RAJENDRA BABU, J. ( 1 ) THE petitioner filed an application under sections 33, 8 and 9 of the Arbitration Act for: (1) A declc ration that :- (a) there is no arbitration agreement in force under the agreement dated 4th. October, 1978 ; (b) Appointment of second arbitrator is not valid; and (2) Restraining the second respondent from taking up arbitration proceedings and rejecting the appointment of the second arbitrator as the sole arbitrator. ( 2 ) IN the application the petitioneraverred as follows :- First respondent had been the sole selling agent of the petitioner for certain periods in respect of items of goods manufactured by the petitioner. On 4-10-78 the petitioner and the 1st respondent entered into an agreement which was to be in force for a period of three years from 4-4-1978 which expired on 3-4-1981. Out of that agreement certain differences arose between the petitioner and the 1st respondent in regard to the payment of commission of remuneration on sale made directly by the petitioner to Central or State Government; or Corporations or bodies controlled by the central or State Governments, but the Company law Board having objected to such payments, it is the case of the petitioner they were not in a position to accede to the claim made by the 1st respondent in that behalf. However, on 20th January 1982 another agreement was entered into between the parties whereby the 1st respondent withdrew all its claims, if any, made by it in respect of the earlier agreement dated 4th October, 1978 including the rights referring the matter for arbitration. First respondent also further unconditionally waived all its rights and liabilities arising out of the agreement dated 4th October, 1978. Thus the arbitration agreement was no longer in force and it cannot be revived for any reason and therefore sought for the declaration. It is also contended that the appointment of the 2nd respondent was illegal as no dispute referable to arbitration had arisen particularly in the context of conditions preceding the invoking of the arbitration clause. It was also contended that certain circumstances existed in this case in which the 2nd respondent placed himself in such a position that he could not act as sole arbitrator. It was also contended that certain circumstances existed in this case in which the 2nd respondent placed himself in such a position that he could not act as sole arbitrator. ( 3 ) THE first respondent filed its objectionscontending that there was an agreement between him and the petitioner for payment of remuneration in respect of the sales effected directly by the petitioner to Governmental agencies and public sector organisations and therefore a dispute arose on that question which was arbitrable. It also contended that the agreement dated 20th January, 1982 was never put into effect by any of the parties and therefore the same has no existence in the eye of law. It is stated that the latter agreement did not supersede the agreement entered into earlier particularly in view of the fact that it was a package deal. It was submitted that necessary pleas have not been raised for granting the alternative prayer for permission to appoint petitioner's sole arbitrator in the event the Court holding that t'ie agreement is subsisting. ( 4 ) ON the basis of the affidavits filedbefore the trial Court as also the documents produced before it, the trial Court raised several questions for consideration and held that there was material on record to show that the agreement dated 20th January, 1982 had not been acted upon and therefore it had not superseded the agreement dated 4th October, 1978. It, therefore, concluded that the arbitration agreement was still in force and could be given effect to and thus denied the relief of declaration sought for by the petitioner. In so far as the alternative relief sought for by the petitioner is concerned, the trial Court granted the same. ( 5 ) AGGRIEVED by that order the petitionerhas approached this Court and has raised various contentions, which are summarised as follows :- (1) That the agreement dated 20th january, 1982 has superseded the agreement dated 4-10-78 and the earlier agreement is no longer in force; (2) That the agreement having expired by efflux of time the arbitration clause cannot be invoked for settlement of the dispute; (3) That without terminating the agreement dated 20th January, 1982 respondent No. 1 cannot have recourse to earlier agreement; and (4) That the appointment of the 2nd respondent as sole arbitrator is not valid on account of non-compliance of section 9 of the Act. ( 6 ) IN reply, the learned counsel for the 1strespondent contended that: (1) the agreement dated 20th January, 1982 was a package deal and has not been put into force as neither party acted upon it; (2) the agreement is entered into subject to certain conditions and those conditions have never been given effect to; (3) the arbitration clause did not lapse on account of the contract coming to an end by efflux of time; and (4) the agreement which had never come into existence and the same having not been acted upon cannot affect the earlier agreement and therefore the question of termination of such an agreement does not arise. ( 7 ) THE trial Court though has stated thatthere is material on record to show that the latter agreement has not been acted upon, has not set out the necessary details for proper appreciation. Therefore, I called for the records in order to understand the scope of the controversy and to effectively deal with the dispute between the parties. ( 8 ) ON the contentions raised by thelearned counsel on either side two questions arise for my consideration : (1) Whether the agreement dated 20th january, 1982 has come into force ? If so, whether respondent No. l has given up its claims under the agreement dated 4-10-78 and settlement of such claims by arbitration ? 2. If the agreement dated 20th January, 1982 has not superseded the agreement dated 4-10-78, whether the arbitration clause in that agreement is still in force having regard to the fact that the agreement itself expired ? ( 9 ) THE contention advanced by thelearned counsel for the petitioner is that the agreement dated 20th January, 1982 if properly understood would extinguish the arbitration clause by reason of the settlement of contract ente ed into in full satisfaction of the original contract and no dispute is left outstanding to be adjudicated by arbitration. If any dispute arises that must be one under the settlement of contract and such dispute is not covered by arbitration clause in original contract for the reason that it is dead and along with it the arbitration clause. Therefore, it is necessary to consider the effect of memorandum of agreement entered into between (he parties on 20-1-82. If any dispute arises that must be one under the settlement of contract and such dispute is not covered by arbitration clause in original contract for the reason that it is dead and along with it the arbitration clause. Therefore, it is necessary to consider the effect of memorandum of agreement entered into between (he parties on 20-1-82. The relevant clause s for our purpose are clauses 1 and 4, which are as follows :"an AGREEMENT ENTERED into between HMT LIMITED and HINDUSTAN EXPORT and IMPORT CORPORATION. . . . . this Twentieth day of January, 1982, as a package deal m settlement of all differences/issues between the parties. 1. HMT will grant to HEIC sole-selling agency in India for the range of pegard machines covered under the Co-operation Agreement entered into between HMT and PEGARD on 5th February, 1980, for a period of three years on a commission of 2 1/2 %, subject to the approval of HMT board and shareholders and the Company law Board, Government of india, as required under the Companies act, 1956. 4. With regard to the condition laid down by the Company Law Board while granting approval to the earlier sole-selling agency agreement dated 4th October, 1978 to the effect that heic should not be given any remuneration on sales made by HMT to Central or State Governments or corporations and bodies controlled by such Central or State Governments, hmt would take up the matter with HMT Board and with the company Law Board, Government of india, seeking approval for payment of remuneration on such sales upto_. the period on which the Compaoy law Board's condition was communicated to HEIC, and the decisions of hmt Board and Company Law board would be communicated to heic. "it is clear from a reading that this agreement was entered into as a package deal in settlement of their disputes and differences between the parties. But it was also made clear in clause-1 that they will enter into a sole selling agency agreement in India to deal with certain machines for a period of three years subject to approval of the Board, share-holders and the Company Law Board government of India as required under the companies Act. But it was also made clear in clause-1 that they will enter into a sole selling agency agreement in India to deal with certain machines for a period of three years subject to approval of the Board, share-holders and the Company Law Board government of India as required under the companies Act. One of the most important clauses of this package deal is the grant of sole selling agency to the 1st respondent which ofcourse is subject to the approval by the Board, the share-holders and the company Law Board. The. petitioner communicated vide letter dated 30th April, 1983 to the 1st respondent that the Board has come to the decision that no remuneration shall be payable on sales to the governmental agencies and public sector organisations and that therefore that condition put by the board was not accepted by the 1st respondent leading to deadlock in the way of giving effect to the memorandum of agreement in toto. Admittedly it was a package deal. The letter addressed by the petitioner to the 1st respondent clearly and categorically recites that the memorandum of settlement entered into between the parties has not been given effect to. This was further strengthened by the fact that two other letters had. been exchanged between the parties as per Ex. P. 9 and P. 10, the details of which are not necessary to be noticed. ( 10 ) HOWEVER, the learned counsel for thepetitioner Shri Alva contended that the only obligation on the part of the petitioner was to piace the matter before the Board and the company Law Board as stated in clause 4 and they having performed their part of the contract this document had been acted upon. I am afraid the learned counsel for the pclitioner is mixing-up issues. So far as the first clause was concerned it was in respect of a future contract that had to be entered inlo in regard to the grant of a sole selling agency to the 1st respondent, while what is dealt with in clause 4 is in relation to the agreement dated 4th October, 1978 where remuneration payable to the 1st respondent had been denied because of the non-approval by the Company Law Board and communicate the decision. Hence the two aspects are entirely different. Hence the two aspects are entirely different. Even if the petitioner had made attempts to give effect to clause 4 that does not absolve the liability to give effect to clause-1, the two clauses are independent of each other. Thus, the conclusion that has to be drawn on the basis of the discussion made now is that the memorandum of settlement was never given effect to and therefore it could not have prevailed over the agreement dated 4-10-78 entered into earlier between the parties which contained the arbitration clause. Even the settlement referred to in the latter agreement itself was part of the package deal and that cannot be read independently of the rights and liabilities that arise by reason of the entering into of the agreement dated 20th january, 1982. Therefore, it cannot be said that ihcre was any accord and satisfaction so far as the dispute and claims arising out of the contract dated 4-10-78. The contention advanced in this behalf by the petitioner is untenable and rejected. ( 11 ) NOW turning to the second questionthe argument advanced is that the agreement entered into on 4-10-78 was to be effective for a period of three years, namely, till 3-4-1981, and on expiry of that period by sheer efflux of lime the arbitration clause cannot be invoked inasmuch as the agreement itself has come to an end. An arbitration clause is a collateral term of contract as distinct from its substantive terms; but nonetheless it is an integral part of it. Though by efflux of time the contract ends the liability to perform, the obligations under that contract were not wiped out, that is, the liability to pay damages that may arise on breach of the terms of the contract or to settle any other claim, say for example, as in the present case, if remuneration had not been paid, it is open to the parties to get the dispute resolved through arbitration provided arbitration clause finds a place in the agreement. The contract in so far as the arbitration is concerned, is still in existence. Therefore, there is not much force in the contention raised by the learned counsel for the petitioner. The same is untenable and rejected. The contract in so far as the arbitration is concerned, is still in existence. Therefore, there is not much force in the contention raised by the learned counsel for the petitioner. The same is untenable and rejected. ( 12 ) THE contention raised on the basis ofsection 9 of the Arbitration Act that in the event an arbitrator dies, the party who appointed him may appoint a new arbitrator in his place and if one party fails to appoint an arbitrator, the other party may put the other party on notice in writing of 15 clear days to make appointment, such other party having appointed his arbitrator before giving notice, the party who has appointed an arbitrator may appoint that arbitrator to act as sole arbitrator. In this case there is absolutely no material to show that any of the conditions have been complied with. Moreover, this section has been liberally interpreted by the Courts to the effect that if any one of the parlies shows before the court that there were certain other supervening circumstances which prevented that party from appointing an arbitrator, the court can exercise discretion to appoint an arbitrator. Therefore, the argument constructed on the basis of Section 9 of the act also does not come to the aid of the petitioner. In this view of the matter, I find absolutely no merit in this petition. The petition is liable to be dismissed with costs. Ordered accordingly. Advocate's fee rs. 1000/ -. Petition dismissed with costs. --- *** --- .