Hon'ble Judges/Coram:
J.C. Shah, K.C. Das Gupta, K.N. Wanchoo and Raghubar Dayal

JUDGMENT

J.C. Shah, J.

1. A dispute arising under a contract relating to the supply of solidified fuel between Messrs. Mohindra Supply Company - hereinafter referred to as the respondents - and the Governor-General of India in Council was referred to arbitration of two arbitrators. On March 19, 1946, the arbitrators made and published an award directing the Governor-General to pay to the respondents Rs. 47,250/- with interest at 3% from July 17, 1944, till payment. This award was filed in the court of the Subordinate Judge, First Class, Delhi. The Governor-General applied for an order setting aside the award on certain grounds which for the purposes of this appeal are not material. The Subordinate Judge refused to set aside the award on the grounds set up and rejected the application. Against the order refusing to set aside the award, the Governor-General preferred to the Lahore High Court an appeal which after the setting up of the Dominions of India and Pakistan was transferred to the Circuit Bench of the East Punjab High Court at Delhi. Falshaw, J., who heard the appeal set aside the order, because in his view the dispute could not be referred to arbitration under the contract which gave rise to the dispute and "that was sufficient to invalidate the award". Against that order an appeal was preferred under clause 10 of the Letters Patent of the High Court of Lahore, which by the High Court (Punjab) Order, 1947 applied to the East Punjab High Court. Before the Appellate Bench, the Governor-General contended that the appeal under the letters Patent was prohibited by section 39(2) of the Indian Arbitration Act. The question whether the appeal was maintainable was referred to a Full Bench of the High Court. The Full Bench opined that an appeal from the judgment of a Single Judge exercising appellate powers did lie under clause 10 of the Letters Patent, notwithstanding the bar contained in section 39(2) of the Arbitration Act. After the opinion of the Full Bench was delivered, a Division Bench considered the appeal on its merits and set aside the order of Falshaw, J. The Union of India appeals against the decision of the High Court.

2. In this appeal, we are only concerned with the question whether the appeal under clause 10 of the Letters Patent of the High Court against the order of Falshaw, J., was maintainable. The proceedings relating to arbitration are, since the enactment of the Indian Arbitration Act X of 1940, governed by the provisions of that Act. The Act is a consolidating and amending statute. It repealed the Arbitration Act of 1899, Schedule 2 of the Code of Civil Procedure and also clauses (a) to (f) of section 104(1) of the Code of Civil Procedure which provided for appeals from orders in arbitration proceedings. The Act set up machinery for all contractual arbitrations and its provisions, subject t........