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Manji Ramji Vs. H.M. Mehta and Co. - Court Judgment

LegalCrystal Citation
SubjectArbitration
CourtMumbai
Decided On
Case NumberO.C.J. Appeal No. 25 of 1943 and Award No. 150 of 1940
Judge
Reported inAIR1943Bom463; (1943)45BOMLR940
AppellantManji Ramji
RespondentH.M. Mehta and Co.
DispositionAppeal dismissed
Excerpt:
indian arbitration act (x of 1940)-award made before act came into force-such award whether affected by act.;the provisions of the indian arbitration act, 1940, have no application to an award made before the act came into force. - - i am not satisfied that the wide construction sought to be placed upon the word 'arbitration' in section 47 is justified. it is hardly more an 'arbitration' than a 'reference pending'.but even if section 47 by itself is wide enough to cover an award made before the act came into force, i am clearly of opinion that, reading the whole act together, particularly sections 14, 15, 16 and 17, and the provisions as to limitation, the act was not intended to apply to an award made before the act came into force......section 15. then section 37 provides that the provisions of the indian limitation act, 1908, shall apply to arbitrations as they apply to proceedings in court, and under that section, and the fourth schedule to the act, an award has to be filed within ninety days after the date of service of the notice of the making of the award. if the new act applies, this award was not filed within time.7. it is contended by the learned advocate general on behalf of the respondents that he had a definite right under the old act to file the award at any time, there being no limitation applicable under the old act, so that he had a right to file the award at any time, and thereupon to enforce it as a decree, and that that right is saved to him by section 6 of the general clauses act, 1897, which.....
Judgment:

John Beaumont, Kt., C.J.

1. This is an appeal against an order made by Mr. Justice Chagla in chambers dismissing an application to set aside an order made by the Prothonotary and Senior Master transmitting a certified copy of an award dated July 30, 1938, to the District Court of Ajmer for execution.

2. The facts giving rise to the application are these. On July 30, 1938, the award in question was made, and on August 6 notice was given to the parties of the filing of the award under Section 11 of the Indian Arbitration Act of 1899. On December 5, 1940, the award was filed in this Court. On May 14, 1942, an application was made to the Prothonotary & Senior Master to transfer the award for execution to the District Court of Ajmer, and such an order was made on June 25. On April 7, 1943, a summons was taken out for setting aside that order of the Prothonotary, and it is against the dismissal of that summons that this appeal is brought.

3. The arbitration took place under the old Arbitration Act of 1899, and the two sections of that Act, which are relevant for the present purpose, are Section 11 and Section 15. Section 11 provides that when the arbitrators or umpire have made their award, they shall sign it and shall give notice to the parties of the making and signing thereof and of the expenses of the arbitration. Then Sub-section (2) provides that the arbitrators or umpire shall, at the request of any party to the submission or any person claiming under him, and upon payment of the fees and charges due in respect of the arbitration and award, and of the costs and charges of filing the award, cause the award, or a signed copy of it, to be filed in the Court; and notice of the filing is to be given to the parties by the arbitrators or umpire. Then Section 15 deals with enforcement of the award, and provides that an award on a submission, on being filed in the Court in accordance with the foregoing provisions, shall (unless the Court remits it to the reconsideration of the arbitrators or umpire', or sets it aside) be enforceable as if it were a decree of the Court. At the time when this award was made those were the provisions in operation, and it was open to the parties to enforce the award as a decree of the Court, after it had been filed. The difficulty, which has arisen, is that the Arbitration Act of 1940 came into operation on July 1, 1940, having received the Governor General's assent on March 11, 1940, so that it came into operation before this award was filed, which, as I have said, was on December 5, 1940.

4. The respondents are seeking to enforce the award under the provisions of the old Act, and the contention of the appellant is that the award can only be enforced under the provisions of the new Act, which, admittedly, have not been complied with. The two sections of the new Act, which are directly relevant, are Section 47 and Section 48. Section 47 provides :

Subject to the provisions of Section 46, and save in so far as is otherwise provided by any law for the time being in force, the provisions of this Act shall apply to all arbitrations and all proceedings thereunder.

The argument of the appellant is that the word 'arbitrations' is wide enough to cover the whole process of arbitration from the arbitration agreement to the enforcement of the award, and that therefore the new Act applies to the enforcement of an award made before the date of the Act coming into operation. Then Section 48 provides :

The provisions of this Act shall not apply to any reference pending at the commencement of this Act, to which the law in force immediately before the commencement of this Act shall, notwithstanding any repeal effected by this Act, continue to apply.

The old Act was repealed by Section 49 and the Third Schedule. The argument of the appellant is that a reference, which has resulted in an award, is not included in the expression 'reference pending'. That, no doubt, is correct. One cannot say that an award is a pending reference. But it would certainly be strange to save the provisions of the old Act as to a reference pending when the Act comes into operation, and not to save them as to an award made under the old Act. I am not satisfied that the wide construction sought to be placed upon the word 'arbitration' in Section 47 is justified. However, one cannot deal with the construction of those two sections without looking at the rest of the Act.

5. The definitions in the new Act do not assist us. 'Award' means an arbitration award, and 'reference' means a reference to arbitration. The definitions do not say in so many words that the reference must be under the Act, or the award made on a reference under the Act.

6. Then in Chapter II there are various provisions relating to arbitration without the intervention of the Court, and Section 14 is the section dealing with the filing of an award. There are two variations from Section 11 of the old Act, Not only the award, but any depositions and documents, which may have been taken and proved before the arbitrators, have to be filed under the Act; and it is the Court, and not the arbitrators, who have to give notice to the parties of the filing of the award. Then Section 15 enables the Court to modify an award on the conditions therein mentioned. I think it would be difficult to say that the Court could modify an award not made under the Act. And the same observation applies to Section 16, which gives the Court power to remit an award under certain circumstances. I think it would be difficult to say that the Court could remit an award not made under the terms of this Act, and if an award was remitted, it would apparently then become a pending reference within Section 48, to which the old Act would then apply. That, I think, would be a very inconvenient result. Then Section 17 provides a different system of enforcing an award. Under the old Act an award can be enforced as a decree as soon as it has been filed, but under Section 17 of the new Act the Court is required, after the time for making an application to set aside the award has expired, or such application having been made, after refusing it, to proceed to pronounce judgment according to the award, and upon the judgment so pronounced a decree is to follow. That procedure was not adopted in this case; the parties have acted under the old Section 15. Then Section 37 provides that the provisions of the Indian Limitation Act, 1908, shall apply to arbitrations as they apply to proceedings in Court, and under that section, and the Fourth Schedule to the Act, an award has to be filed within ninety days after the date of service of the notice of the making of the award. If the new Act applies, this award was not filed within time.

7. It is contended by the learned Advocate General on behalf of the respondents that he had a definite right under the old Act to file the award at any time, there being no limitation applicable under the old Act, so that he had a right to file the award at any time, and thereupon to enforce it as a decree, and that that right is saved to him by Section 6 of the General Clauses Act, 1897, which provides that where any Central Act made after the commencement of the Act repeals any enactment hitherto made or hereafter to be made, then, unless a different intention appears, the repeal shall not affect any right, privilege, obligation or liability acquired, accrued or incurred under any enactment so repealed, or affect any investigation, legal proceeding or remedy in respect of any such right. The answer of Mr. Setalvad for the appellant is that we are dealing in this case with a procedural right, and not a substantive right, and it is not a right to which Section 6 of the General Clauses Act applies. I do not think it necessary to decide this point.

8. In my view, on the true construction of the Arbitration Act, 1940, it has no operation in respect of an award made before the Act came into force. It seems to me that that is the effect of the Act read as a whole; it only applies to an award made under the Act. I doubt whether Section 47, taken by itself, would apply to an award made before the Act comes into force, though, no doubt, if it does not, Section 48 was unnecessary. The words in Section 47 'to all arbitrations and to all proceedings thereunder' are not apt to describe the mere enforcement of an award. In my view, an arbitration, which has proceeded to the point of an award before the Act comes into force, cannot be properly described as an arbitration. It is hardly more an 'arbitration' than a 'reference pending'. But even if Section 47 by itself is wide enough to cover an award made before the Act came into force, I am clearly of opinion that, reading the whole Act together, particularly Sections 14, 15, 16 and 17, and the provisions as to limitation, the Act was not intended to apply to an award made before the Act came into force. In my view, therefore, the judgment of Mr. Justice Chagla was right, and the appeal must be dismissed with costs.

Rajadhyaksha, J.

9. I agree.


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