Judgment : This original petition is filed to set aside the award passed by the second respondent dated 14. 2007. 2. The case of the petitioners is that on 21. 2005, the first petitioner entered into an agreement of hire purchase with the first respondent company for a sum of Rs. 6 lakhs for the purchase of TATA vehicle bearing Engine No.AUZ 100930, Chassis No.AUZ 101653. The second petitioner stood as the guarantor in his personal capacity and executed the said agreement. According to the petitioners, as per the terms of agreement, the first petitioner has to repay the loan amount in 45 monthly instalments at the rate of Rs. 17,150/- per month from the first month to the 30th month and at the rate of Rs. 15,700/- per month from the 31st month to 45th month. According to the first petitioner, he paid 21 instalments and thereafter, due to his ill-ness, he could not use the vehicle and was unable to pay the due amounts. The time to pay the entire loan amount was available till 210. 2008. The first petitioner surrendered the vehicle to the company at Sonbhadra in Uttar Pradesh State in the month of July, 2006 and according to the him, the balance payable was Rs. 2,85,000/-. 3. It is also stated in the petition that the first respondent informed the first petitioner while handing over possession of the vehicle, that the Manager of the first respondent can sell the vehicle for a sum of Rs. 5 lakhs and return back the excess, if any to the first petitioner and believing; the said promise, he returned to his native place. It is further stated that only after receiving the notice from the Execution Petition from the learned District and Sessions Judge, Sonbhadra, Uttar Pradesh, on 22. 2008. he came to know about the passing of the arbitration award against the petitioners on 14. 2007. 4. The contention of the first respondent that the vehicle was sold for a sum of Rs. 3,20,000/- is stated to be false in the petition and in fact, the vehicle was sold for a sum of Rs. 4,95,000/- on 30.9.2006 as per the information given to the petitioner by his friend. 2007. 4. The contention of the first respondent that the vehicle was sold for a sum of Rs. 3,20,000/- is stated to be false in the petition and in fact, the vehicle was sold for a sum of Rs. 4,95,000/- on 30.9.2006 as per the information given to the petitioner by his friend. It is averred in the petition that the company nominated the second respondent as Sole Arbitrator, without giving any proper notice and intimation to the petitioners and the second respondent, in violation of the principles of natural justice, with the prejudicial mind and in a biased manner, passed the award. The petitioners deny the arbitration agreement itself in this petition and consequently the award passed by the second respondent, as Arbitrator, is sought to be set aside on the ground that no notice of appointment of Arbitrator was sent to the petitioners, no notice was received by the petitioners from the Arbitrator regarding the proceedings and without their knowledge, they were set ex parte on 14. 2007 and the impugned award was passed on the same day in favour of the first respondent. 5. It is also contended in the grounds that the proceedings dated 13. 2007 sent to the petitioners, which were returned with an endorsement made in some vernacular language, is not known to the Arbitral Tribunal, hence, it was presumed that the service is completed and due to the lack of opportunity given to the petitioners, the impugned award is to be set aside under Section 34(2)(a)(ii) of the Arbitration and Conciliation Act, 1996 6. The first respondent has filed counter affidavit stating that the loan agreement was signed by the petitioners on 21. 2005 and the said agreement contains a clause that in the event of default in payment of the Instalments, the borrower is liable to pay additional finance charge at 36% per annum, on the arrears of the sum due. until realisation and the loan obtained by the first petitioner was guaranteed by the second petitioner, who also signed in the agreement. Since there was default in payments, the first respondent re-possessed the vehicle and the same was sold through auction for a sum of Rs. 3,20,000/- being the highest bid. The difference amount of Rs. until realisation and the loan obtained by the first petitioner was guaranteed by the second petitioner, who also signed in the agreement. Since there was default in payments, the first respondent re-possessed the vehicle and the same was sold through auction for a sum of Rs. 3,20,000/- being the highest bid. The difference amount of Rs. 2,71,607/-is still payable by the petitioners on the date of filing of the arbitration proceedings and in spite of repeated demands, the same having not been paid, as per the clause contained in the agreement arbitration proceeding was initiated for the recovery of the said amount, It is further stated in the counter affidavit that the arbitration initiated in Claim Petition No. UM00055611 against the petitioners was duly sent to both the petitioners for hearing on 13. 2007 and the notice was also duly served on the petitioners on 12. 2007 and the petitioners, in spite of receiving the said notice, failed to appear on 13. 2007. The second respondent fixed further hearing date as 14. 2007. The second notice, even though not required to be sent, the second respondent sent the second notice to the petitioners, which was returned unserved with an endorsement and consequently, the second respondent set the petitioners ex parte and proceeded further in the arbitration proceeding and ultimately passed an award by giving directions to the petitioners to pay the sum of Rs. 2,71,607/-. 7. It is also further stated in the counter affidavit that the petitioners were having knowledge about the arbitration proceedings and they did not appear before the Arbitrator wantonly and therefore, the principles of natural justice was fully complied with by the Arbitrator. The petitioners, having availed the loan by signing the agreement, which contains a clause for arbitration if there is a dispute, it is not open to the petitioners to question the validity of the agreement. By filing the above said counter, the first respondent prayed for dismissal of the original petition. 8. Heard the learned counsel for the petitioners as well as the learned counsel for the first respondent. I have also perused the records. 9. The grievance of the petitioners is that there is no arbitration clause in the loan agreement and therefore, the first respondent ought not to have appointed the second respondent as Arbitrator to adjudicate the dispute. 8. Heard the learned counsel for the petitioners as well as the learned counsel for the first respondent. I have also perused the records. 9. The grievance of the petitioners is that there is no arbitration clause in the loan agreement and therefore, the first respondent ought not to have appointed the second respondent as Arbitrator to adjudicate the dispute. Taking note of the certified copy of the loan agreement dated 22. 2005, which was marked as Exhibit A-2; the Termination Notice dated 21. 2007 as Exhibit A-3; the Statement of Accounts dated 1. 2007, which was marked as Exhibit A-4; the Additional Interest Charges Statement dated 1. 2007 as Exhibit A-5; and the Invoice as Exhibit A-6, the second respondent Arbitrator came to the conclusion that the first petitioner defaulted in payment and awarded the claim amount. 10. The contention of the petitioners that they have not been given notice of the arbitration proceedings and the hearing dates cannot be accepted in view of the fact that the notice dated 30.1.2007 issued by the second respondent/Arbitrator to the petitioners have been duty served. To prove the same, the postal acknowledgment is also filed in the typed set of papers in this original petition. In the said notice, it is clearly stated that the second respondent has posted the arbitration matter for tiling counter on 13. 2007 at 4.50 p.m. at New No. 2, Old No.16, 8th Street, Dr. Radha Krishnan Salai, Mylapore, Chennai-4 and the petitioners were requested to appear either in person or by authorised representative. The acknowledgment of such notice was signed on 12. 2007. 11. From the above facts, it is evident that more than one month time was given by the second respondent-Arbitrator to the petitioners to make arrangement for filing counter and for their appearance. The fact remains the petitioners were neither chosen to appear, nor filed counter affidavit. The second respondent taking note of the nonappearance of the petitioners, again adjourned the matter to 14. 2007 at 16.20 hours and the said adjournment date was also intimated through notice dated 13. 2007. The said notice was also sent to the respondents by Registered Post on 13. 2007 and the said registered covers were returned to the respondents with endorsements in Gujarathi Language. The notice sent to the first petitioner was returned with the endorsement as follows: “Not available. He has gone out. 2007. The said notice was also sent to the respondents by Registered Post on 13. 2007 and the said registered covers were returned to the respondents with endorsements in Gujarathi Language. The notice sent to the first petitioner was returned with the endorsement as follows: “Not available. He has gone out. May be kept in abeyance till 23. 2007.” On 23. 2007 also, an endorsement was made, which reads thus: “Addressee has gone out for an indefinite period. Hence, returned to the sender.” The postal authority has signed on endorsement on 23. 2007.” 12. In view of issuing the notice of hearing by Registered Post after adjournment and the same having been returned on the ground that the addressee has gone out for an indefinite period, it has to be ascertained as to whether the said notice sent can be treated as proper service of notice of hearing on 14. 2007. 13. (a) The Supreme Court in the decision Madan and Co., v. Wazir Javir Chand AIR 1989 SC 630 : (1989) 1 SCC 264 , considered similar issue with regard to the alleged non service of notice by the tenant in a tenancy proceeding. In paragraph-6 of the said judgment, it is held thus: “6. We are of opinion that the conclusion arrived at by the Courts below is correct and should be upheld. It is true that the proviso to clause (1) of Section 11(1) and the proviso to Section 12(3) are intended for the protection of the tenant. Nevertheless it will be easy to see that too strict and literal a compliance of their language would be impractical and unworkable. The proviso insist that before any amount of rent can be said to be In arrears, a notice has to be served through post. All that a landlord can do to comply with this provision is to post a prepaid registered letter (acknowledgement due or otherwise) containing the tenant’s correct address. Once he does this and the fetter is delivered to the post office, he has no control over it. It is then presumed to have been delivered to the addressee under Section 27 of the General Clauses Act. Under the rules of the post office, the letter is to be delivered to the addressee or a person authorised by him. Such a person may either accept the letter or decline to accept it. It is then presumed to have been delivered to the addressee under Section 27 of the General Clauses Act. Under the rules of the post office, the letter is to be delivered to the addressee or a person authorised by him. Such a person may either accept the letter or decline to accept it. In either case, there is no difficulty, for the acceptance or refusal can be treated as a service on and receipt by the addressee. The difficulty is where the postman calls at the address mentioned and is unable to contact the addressee or a person authorised to receive the letter. All that he can then do is to return it to the sender. The Indian Post Office Rules do not prescribe any detailed procedure regarding the delivery of such registered letters. When the postman is unable to deliver it on his first visit, the general practice is for the postman to attempt to deliver it on the next one or two days also before returning it to the sender. However, he has neither the power nor the time to make enquiries regarding the whereabouts of the addressee: he is not expected to detain the letter until the addressee chose to return and accept it; and he is not authorised to affix the letter on the premises because of the assessee’s absence. His responsibilities cannot, therefore, be equated to those of a process server entrusted with the responsibilities of serving the summons of a Court under Order 5 of the C.P.C. The statutory provision has to be interpreted in the context of this difficulty and in the light of the very limited role that the post office can play in such a task, if we interpret provision as requiring that the letter must have been actually delivered to the addressee, we would be virtually rendering it a dead letter. The letter cannot be served where, as in this case, the tenant is away from the premises for some considerable time. Also, an addressee can easily avoid receiving the letter addressed to him without specifically refusing to receive it. He can so manipulate matters that it gets returned to the sender with vague endorsements such as “not found”, “not in station”, “addressee has left” and so on. Also, an addressee can easily avoid receiving the letter addressed to him without specifically refusing to receive it. He can so manipulate matters that it gets returned to the sender with vague endorsements such as “not found”, “not in station”, “addressee has left” and so on. It is suggested that a landlord, knowing that the tenant is away from station for some reasons, could go through the motions of posting a letter to him which he knows will not be served. Such a possibility cannot be excluded. But, as against this, if a registered letter addressed to a person at his residential address dose not get served in the normal course and is returned, it can only be attributed to the addressee’s own conduct, if he is staying in the premises, there is no reason why it should not be served on him. If he is compelled to be away for some time, all that he has to do is to leave necessary instructions with the postal authorities either to detain the letters addressed to him for some time until he returns or to forward them to the address where he has gone or to deliver them to some other person authorised by him. In this situation, we have to choose the more reasonable, effective, equitable and practical interpretation and that would be to read the word “served” as “sent by post”, correctly and property addressed to the tenant, and the word “receipt” as the tender of the letter by the postal peon at the address mentioned in the letter. No other interpretation, we think will fit the situation as it is simply not possible for a landlord to ensure that a registered letter sent by him gets served on, or is received by, the tenant.” (b) In a recent decision in Kailash Rani Dang v. Rakesh Bala Aneja and Another (2009) 1 SCC 723: (2009) 3 MLJ 332, a question arose as to whether the award of the Arbitrator, which was sent by Registered Post to the person against whom the award passed and the envelop returned to the sender, can be presumed to be served to the person concerned. In paragraph-23 of the said judgment, it is held thus: “23. In paragraph-23 of the said judgment, it is held thus: “23. Admittedly, a copy of the award had been sent to Subhash Chander at Alka Cinema which was in fact, the property which was the subject-matter of the partnership business between the parties. In this view of the matter, the statement of the postman Dharam Pal becomes extremely relevant wherein he deposed that on 30.88.1999, Subhash Chander had not been present in the cinema premises and that on the next day he had refused to receive the communication even when tendered to him which fact had been endorsed by him oh the envelop which had then been returned to the sender. We are, thus, of the opinion that by virtue of sub-clause (a) of Section 3(1) read with Section 3(2). A presumption that the document had indeed been delivered is writ large on the facts of the case.” (C) The judgment of Andhra Pradesh High Court in N. Khdervali Sahen and Another v. N. Gudu Sahib and Others AIR 1984 AP 126, was cited by the learned counsel for the first respondent for the proposition that once a notice is given to a party to appear on a noted date it implies consequence of non appearance, ex parte hearing will follow and specific mention need not be given. For non appearance, the party will be set ex parte. (d) The learned counsel for the respondent in support of his contentions, also referred to a judgment of the Delhi High Court in the case (2006) 2 ARBLR 274 (Delhi), in paragraph-10, it is held as follows: “10. ………………………. The petitioner chose not to appear before the arbitrator and exercise his defence. It was for the petitioner to have taken the plea of waiver and in that eventuality the matter would have been examined on the evidence produced by the parties. The occasion for this did not arise because the petitioner did not appear before the arbitrator and did not set forth his defense. There is no cogent Explanation for the non appearance of the petitioner and the petitioner cannot take advantage of his absence from the proceedings before the arbitrator.” 14. The occasion for this did not arise because the petitioner did not appear before the arbitrator and did not set forth his defense. There is no cogent Explanation for the non appearance of the petitioner and the petitioner cannot take advantage of his absence from the proceedings before the arbitrator.” 14. Applying the above principles to the facts of this case and having regard to the fact that the first notice was received by the petitioners, but the petitioners have not chosen to appear or to file counter to the claim statement and the second notice having been sent by Registered Post, which was returned with an endorsement as stated supra, the second respondent has followed the principles of natural justice while proceeding with the arbitration proceedings and passed the arbitral award. There is no error committed by the Arbitrator, violating Section 34(2)(a)(ii) of the Arbitration and Conciliation Act, 1996 as raised in this petition. 15. There is no merit in this original petition and the same is dismissed. No costs. Petition dismissed.