S. K. Agarwal ( 1 ) THIS order will dispose of the preliminary issue raised by the defendants regarding the maintainability of the suit, in view of Section 7b of the indian Telegraph Act, 1885 (for short the Act ). ( 2 ) FACTS in brief are: that the plaintiff [mahanagar Telephone Nigam Limited (for short mtnl )] instituted the suit pleading therein that on 21st september, 1989, telephone No. 236415 was provided to Om prakash Chawla, (first defendant), at shop No. 872-B, Old lajpat Rai Market, Delhi with STD facility. The plaintiff used to issue bills for actual use of telephone recorded in the associated meter. It is pleaded that after adjustments bills for Rs. 4,67,887/- remained payable. The defendants failed to make payment of the aforesaid bills, despite reminders. Consequently, the telephone was disconnected on 19th October, 1992, on account of non-payment of bills. During the course of investigation it was found that the telephone was installed in the name of first defendant and was being used by second defendant, who is the owner of the shop no. 872-B, Old Lajpat Rai Market, Delhi. The plaintiff has further claimed interest @ Rs. 18% per annum on the amount till the date of realisation. First defendant filed written statement raising a preliminary objection that the suit is not maintainable, in view of the statutory and mandatory provision of Section 7b of the act which requires that all the disputes or differences arising between the telegraph authority and the subscriber, concerning telephone line, appliances or apparatus are to be decided by the statutory Arbitrator. Second defendant in the written statement submitted that there is no privity of contract between him and the plaintiff; that he is neither the subscriber nor the beneficiary of telephone in question; and that there is no cause of action in favour of the plaintiff and against him; therefore, suit is liable to be dismissed. On the above pleadings, a preliminary issue "whether the suit is barred by provision of Section 7b of the Indian Telegraph act 1885" was framed. On this issue, I have heard learned counsel for the parties and have been taken through the record. On the above pleadings, a preliminary issue "whether the suit is barred by provision of Section 7b of the Indian Telegraph act 1885" was framed. On this issue, I have heard learned counsel for the parties and have been taken through the record. ( 3 ) LEARNED counsel for the defendant argued that as per plaintiff s own showing it is a licensee of the central Government, appointed in exercise of the powers conferred under the Indian Telegraph Act and is authorised and responsible to establish and maintain the telephone services in the metropolitan cities of Delhi and Bombay. Assuming the allegations contained in the plaint to be true, the plaintiff was bound to refer the disputes for statutory arbitration as provided by Section 78 of the Act. Therefore, suit is not maintainable and is liable to be dismissed. Learned counsel for the plaintiff argued to the contrary. ( 4 ) IN order to appreciate the rival contentions, it would be appropriate to refer to Section 7b of the indian Telegraph Act, which reads as under:- "7-B. Arbitration of disputes (1) Except as otherwise expressly provided in this Act, if any dispute concerning any telegraph line, appliance or apparatus arises between the telegraph authority and the person for whose benefit the line, appliance or apparatus is, or has been provided, the dispute shall be determined by arbitration and shall, for the purposes of such determination, be referred to an arbitrator appointed by the Central government either specially for the determination of that dispute or generally for the determination of disputes under this Section. (2) The award of the arbitrator appointed under sub-section (1) shall be conclusive between the parties to the dispute and shall not be questioned in any Cou rt. " ( 5 ) A bare perusal of above Section shows that if any dispute concerning the telephone lines, appliances or apparatus between the telegraph authority and the subscriber arises, it has to be referred to an Arbitrator appointed by the Central Government either specially for the determination of that dispute or generally for the determination of such disputes. The award of Arbitrator is to be conclusive between the parties. Thus dispute regarding non-payment of the bill and the liability of the subscriber to pay the same is required to be referred to the Arbitrator. The award of Arbitrator is to be conclusive between the parties. Thus dispute regarding non-payment of the bill and the liability of the subscriber to pay the same is required to be referred to the Arbitrator. The extent and powers of the Arbitrator under Section 7b of the Act and mode of exercising such powers is also settled by several authoritative pronouncements of the Apex Court. It would be useful to refer to the following decisionr,- in Telecom Distnict Manager. Goa and ors. v. V. S. Dempo and co. and ors. JT 1996 (3) SC 669, it was held:- "the Administrative Instructions issued by the Union of India that the dispute shall be referred only when there is a reference by the Court is obviously in defiance of the language used in Section 7b. The power to refer the dispute has been given by the Parliament only with a view to see that the authority acts within reasonable limits and that when subscriber disputes the correctness of the meter reading or operation of the apparatus etc. instead of litigating the dispute in a civil court, it should be denied by arbitrator under Section 7b. Obviously, the Act intends to limit operation expeditiously without any undue delay so that the electrical operations, envisaged under the Act, recorded to be one of the public revenue, should not be postponed due to the pendency of the proceedings. Under those circumstances, we are of the view that the High Court is right in directing that the authority under the Act is enjoined to make reference under Section 7b without any direction by the Court and if need be it is for the subscriber to approach the court. " (emphasis supplied ). ( 6 ) LEARNED counsel for defendants next argued that provisions of Arbitration Act do not come into play because the same are inconsistent with the statutory provision contained in sub-Section (2) of Section 7b of the Act, therefore, jurisdiction of the civil court is barred. In support of his submission, reliance was placed on the decisions in Mahanagar Telephone Nigam Ltd. v. Royal enterprises and Ors. 72 (1998) DLT 368 and Smt. Makhani Davi banka v. Union of India, AIR 1981 Orissa 11. Particularly reliance was placed on the following observations in nityananda Sahu v. Post Master General. Orissa, Bhubaneswar and others. In support of his submission, reliance was placed on the decisions in Mahanagar Telephone Nigam Ltd. v. Royal enterprises and Ors. 72 (1998) DLT 368 and Smt. Makhani Davi banka v. Union of India, AIR 1981 Orissa 11. Particularly reliance was placed on the following observations in nityananda Sahu v. Post Master General. Orissa, Bhubaneswar and others. AIR 1977 Orissa 48;- "these authorities, in my view, are not of any avail for the contention of mr. Mohanty for the appellant. As already noticed, sub-sec. (2) of S. 7-B of the Act makes the award of the Arbitrator conclusive between the parties to the dispute and makes it immune from challenge in any court. This provision rules out the application of the Arbitration Act, section 46 of the Arbitration Act clearly indicates that the Arbitration Act shall apply provided it is not inconsistent with the scheme of the statute providing statutory arbitration. Under the arbitration Act, the court has power to modify an award, to remit an award or to make the award a rule of the court. It has also power to set aside an award. In view of the clear terms of Section 7-B of the Act, the general scheme of the arbitration Act is not applicable to statutory arbitration under the Act. " ( 7 ) LEARNED counsel for plaintiff, on the other hand, referring to Sections 34 and 46 of the Arbitration Act argued that the defendants have already filed written statements and have taken steps in the proceedings and that as per the investigation, second defendant was the user of the telephone but he is not the subscriber, therefore, the objection raised by the defendants is not sustainable. ( 8 ) IN my considered view, award of the Arbitrator under sub-Section (2) of Section 7b of the Act, though conclusive between the parties, is not immune from challenge in the court. The Arbitration Agreement signed between the parties is the foundation for reference under the Arb. Act to an Arbitrator. Section 46 of the Arb. Act effectuates the arbitration of the dispute referred to under the statute. However, it is subject to the provisions of that statute and the exceptions envisaged in Section 46 itself. The Arbitration Agreement signed between the parties is the foundation for reference under the Arb. Act to an Arbitrator. Section 46 of the Arb. Act effectuates the arbitration of the dispute referred to under the statute. However, it is subject to the provisions of that statute and the exceptions envisaged in Section 46 itself. It introduces a fiction that an arbitration under the statute stands substituted by a deeming agreement between the parties as if it is a bilateral agreement for reference under the arbitration Act. The provisions of the Arbitration Act would then apply except those excluded by Section 46. The sections excluded are sub-Section (1) of Section 6 (arbitration agreement not to be discharged by death of party thereto); section 7 (provisions in case of insolvency); Section 12 (power of Court where Arbitrator is removed or his authority is revoked); Section 36 (power of Court where arbitration agreement is ordered not to apply to a particular difference etc.) and Section 37 (limitations ). There is no provision In the Telegraph Act for enforcement of the award if any party does not obey the same; then necessarily such an award would have to be made rule of the court under the Arbitration Act (Old ). Thus, Section 46 does not bar the Court s jurisdiction to modify, remit or set aside the award or to make it a rule of the Court as per law. Section 46 is in pari-materia to Section 2 (4) of the Arbitration Act, 1996, the civil court has the jurisdiction to refer the matter in dispute between the parties to the Central Government for appointment of the Arbitrator. Reference in this regard can be made to a decision of Division Bench of this Court in ashok Katyal v. Mahanagar Telephone Nigam Ltd. , 1997 II AD (Delhi) 468. It was held:- "though an award under Section 7-B of Act is immune from challenge in any Court, a person having grievance against an arbitrator is not without remedy. Section 46 of the Indian Arbitration Act,20;20h 1940 makes the provisions thereof applicable to statutory arbitrations also except to the extent to which the provisions of such other enactment may be inconsistent with the provisions of the arbitration Act. Section 46 of the Indian Arbitration Act,20;20h 1940 makes the provisions thereof applicable to statutory arbitrations also except to the extent to which the provisions of such other enactment may be inconsistent with the provisions of the arbitration Act. If a person aggrieved may made out a case of bias on the part of the arbitrator, his authority can be revoked by the leave of the Cour under section 5 of the Arbitration Act. though section 12 thereof being inapplicable to statutory arbitrations matter of fresh appolntment shall haye to be left to the. Central Government. (see observations in reg. Co-operative Societies W. 8. Vs. Krishan Kumar Singhania (1995) 6 SCC 482 ). "the above view also finds support from the observations made in Prithvi Raj Kohli vs. Union of India, air 1938 Jammu and Kashmir 17. However, I am unable to agree with the view expressed in the cases cited by learned counsel for the defendant/applicant. Further, the operation of the judgment in Mahanagar Telephone Nigam Ltd. (supra) was stayed by the Division Bench on 13th February, 1998 in RFA (OS) 39/98. For the foregoing reasons, I find no merit in the preliminary issue raised by the defendants, and the same is rejected.