1. This appeal is brought by the Food Corporation of India from the Judgment of the learned Subordinate Judge, Palghat in O.S. (Arb.) No. 386 of 1982 whereby the learned Judge held that the differences between the parties were referable to arbitration. The Judge does not seem to have specifically ordered the filing of the arbitration agreement as required under section 20(4) of the Arbitration Act, 1940. The Judge also does not seem to have called upon the appellants to appoint an arbitrator as required under clause 25 of the agreement.

2. The question which directly arises in this appeal, at the instance of the Food Corporation of India, is whether the learned Judge rightly held that the disputes between the parties were referable to arbitration. Counsel for the appellants Sri P. C. Chacko submits that clause 25 which contains the arbitration agreement excludes matters otherwise provided. The matters in dispute relate to compensation payable for delayed execution of work. These are matters, counsel points out, which are specifically provided under clause 2. Accordingly, counsel submits, the court exceeded its jurisdiction in holding that the disputes between the parties were arbitrable.

3. The material portion of the arbitration clause reads:

"Clause 25.- Except where otherwise provided in the contract all questions and disputes relating to the meaning of the specifications, designs, drawing and instructions herein before mentioned and as to the quality of workmanship or materials used on the work or as to any other question, claim, right, matter or then whatsoever, in any way arising out of or relating to the contract, designs, drawings, specifications estimates, instruction, orders or these conditions or otherwise concerning the works, or the execution or failure to execute the same whether arising during the progress of the work or after the work or after the completion or abandonment thereof shall be referred to the sole arbitration of the person appointed by the Managing Director, Food Corporation of India.........."(emphasis supplied)

The effect of this clause is that, in the absence of a provision to the contrary, all matters arising under the contract, including those concerning delayed execution of work, are arbitrable. Delayed execution of work, as we stated earlier, is precisely what is provided under clause 2. That clause says:

"Clause 2.- The time allowed for carrying out the work as entered in the tender shall be strictly observed by the contractor and shall be deemed to be of the essence of the contract on the part of the contractor and shall be reckoned from the 7th day after the date on which the order to commence the work is issued, to the contractor. The work shall throughout the stipulated period of the contract be proceeded with all due deligence and the contractor shall pay as compensation an amount equal to one percent, or such smaller amount as the Superintending Engineer (whose decision in writing shall be final) may decide on the amount......."(emphasis supplied)

4. The argument of the appellants is that, in so far as clause 2 says that the decision of the Superintending Engineer shall be final, that is a matter which is provided otherwise than under clause 25 relating to arbitration. The appellants counsel relies on the decision of the Delhi High Court in F.A.O. (O.S.) No. 74 of 1975 which dealt with an agreement in which there was an exclusion in the following words:

"All disputes and differences arising out of or in any way touching or concerning this agreement whatsoever (except as to any matter the decision of which is expressly provided for in the contract shall be referred to the sole arbitration of any person appointed by the Managing Director of the Food Corporation of India."(emphasis supplied)

It was held that matters relating to demurrage and wharfage came within the words "expressly provided for in the contract" and were therefore excluded from the purview of the arbitration agreement. With great respect, we do not agree that principle is applicable in the present case.

5. The question is not whether the decision of the Superintending Engineer is final, but whether the jurisdiction of the civil court is preserved from the arbitration agreement. Disputes between the parties can arise only from the final refusal of the claim of the one by the other. The fact that the contractors claim is finally rejected by the decision of the Superintending Engineer only means a dispute has arisen on the basis of that decision. Ordinarily such a dispute is a matter which can be taken to a civil court, except where the jurisdiction of the court is outed by a specific agreement between the parties to refer their differences to arbitration. The question then is whether, in terms of the arbitration agreement, the dispute between the parties is one which has been excluded from the purview of that agreement so as to preserve the jurisdiction of the civil court. In order to show that, the parties have limited the scope of the arbitration agreement so as not to extend it to a particular matter, there must be a specific provision, especially when the arbitration clause is so widely framed as it is in the present case, to the effect that the matter in dispute is one which has been excluded from arbitration or in other words has not been excluded from the purview of the civil court. This can be done either by an additional clause to make the intention of the parties clear, or by a supplemental agreement. There is no such clause or supplemental agreement.

6. All that counsel is in a position to point out are clause 25 containing the words "except where otherwise provided in the contract" and clause 2 which says that the decision of the Superintending Engineer shall be final. In our view what is meant by the words of exclusion in clause 25 is what is otherwise specifically provided so as to oust the arbitration agreement in respect of a particular claim. No specific exclusion has been brought to our notice. In the circumstances, the mere fact that clause 2 contains a reference to the finality of the decision of the Superintending Engineer is not an ouster of the arbitration agreement. In our view, the matter in dispute will squarely fall within the arbitration agreement.

7. The proceeding before the court below was under section 20. An order under sub-section (4) postulates two things: (1) an order filing the arbitration agreement which is what is appealable under section 39(1)(iv) and (2) a ministerial order appointing the arbitrator. Where the parties have by agreement provided for the appointment of an arbitrator, the arbitrator has to be appointed as provided in the agreement. If the parties cannot agree, then and only then can the court appoint the arbitrator. Under clause 25 the arbitrator has to be appointed by the Managing Director of the Food Corporation of India. It was therefore incumbent upon the court to call upon the Food Corporation of India to appoint an arbitrator within a stipulated period and only if that direction was not complied with by the Food Corporation of India could the court appoint an arbitrator independent of the agreement. The court went wrong in appointing an arbitrator without giving the Food Corporation of India an opportunity to appoint an arbitrator in terms of the agreement.

8. As we stated earlier, although the court has come to the right conclusion as regards the dispute being arbitrable, the court failed to make an order filing the arbitration agreement under section 20(4) which it ought to have made and. which alone is an appealable order under section 39(1)(iv). In the circumstances, we confirm the finding of the court below on the merits of the matter concerning the nature of the dispute, put set aside the operative part of the judgment, and direct the court to order the filing of the arbitration agreement and call upon the Food Corporation of India to appoint an arbitrator within a specified period. It will be open to the court to appoint an arbitrator independent of the agreement in the event of the Food Corporation of India failing to comply with the courts direction. In the circumstances, the appeal is allowed to the limited extent indicated above. The parties shall bear their respective costs. The parties shall appear before the court below on 15th December 1986 for further directions of that court.