have claimed it and have sold it for the benefit of his creditors. It follows that on the same supposition, he could have assigned such interest in his lifetime." 23. From the observations quoted above, Mr. Agarwal contended that even if there would have been no clause 20 in the agreement, the agreement in question would have devolved upon the Electricity Board in view of the Government Order referred to above. 24. It was next contended that the contract in question is governed by Specific Relief Act, 1877 and under Section 23 of the said Act, the contract in question would devolve upon the Board. Section 23 of the said Act insofar as it is relevant is quoted below : - "23. Except as otherwise provided by this Chapter, the specific performance of a contract may he obtained by - (a) .......... (b) the representative in interest of the principal of any party thereto." 25. Section 27(b) of the Specific Relief Act is to the following effect :- "27. Except or otherwise provided by this Chapter, specific performance of a contract may be enforced against : - (a) .......... (b) any other person claiming under him by a title arising subsequently to the contract, except a transferee for value who has paid his money in good faith and without notice of the original contract." By reference to this provision it is contended that apart from clause 20 of the agreement, the contract can be performed either by the parties between whom the contract is entered into or by their transferees or assignees. In this respect, reliance has been placed on Ram Baran Prasad v. Ram Molut Hazra and others, (AIR 1967 Supreme Court, 744). In this respect, reliance has been placed on Ram Baran Prasad v. Ram Molut Hazra and others, (AIR 1967 Supreme Court, 744). The Supreme Court after discussing the above quoted provisions and the provisions of Sections 37 and 40 Contract Act observed as follows : - "In substance these statutory provisions lay down that subject to certain exceptions which are not material in this case, a contract in the absence of a contrary intention express or implied will be enforceable by and against the parties and their legal heirs and legal representatives including assignees and transferees." 26. After having examined the arguments of the learned counsel for the parties on this aspect of the matter I am of the view that in view of the principles laid down in the aforesaid decisions, the contract in dispute stands assigned and transferred to 'he Hoard and the Board as an assignee of the contract is responsible for carrying out the terms of the contract. 27. There is yet another ground on which the Board will be treated as successor and assignee under contract dated 30-9-1963. Clause 20 of the said agreement provides that the expression 'the Governor' and 'the Company' hereinbefore used shall unless there is anything repugnant to the subject or content include their prospective successors and assigns, and the expression "Governor" shall include the expression "the Government of "Uttar Pradesh", "State Government" and "the Government". It may be noted that the agreement dated 30-9-1963 was entered into by the Governor of Uttar Pradesh of the one part and the Kanoria Chemicals and Industries Ltd., of the other part. 28. Apart from legal position discussed above which indicates that the agreement dated 30-9-1963 devolved upon the Board, there is another aspect of the case which deserves consideration. From a perusal of the documentary evidence placed on record it appears that the Board was all along relying upon the agreement and in its dealings with the opposite party the Board proceeded on the basis of the said agreement. On 1-11-1966 a notice was issued by the Board to the Managing Agents, Kanoria Chemicals and Industries Ltd., informing them that on account of failure of rains in the Rihand Catchment and low reservoir level, there will be power cut to the extent of 30%. The Kanoria Chemicals were served with this notice under clause 12(b)(i) of the agreement dated 30-9-1963. The Kanoria Chemicals were served with this notice under clause 12(b)(i) of the agreement dated 30-9-1963. The notice stated that 30% cut in the permissible energy consumption under the said agreement be brought into effect immediately. This clearly indicates that the cut to the extent of 30% in the consumption of electricity was imposed by the Board in exercise of its powers under clause 12(b (ii) of the agreement. The above notice was effective till 30-6-1967. On 15-1-1968 another notice was issued by the Board to Kanoria Chemicals whereby the Board notified that for the period October 1, 1967 the Board will not he able to supply power to the extent of 3, 4 x 10 units out of the units granted against the agreement for the three quarters (October 1, 1967 to June 30, 1969). This power had again been exercised by the Board under clause 12(b)(i) of the agreement dated 30-9-1963. On 10-5-1968 the Board sent a letter to Kanorias along with the draft supplemental agreement for the supply of power to the extent of 11,000 KW. The contents of the letter-indicates that the Board suggested to the Kanoria Chemicals to enter into a supplemental agreement to supplement the agreement dated 30-9-1963. A perusal of the draft supplemental agreement submitted by the Board for the approval of Kanoria Chemicals clearly shows that the supplemental agreement was an agreement supplementing the agreement dated 30-9-1963. The portions of the said proposed supplemental agreement are quoted as follows : "Whereas this Deed is supplemental to the Deed of Agreement made on the Thirtieth day of September One thousand nine hundred and sixty three between the Governor of the State of Uttar Pradesh and Kanoria Chemicals and Industries Limited, a Company incorporated under the Companies Act, 1956 and having its registered office at 9, Brabourne Road, Calcutta hereto (hereinafter called the "Principal Agreement. .......And whereas under the provisions of the Electricity (Supply) Act, 1948, on the transfer of the Rihand Service Area from the Government to the Uttar Pradesh State Electricity Board with effect from April 1, 1965, the supplier has become the successor to the said Governor in respect of the matter aforesaid, and in pursuance of the said agreement between the Company and the Governor, the supplier executes these presents : - ........'' 29. On 26-3-1969 the Electricity Board intimated to Kanoria Chemicals that on account of scanty rainfall in the catchment area of the Rihand Reservoir level had fallen and consequently the power generation will be less. The letter further goes on to say that on that account the Board will have to determine what rate will be chargeable from Kanoria Chemicals for the units supplied in excess of the rateable distribution of the Rihand power in terms of sub-clause (b) of clause 12 of the agreement. The letter also informs the opposite party that the rate for the excess energy drawn by the Company will have to be paid at the Heavy Power Tariff Rate Schedule. The Kanoria Chemicals denied their liability for payment of the bills and under clause 21 of the agreement dated 30-9-1963 they appointed Shri B.P. Khaitan as their arbitrator and called upon the Board to nominate its own arbitrator. This was done by their letter dated 6-10-1969. By their letter dated 13-10-1969 the Electricity Board informed Messrs Kanoria Chemicals that Shri B.N. Mehrotra, General Manager, Kanpur Electricity Supply Administration, Kanpur has been nominated by the Board to act as an arbitrator on their behalf in respect of the dispute referred to in letter dated 6-10-1969. 30. The next document which is very important is an agreement dated 3-12-1971 entered into between the Board and the Kanoria Chemicals in regard to rateable cut imposed on Kanoria for the years 1967-68, 1968-69, 1969-70 and 1970-71. It is staled in this agreement that the Government agreed to supply electricity to Kanorias on terms and conditions contained in the agreement dated 30-9-1963. The next clause of this agreement which is very important is quoted below : - "And whereas after the transfer of Rihand organisation to the Board with effect from April 1, 1965 matters relating to supply of power to KANORIAS came under the purview of the Board and rights and obligations of the Government under the said agreement devolved on the Board." The agreement also recites that in the first instance the dispute was referred to certain arbitrators but later on that reference was revoked and then they agreed to appoint Mr. M. Hidatyatullah, retired Chief Justice of the Supreme Cunt as sole arbitrator to decide the disputes specified in the agreement. M. Hidatyatullah, retired Chief Justice of the Supreme Cunt as sole arbitrator to decide the disputes specified in the agreement. This agreement also states that the disputes which were being referred to Justice Hidayatullah were the disputes arising under the agreement dated 30-9-1963. This agreement is signed both by the State Electricity Board and the Kanorias. The agreement clearly indicates that the Board accepted the position that the agreement dated 30-9-1963 devolved upon the Board and the disputes which were referred to arbitration of Justice Hidayatullah were the disputes which arose under the terms of the agreement dated 30-9-1963. This agreement clearly records an admission by the Board that the agreement dated 30-9-1963 had devolved upon them, they had been acting upon the agreement and that in pursuance of the disputes having arisen under the agreement, the same were referred to arbitration under the agreement. On 15-4-1972 the Board filed its claims before the sole arbitrator Justice M. Hidayatullah. In paragraph 2 of the Claims it has been stated by the Board that the Rihand Dam and Hydro Electricity Generating Station which were constructed by the State of Uttar Pradesh were transferred to the Board on 1-4-1965. The Board further stated that it was with effect from that date, namely, the 1st of April, 1965, that the Board had received all the rights and obligations as well as liabilities of the State Government under previous agreements and contracts entered into by the State of Uttar Pradesh. The reference to agreement is the reference to the agreement between the parties dated 30-9-1963. In paragraph 11 of the Claim filed by the Board, it was stated that the Board in exercise of its power under clause 12(b) (i) of the agreement issued a letter to the Company informing them that due to failure of rains in the Rihand catchment and low reservoir level, it had been decided to impose 30% cut in energy consumption. The Board, accordingly, served the Company with a notice under clause 12 (b)(i) of the agreement dated 30-9-1963 that 30% cut in energy consumption be brought into effect immediately. 14-9-1973 Justice Hidayatullah gave this award. A perusal of the said award would indicate that he had given the award in respect of the disputes arising under the agreement dated 30-9-1963 between the parties. 14-9-1973 Justice Hidayatullah gave this award. A perusal of the said award would indicate that he had given the award in respect of the disputes arising under the agreement dated 30-9-1963 between the parties. In the award the dispute between the parties is referred to as "Disputes arising under agreement dated 30-9-1963". 31. On 16-6-1980 the Board sent a notice to Kanoria Chemicals. The subject of the notice was "Revision of price in terms of clause 15(a) of the Agreement dated 30-9-1963." A perusal of the notice indicates that the attention of the Kanoria Chemicals was drawn to clause 15 of the agreement dated 30-9-1963 executed by the Kanoria Chemicals with the State of Uttar Pradesh. The notice further states that the rights and obligations of the said agreement had been transferred to the U.P. State Electricity Board by the State Government and the Board had been supplying power to Kanorias in terms of the said agreement since the transfer of Rihand service area to the Board, the Secretary of the Board shall act in place of Governor for purposes of the said agreement. In exercise of its powers under clause 15(a) of the agreement dated 30-9-1963 the Board purported to revise the rate in the manner indicated in the notice. On 11-5-1981 Kanoria Chemicals wrote to the Board that disputes and differences had arisen between them and the Board regarding rate of electricity charges and that in view of the said disputes they appoint Mr. Bhagwati Prasad Khaitan of 9, Old Post Office Street, Calcutta as an arbitrator. The Company also asked the Board either to concur in the appointment of Mr. B.P. Khaitan as sole arbitrator or to appoint an arbitrator of their own choice. On 17-6-1981 the Board replied to Kanoria Chemicals that they should specify the disputes for reference to arbitration and that the matter shall be examined and necessary steps for appointment of an arbitrator shall be taken, The Board further stated that without prejudice to its rights, Shri G.L. Shukla, Secretary to Government of U.P., Judicial Department was to act as an arbitrator on behalf of the Board to settle disputes between the parties. From a perusal of the letters dated 11-5-1981 and 17-6-1981 it is obvious that the Board did not deny the existence of the arbitration clause. From a perusal of the letters dated 11-5-1981 and 17-6-1981 it is obvious that the Board did not deny the existence of the arbitration clause. After a good deal of correspondence, three disputes were agreed to be referred to arbitration and the Board by its letter dated 17-3-1982 wrote to Kanoria Chemicals that the entire matter had been examined and discussed with the representatives of the Company who had visited the Board from time to time. The letter further states the specific disputes to be referred to the arbitrators. The disputes mentioned in the said letter are as follows : - "(i) Rate of supply of 4.5 MW power. This dispute may be referred to arbitration but the claims are referable only in respect of payment made after May 18, 1978. (ii) Levy of additional charge for 2-5 Paise. The dispute is referable to the arbitration. (iii) Coal surcharge for the month of April and May, 1976. The dispute is referable to the arbitration" It has already been pointed out earlier that there were proceedings before the arbitrators and in those proceedings both the parties participated. On 22-9-1984 issues were framed. 32. From all the facts that have been stated above, it is obvious that the agreement dated 30-9-1963 devolved upon the Electricity Board. It is also clear that the Board acted upon the agreement and in pursuance of the agreement one of the disputes was referred to Justice Hidayatullah and other disputes were referred to the arbitration of Mr. B.P. Khaitan and Mr. B.L. Looma. The correspondence enumerated above clearly indicates that on all occasions, the Board accepted its liabilities under the agreement dated 30-9-1963 and exercised its powers under the said agreement in its dealings with Kanoria Chemicals. I am, accordingly of the view that the agreement dated 30-9-1963 has devolved upon the Board and since the disputes have arisen under the said agreement the said disputes have rightly been referred to arbitration of Mr. B.P. Khaitan and Mr. B.L. Loomba in view of clause 21 of the agreement dated 30-9-1963. 33. The next contention of Mr. R.N. Trivedi is that even if the agreement has devolved upon the Electricity Board, clause 10(c) of the agreement under which the dispute has arisen cannot be made the subject-matter of decision by arbitration. B.P. Khaitan and Mr. B.L. Loomba in view of clause 21 of the agreement dated 30-9-1963. 33. The next contention of Mr. R.N. Trivedi is that even if the agreement has devolved upon the Electricity Board, clause 10(c) of the agreement under which the dispute has arisen cannot be made the subject-matter of decision by arbitration. The contention is that under section 49(2) of the Supply Act, the State of U.P. has conferred a statutory power on the Board to fix tariff and if the fixation of tariff is required to be done under a statute by the Board, power exerciseable by it under the statute cannot be whittled down by entering into a contract of the nature contemplated by clause 10(c) of the agreement. It is contended by Mr. Trivedi that section 59 of the Electricity Supply Act was amended by U.P. Act 16 of 1983 and under that Act there is a statutory obligation imposed on the Board which requires that the Board shall leave such surplus as is not less than three per cent or such higher percentage specified by the State Government in this behalf at the beginning of such a year. The contention is that if the terms of agreement dated 30-9-1963, specially clause 10(c) thereof, are accepted there will be a conflict between the agreement and statutory provision. The provisions of clause 10(c), according to the applicant, are inconsistent and unworkable as the powers contemplated by the State are exerciseable only under section 49 of the Act, This argument is farther developed by saying that if clause 10(c) of the agreement is unworkable, there can be no dispute referred to arbitration because it will be a dispute disconnected with the purposes of the Act and cannot he made the subject-matter of dispute by means of an agreement. Mr, Trivedi fortifies his argument by reference to section 70 of the Supply Act which provides that no provision of the Indian Electricity Act, 1910 or of any rules made thereunder or of any instrument having effect by virtue of such law or rule shall, so far as it is inconsistent with any of the provisions of this Act, have any effect. Reference was made to section 23(3) of the Indian Electricity Act, 1910, The said provision provides that in the absence of an agreement to the contrary, a licensee may charge for energy supplied by him to any consumer by such other method as may he approved by the State Government. Section 26 of the Supply Act provides that the Board shall, in respect of the Whole State, have all the powers and obligations of a licensee under the Indian Electricity Act, 1910 and this Act shall be deemed to be the licence of the Board for the purposes of that Act. A perusal of the proviso to this section indicates that nothing in sect ion 23 of the Electricity Act relating to the duties and obligations of a licensee shall apply to the Board. By reference to section 23 and section 26 of the Supply Act, it is argued by Mr. Trivedi that the Kanoria Chemicals are to be regulated in respect of fixation of price in respect of matters contemplated by clause 10(c) of the agreement only by the provisions or the Supply Act and not by the agreement. 34. On the other hand, Mr. Raja Ram Agarwal, learned counsel for the opposite party contended that there is no inconsistency between clause 10(c) of the agreement and section 49 of the Supply Act. According to him section 49 of the Supply Act is divisible in two parts. Section 49(1) and (2) deal with fixation of uniform tariff but section 49(3) deals with fixation of special tariff. Section 49(3), leaving aside unnecessary words, reads as follows "Nothing in the foregoing provision of the section shall derogate from the power of the Hoard, if it Considers it necessary or expedient to fix tariffs for the supply of electricity to any person riot being a licensee having regard to the geographical position of any area, the nature of the supply and purpose for which supply is required and any other relevant factors." 35. Mr. Agarwal submitted that sub-section (3) of section 49 confers power on the Board to fix different tariffs for the supply of electricity to any person, regard being had to several conditions mentioned in the Act. Mr. Agarwal submitted that sub-section (3) of section 49 confers power on the Board to fix different tariffs for the supply of electricity to any person, regard being had to several conditions mentioned in the Act. The correspondence between the parties which has been enumerated above clearly indicates that the opposite party wanted to set up a factory for manufacture of caustic soda and one of the important consideration for the establishment of the factory in Mirzapur district was that the supply of electricity would be at cheap rate as the supply of electricity was a raw material for the preparation of Caustic Soda. The correspondence between the parties clearly reveals that Kanoria Chemicals all along insisted that unless they get electricity at cheap rate, it would not be possible for them to set up the factory for manufacturing Caustic Soda in Mirzapur district. Keeping these facts into consideration the agreement dated 30-9-1963 was entered into and in my opinion, such a contract could be entered into in exercise of powers under section 49(3) of the Act. The conditions relating to the supply of electricity have been enumerated in the agreement specially in clause 10(c) of the said agreement. The agreement also contemplates that if there are disputes in regard to supply of electricity or electrical charges, the matter shall be referred to arbitration under clause 21 of the agreement. In my opinion, there is no inconsistency between sections 49(1) and (3) of the Supply Act. The two sub-sections operate on different fields. It is open to the Board to fix uniform tariff under section 49(1) and for that purpose guidelines have been indicated in section 18 of the Act but section 49(3) contemplates a case when the Board may instead of fixing uniform tariffs may, in the interest of development of industry of a particular type, fix special tariffs for the supply of electricity to any person, not being a licensee. There is no bar in section 49(3) that such fixation cannot be done by agreement of parties. In the instant case principles of fixation of tariff have been determined by agreement dated 30-9-1963. For the reasons stated above, I am of the view that there is no inconsistency between section 49 of the Supply Act and clause 10(c) of the agreement dated 30-9-1963. In the instant case principles of fixation of tariff have been determined by agreement dated 30-9-1963. For the reasons stated above, I am of the view that there is no inconsistency between section 49 of the Supply Act and clause 10(c) of the agreement dated 30-9-1963. Since different tariffs as against uniform tariffs can be fixed under section 49(3), by an agreement such as has been entered into between the parties on 30-9-1963 there can be no inconsistency between section 49 of the Supply Act and the agreement dated 30-9-1963 as the said agreement has been entered into between the parties in exercise of the power conferred under section 49(3) of the Act. The interpretation placed on section 49(3) of the Supply Act finds support from section 18 of the Supply Act and under the said provision the Board is charged with a number of duties, one of the duties being to supply electricity as soon as practicable to a licensee or other person requiring such supply if the Board is competent under the Act so to do. It is not in dispute that under section 49(3) of the Supply Act different tariffs can be fixed as against uniform tariffs. In this back-ground if an entrepreneur approaches the Board, as has been done in the instant case, for setting up a factory for preparation of Caustic Soda and the supply of electricity is a raw material for the purpose of manufacturing then it is open to the Board under section 49(3) to fix different tariffs under an agreement with the entrepreneur so that he may be able to set up a factory for the growth of industrialization in the Stall-. The important words under section 18(b) are "if the Board is competent under this Act". In this respect the Board is obviously competent to supply electricity to an entrepreneur by fixing different tariffs under section 49(3) of the Supply Act. 36. It is also clear from the correspondence that the main reason for the opposite party to set up the factory in Mirzapur district was that the supply of electricity would be available on cheap rates. It is, therefore, obvious that different tariffs can be fixed under clause 10(c) of the agreement and fixation of such a tariff would be for the purposes of the Act and would not be inconsistent with the Act. It is, therefore, obvious that different tariffs can be fixed under clause 10(c) of the agreement and fixation of such a tariff would be for the purposes of the Act and would not be inconsistent with the Act. I find support for this conclusion in the following observations made by P.N. Bhagwati, J. in Indian Aluminium Co. v. Kerala Electricity Board (AIR 1975 Supreme Court 1967 at page 1972) : - "One of the primary purposes of the Supply Act is to provide inter alia for the supply of electricity, in fact, the Supply Act empowers the Board to supply electricity to any person other than a licensee. An agreement for supply of electricity to a consumer is, therefore, plainly and indubitably an agreement for one of the purposes of the Supply Act............." 37. Next argument of Mr. R.N. Trivedi is that clause 10 of the agreement ts vague on account of uncertainty and is, therefore, void and incapable of enforcement. It is agreed between the parties that the contingency created by clause 10(b) of the agreement has not arisen. With reference to clause 10(c) of the agreement, it is contended by the applicant that the agreement does not fix any workable principle on the basis of which fixation of price can be made. The fixation of price in order to be effective has to be on the basis of ascertainable facts. According to the learned counsel the words in the agreement that "but such a rate shall be reasonable one taking into account, inter alia, the cost of production of power at the Obra Hydro Electric Project and other factors" are vague and do not indicate any principle on the basis of which fixation of price can be made. Reference in this connection may be made to sections 31 and 32 of the Contract Act. Section 31 of the Contract Act defines contingent contract as follows : - "A 'contingent contract is a contract to do or not to do something, if some event, collateral to such contract does or does not happen." 38. Section 32 of the Contract Act reads as follows : - "Contingent contracts to do or not to do anything if an uncertain. Future event happens cannot be enforced by law unless and until that event has happened." 39. Section 32 of the Contract Act reads as follows : - "Contingent contracts to do or not to do anything if an uncertain. Future event happens cannot be enforced by law unless and until that event has happened." 39. A close analysis of the two sections would indicate that a contingent contract is not void to start with. It may, however, fail subsequently on account of a contingency. In the event of happening of the contingency the contract would be void. The admitted facts in the instant case are that HINDALCO did not release the supply of electricity power as is envisaged in paragraph 10(b) of the agreement. The Obra Hydro Electrict Project was commissioned with effect from 1-4-1971. From a perusal of a letter dated 25-4-1974 from the Board to Kanoria Chemicals it appears that the Board admitted that clause 10(c) of the agreement had come into operation after the completion of Obra Hydel Project and as per clause 10(c), 4500 KW additional power will be supplied to the Company from Obra Hydel taking into account the cost of production at Obra Hydel Project. In the same letter the Board intimated to Kanoria Chemicals that the standard rate of heavy power consumers rate Schedule HV-2B may be made applicable to Kanoria Chemicals for supply of additional power provided in clause 10(c) of the agreement dated 30-9-1963 i.e. from the date of commissioning of the Obra Hydel Project. This letter clearly establishes two things. In the first instance the Board has admitted that clause 10(c) of the agreement had come into operation and for the supply of additional power the rate applicable to heavy power consumers rate Schedule HV-2B shall be made applicable to Kanoria Chemicals. The letter further indicates that this power has been exercised under clause 10(b) of the agreement dated 30-9-1986.(1963?) The question that arises now is whether the sale of electricity comes within the category of sale of goods within the meaning of Sale of Goods Act. It has been held in Commissioner of Sales Tax, Madhya Pradesh v. Madhya Pradesh Electricity Board (AIR 1970 Supreme Court 732) that electricity is 'goods' within the meaning of Sale of Goods Act. It has been held in Commissioner of Sales Tax, Madhya Pradesh v. Madhya Pradesh Electricity Board (AIR 1970 Supreme Court 732) that electricity is 'goods' within the meaning of Sale of Goods Act. Under section 18 of the Electricity Supply Act, 1948 it is one of the duties of the Board to supply electricity to any person and section 49 of the said Act provides for the sale of electricity. The rate at which the electricity will be sold has been laid down in section 49 of the said Act. The section is in two parts, section 49(1) and 49(2) dealing with the fixation of uniform tariff. Section 49 (3) of the Act provides that nothing in the earlier part of the section shall derogate form power of the Board to fix different tariffs for the supply of electricity to any person not being a licensee having regard to the purpose for which supply is required and will also take into account other relevant factors germane to the principle indicated in the Act. Section 9(2) of the Sale of Goods. An provides for the fixation of price. It is thus obvious that fixation of price can be done by the Board regard being had to section 49 of the Electricity Supply Act read with section 9 of the Sale of Goods Act. It is also in evidence that after a good deal of correspondence the Board decided to fix the price of electricity at the rate of 8.64 Paise per KW. From the facts that have been enumerated above it is clear that the subsequent even is have made the performance of the contract possible. In Shrimati Raj kumari Devi v. Ganesh Prasad (First Appeal No. 13 of 1972) a Division Bench of this Court held that it is the policy of the law to uphold the contracts wherever possible lest it may destroy the purposes for which the contract was entered into. It is the duty of the Court to ascertain the intention of he parties in a just and reasonable manner and the said intention of the parties should as far as possible be given effect to even if the contract is silent in matters of some detail. It is the duty of the Court to ascertain the intention of he parties in a just and reasonable manner and the said intention of the parties should as far as possible be given effect to even if the contract is silent in matters of some detail. It has also been held in the said decision that an uncertain agreement may be so supplemented by subsequent ai ts of the parties as to make it certain and valid. A perusal of the said decision would also disclose that even if there was an element of uncertainty that uncertainty may he removed by the conduct of the parties. In the instant case, the Board itself has proceeded on the assumption that clause 10(c) of the agreement had come into force. The Board has also fixed the price of electricity at the rate of 8.69 Paise per KW. In the first instance clause 10(c) of the agreement dated 30-9-1963 in my opinion, is neither vague nor indefinite and even if there was an element of uncertainty, that stands removed by the admission of the parties when clause 10(c) of the agreement comes into operation and fixation of price has been made in respect of which there is dispute between the parties. The fact that the Board has proceeded on the assumption that clause 10(c) of the agreement had come into operation is also evident from the letter dated 2-8-1971 whereby the Board intimated to Kanoria Chemicals that the matter of fixation of price had been examined vis-a-vis clause 10(c) of the agreement dated 30-9-1963 and that the cost of generation at Obra will not be less that 8.49 Paise per unit at any stage. The carriage charges of power from Ohra to the Pipri busbar would come to 20 Paise per unit. The power generated at Obra Mydel Project was offered to be made available to the Kanoria Chemicals at the rate of 8.69 Paise pet unit. The said letter also gives an option to the Kanoria Chemicals that the Obra Hydel Project is also a part of the Board's Grid System, they may avail of the supply of the additional power in question under Board's standard rale Schedule HV-2 integrated Grid System of the Board. 40. The said letter also gives an option to the Kanoria Chemicals that the Obra Hydel Project is also a part of the Board's Grid System, they may avail of the supply of the additional power in question under Board's standard rale Schedule HV-2 integrated Grid System of the Board. 40. There is an arbitration clause contained in the agreement which provides that if there is any dispute between the parties that dispute can be resolved by reference of the said disputes to the arbitration. The dispute between the parties relating to fixation of price can he resolved by referring the case to arbitration. The agreement itself provides for a mode of settlement of disputes and if the dispute in regard to price can be resolved by referring the dispute to arbitration under arbitration clause then clause 10(c) of the agreement cannot be struck down on the ground of vagueness and uncertainty. The question whether the price fixed by the Board is correct price or the price is not reasonable anti proper as alleged by the opposite party can be decided by the arbitrators. The arbitration clause contained in the agreement is a part of the agreement and any dispute that arises between the parties can be resolved by the arbitrators. The question as to what is the reasonable rate or what is the rate which may be assessed for the supply of electrical energy can be determined by the arbitrators after affording opportunity to both the parties. For the reasons stated above I am of the view that clause 10(c) of the agreement is not vague of indefinite. At any rate, the conduct of the parties in the instant case indicates that they are relying upon clause 10(c) of the agreement in matters of fixation of price and that the dispute is with regard to the said fixation of price. 41. Another contention raised by Mr. R.N. Trivedi is that the operation of clause 10(c) of the agreement has become impossible of performance. It is contended that with the formation of the Grid in the year 1968 the source of supply to Kanoria Chemicals from Obra is not identifiable and as such clause 10(c) of the agreement which provides for electricity from Obra has become impossible of performance. The principle of frustration of contract is contained in section 56 of the Contract Act. It is contended that with the formation of the Grid in the year 1968 the source of supply to Kanoria Chemicals from Obra is not identifiable and as such clause 10(c) of the agreement which provides for electricity from Obra has become impossible of performance. The principle of frustration of contract is contained in section 56 of the Contract Act. The principle underlying the section is that the performance of contract can be avoided if on account of happening of an event which is not the result of action of either of the parties, the performance of the contract may be avoided. The leading case of the Supreme Court on this principle is Satyabrata Ghose v. Magneeram Bangur & Co. (AIR 1954 Supreme Court 44). The Court relied upon A.N. Nair & Co. v. Gordhandas Sagarmull (AIR 1951 Supreme Court 9). The principle deducible form these two decisions is that so far as the Courts in India are concerned, they have to look to the law contained in section 56 of the Indian Contract Act, 1972(1872?) for determining whether the performance of the contract is frustrated or not. Another principle which is deducible is that if the parties contemplate possibility of intervening circumstances which might affect the performance of the contract but expressly stipulate that the contract would stand despite such circumstance, there can be no case of frustration because the contact being to demand performance despite the happening of a particular event, is cannot disappear when that event happens. The aforesaid two decisions were subsequently followed by this Court in Ganga Singh v. Santosh Kumar (AIR 1963 Allahabad 194). This Court after dealing with the case law on the point held that the Court will not apply the doctrine of frustration to assist a party who does not wish to fulfil his obligations under the contract and relies on literal impossibility to back out of it. The Court observed that the doctrine of frustration is based on equity and common sense and cannot be permitted to become a device for destroying the sanctity of the contract. 42. In the instant case the format ion of a Grid was specifically in the knowledge of the parties when the agreement watt entered into on 30-9-1963. The agreement mentions the interlinking of Thermal Station at Mau and Gorakhpur with each other and with Rihand Hydro Electric Generating Station. 42. In the instant case the format ion of a Grid was specifically in the knowledge of the parties when the agreement watt entered into on 30-9-1963. The agreement mentions the interlinking of Thermal Station at Mau and Gorakhpur with each other and with Rihand Hydro Electric Generating Station. It was specifically agreed that the initial supply of 6.5 M. YV. would be from Rihand. Under clause 10(c) of the agreement, the parties agreed that when Obra Project was completed, the supply was to be made from Obra. In view of this specific stipulation the doctrine of frustration cannot be resorted to by the Board an the contract cannot be held to have frustrated or to have become impossible of performance after the formation of the Grid. In the instant case, the object and purpose of the contract is the supply of electricity to the extent of 4.5 M.W. under clause 10(c) of the agreement. This part of the contract, in my opinion, can be substantially performed even after formation of the Grid. The quality of electricity is not affected by the formation of the Grid. In my opinion, in these circumstances clause 10(c) of the agreement cannot be held to have become impossible of performance. 43. It is next contended by Mr. R.N. Trivedi that the arbitration clause in the instant case is not workable. Section 76 of the Electricity Supply Act provides that if an Act provides for referring a dispute to arbitration then it has to be referred to an authority defined by the Act. The aforesaid section further provide, that in other cases the dispute may be referred to the arbitration, one to be appointed by each party in the dispute. Mr. Trivedi during the course of his arguments attempted to give a limited construction to the words "other cases". It was also contended by Mr. R.N. Trivedi that the arbitration clause contained in the agreement dated 30-9-1963 cannot be said to be a matter which serves any purpose of the Act as contemplated by section 18 of the Supply Act. He contended that although section 76 of the Supply Act provides for arbitration but such a provision has been made in respect of those cases in which the Act provides that the dispute be referred to arbitration and in such an eventuality the disputes shall be referred to the authority constituted under the Act. He contended that although section 76 of the Supply Act provides for arbitration but such a provision has been made in respect of those cases in which the Act provides that the dispute be referred to arbitration and in such an eventuality the disputes shall be referred to the authority constituted under the Act. In respect of clause (b) of section 76 it was contended by Mr. Trivedi that this has no application to any arbitration agreement entered into with consent of the parties or resolving of disputes is not the purpose of the Act. 44. On this aspect after having heard the learned counsel for the parties, I find that the contention raised by Mr. R.N. Trivedi has no merit. A perusal of the preamble of the Supply Act, 1948 would indicate that the Act deals not only with the rationalisation of production and supply of electricity but also for all matters incidental thereto. It reads as follows : - "Whereas it is expedient to provide for the rationalisation of the production and supply of electricity, for taking measures conducive to electrical development and for all matters incidental thereto." 45. It is one of the recognised principles of (interpretation of) statute that the power to do an act carries with it the power to do acts incidental to the main act. It is one of the purposes of the Supply Act to supply electricity at rates indicated in the Act. Section 49(3) of the Act provides that although general tariff may be fixed under section 49(1), the Board has the power to fix special tariff having regard to the facts and circumstances of each case. I have already held above that fixation of rates under section 49(3) of the Act can he made by agreement of the parties as such a method has not been eliminated out of consideration by the provisions of the Act. As a matter of fact section 76 of the Act provides for reference of disputes to arbitration. The possibility of arising of disputes cannot be eliminated and for that purpose the general practise prevailing is that if an agreement is entered into between an entrepreneur and the State, an arbitration clause is generally inserted so that disputes between them are settled by arbitration. The insertion of an arbitration clause is, obviously, with a view to resolving disputes between the parties. The insertion of an arbitration clause is, obviously, with a view to resolving disputes between the parties. In this background, the provision for the settlement of disputes by arbitration in respect of disputes arising out of supply of electricity to be made by the Board would be a matter incidental to the supply of electricity. The settlement of disputes by arbitration would be a matter clearly for giving effect to the purposes of the Act and in order that the supply of electricity be made by the Board, it is necessary that suitable provisions be made to resolve disputes between the parties if they arise at any stage. I am, accordingly, of the view that the arbitration clause contained in agreement dated 30-9-1963 carries on the purpose of the Act us it is a matter incidental to the purposes for which the Act has been enacted. In this respect Mr. Raja Ram Agarwal has relied upon the case of Haymen v. Darwin Ltd. (1942 Appeal Cases, 356). A quotation from the said judgment is as follows : - "It is quite distinct from the other clause. The other clause, set out the obligations which the parties undertake towards each other inde; but the arbitration clause does not impose on one of the parties an obligation in favour of the other. It embodies the agreement of both the parties that if any dispute arises with regard to the which the one party had undertaken to the other, such disputes shall be settled by tribunal of their own constitution and there is this very material difference, that whereas in an ordinary contract the obligations of the parties to each other cannot in general be specifically enforced and breach of them results only in damages, the arbitration clause can be physically enforced by the machinery of the Arbitration Acts." Lord Wright observed as follows : - "It is collateral to the substantial stipulation of the contract. It is merely procedural and ancillary, it is a mode of settling disputes, though the agreement is itself subject to the discretion of the Court." The observations quoted above have been quoted with approval by the Calcutta High Court in Lotus Oil Company v. Calcutta Soap Works (AIR 1962 Calcutta 441). It is merely procedural and ancillary, it is a mode of settling disputes, though the agreement is itself subject to the discretion of the Court." The observations quoted above have been quoted with approval by the Calcutta High Court in Lotus Oil Company v. Calcutta Soap Works (AIR 1962 Calcutta 441). The observations of Lord Wright quoted above clearly indicate that the insertion of arbitration clause is procedural and is an ancillary provision which gives effect to the provisions of the contract in case disputes arise between the parties, 46. There is yet another way of looking the matter and it is that if a contract is assignable, as I have already bold, (he arbitration clause will also be assignable and in case of any dispute the parties will be bound to refer the dispute to arbitration. However, I have already held that the agreement dated 30-9-1963 has devolved upon the parties and if the agreement is one which is assignable under the agreement then the arbitration clause will also be assignable. 47. One of the contentions raised by Mr. R.N. Trivedi is that the appointment of arbitration at the instance of the Board was 'without pre judice to its rights' to challenge that the dispute in question was not liable to be adjudicated upon by the arbitrators. The question is as to what is the significance of the words 'without prejudice to its rights'. In this respect the learned counsel for the opposite party Mr. Agarwal relied upon M/s. Tarapore and Company v. Cochin Shipyard Ltd., Cochin and another (AIR 1984 Supreme Court, 1072). The learned counsel relied upon the following observations of the Supreme Court at page 1087 of the said report : - ".......... the expression 'without prejudice' ............... would only mean that the respondent reserved the right to contend before the arbitrator that the dispute is not covered by the arbitration clause............ It only means that the respondent reserved in itself the right to contend before the arbitrator that a dispute raised or the claim made by the contractor was not covered by the arbitration clause. No other meaning can be assigned to it........." 48. Reference in this connection may also be made to a letter issued by the Board to Kanoria Chemicals dated 17-6-1981. No other meaning can be assigned to it........." 48. Reference in this connection may also be made to a letter issued by the Board to Kanoria Chemicals dated 17-6-1981. In that letter the Board stated as follows : - "However, without prejudice to the rights, it is hereby made clear to you that Sri G.L. Shukla, Secy. to Govt. U.P. Judicial Department, Vidhan Bhawan, Lucknow shall act as Arbitrator on Board's behalf to settle the dispute between the parties which are worked out on receipt of your detailed and proper notice for arbitration with specific reference to the arbitration clause of the agreement." In the light of the observations made by the Supreme Court the words 'without prejudice to its rights' clearly mean that the arbitrators Mr. Shukla and Mr. Khaitan will decide the question whether the dispute is referable to arbitration and the arbitrators are empowered to decide the dispute between the parties. Furthermore record of the case indicates that the Law Officer was entrusted to look after the legal matters of the Board and was all the time negotiating with the opposite party in regard to matters in dispute. On 17-3-1982 the Law Officer of the Board wrote to the opposite party : - "I am directed to say that the entire matter has now been examined and also discussed with your representatives who have visited from time to time." This indicates that the Board had entrusted the Law Officer to look after the dispute between the parties. This is also clear from the proceedings before the arbitrator dated 21-10-1983(sic) also indicate that Shri R.K. Garg, Law Officer, was looking after the case and was Incharge of legal affairs of the Board. 49. Reference in this connection may also be made or Renusagar Power Co. Ltd. v. General Electric Company and another (AIR 1985 Supreme Court, 1156). The principle deducible from this is that the Arbitration Act does not prevent the arbitrators or an umpire from deciding questions of their own jurisdiction provisionally or tentatively and to proceed to make their award on that basis. It is, however, dear that their provisional or tentative decision on questions of their own jurisdiction would be subject to the final determination by the Court and if the Court takes a contrary view their award will not be given effect to. It is, however, dear that their provisional or tentative decision on questions of their own jurisdiction would be subject to the final determination by the Court and if the Court takes a contrary view their award will not be given effect to. Another principle deducible from this decision is that the jurisdiction of the arbitrators to decide the question of the existence of arbitration clause is not wholly taken away by mere denial of its existence. The arbitrators are required to consider the question of jurisdiction, not to give final and binding judgment on the question but in order to determine what course they should adopt. They may in a case hold that they have no jurisdiction and direct the party who affirms the jurisdiction to obtain a decision of the Court under the Arbitration Act. but if they are satisfied that they have got jurisdiction they may proceed with the arbitration and make their award but a decree in terms of such award may not be made by the Court if at the time when one is sought the Court decides question of jurisdiction otherwise. On the basis of this decision it is not possible to accede to the contention of the applicant that since the question of jurisdiction is involved this Court may proceed to determine that question first in a case under section 33 of the Arbitration Act. As emphasised by the Supreme Court the decision given by the arbitrators in regard to their own jurisdiction is tentative and provisional and would be subject to the final determination by a Court of law. The final verdict on the question of existence of arbitration clause and the matter covered by the arbitration clause will be decided by the said Court and a binding decision will be given. Unless that stage is reached, it is not possible for any party to contend that merely because the question relating to jurisdiction of arbitrators is raised that question may not be decided by the arbitrators and should be adjudicated upon by Court. The Supreme Court after considering various decisions observed that so far as the Indian law on the law of arbitration is concerned, the position is clarified by a decision of the Bombay High Court in Vallabh Pitti v. Narsingdas (AIR 1963 Bombay 137). By reference to the said decision, the Supreme Court observed as follows : - "....... The Supreme Court after considering various decisions observed that so far as the Indian law on the law of arbitration is concerned, the position is clarified by a decision of the Bombay High Court in Vallabh Pitti v. Narsingdas (AIR 1963 Bombay 137). By reference to the said decision, the Supreme Court observed as follows : - "....... the jurisdiction of the arbitrators to decide the question of existence of the contract which contains an arbitration clause is not wholly taken away by mere denial of its existence ; that the arbitrator may consider the question of jurisdiction, not to give final and binding judgment on that question bur in order to determine what course they should adopt ; that they may in a case hold that they have no jurisdiction and direct the party who affirms the jurisdiction to obtain a decision of the Court under the Arbitration Act but on the other hand if they are satisfied that they have got jurisdiction they may proceed with the arbitration and make that award but a decree in terms of such award may not be made to the Court if at the time when one is sought the Court decides question of jurisdiction otherwise." 50. In my opinion, the observations quoted above are a complete answer to the contention raised on behalf of the applicant that the dispute in question was not liable to be adjudicated upon by the arbitrators as the officials of the Board could not bind the Board by appointment of Mr. Shukla as an arbitrator. It may be that the Board appointed Mr. Shukla as an arbitrator without prejudice to its rights to raise the question whether the dispute was cognisable by arbitrators. But such a dispute can be decided by the arbitrators provisionally and it will be open to the applicant to challenge the award if the Court finds that the arbitrators had no jurisdiction to adjudicate upon the dispute in question. 51. Now I take up the other case. In this case the U.P. State Electricity Board has challenged the appointment of the Umpire. The contention of the petitioner is that the Umpire was not appointed according to law and, therefore, he had no jurisdiction to proceed to arbitrate the dispute between the parties. It is further contended that the Umpire has given a decision that it has jurisdiction to entertain the dispute. The contention of the petitioner is that the Umpire was not appointed according to law and, therefore, he had no jurisdiction to proceed to arbitrate the dispute between the parties. It is further contended that the Umpire has given a decision that it has jurisdiction to entertain the dispute. This finding, according to the learned counsel for the applicant, is without jurisdiction as the appointment of an umpire itself is not in accordance with law. It has further been contended on behalf of the applicant that although the applicant participated in the proceedings before the Umpire, that participation will not confer the jurisdiction on an umpire which he does not legally possess. In order to appreciate the controversy certain facts will have to be stated. On 17-6-1981 the Board nominated Mr. G.L. Shukla, Secretary to Government of U.P., Judicial Department as its arbitrator. On 20-11-1982 the Government sanction was received which permitted Mr. Shukla to arbitrate the dispute between the parties. On 13-12-1982 Mr. Shukla declined to act as an arbitrator. On 2-2-1983 the Board nominated Mr. B.L. Loomba, Judicial Secretary in place of Mr. G.L. Shukla. On 18-4-1983 Government sanction was received to enable Shri Loomba to take up his duties as an arbitrator. At this stage it may be recalled that earlier the petitioner had appointed Mr. Bhagwati Prasad Khaitan as its arbitrator. On 20-4-1983 Shri Khaitan requested Mr. Loomba to convene first meeting of the arbitrators. On these facts the argument of Mr. R.N. Trivedi, learned counsel for the applicant, is that in the instant case the reference was made to even number of arbitrators, namely, Shri Bhagwati Prasad Khaitan and Shri B.L. Loomba. Under the First Schedule to the Arbitration Act, the arbitrators are required to appoint an umpire not later than one month from the latest date of their respective appointments. According to the applicant Shri Shukla acted on the basis of bis appointment and a meeting of the arbitrators was to take place on a subsequent date. On this basis it is contended by Mr. R.N. Trivedi that by conduct Shri Shukla accepted the appointment by fixing a date for meeting. Further on 24-12-1982 Mr. Shukla expressed his inability to act and on 21-1-1983 the apposite party wrote a letter to the Board requesting it to substitute the arbitrator under section 9(b) of the Arbitration Act. On this basis it is contended by Mr. R.N. Trivedi that by conduct Shri Shukla accepted the appointment by fixing a date for meeting. Further on 24-12-1982 Mr. Shukla expressed his inability to act and on 21-1-1983 the apposite party wrote a letter to the Board requesting it to substitute the arbitrator under section 9(b) of the Arbitration Act. Under section 9(b) of the Arbitration Act if one party fails to appoint an arbitrator either originally or by way of substitution for 15 clear days, then the arbitrator after the service by the either party of a notice in writing to make the appointment, such other party having appointed his arbitrator before giving the notice, the party who has appointed an arbitrator, may appoint that arbitrator to act as sole arbitrator. It is not in dispute that section 9(b) has been amended and instead of the words "fifteen clear days", the words "one month or where the party is Government, for three months" have been substituted. The argument of Mr. Trivedi is that under the First Schedule to the Arbitration Act Mr. Shukla had been appointed an arbitrator and the Umpire could be appointed not later than one month from the date of appointment of Mr. Shukla. 52. In order to appreciate the controversy so raised it would be necessary to determine the question whether the provisions contained in the First Schedule are mandatory or directory. The answer to this question is immediately furnished if we look at the amendment of the First Schedule introduced by U.P. Act No. 57 of 1976 which came into force on 1-1-1977. Paragraph 2 of the First Schedule has been drastically amended and for the words "not later than one month from the latest date of their respective appointments", the words "within one month from the latest date of their respective appointments or within such extended time as the parties to the reference agree to, and in the absence of such agreement as the Court may allow" shall be substituted. The amended paragraph of the First Schedule now reads as follows : - "If the reference is to an even number of arbitrators, the arbitrators that appoint an umpire within one month from the latest date of their respective appointments or within such extended time as the parties to the reference agree to, and in the absence of such agreement as the Court may allow." 53. It is thus obvious that by amendment introduced in the First Schedule the mandatory nature of the provisions contained earlier has been modified and the provision has become directory. It may at this stage be pointed out that both Mr. G.L. Shukla and Mr. B.L Loomba were Judicial Secretaries to the State of U.P. At first Mr. Shukla was nominated by the Board. Under U.P. Government Servants Conduct Rules 1956, no Government servant is permitted to enter into private trade or employment unless necessary permission is obtained under Rule 15 of the Rules. The necessary permission in the case of Mr. Shukla had been obtained but in view of the situation created by inability of Mr. Shukla to arbitrate the dispute, another arbitrator had to be nominated and appointed. On 18-4-1983 Government sanction for the appointment of Mr. Loomba was received on 20-4-1983 Mr. B.P. Khaitan requested Mr. Loomba that the first meeting of the arbitrators be held. On 7-5-1983 within one month of the Government sanction in favour of Mr. Loomba, Justice G.S.L. Srivastava was appointed an Umpire by the arbitrators. If Mr. Loomba is deemed to have been appointed on 18-4-1983 then obviously the appointment of an Umpire on 7-5-1983 is within one month from the latest dale of the appointment. The latest appointment was that of Sri Loomba and the period of one month had to be counted from 18-4-1983. In this way, I am of the view that the appointment of the umpire on 7-5-1983 by the two arbitrators is legal. 54. In this connection it would be appropriate to refer to the observations appearing on page 294 of Halsbury's Laws of England, Volume 2, where question of appointment of arbitrators has been dealt with. In this way, I am of the view that the appointment of the umpire on 7-5-1983 by the two arbitrators is legal. 54. In this connection it would be appropriate to refer to the observations appearing on page 294 of Halsbury's Laws of England, Volume 2, where question of appointment of arbitrators has been dealt with. Relevant portion from the said Volume is quoted below : - "Where an arbitration agreement provides for the appointment of an arbitrator by each of two or more parties, three separate conditions must be fulfilled before any appointment is valid : (1) the arbitrator must be notified of the appointment. (2) he must consent to act, and (3) his name and the fact of his appointment must he communicated to the other party." In the instant case Mr. Loomba was nominated by the Board for being an arbitrator and his nomination was approved by the State Government and the said approval was communicated to Mr. Loomba. Mr. Loomba consented to act as an arbitrator and for that purpose the two parties assembled on 7-5-1983 and appointed Justice G.S.L. Srivastava as an umpire. It appears that for the first time this question was raised before the arbitrator on 8-5-1985. On this question elaborate arguments were advanced by the parties and ultimately Justice G.S.L. Srivastava held that he had jurisdiction to decide the dispute between the parties as an umpire. From the facts that have been stated above, I find that no question of revocation of the authority of the umpire arises in the instant case. In the first instance, the appointment of the umpire is legal for the reasons already slated above. The applicant participated in the proceedings before the umpire and challenged his jurisdiction and the umpire held that it had jurisdiction to entertain the case. In my opinion, there is no justifiable basis to revoke the authority of the umpire. Mr. R.N. Trivedi strenuously contended that the Baard participated in proceedings before the umpire but that will not amount to waiver on the part of the Board not to raise the plea in regard to revocation of the authority of the umpire. In my opinion, there is no justifiable basis to revoke the authority of the umpire. Mr. R.N. Trivedi strenuously contended that the Baard participated in proceedings before the umpire but that will not amount to waiver on the part of the Board not to raise the plea in regard to revocation of the authority of the umpire. Without going into the question whether the principle of waiver will apply, I am of the view that the appointment of the umpire is legal and does not suffer from any infirmity and, therefore, there is no reason to revoke the authority of the Umpire. 55. As a result of the findings recorded above, I come to the conclusion that the agreement dated 30-9-1963 is binding upon the parties and has devolved upon the Board. Clause 10(c) of the agreement is neither vague nor indefinite and is capable of enforcement. Since there are disputes between the applicant and the opposite party, the disputes could be referred under clause 21 of the arbitration agreement, which has devolved upon the Board along with the main agreement dated 30-9-1963, to the arbitrators selected by the parties. I also hold that the arbitrators were rightly appointed and they could legally appoint justice Gur Saran Lal Srivastava as an Umpire. I am, accordingly, of the view that Miscellaneous Cases Nos. 2 and 3 of 1986 are liable to be dismissed. Writ Petition No. 1933 of 1985 is directed against an order passed by the Civil Judge, Lucknow for staying of proceedings before the Umpire. In view of the fact that I have held that the appointment of Umpire is legal and the dispute is covered by arbitration clause contained in the agreement dated 30-9-1983, the controversy between the parties has to be decided by the Umpire. In this view of the matter, Writ Petition No. 1933 of 1985 is also liable to be dismissed. 56. As a result of the findings recorded above, Miscellaneous Cases Nos. 2 and 3 of 1986 and Writ Petition No. 1933 of 1985 are dismissed with costs. The stay order is vacated. 57. Miscellaneous Cases Nos. 4 of 1986 and Miscellaneous Case No. 24 of 1985 stand disposed of in view of the fact that the interim stay order has been vacated.