Skip to content


The Apollo Mills, Ltd. Vs. Babubhai Chandulal - Court Judgment

LegalCrystal Citation
SubjectArbitration
CourtMumbai
Decided On
Case NumberO.C.J. Suit No. 23 of 1942
Judge
Reported inAIR1944Bom12; (1943)45BOMLR904
AppellantThe Apollo Mills, Ltd.
RespondentBabubhai Chandulal
Excerpt:
indian arbitration act (x of 1940), sections 48, 17-reference-award-award in pending reference whether affected by act-award whether becomes decree by merely filing in court.;an award, which is the result of a reference pending at the date of the commencement of the indian arbitration act, 1940, is saved from the application of the act and its provisions do not apply to such an award, because the word 'references' in section 48 of the act is wide enough to cover the necessary and logical result of a reference, viz. an award.;an award does not become a decree merely because it is filed in court. it only becomes executable as a decree. the cause of action on such an award still subsists; and, it is open to the plaintiff to base his action on the award.;the china steam navigation company..........and mr. dewji damodar. the arbitrators duly made and published their award on july 15, 1940. this suit is filed to enforce that award. the award is not challenged on its merits, but the contention is taken that the suit is not maintainable. this contention is based on the argument that the award haying been given on july 15, 1940, and the present arbitration act (x of 1940) having come into force on july 1, 1940, a suit on the award is barred under section 17 of the act. in order to decide that contention, the question that has got to be determined is whether this award is governed by the provisions of the new act or by the provisions of the old act which was repealed, by the new act. mr. m.s. vakil for the defendants has relied on section 48 of the new act. section 48 provides that all.....
Judgment:

Chagla, J.

1. There were disputes between the plaintiffs and the defendants in the year 1938 which were referred to the arbitration of Mr. T.V. Baddeley and Mr. Dewji Damodar. The arbitrators duly made and published their award on July 15, 1940. This suit is filed to enforce that award. The award is not challenged on its merits, but the contention is taken that the suit is not maintainable. This contention is based on the argument that the award haying been given on July 15, 1940, and the present Arbitration Act (X of 1940) having come into force on July 1, 1940, a suit on the award is barred under Section 17 of the Act. In order to decide that contention, the question that has got to be determined is whether this award is governed by the provisions of the new Act or by the provisions of the old Act which was repealed, by the new Act. Mr. M.S. Vakil for the defendants has relied on Section 48 of the new Act. Section 48 provides that all references pending at the commencement of the new Act are saved and the provisions of the new Act shall not apply to those pending references, and the law in force immediately before the commencement of the new Act shall apply to those pending references. The contention of Mr. Vakil is that all that is saved by Section 48 is pending references. Awards are not saved and therefore, when an award is made after the new Act came into force, it is governed by the provisions of the new Act. It is contended that the Legislature has advisedly not used the expression 'award' in Section 48 and, therefore, it deliberately did not want to save awards made after the commencement of the Act from the provisions of the new Act. In my opinion this contention is clearly untenable.

2. An award is the necessary and logical conclusion of a reference. What Section 48 says is that the new Act shall apply only to those references which commence after the date on which the Act comes into force. If there are any references pending on that date, the new Act shall not apply to those references. In my opinion the expression 'references' is wide enough to cover the necessary and logical result of a reference, viz. an award. If Mr. Vakil's contention were to be correct, it would lead to this extraordinary result that while a pending reference would be saved from the application of the new Act, as soon as that reference terminated and the arbitrator made his award, the provisions of the new Act would apply to that award. The Legislature could never have intended such an extraordinary result. Therefore, in my opinion, any award which is the result of a reference which was pending at the date of the commencement of the Act is saved from the application of the new Act, and the provisions of the new Act do not apply to such an award.

3. It is further contended by Mr. Vakil that even assuming the old Arbitration Act applied to this award, the plaintiffs are still not entitled to maintain the suit. It is urged that the award in suit was filed in this Court on August 16, 1940. It was open to the plaintiffs to execute that award. Instead of doing that, they filed this suit and are asking for a decree on the award. Mr. Vakil argues that the plaintiffs having resorted to a particular remedy given to them under the old Act, it is not open to them now to base a suit on that award The validity of this argument can only depend on the assumption that by filing the award the cause of action on the award was merged in the award that was filed in this Court. Now it has been held by our Court and other Courts in India that an award does not become a decree because it is filed in Court, It only becomes executable as a decree. The merger would only take place if by filing an award it became a decree in which case the award would be merged in the decree. Inasmuch as it does not become a decree, the cause of action on the award still subsists, and it is open to the plaintiffs to base their action on the award. Sir Jamshedji Kanga has referred me to an English decision which dealt with the identical point raised by Mr. Vakil. That is a case-The China Steam Navigation Company (Limited) v. Van Laun (1905) T.L.R. 26, In this case the plaintiff had obtained an order of the Court under Section 12 of the English Arbitration Act giving him leave to enforce the award as if he had obtained judgment. He then filed a suit on the award, and it was contended that the suit was not maintainable as the plaintiff had already obtained an order under Section 12 of the English Act. Mr. Justice Bigham in delivering his judgment said (p. 26) :-

The first remedy was not of the same value as the remedy he now required, and the same proceedings could not be taken on the one as on the other. A judgment in an action was what he was entitled to under the award....

Here too it would not be open to the plaintiff to found a bankruptcy notice on the award which has been filed in the Court. If he wants to take out a bankruptcy notice, he would have to obtain a decree on the award. It is only on such a decree that a bankruptcy notice could be founded. Therefore it is clear that a decree on an award gives the plaintiffs further and additional rights than merely filing an award in Court. I, therefore, hold that it is open to a party who has already filed the award obtained by him in Court to file a suit on that very award.

4. I, therefore, answer the issue in the affirmative.

5. There will, therefore, be a decree for the plaintiffs as prayed.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //