ORDER A. L. Vaidya, J. - Both the suits referred to above have arisen between the same parties, having common questions of law and facts involved, and with that background they are being disposed of by this common judgment. 2. The plaintiff-claimant in both the suits happened to be M/s. Himachal Khand Udyog (P) Ltd., a private Ltd. Company registered under the Companies Act, with one Shri Mahant Sugriva Nand as its Managing Director. Two policies were issued by the Objector - respondents in the name of M/s. Himachal Khand Udyog on 12.1.1988 and 20.1.1988 insuring the building and machinery, stocks of the company against fire, tempests, floods and rains etc. In Civil Suit No. 40 of 1992 the policy was effective from 12.1.1988 to 11.1.1989 in respect of the risk covered for building and machinery in the total sum of Rs. 33,00,000/- (rupees thirty three lacs), that is, rupees seventeen lacs for building and rupees sixteen lacs for machinery. On the other hand of civil suit No. 72 of 1992, the policy was effective from 20.1.1988 to 19.1.1989 in respect of the risk covered for stocks of sugar and raw materials, referred to in the policy itself in the sum of rupees ten lacs. 3. On account of payment of some amount, on the basis of the aforesaid policies, some disputes arose and the plaintiff referred the matter for the arbitration of sole Arbitrator, Shri R. D. Sharma, Advocate, Una. The objectors, that is, the Insurance Company did not participate in the proceedings and the Arbitrator made an ex-parte Award in each of these cases. 4. In Civil suit No. 40 of 1992 the Award is dated 26th December, 1990. The relevant portion of the Award runs as under : "I award and direct that (A) Reference claims of M/s. Himachal Khand Udyog (P) Ltd. The sum total of the amounts shown under award column against respective items : -------------------------------------------------------------------------------------Claimant' Brief description of claim Award Claim No. ------------------------------------------------------------------------------------- 1. Damage to the building and machinery caused by flood Amount of claim-Rs. 6,48,870.00 (Claim partially sustained) Rs. 4,00,336.00 2. Loss of Interest on borrowed amount Rs. 50,600.00 Amount of claim Rs. 73,130.38 (Claim partially sustained) 3. Loss of interest on excess drawn of sums from Bank Amount of Claim Rs. 38,665.00 (Claim rejected) Nil (Original Award on Stamp paper of Rs. 120.00. Rupees one hundred and twenty only) 4. 6,48,870.00 (Claim partially sustained) Rs. 4,00,336.00 2. Loss of Interest on borrowed amount Rs. 50,600.00 Amount of claim Rs. 73,130.38 (Claim partially sustained) 3. Loss of interest on excess drawn of sums from Bank Amount of Claim Rs. 38,665.00 (Claim rejected) Nil (Original Award on Stamp paper of Rs. 120.00. Rupees one hundred and twenty only) 4. The compensation on the basis of interest lost on balance claimed sum. Rs. 1,49,000.00 Amount of Claim Rs. 2,41,592.00 Claim partially sustained) ------------------------------------------------------------------------------------- (B) Interest The respondents shall pay to the claimants amounts directed above within 60 days of the publication of this Award failing which the respondents shall pay an interest at the rate of 18% per annum on the amounts awarded from the date of this Award till the date of payment of Court decree, whichever is earlier." 5. In civil Suit No. 72 of 1992, the Award is dated 21st March, 1992. The relevant portion of the Award runs as under : "I Award and Direct that Reference Claims of M/s. Himachal Khand Udyog Pvt. Ltd. The Chairman, United India Insurance Company represented by the Branch Manager United India Insurance Company Ltd. Nangal Road, Near Bus Stand, Una, (H.P.) shall pay to M/s. Himachal Khand Udyog Pvt. Ltd., the claimant the sum total of the amounts show under Award Column against respective item of claims : ------------------------------------------------------------------------------------ Claim No. Brief Description of Claims Award ------------------------------------------------------------------------------------ 1."Losses of Lying stocks due to flood" Rs. 5,30,000.00 Amount of claim Rs. 5,60,985.00 (Claim partially allowed) 2. "Losses of interest on borrowed sums as damage due to non-balance payment of the NIL claims." Amount of claim Rs. 1,65,670.02 (Claim rejected) 3. "Losses in payment of interest and Penal interest to the Bank" NIL Amount of claim : Rs. 55,740.30 (Claim rejected) 4. "the compensation on the basis of interest lost on balance amount due 1,81,000.00 Amount of claim : Rs. 2,00,847.99 (Claim partially allowed) (Period from 22.9.88 to 20.7.90) ------------------------------------------------------------------------------------------ Pendente Lite Interest Interest pendente lite should be paid to the claimant by the respondent at the rate of 18% on the awarded amount from the date of entering into reference till the date of award i.e., from 8.8.90 till 21.3.1992. 2,00,847.99 (Claim partially allowed) (Period from 22.9.88 to 20.7.90) ------------------------------------------------------------------------------------------ Pendente Lite Interest Interest pendente lite should be paid to the claimant by the respondent at the rate of 18% on the awarded amount from the date of entering into reference till the date of award i.e., from 8.8.90 till 21.3.1992. Future Interest The respondent shall pay to the claimant amounts directed above within 60 days of the publication of this award failing which the respondent shall pay an interest at the rate of 18% per annum on the amount awarded above from the date of this award till the date of payment or Court decree whichever is earlier." 6. The present plaintiff preferred an application before the Senior Sub-Judge, Una, praying for passing the decree in terms of the Award but that application was returned to the plaintiff with the remarks that the Court of Senior Sub-Judge, Una, had no jurisdiction in the matter and the application, accordingly, was returned. The plaintiff claimant then submitted the present application before this Court and prayed that the Award which had been separately presented by the sole Arbitrator, Shri R. D. Sharma, be made rule of the court. This happened in civil suit No. 40 of 1992. In civil suit No. 72 of 1992 the Arbitrator himself filed the Award in this Court through Shri Subhash Sharma, Advocate, who had been so authorised by the Arbitrator. 7. The respondents preferred objections under Sections 30 and 33 of the Arbitration Act. The objections, submitted with the prayer for setting aside two awards, are of identical nature and can safely be summed as under : (a) That the mandatory provisions of Sections 8 and 9 of the Arbitration Act, wherein it was provided that the party who made appointment of its sole Arbitrator in the reference, shall have to give a notice, in writing, to make appointment, after having appointed its own Arbitrator. But in the present case no intimation was earlier sent that the claimant had appointed Shri R. D. Sharma, Advocate, as Arbitrator and did not call upon the objectors to appoint their own Arbitrator, within the time prescribed under the agreement. But in the present case no intimation was earlier sent that the claimant had appointed Shri R. D. Sharma, Advocate, as Arbitrator and did not call upon the objectors to appoint their own Arbitrator, within the time prescribed under the agreement. It has also been pleaded that earlier the claimants had asked only to appoint a sole Arbitrator but thereafter did not intimate that the claimant company had appointed Shri R. D. Sharma as its Arbitrator within a period of two months after the receipt of the notice. According to the Objectors, the appointment of Shri R. D. Sharma, being against the agreement and against the provisions of law, was void ab initio and non est : (b) That even if it were to be taken that letters dated 29th May, 1990 and 31st May, 1990 were proper notice, as envisaged under Section 9 of the Act, the Objectors maintained that the aforesaid letters were received on 5th and 4th June, 1990 respectively and with that background the reference could not have been made to the sole Arbitrator before the expiry of two months from the date of the delivery of last notice which expired on 4th and 5th August, 1990 respectively and, thus, the appointment of Arbitrator on 20th July, 1990 itself was illegal and void; (c) The Objectors claimed that the Awards were beyond the scope of arbitration clause in as much as : (i) That the liability to pay any compensation with respect to boundary walls and labour quarters had been denied as not having been insured and, therefore, the aforesaid liability having not been admitted, there was no question of arbitration under the arbitration clause; (ii) That the amount of Rs. 72,687/- had been deducted as penalty premium which was not within the scope of arbitration clause; (iii) That the claim with respect to loss of interest on borrowed amount; loss of interest on excess drawn of sums from the bank; the compensation on the basis of the interest lost on balance claimed sum, were not within the arbitration clause; (iv) That there was no proper reference before the Arbitrator nor any proper proceedings were held inasmuch as the Himachal Pradesh Financial Corporation, which was a party to the agreement, was not made a party to the reference; (v) That in the final notice dated 6-10-90 through Shri S. N. Bali, Advocate, the claim was confined only to two matters, that is, the deduction of Rs. 72,000/- with respect to the deduction of penal premium as also with respect to the claim relating to the boundary wall and labour quarters. But no claim was laid with respect to stocks and raw materials. Thus there was no dispute raised with respect to any item which was arbitrable. The liability with respect to two disputes relating to Rs. 72,000/- for penal premium and rupees one lac for boundary wall had been denied by the company. Therefore, both the disputes were not arbitrable; (d) That the Arbitrator, Shri R. D. Sharma, was not competent to be appointed as an Arbitrator as he was based and was not a "disinterested person," as required under the terms of the policies inasmuch as : (i) Shri R. D. Sharma had been working as Mukhtiar and was still working as Mukhtiar of the Managing Director; (ii) That the partner of Shri R. D. Sharma, Arbitrator, that is, Shri S. N. Bali, Advocate, was handling the cases in early stages when the notices were issued. Accordingly, Shri R.D. Sharma was disqualified to become an Arbitrator. (iii) Even otherwise, Shri R. D. Sharma had been appearing for the claimant in many cases as its standing counsel and some of those cases were as under; (1) Civil Suit No. 212/86, Santokh Singh v. Balam Singh; (2) Civil Suit No. 222/89, Mangat Ram v. State (3) Case No. 41/92, Dev Kumari v. Guljar Mal. (4) HP Board v. H.P. Khand Udyog, R. No. 42, g 0.229 decided on 30.12.1989. (4) HP Board v. H.P. Khand Udyog, R. No. 42, g 0.229 decided on 30.12.1989. (e) It was also pleaded that there was a stay order operating against the Arbitrator with respect to a reference made vide letter dated 8th August, 1990 of the claimant, the Arbitrator deliberately announced the Award without even waiting for the extension of time. The Arbitrator took up the shelter that so far as the second reference is concerned, he entered into reference only on 27th August and, therefore, he was not bound by the stay order without there being any such directors from the court. (f) That there was no proper Award as there was no proper extension of time granted by the Court; (g) That the claim had been fully satisfied and the claimant had issued receipts in this behalf which had been confirmed by its financial institution; (h) That under the Advocates Act it was misconduct on the part of the Arbitrator to have taken up the matter in which he himself was engaged and in view of that fact the notice was sent by his partner, Shri S. N. Bali, Advocate. (i) That when the Objectors had denied the liability to pay anything over and above already paid, the case has ceased to be arbitrable but could have been agitated in a civil court. (j) That even otherwise the Arbitrator had shown keen interest in view of the fact that an application for his removal was made and he not only appeared in person but conducted the cross-examination of witnesses and defended the case before the Senior Sub-Judge, Una. Shri R. D. Sharma Arbitrator has been alleged to be closely related to Mahant Sugrivanand, the Managing Director of the claimant-company. 8. In Civil Suit No. 40 of 1992, the reply submitted on behalf of the plaintiff-claimant did not admit the objections raised on behalf of the Objectors. It had been pleaded that the reference to the sole Arbitrator was legally made in accordance with law and in accordance with the terms of the agreement entered into between the parties. It has further been submitted that Shri R. D. Sharma was competent to act as an Arbitrator. According to the claimant, the claim had been fully considered and reference was allowed. 9. It has further been submitted that Shri R. D. Sharma was competent to act as an Arbitrator. According to the claimant, the claim had been fully considered and reference was allowed. 9. In Civil Suit No. 72 of 1992, apart from the reply referred to above, submitted by the claimant, some preliminary objections were also raised. The first objection was that the present objection petition, filed by the respondents-defendants, under the provisions of Sections 30 and 33 of the Arbitration Act were not legally maintainable as at each and every stage of proceedings the respondent - defendants were aware about the orders which were passed and also about the proceedings which were taken and the purpose for which the matter was fixed. It was also pleaded on behalf of the claimant that the objectors had submitted to the arbitration proceedings so much so that they had moved the trial court to have the Arbitrator removed under the provisions of Section 5 and 11 of the Arbitration Act but that had not been successful and all the objections, which were raised in the present petition, were also raised by them in the trial court and after recording evidence it was found that none of the objections preferred by the Objectors were sustainable. It was, therefore, pleaded that the matter now cannot be agitated by the Objectors. 10. In both these cases common issues were framed on the pleadings of the parties, which are as under : 1. Whether the Arbitrator had no jurisdiction to entertain the dispute and finally decide the same ? OP Objectors. 2. Whether the Arbitrator mis-conducted himself as also the proceedings, as alleged. OP Objectors. 3. Whether the objections on issue No. 1 are maintainable in view of the fact that the objectors-defendants had submitted to the jurisdiction of the Arbitrator or in view of the civil court's judgment dated 19.3.1992, as alleged ? OP Objectors. 4. Relief 11. The parties, in support of their respective case, have tendered affidavits together with documents in evidence. 12. I have very carefully heard the submissions put forth by the learned counsel for the parties and have also minutely gone through the record. The aforesaid Issues are being disposed of as under; Issue Nos. OP Objectors. 4. Relief 11. The parties, in support of their respective case, have tendered affidavits together with documents in evidence. 12. I have very carefully heard the submissions put forth by the learned counsel for the parties and have also minutely gone through the record. The aforesaid Issues are being disposed of as under; Issue Nos. 1 and 3 It has been the case of the Objectors that the appointment of Shri R. D. Sharma, Advocate, as an Arbitrator was not in accordance with the terms of the agreement entered into between the parties in this behalf and also against the provisions of the Arbitration Act, accordingly, the appointment, being void ab initio and non est, the Arbitrator had absolutely no jurisdiction to enter upon the aforesaid reference and the Award made by the Arbitrator on this sole ground was void and without jurisdiction. On the other hand it has been contended on behalf of the claimants that the question of appointment of Arbitrator, being void one, did not arise in the present case in as much as the Objectors themselves had submitted to the jurisdiction of the Arbitrator, more so, when they themselves moved the court of the Senior Sub-Judge, Una, Under Section 5 and 11 of the Arbitration Act where they had been unsuccessful and that order, being final between the parties, having not been set-aside uptil today. 13. It is not so simple a matter, as has been contended on behalf of the plaintiff-claimant. In order to give the findings on Issue No. 3 one has to interpret the order dated 19.3.1992 passed by the Senior Sub-Judge, Una, on the application preferred by the Objectors under Section 5 and 11 of the Arbitration Act. In case if one comes to the legal conclusion that on the basis of the said order, passed by the Senior Sub-Judge, Una, the appointment of the Arbitrator, on that sole ground, can be held to be a valid one, definitely in that event the Objectors' case under Issue No. 1 cannot be looked into. In case if one comes to the legal conclusion that on the basis of the said order, passed by the Senior Sub-Judge, Una, the appointment of the Arbitrator, on that sole ground, can be held to be a valid one, definitely in that event the Objectors' case under Issue No. 1 cannot be looked into. However, on the other hand, if, after appreciating the law in this particular behalf, the assailing of the appointment of the Arbitrator to be void one on other factors, not covered under Sections 5 and 11 of the Arbitration Act, is legally accepted, in that view of the matter the Objectors' submission within the scope of Issue No. 1 shall have relevancy and the same has to be disposed of on merit independently. 14. Annexure-P/1 is the copy of order dated 19.3.1992 passed by the Senior Sub-Judge, Una, in an application preferred under Section 5 and 11 of the Arbitration Act by the present objectors for seeking leave of the court to revoke the authority of the sole Arbitrator, Shri R. D. Sharma, Advocate, who was made one of the parties in the petition. It has been mentioned in Annexure-P/1 that, according to the allegations made in the petition that respondent No. 2, that is, Shri R. D. Sharma was appointed as sole Arbitrator, by respondent No. 1, the present claimant, in spite of the protest of the applicant that the matter could not be referred for arbitration and there existed no dispute between the parties to the agreement as the claim had been satisfied by the applicant and respondent No. 1 and its banker had accepted the payment of the claim as full and final discharge of the said claim. The leave to revoke the authority of the sole Arbitrator, as per this order, was sought on the following grounds : (i) That the respondent No. 2 is guilty of legal profession in collusion with respondent No. 1 and is partial and biased; (ii) That he was found to be acting as "Mukhtiar" of Mahant Sugrivanand, the Managing Director of respondent No. 1. (iii) That respondent No. 2 is and was the legal advisor of the said Mahant Sugrivanand and he was prosecuting so many cases in various courts and in defence of said Mahant; (iv) That the Arbitrator has got shares in the Private Limited Company/respondent No. 1 and is thus a shareholder with respondent No. 1. (v) That he is related to Mahant Sugrivanand; (vi) That the partner of the sole Arbitrator, that is, Shri S. N. Bali, Advocate, is looking after the legal work of respondent No. 1 and has already served legal notice to the applicant on behalf of respondent No. 1; and (vii) That the Arbitrator is acting without any reference and, therefore, as such, he has no jurisdiction to proceed in the matter on account of his biased and prejudiced attitude, no justice is expected from him. Also, he has expressed strong views already in connection with the arbitration." 15. The averments made in the petition were denied by the claimants and the Senior Sub-Judge, Una, framed the following Issue in that petition; "1. Whether respondent No. 2/Arbitrator is biased and guilty of misconduct and, as such, whether the applicant is entitled to the leave of the court for the revocation of his authority, as Arbitrator ? OPA 2. Relief." 16. Issue No. 1 was decided in the negative after recording the evidence and the court came to the conclusion that there was no reasonable ground to presume or apprehend that the Arbitrator appeared to be biased. The application, as such, was dismissed. 17. On the basis of the aforesaid order, one aspect is crystal clear, that is, whatever had been decided vide Annexure-P/1 at the maximum could be the matters covered within the scope of Issue No. 2. There is nothing in the order passed by the Senior Sub-Judge on 19th March, 1992, that the appointment of the sole Arbitrator was assailed to be void, being violative of the terms of the agreement and the provisions of the Arbitration Act. The jurisdiction of the Arbitrator is being assailed for the first time in the present proceedings by preferring objection petition. The previous proceedings nowhere were drawn on that account as is clear from the order, referred to above, passed by the Senior Sub-Judge, Una. 18. The jurisdiction of the Arbitrator is being assailed for the first time in the present proceedings by preferring objection petition. The previous proceedings nowhere were drawn on that account as is clear from the order, referred to above, passed by the Senior Sub-Judge, Una. 18. It has been contended on behalf of the Objectors that the order passed by the Senior Sub-Judge was otherwise without jurisdiction, as admittedly the Senior Sub-Judge, Una, had no pecuniary jurisdiction to decide those objections. I think such an objection would not be available to the objectors at this stage especially when no such objection was taken by the Objectors when those proceedings were pending before the Senior Sub-Judge, Una. Section 21 of the Code of Civil Procedure prohibits such an objection, to be raised, with regard to the pecuniary jurisdiction, at a later stage. Even otherwise also, the objection being raised for the first time in these proceedings, will not have any effect especially when the order passed by the Senior Sub-Judge did not include the subject matter of appointment of Arbitrator, being without jurisdiction and against the provisions of agreement and law in this behalf. 19. It has come on record and, in a way, not disputed by the parties, that the present claimant also preferred an application for extension of time for making the Award by the Arbitrator which application was accepted. It has been contended on behalf of the claimant now that as the time was extended inspite of the protest by the present Objectors, accordingly, it should be taken for granted that the order of extension of time having been rendered final between the parties, the Objectors submitted to the jurisdiction of the Arbitrator and the same cannot be assailed now through the present petition. 20. In the present case it has been the specific case of the Objectors that the appointment of the sole Arbitrator by the claimant was not only against the agreed terms of the agreement in this behalf but also against the provisions of Section 8 and 9 of the Arbitration Act. 20. In the present case it has been the specific case of the Objectors that the appointment of the sole Arbitrator by the claimant was not only against the agreed terms of the agreement in this behalf but also against the provisions of Section 8 and 9 of the Arbitration Act. Moreover, the appointment of the Arbitrator, on the objections of the Objectors, in case is held void and non est, the Award on the sole ground will fall as such an objection head neither been previously raised by the Objectors nor, under the circumstances, they can be estopped to raise the same in the manner they have done in order to seek the relief of quashing of the Award. The objection taken, if accepted, shall go to the root of the Award itself, having been made by a person not legally appointed in this particular behalf, Needless to say, the appointment of the Arbitrator in violation of the terms of the agreement, vitiates the entire proceedings. 21. Thus, the Objectors' taking part in a proceedings initiated by one of the parties, seeking permission of the Court for extension of time for making the Award or by a party making an application for the removal of the Arbitrator under Section 5 and 11 of the Arbitration Act will not, in any way, deprive such a party to raise legal objections which, if accepted, shall make the appointment of the Arbitrator void and, as such, for want of jurisdiction the Award made by such an Arbitrator cannot be termed to be a legal one, sustainable under the provisions of law. Issue No. 1, as such, has to be decided on the basis of the facts and law covering the scope of that Issue. 22. The provisions of the Arbitration Act have been made applicable with the sole purpose to avoid lengthy procedure of civil court in settling the matters and instead get decision through the arbitration by means of an agreement between the parties. The word "arbitrate" means do not litigate and this was legislative intent and the very purpose behind the Indian Arbitration act. Arbitration is a mode of settling differences through investigation and determination by one or more persons selected for purposes of some disputed matters by contending parties for decision and Award, in lieu of a judicial proceedings. The word "arbitrate" means do not litigate and this was legislative intent and the very purpose behind the Indian Arbitration act. Arbitration is a mode of settling differences through investigation and determination by one or more persons selected for purposes of some disputed matters by contending parties for decision and Award, in lieu of a judicial proceedings. Thus, Arbitration settled a dispute, arising out of a contract, and the parties having agreed themselves for such a decision through the Arbitrator/Arbitrators, to be appointed on the basis of the agreement arrived at between the parties. Thus arbitration means 'a non litigious settlement', a determination by a person(s) chosen by the parties themselves. 23. The purpose of Arbitration is to provide a summary method of settling disputes and speedily determine the disputes and controversies by quasi judicial means. 24. Needless to say, the base for proceedings under the Arbitration Act is the agreement executed between the parties in this behalf. There should be an agreement for referring the matter for Arbitration in case some dispute or disputes arose out of that agreement. Again, the appointment of Arbitrator has also to be the subject of agreement between the parties. There is no doubt, the parties agreed to settle the disputes in a summary manner through arbitration, but sometimes the agreements are not adhered to while making the reference or while appointing the Arbitrator which results in endless litigation between the parties and the present case is of that very nature. The purpose of the arbitration, as such, cannot be successfully served in case the parties disagreed with the terms of the agreement or did not comply with the terms of the agreement. It is in this context that the present case has also to be appreciated. More so, the scope of issue No. 1. 25. In the present case there is practically no dispute between the parties pertaining to the two insurance policies, referred to above. The parties are also not in dispute that, as per clause 13 of the agreement, the reference could be made for the arbitration of the disputes arising between the parties and, again, the parties are unanimous that clause 13 covered the manner of appointment of Arbitrator. That clause 13 for the sake of convenience is being reproduced hereunder : "13. The parties are also not in dispute that, as per clause 13 of the agreement, the reference could be made for the arbitration of the disputes arising between the parties and, again, the parties are unanimous that clause 13 covered the manner of appointment of Arbitrator. That clause 13 for the sake of convenience is being reproduced hereunder : "13. If any difference shall arise as to the quantum to be paid under this policy (liability being otherwise admitted) such difference shall independently of all questions be referred to the decision of an arbitrator to be appointed in writing by the parties in difference, or if they cannot agree upon a single arbitrator, to the decision of two disinterested persons as arbitrators of whom one shall be appointed in writing by each of the parties within two calendar months after having been required so to do in writing by the other party in accordance with the provision of the Arbitration Act, 1940, as amended from time to time and for the time being in force. In case either party shall refuse or fail to appoint arbitrator within two calendar months after receipt of notice in writing requiring an appointment, the other party shall be at liberty to appoint sole arbitrator and in case of disagreement between the arbitrators, the difference shall be referred to the decision of an umpire who shall have been appointed by them in writing before entering on the reference and who shall sit with the arbitrators and preside at their meetings. It is clearly agreed and understood that no difference or dispute shall be referable to arbitration as herein before provided, if the Company has disputed or not accepted liability under or in respect of this policy. It is hereby expressly stipulated and declared that it shall be a condition precedent to any right of action or suit upon this policy that the award by such arbitrator, arbitrators umpire of the amount of loss or damage shall be first obtained." 26. Section 9 of the Arbitration Act, which has been referred by the learned counsel for the parties, runs as under : "9. Where an arbitration agreement provides that a reference shall be to two arbitrators, one to be appointed by each party then, unless a different intention is expressed in the agreement. Section 9 of the Arbitration Act, which has been referred by the learned counsel for the parties, runs as under : "9. Where an arbitration agreement provides that a reference shall be to two arbitrators, one to be appointed by each party then, unless a different intention is expressed in the agreement. (a) If either or the appointed arbitrators neglects or refuses to act, or is incapable of acting, or dies, the party who appointed him may appoint a new arbitrator in his place; (b) If one party fails to appoint an arbitrator, either originally or by way of substitution as aforesaid, for fifteen clear days after the service by the 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 in the reference, and his award shall be binding on both parties as if he had been appointed by consent : Provided that the court may set aside any appointment as sole arbitrator, made under clause (b) and either, one sufficient cause being shown, allow further time to the defaulting party to appoint an arbitrator or pass such other order as it thinks fit. Explanation : The fact that an arbitrator or umpire, after a request by either party to enter on and proceed with the reference, does not within one month comply with the request may constitute a neglect or refusal to act within the meaning of Section 8 and this Section." 27. In Babulal Churiwala v. Sri Aurobindo Agency (AIR 1968 Cal. 396), it has been held that the following conditions must be satisfied before there can be any valid appointment of a sole Arbitrator, as provided under Section 9 of the said Act : "1. There must be a valid arbitration agreement between the parties. 2. The agreement must provide that the reference shall be to two arbitrators, one to be appointed by each party. 3. The agreement must not express an intention that the power is not to be exercised. 4. The party willing to exercise this power must have appointed its own arbitrator before service of notice. 5. 2. The agreement must provide that the reference shall be to two arbitrators, one to be appointed by each party. 3. The agreement must not express an intention that the power is not to be exercised. 4. The party willing to exercise this power must have appointed its own arbitrator before service of notice. 5. After appointing its own arbitrator the party must serve a notice on the other party in writing intimating to the other party about the appointment of its own arbitrator and calling upon the other party to appoint its arbitrator. 6. There must be default or failure on the part of the other party to appoint its arbitrator for a period of at least 15 clear days from the date of service on the other party of such notice. 7. On the expiry of this period of minimum 15 clear days from the date of service of the notice the party who has appointed its own arbitrator, acquires the right to appoint its own arbitrator as the sole arbitrator. 8. The right so accrued, to appoint its own arbitrator as the sole arbitrator, has to be exercised by the party by appointing its arbitrator already appointed as the sole arbitrator." 28. Thus, it is eminently desirable that notice of appointment as a sole Arbitrator, before appointment and after appointment as such, should be given by the party exercising its right to appoint its own arbitrator as the sole Arbitrator under Section 9(b) of the Arbitration Act. The reasoning which makes such a notice imperative in the case of appointment of an Arbitrator is clear as only upon such notice being given the right of the other party to appoint its Arbitrator, arises and the right to appoint the sole Arbitrator only arises, if there be failure or default on the other party to appoint its own Arbitrator within the statutory period, as required under this Section. In this view of the matter unless the party which chooses to appoint its own Arbitrators gives notice of such appointment to the other party, there cannot be any valid appointment of the Arbitrator and the appointment is not perfected. In this view of the matter unless the party which chooses to appoint its own Arbitrators gives notice of such appointment to the other party, there cannot be any valid appointment of the Arbitrator and the appointment is not perfected. Under Section 9(b) of the Arbitration Act, as mentioned above, notice of appointment of Arbitrator by the party to make the appointment of Arbitrator valid, must have been duly served on the other party and the other party must have been called upon to appoint its Arbitrator. If, in spite of a notice by virtue of which a valid arbitrator on behalf of the other party, is appointed within the statutory period, the right to appoint the Arbitrator appointed by the party as the sole Arbitrator to determine the disputes arises under the law, and as soon as the said right is exercised by the party by appointing the said arbitrator as sole arbitrator, the appointment of the sole arbitrator, the appointment is validly made. 29. It is now to be looked on the basis of the material on record as to under what circumstances the sole Arbitrator Shri R. D. Sharma was appointed in the present case. 30. Annexure-D is the notice dated 6th October, 1989 issued by the claimant through the the counsel Shri S. N. Bali, Advocate, to the present Objectors and in the said notice a claim of Rs. 72,000/-, alleged to have been illegally deducted, on the basis of the survey made by the surveyor, as also for the actual amounts for the damage of boundary wall and labour quarters, was made, Annexure-PE is the reply dated 30.12.1989, submitted by the present Objectors, whereby the averments of the notice were denied and it was alleged that the amount of Rs. 72,687/-, from the approved claim of Rs. 4,56,895/-, being the penalty premium was rightly deducted. The liability of the Objectors to pay all the damages for the boundary wall and labour quarters, being not covered under the policy, was also disputed. Annexure-PF is the receipt issued by the Managing Director of the claimant-Company Shri Sugrivanand whereby Rs. 94,193/- were received from the Objectors in full and final discharge of the claim on the basis of the earlier referred insurance policies. Annexure-PF is the receipt issued by the Managing Director of the claimant-Company Shri Sugrivanand whereby Rs. 94,193/- were received from the Objectors in full and final discharge of the claim on the basis of the earlier referred insurance policies. On 29th May, 1990 the claimant sent a letter Annexure-PG whereby apart from other matters it was conveyed as under :- "It reveals from your correspondence and in verbal discussion that the above difference disputes cannot be settled until the sole arbitrator or arbitrators are appointed as per conditions 18 of the policy. Hence it is requested to agree upon the said condition so that a sole arbitrator can be appointed with the consent of both the parties." Actually, as per policies, it is condition No. 13 which deals with arbitration clause. Annexure-H is the letter dated 31.5.1990 sent by the Objectors to the claimant in response to the aforesaid letter dated 29.5.1990 and the Objectors informed that the claim had already been paid, as per policy's terms and conditions and again appointing an Arbitrator at this stage did not arise and, as such, the matter might please be deemed as closed. Thereafter, vide Annexure-I, a letter dated 31.5.1990, the claimant again reiterated and requested the Objectors to agree upon to appoint a sole Arbitrator or Arbitrators with the consent of both the parties, as per terms and conditions of the policy. Another letter dated 4th June, 1990, Annexure 1-A, was sent by the claimant to the Objectors wherein it was again requested to agree upon to appoint sole Arbitrator or Arbitrators with the consent of both the parties, as per conditions of the policy, to avoid further delay. 31. Finally, vide letter dated 20th July 1990, Annexure-J, the claimant informed Shri R. D. Sharma, Advocate, Una, that he had been appointed as sole Arbitrator and was requested to enter upon the reference and give an Award. For the sake of appreciation the letter in its original form is being reproduced hereunder : "To, Shri R. D. Sharma, Advocate, Near Old Bus Stand, Una-173-303 Himachal Pradesh. Subject : Appointment of Arbitrator-Policies No. 110407/01/38/88 and 110407/81/44/88 insured for building, Labour quarters, boundary wall, etc. and stocks etc. respectively. Dear Sir, Whereas the above mentioned contract agreement was entered into between the United India Insurance Company Limited, Madras, represented by the Asstt. Subject : Appointment of Arbitrator-Policies No. 110407/01/38/88 and 110407/81/44/88 insured for building, Labour quarters, boundary wall, etc. and stocks etc. respectively. Dear Sir, Whereas the above mentioned contract agreement was entered into between the United India Insurance Company Limited, Madras, represented by the Asstt. Branch Manager, Nangal Road, Near Bus Stand, Una, H.P. and H.P. Financial Corporation, Simla on account of M/s. Himachal Khand Udyog, Pvt. Ltd., P.O. Basal Distt. Una. (H.P.). And whereas the said contract includes an arbitration agreement vide Condition No. 18 forming part of the Contract which, inter alia, provides that if any difference shall arise to the quantum to be paid under the policy. In case either party shall refuse or fail to appoint arbitrator within two calendar months on the receipt of notice in writing requiring an appointment, the other party shall be at liberty to appoint sole arbitrator. And whereas disputes/differences have arisen and either party has failed to appoint arbitrator from his side and the case has also been refused to be settled at this stage by the Branch Manager, Una, therefore, action is taken for appointment of a sole Arbitrator within two calendar months; And whereas the disputes/differences are still persisting; Now, therefore, by virtue of the aforesaid, we hereby appoint you as sole Arbitrator and request you to enter on the reference and publish your findings and award in respect of the disputes/differences which have arisen and the disputes/differences as have been arisen are referable to arbitration in accordance with the said agreement. Please acknowledge. Yours faithfully, sd/- (Sugriva Nand Ji) Managing Director, for Himachal Khand Udyog Pvt. Ltd. Copy by post. 1. Head Office U.I.I. Co. Ltd. Madras 2 R.M. Chandigarh/24 White Road, Madras 600014 3 D.M. Nangal (Pb)." On the basis of the aforesaid communication, Shri R. D. Sharma, Advocate, entered upon the reference and started proceedings. 32. There are some more letters brought on record - Annexure-K and Annexure-L - whereby the Arbitrator informed the Objectors regarding the reference he had entered upon 33. Admittedly, the Objectors did not take part in the Arbitration proceedings and the Award was made behind their back. 34. 32. There are some more letters brought on record - Annexure-K and Annexure-L - whereby the Arbitrator informed the Objectors regarding the reference he had entered upon 33. Admittedly, the Objectors did not take part in the Arbitration proceedings and the Award was made behind their back. 34. As per arbitration clause of the Insurance Policies, the disputes were agreed to be referred to the decision of an Arbitrator, to be appointed in writing, by the parties in difference, or if they cannot agree upon a single arbitrator, to the decision of two disinterested persons as arbitrators of whom one shall be appointed in writing by each of the parties within two calendar months after having been required so to do in writing by the other party in accordance with the provision of the Arbitration Act, 1940, as amended from time to time being in force. 35. What has happened in the present case, as has been revealed from the documents referred to above, is this. Through communication dated 29th May, 1990, Annexure-G, the Objectors were asked to agree upon the said condition of appointment of Arbitrator in the agreement itself so that a sole Arbitrator could be appointment with the consent of both the parties. Admittedly, through this communication the Objectors were required to agree upon the condition of the appointment of Arbitrator, referred to in the agreement itself and as a consequence thereof it was proposed in case this condition of the appointment for referring the matter, was agreed upon by the Objectors, in that event the sole Arbitrator should be appointed. This communication no where revealed any proposal submitted on behalf of the claimants for the appointment of a particular person to be sole Arbitrator. 36. The second communication was dated 31.5.1990 whereby also the claimants requested the Objectors to agree upon the appoint a sole Arbitrator or Arbitrators with consent of both the parties. Again, there was no proposal in favour of any particular person made by the claimant for the appointment of a sole Arbitrator or an Arbitrator to be appointment by the claimants under the agreement. Then there is a communication dated 4th June, 1990, Annexure-1A, whereby again it was requested to agree upon to appoint sole Arbitrator or Arbitrators with the consent of both the parties, as per condition of the policy. Then there is a communication dated 4th June, 1990, Annexure-1A, whereby again it was requested to agree upon to appoint sole Arbitrator or Arbitrators with the consent of both the parties, as per condition of the policy. Again, no proposal by naming specific person on behalf of the claimant for appointment of sole Arbitrator was made. 37. Even if for arguments sake the aforesaid communication were not at all responded by the Objectors, it is now to be seen whether the appointment of Shri R. D. Sharma, Advocate, through Annexure-J dated 20th July, 1990 unilaterally, under the aforesaid circumstances, by the claimant was valid and in accordance with the agreed terms of the agreement or in accordance with the provisions of law. As per arbitration clause, already detailed above, at first instance when the difference appeared between the parties under the policy the dispute was to be referred to the decision of an Arbitrator, to be appointed in writing by the parties. Admittedly, the parties to the agreement did not appoint jointly or by agreement any sole Arbitrator. 38. The agreement further provided that if the parties cannot agree upon a single Arbitrator, then the matter was to be referred to the decision of two disinterested persons as Arbitrators of whom one shall be appointed in writing by each of the parties within two calendar months after having been required so to do in writing by the other party in accordance with the provisions of the Arbitration Act, 1940. Under this provision two disinterested persons as Arbitrators were to be appointed - one each by each party within two calendar months - after having been required to do so in writing by the other party. There is no doubt that, on the basis of the aforesaid communications dated 29th May, 1990, 31st May, 1990 and 4th June, 1990, the claimant requested the opposite party to appoint sole Arbitrator or Arbitrators, as per agreement. Except these communications, no other communication has been brought on record which could reflect that the claimant on their part had appointed one Arbitrator as per agreement referred to above and they had asked the other party to appoint another Arbitrator as per terms of the agreement. Such a procedure was not at all followed. Except these communications, no other communication has been brought on record which could reflect that the claimant on their part had appointed one Arbitrator as per agreement referred to above and they had asked the other party to appoint another Arbitrator as per terms of the agreement. Such a procedure was not at all followed. In the absence of proposing any specific Arbitrator by the claimant, the opposite party, under the agreement, was not at all bound to propose the name of an Arbitrator on their behalf. Moreover, in the present case, neither the claimant under the agreement appointed any disinterested person on its behalf as Arbitrator nor the opposite party did the same. Accordingly, the term of the agreement for appointment of two disinterested persons as Arbitrators by the parties was not complied with at all. The question of appointment of sole Arbitrator could come in case the condition of appointment of two disinterested persons as Arbitrators one each party was complied with. The record brought before this Court and referred to above no where, even remedy, reflected the compliance of this agreed condition of the appointment of two disinterested persons as Arbitrators, one each by each party having been complied with. The second condition was to be complied with when the parties had failed to appoint a sole Arbitrator by agreement. 39. The third alternative, under the agreement, for the appointment of Arbitrator was that in case either party shall refuse or fail to appoint arbitrator within two calendar months after receipt of notice in writing requiring an appointment, the other party shall be liberty to appoint sole arbitrator. The last resort of appointment of the sole Arbitrator could be availed of in case the earlier two options, agreed upon after compliance, could not have materialised. In the present case, as discussed above, at first instance, the earlier conditions have not been complied with in its true sense and, therefore the third alternative through which a sole Arbitrator could be appointed by a party, under these circumstances, was not at all legally available. Moreover, the appointment of sole arbitrator was within 2 months of the stipulated time which was against the term of agreement. 40. Moreover, the appointment of sole arbitrator was within 2 months of the stipulated time which was against the term of agreement. 40. In the present case first of all, as per agreement, the parties had to agree for a sole Arbitrator and for that purpose the claimant was required to propose a sole Arbitrator to the opposite party and in case the opposite party was not agreeing for such an appointment, thereafter the second alternative could be pressed into service. Even while exercising the first option under the agreement for the appointment of sole Arbitrator, the claimant was required to propose the name of the sole Arbitrator and not to make a request to the opposite party for agreeing for the appointment of sole Arbitrator without there being the name of the person proposed to be appointed as sole Arbitrator. In this view of the matter, at the first instance, the first alternative provided under the agreement for the appointment of sole Arbitrator was not legally complied with. As referred to earlier, the second alternative again was not complied with as no where the claimant proposed a specific disinterested person to be the Arbitrator proposed, by it to the opposite party. In case it was so done and the opposite party had not proposed any disinterested person to be an Arbitrator on their behalf, the sole Arbitrator, already purported to have been proposed, under the first alternative by the claimant, in that event could be made the sole Arbitrator to enter upon this reference. This is the only relevant interpretation which can be made available, under the law, to the various alternatives provided under the agreement for the appointment of sole Arbitrator. 41. The aforesaid inferences can safely be drawn in case the provisions of Section 9 of the Arbitration Act are taken note of. This is the only relevant interpretation which can be made available, under the law, to the various alternatives provided under the agreement for the appointment of sole Arbitrator. 41. The aforesaid inferences can safely be drawn in case the provisions of Section 9 of the Arbitration Act are taken note of. As earlier pointed out, it has been provided under Section 9 of the Arbitration Act that after appointing its own Arbitration the party must serve a notice on the other party, in writing, intimating about it and calling upon the other party to appoint its Arbitrator and there must be default or failure on the part of the other party to appoint its Arbitrator for a period of 15 clear days from the date of service on that other party and thereafter on the expiry of the period of 15 clear days from the date of service, the party who has appointed its own Arbitrator, may appoint its own Arbitrator as the sole Arbitrator. It has also been held that the right of a party, so agreed, to appoint its own Arbitrator as the sole Arbitrator, has to be exercised by the party by appointing its Arbitrator, already appointed, as the sole Arbitrator. 42. In the present case, as per the material placed on record and as discussed above, the terms agreed upon by the parties for the appointment of the sole Arbitrator have not at all been complied with but definitely stood violated and as a consequence thereof the appointment of the sole Arbitrator, Shri R. D. Sharma, Advocate, cannot be said to be the result of the agreement of the parties, as referred to above but on the other hand his appointment being not made in accordance with the agreement and, more so, in accordance with the provisions of the Arbitration Act, will not, in any manner, give the Arbitrator jurisdiction to enter on the reference and make the award. As the appointment itself being void ab initio, non-existent in the eye of law, the entire proceedings by such an Arbitrator necessarily will not have any legal force, more so, the Award made by the Arbitrator without having any legal authority. 43. Some precedence, involving the proposition of law involved in the present case, are being referred hereunder, which have been cited by the learned counsel for the parties. 44. In M. I. Shahdab v. Mohd. 43. Some precedence, involving the proposition of law involved in the present case, are being referred hereunder, which have been cited by the learned counsel for the parties. 44. In M. I. Shahdab v. Mohd. Abdullah Mir (AIR 1967 Jammu and Kashmir 120), it has been held that arbitration agreements are to be construed strictly and any defect in appointment of Arbitrator would vitiate the entire proceedings. 45. Learned counsel for the claimant has referred to P. S. Oberoi v. The Orissa Forest Corporation Ltd. (AIR 1982 Orissa 168), to support his contention that ex-parte proceedings by the Arbitrator against one party, after sufficient notice, did not amount to legal misconduct. There is no dispute to this proposition inasmuch as in the present case it is not the legal misconduct of the Arbitrator which is being made the subject of the ground for setting aside the Award but on the other hand the inherent lack of jurisdiction in the Arbitrator with respect to his appointment which renders the entire proceedings and the Award made by him to be void and without jurisdiction. 46. Shaymlal Agarwalla v. Union Life and General Insurance Co. Ltd. (ILR (Vol. 2) 1952 (Cal.)), has been relied upon by the learned counsel for the claimant in order to support the appointment of sole Arbitrator by his client, under the circumstances of the present case, I think the ratio of the ruling was not at all available inasmuch as in the reported case the applicability of Section 9 of the Arbitration Act was in issue and it was held that Section 9 cannot over ride but only supplement the agreement between the parties and the contractual right, as such, could not be taken away. 47. In Food Corporation of India v. A. Mohammed Yunus (AIR 1987 Kerala 231), it was held that where an agreement between A and B provides that the matter in dispute shall be referred to the sole Arbitration of any person appointed by A and also that no person other than a person appointed by A should act as Arbitrator and if for any reason that is not possible the matter is not to be referred to arbitration at all the Arbitrator appointed by court on an application by B will be without jurisdiction. The award made by such Arbitrator can be set aside under Sec. 30. The award made by such Arbitrator can be set aside under Sec. 30. It has further been held that the Award passed by the Arbitrator appointed by a Court lacking jurisdiction cannot have any binding force. It is always open to the aggrieved party to take the stand that the award is not legally and properly obtained. It was also held that merely because the party failed in its attempt to challenge the very appointment of the Arbitrator as the appeal filed by him was dismissed as barred by limitation he is not precluded from challenging the Award under Sec. 30(c) of the Act. 48. The Objectors have tried to take advantage of the aforesaid ruling on two counts. Firstly, that they have got every right to challenge the Award assailing the very appointment of the Arbitrator and, secondly, it is the agreement between the parties that has to be looked into even at the time of appointment of the Arbitrator. 49. Thus, on the basis of the aforesaid discussion it stood legally established that appointment of Shri R. D. Sharma, Advocate, as sole Arbitrator was void and he had no jurisdiction to entertain the disputes and finally decide the same. Similarly, as discussed above, the objections preferred by the Objectors, which were within the scope of Issue No. 1, were legally maintainable, inspite of the proceedings referred to above which took place before the Senior Sub-Judge, Una. Issues No. 1 and 3, accordingly, are decided in favour of the Objectors. Issue No. 2 In view of the findings on Issue No. 1 and 3, the present Issue in rendered infructuous. 50. On the basis of the findings on the Issues, as aforesaid, in both the cases (Civil Suits No. 40 and 72 of 1992) the objectors preferred under Section 30 and 33 are accepted and as a consequence thereof the Awards dated 26.12.1992 and 21.3.1992 are, accordingly, set aside, Claimant's prayer to make the Awards a rule of the court is disallowed. Parties are, however, left to bear their own costs. Order accordingly.