JUDGMENT Mr. K. Kannan, J. (Oral):- The revision is against the order passed by the Court below accepting the appeal filed by the Rice Mills Industry, which had contracted to make some supplies to the petitioner-PUNSUP. The dispute in the matter of mutual claims was a subject of reference to arbitration on the basis of an arbitral clause 26 brought within an agreement signed by the parties on 14.11.1986. The clause reads as follows:- “That in case of any dispute of difference arising out of this contract and concerning to the same shall be referred to the sole arbitration of the Managing Director, Punjab State Civil Supplies Corporation Chandigarh, who will have the discretion either to decide the dispute himself or nominate some other person/official on his behalf and the decision of the Arbitrator or his such nominee shall be final and binding upon the parties. The second party shall have no objection whatsoever if the said arbitrator nominates any of the official of the Punjab State Civil Supplies Corporation as an arbitrator or as the same may be have dealt with the case in his official capacity the Arbitration proceedings shall be subject to the provisions of the Arbitration Act, 1940 and shall take place at Chandigarh.” The award had been passed on 22.01.1988 and it was made rule of the Court after serving notice by the Civil Court on the respective parties and after hearing their objections. This decree when it was made rule of the Court appears to have been challenged by means of an appeal. Against this decree passed by the subordinate Judge on 10.08.1991, there appears to have been an appeal filed by the Rice Mills and the appellate Court reversed the decision finding that the arbitral clause was an unilateral exercise and, therefore, cannot be given effect to. 2. In my view, the decree passed by the trial Court is erroneous for four reasons: (i) A decree, which is passed after serving notice, is final and no appeal was permissible. The appeal to the District Judge himself was incompetent. The provision for appeal is contained under Section 39 of the Arbitration Act, 1940. The said Section reads as follows: “39. Appealable orders. The appeal to the District Judge himself was incompetent. The provision for appeal is contained under Section 39 of the Arbitration Act, 1940. The said Section reads as follows: “39. Appealable orders. (1) An appeal shall lie from the following orders passed under this Act (and from no others) to the Court authorized by law to hear appeals from original decrees of the Court passing the order:- An order- (i) superseding an arbitration; (ii) on an award stated in the form of a special case; (iii) modifying or correcting an award; (iv) filing or refusing to file an arbitration agreement; (v) staying or refusing to stay legal proceedings where there is an arbitration agreement; (vi) setting aside or refusing to set aside an award; Provided that the provisions of this section shall not apply to any order passed by a Small Cause Court. (2) No second appeal shall lie from an order passed in appeal under this section, but nothing in this section shall affect or take away any right to appeal to the Supreme Court. The decree passed by the subordinate Judge on an application filed under Sections 14 and 17 for making it an order of Court does not fall within any of the clauses. In other words, the order passed making the award of the Arbitrator a rule of the Court is final. (ii) The manner of assailing the award or an an arbitral agreement is contained in Section 33 of the Arbitration Act, 1940. The Section reads as follows:- “33. Arbitration agreement or award to be contested by application.-Any party to an arbitration agreement or any person claiming under him desiring to challenge the existence or validity of an arbitration agreement or an award or to have the effect of either determined shall apply to the Court and the Court shall decide the question on affidavits: Provided that where the Court deems it just and expedient, it may set down the application for hearing on other evidence also, and it may pass such orders for discovery and particulars as it may do in a suit.” Consequently, if any party were to contend that the arbitral agreement was void and consequently the award was void, it was bound to file an application under Section 33 to declare as its validity. That shall be done before the award is made the rule of Court. That shall be done before the award is made the rule of Court. In this case, no such application was filed by the respondent herein. (iii) If the award was invalid for any reason, such as the ground urged that the arbitral clause was void and the award was invalid, it ought to have been made a ground for setting aside the award under Section 30 of the Arbitration Act, 1940 . The said Section reads as under:- “30. Grounds for setting aside award. An award shall not be set aside except on one or more of the following grounds, namely:- (a) that an arbitrator or umpire has misconducted himself or the proceedings; (b) that an award has been made after the issue of an order by the Court superseding the arbitration or after arbitration proceedings have become invalid under section 35; (c) that an award has been improperly procured or is other- wise invalid.” This shall be done before the award was made the rule of Court. The subordinate Judge himself could set aside the award, if only a petition had been filed by the respondent that it was likely to be set aside. There was admittedly no application fled by the respondent to set aside the award. Consequently, the respondent forfeited his right to challenge its validity on any of the grounds mentioned under Section 30 which we have extracted below. (iv) A clause allowing for an Arbitrator to be appointed cannot be taken to be unilateral if it is founded on an agreement where one of the parties to the agreement allows yet another party to nominate an Arbitrator. An agreement which contains an arbitral clause is an agreement to which the Rice Mill was a party. The validity of an arbitral clause is always founded on mutuality. That mutuality obtains through the agreement signed by both the parties. We have extracted the clause above. There is no exclusivity or want of mutuality for referring the dispute only by PUNSUP. The respondent was equally at liberty to refer the dispute to arbitration. In other words, the clause which provides bilateral rights of reference to both parties cannot be said to be an unilateral reference. In New India Assurance Co. We have extracted the clause above. There is no exclusivity or want of mutuality for referring the dispute only by PUNSUP. The respondent was equally at liberty to refer the dispute to arbitration. In other words, the clause which provides bilateral rights of reference to both parties cannot be said to be an unilateral reference. In New India Assurance Co. Ltd. Versus Central Bank of India-AIR 1985 Cal 86, a clause in the insurance policy under which the bank alone had the right to make the reference, the clause was held to be valid. It is really an extreme illustration about effect of a clause which is brought in an agreement signed by both the parties. 3. In a Court of Appeal case in England, in Woolf Versus Collis Removal Service-(1948) 1 KB 11, the contract was for storage of goods in a warehouse. It contained a clause that any claim by the customer but not any claim by the warehouse keeper could refer to arbitration. It was still held to be valid. This decision was also cited and followed in a subsequent decision in Pittalis Versus Shorefettin-(1986) 2 WLR 1003 (CA); (1986) 2 All ER 227, where the case was as regards a rent review clause in a lease deed. One of the questions was whether a unilateral option on the part of the lessee to refer was a valid arbitration agreement. It was held that there was nothing in the unequal operation of the clause to divest it of the character of being an arbitration clause. Even otherwise there was no lack of mutuality in the clause. 4. The order passed by the Court below is erroneous and set aside and the decree passed in terms of the award passed by the subordinate Judge is restored. The civil revision is allowed. ---------0.B.S.0------------