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Bollaram George Vs. Kadpak Lingiah - Court Judgment

LegalCrystal Citation
SubjectArbitration
CourtAndhra Pradesh High Court
Decided On
Case NumberCivil Revn. Petn. No. 325/4 of 1956
Judge
Reported inAIR1961AP457
ActsArbitration Act, 1940 - Sections 14(2); Limitation Act - Schedule - Article 158
AppellantBollaram George
RespondentKadpak Lingiah
Appellant AdvocateGopal Rao Tuljapurkar, Adv.
Respondent AdvocateV. Gopala Krishniah, Adv.
DispositionRevision Petition allowed
Excerpt:
.....statement. it was held that :that it was a good ground for revision of a decree based upon an award filed in court that no notice of the filing of the award was given by the court to the parties as required by section 516 of the code of civil procedure, even though the applicant in revision might have received, information aliunde that the award has been filed'.in this decision reliance was placed on the madras case in ilr 11 mad 144. similar view has been taken by jailal, j. bissay ram, air 1926 cal 1018 following ilr 11 mad 144 and ilr 20 all 474 has held that the courts omission to give notice of the filing of the award to the parties was a serious irregularity and it was a good ground for revision. in such a case even if the court has failed to give notice to him, the date when.........., we cannot accept the contention of the learned counsel. in the result, the copy of the award filed along with the plaint and the one filed by the umpire on 28-3-55 would both be invalid. the only award worth the name would be the one received from the collector's office on 7-6-55. after the receipt of this award, the petitioner filed his objections on 5-7-55 i.e., within a period of thirty days. it is common ground that when this award was received in court from the collector's office on 7-6-55 no notice was issued to the parties of the filing of the award. as stated earlier, the objections for setting aside the award or remitting the award for reconsideration have to be made within 30 days from the issue of the notice. the court below finds that no notice was issued, but in.....
Judgment:

Manohar Pershad, J.

1. This is a petition for revision of an order passed by the Subordinate Judge of Warangal holding that the objection petition dated 5-7-1955 was time barred and passing a decree in favour of the plaintiff in terms of the award. The award in question was received in Court on 7-6-1965 from the Collector. On 4-1-1955, the respondent herein who was the plaintiff in the lower court filed a suit for enforcement of the award along with unsigned copies of the award and the agreement. In para 5 of the plaint, he stated that the original award was filed before the Collector for stamping the same as required by law as it was written on a stamp paper of Rs. 5/- and that the original agreement was in possession of the Umpire Sri Matrasi Jagannatham and that the same may be summoned from them, On 6-1-1955, the Presiding Judge passed the following order :

'Take on Register No. 2. Issue notice to the respondent at the cost of the petitioner. Send also for the original documents us required in the petition'.

It appears that before any notice could be issued as directed by the Presiding Judge, the petitioner herein filed a petition on 5-1-1955 to the effect that he had come to know that the plaintiff had instituted a suit for recovery of money and filed a petition for interlocutory orders. As this would affect his business, he prayed that if any application for interlocutory orders had been made, the same may be heard in his presence. On 21-1-1955, he filed another petition stating that on coming to know that an interim order of some sort was being issued by the Court against him, he requests that no order should be passed without informing him.

Upon this, he was asked to furnish security to the extent of the suit amount. For this purpose, he wanted a week's time. On 24-1-1955, when the matter was taken up, counsel for the parties were present and the court directed the plaintiff to give a copy of the plaint to the defendant. On 2-2-1955, when the matter came up for hearing, the defendant (the petitioner herein) wanted to file a written statement and the case was posted to 15-2-1955. On that date, the revision petitioner applied to call for the award proceedings from the arbitrator and stated that after its inspection he would file his written statement.

The case was thereafter directed to be posted to 28-2-1955. On that day the court directed the parties to furnish the correct addresses of the arbitrators and posted the case to 15-3-1055. As necessary costs were not deposited, orders were not issued and the case was posted to 28-3-1955. On that date, the court passed the following order

'Parties represented by their respective Advocates. One Umpire has filed some papers in the case. The defendant is directed to file written statement without further delay'.

and posted the case to 11-4-1955. But it appears that no written statement was filed, adjournment was taken and the case dragged on like that till 6-7-1955 when the defendant tiled his written statement. In the meantime, the original award was received in Court on 7-6-1955. In the written statement filed by him the petitioner among other pleas took the plea that no notice was issued under Section 14(2).

The Court below while conceding that no notice was given to the petitioner under section 14(2) of the Arbitration Act, held that since the petitioner had knowledge of the filing of the award, that was sufficient compliance and therefore rejected the petition on 5-7-1955 as being time-barred. It is this Order of the learned Subordinate Judge that is now challenged in this revision.

2. Shri Tuljapurkar for the petitioner contended that Section 14(2) of the Arbitration Act is mandatory and when the Court below admits that no notice was issued it would vitiate the award and mere knowledge that an award has been filed would not be sufficient compliance. In this connection, the learned counsel drew our attention to Gurdutta Mal v. Firm of Basanta Mal Pannalal, AIR 1925 Lali 619 (1), Punoo Ram v. Nebh Raj, AIR 1930 Lah 228 and Harichand v. Lachhman Das, AIR 1948 EP 11.

While conceding that on 4-1-55, the respondent had filed a copy of the award and agreement along with the plaint, it is contended by the learned counsel for the petitioner that the award not having been signed by the arbitrators or the umpire and there being nothing to show that it was given by the Umpire or the arbitrators authorising him to file it in court, the filing of such an award by the respondent would not be a valid filing. Reliance was placed on the case of Kumbha Mawji v. Dominion of India, : [1953]4SCR878 .

3. Shri Gopalakrishniah, learned counsel for the respondent while conceding that the filing of the award by the respondent-plaintiff was not valid, contended that when the Umpire or, 28-3-1955 had filed a copy of the award and the revision petitioner had knowledge of the filing, it was unnecessary for the Court to give a notice of the filing of the award under Section 14(2) of the Arbitration Act. In this connection, the learned counsel placed his reliance on Bhola Nath Mallick v. Mahadev Mallick, : AIR1952Cal226 , and Kawal Singh v. Baldeosingh, AIR 1957 Nag 57.

4. In order to appreciate the contentions of the learned counsel for the parties, a reference to Section 14 of the Arbitration Act is necessary which runs thus :

'(1) When the arbitrators Or Umpire have made their award, they shall sign it and shall give notice in writing to the parties of the making and signing thereof and of the account of fees and charges payable in respect of the arbitration and award.

(2) The arbitrators or Umpire shall, at the request Of any party to the arbitration agreement or any person claiming under such party or if so directed by the Court 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, together with any depositions and documents which may have been taken and proved before them, to be filed in Court and the Court shall thereupon give notice to the parties of the filing of the award.

(3) Where the arbitrators or Umpire state a special case under Clause (b) or section 13 the court after giving notice to the parties and hearing them shall pronounce its opinion thereon and such opinion be added to, and shall form part of the award.

5. In this revision, we are only concerned with Section 14(2). Under this provision, it is the arbitrator or umpire who has to file the award or a signed copy thereof in court and after that is done, the court has to issue a notice to the parties of the filing of the award. Article 158 of the Limitation Act prescribes a Period of thirty days for setting aside an award or to get it remitted for reconsideration from the date of the service of the notice of the filing of the award.

It is clear therefore that under the above provision two things are necessary: (1) filing of the award by the Umpire and (2) issue of the notice by the Court of the filing of the award. In the instant case, initially the award was not filed by the arbitrator or the Umpire. In para 5 of the plaint, it was stated that the award was filed in the office of the Collector. This award was received in Court from the Collector's office on 7-6-1955. In the meantime, it appears that on 28-3-1955, the Umpire through a petition tiled a copy of the award and some other documents; but this award also does not bear the signature of the Umpire or the other arbitrators- Shri Gopalakrishniah, learned counsel while conceding that the award not being signed by the Umpire or the arbitrators would not be deemed to be a valid award, contended that since the award was filed along with the list of documents signed by the Umpire, that would be sufficient compliance under Section 14(1) of the Arbitration Act.

In view of the recent pronouncement of their Lordships of the Supreme Court in : [1953]4SCR878 , we cannot accept the contention of the learned counsel. In the result, the copy of the award filed along with the plaint and the one filed by the Umpire on 28-3-55 would both be invalid. The only award worth the name would be the one received from the Collector's office on 7-6-55. After the receipt of this award, the petitioner filed his objections on 5-7-55 i.e., within a period of thirty days. It is common ground that when this award was received in Court from the Collector's office on 7-6-55 no notice was issued to the parties of the filing of the award.

As stated earlier, the objections for setting aside the award or remitting the award for reconsideration have to be made within 30 days from the issue of the notice. The court below finds that no notice was issued, but in its opinion as the petitioner had knowledge of the filing of the award, that was sufficient compliance. In this connection, the lower court has placed reliance on : AIR1952Cal226 . It is not denied that the provisions of Section 14(2) are mandatory. Question arises whether in a case where no notice is issued as provided under Section 14(2) if the party comes to know of the tiling of the award, is that sufficient compliance. Identical question had arisen in the Lahore High Court in two cases; AIR 1925 Lah 619 (1) and AIR 1930 Lah 228.

6. AIR 1925 Lah 619 (1) was a case where an award was submitted by the arbitrator to the court on 30th January, 1923. The court without issuing a notice to the parties at once proceeded to judgment and passed a decree in accordance with the terms of the award. Against this order, the defendants came in revision. It was urged there on behalf of the respondents that when the defendant was aware of the filing of the award, issue of notice was unnecessary. This contention was rejected and it was held that :

'The provisions of Clause (10) Schedule II of the C. P. C. (which is equivalent to Section 14(2) of the Arbitration Act) are mandatory and the parties are entitled to notice even if they have knowledge of the date on which the award is filed. The omission to give such notice is a material irregularity which entitles the party to have the decree passed on the award set aside In revision'.

In this case reliance was placed on the cases of Rangaswami v. Muthuswami, (ILR 11 Mad 144) and Chaturbhuj Das v. Ganesh Ram. ILR 20 All 474.

7. ILR 11 Mad 144 was also a case of revision arising out of an award. The District Mun-sif had passed a decree in terms of the award without giving a notice of the filing of the award under Section 516 C. P. C. It was held that the District Munsif acted with material irregularity within the meaning of Section 622 C. P. C. Holding so, the decree Passed by the District Munsif was set aside and the case was remanded.

8. In ILR 20 All 474 while conceding that no notice was sent as required by Section 510 C. P. C. as it stood then, it was contended that the other side had the knowledge of the filing of the award. It was held that :

'That it was a good ground for revision of a decree based upon an award filed in Court that no notice of the filing of the award was given by the Court to the parties as required by Section 516 of the Code of Civil Procedure, even though the applicant in revision might have received, information aliunde that the award has been filed'.

In this decision reliance was placed on the Madras case in ILR 11 Mad 144. Similar view has been taken by Jailal, J. in the case of AIR 1930 Lah 228. The Calcutta High Court in the case of Ranjit Chandra v. Bissay Ram, AIR 1926 Cal 1018 following ILR 11 Mad 144 and ILR 20 All 474 has held that the courts omission to give notice of the filing of the award to the parties was a serious irregularity and it was a good ground for revision. The same High Court in another case Ganeshmal v. Kesoram Cotton Mills, . : AIR1952Cal10 following ILR 11 Mad 144; AIR 1925 Lab 619 (1); AIR 1930 Lah 228; AIR 1926 Cal 1018 and ILR 20 All 474 has taken a similar view. But in the case of : AIR1952Cal226 it took a different view disagreeing with the view taken by the Allahabad High Court in ILR 20 All 474 and AIR 1925 Lah 619 (1) and held :

'Under Article 158, Limitation Act, the starting point of limitation id the date of the service of the notice of the filing of the award. The provision as to the, service of notice of the filing of the award under Section 14(2) Arbitration Act is mandatory and the court has no power to pass a decree on the award unless notice is given to the parties to file objections. But where a party is already cognizant of the filing of the award appears in the case and applies to the Court for leave to examine the award and for time to file objections the service of notice of the filing of the award becomes unnecessary. In such a case even if the Court has failed to give notice to him, the date when he enters appearance in the proceedings will be deemed to be the date of the service of the notice of the filing of the award and an application filed more than 30 days from such date will be barred under Article 158'.

The Nagpur High Court in AIR 1957 Nag 57 disagreed with the view taken by the Allahabad, Madras, Lahore and Calcutta High Courts in ILR 20 All 474, ILR 11 Mad 144, AIR 1925 Lah 619 (1) and : AIR1952Cal226 and has held :

'Section 14 of the Arbitration Act, 1940 contemplates a case where the arbitrators or Umpire filed an award in Court when both parties to arbitration may be absent. It is for this reason that provision is made in Sub-section (2) requiring the court to give notice to the parties of the filing of the award. The terms of the section do not contemplate that notice has to be given even when the parties had knowledge of the filing of the award'.

In a recent case, a Bench of this Court In Rama-krishnamma v. Lakshmibayamma, AIR 1958 Andh Pra 497 following ILR 11 Mad 1.44; ILR 20 All 474 and AIR 1926 Cal 1018 has held that :

'The omission by the Court to intimate the parties of the filing of the award is against a mandatory provision because it is designed to give an opportunity to the parties to file their objections against the award the non-compliance of which will certainly vitiate the award'.

9. An identical question had come up for decision before the East Punjab High Court in AIR 1948 EP 11 and it was there held by Teja Singh and Achru Ram, JJ. as under :

'Under Section 14(2) of the Arbitration Act after award has been filed in Court, the Court shall give notice to the parties of the filing of the award. This is a statutory provision and it cannot be dispensed with. Notice, however, need not be in writing. It can be oral. It can be implied from the order of the court. But where the order merely records the presence of the parties when the award was filed by the arbitrators but does not say that any notice of the filing of the award was given to them no notice can be implied from this order. Nor can the notice be implied from the mere mention of the fact that the award has been filed, specially when the orders passed by the Court on subsequent date make it clear that it was only on that subsequent date that the court thought of giving notice of the filing of the award'.

In this decision reference Is made to the case of ILR 20 All 474.

10. From the above discussion, it is clear that so far as the question whether Section 14(2) is mandatory, all the High Courts are uniformly of the view that it is mandatory. But as regards the question whether in the absence of notice knowledge of the filing of the award would be sufficient compliance, there is a divergence of views. Some High Courts are of the view that even though notice has not been issued under Section 14(2) if the party has the knowledge of the filing of the award that is sufficient compliance. The other view is that Section 14(2) being mandatory, non-compliance with it will vitiate the award and knowledge of the award having been filed in Court aliunde does not amount to such a notice.

In AIR 1958 Andh Pra 497 and ILR 11 Mad 144 though it has been held that Section 14(2) is mandatory, there is no discussion of the fact as to whether if the party had the knowledge, that would be sufficient compliance of Section 14(2). There could not be any discussion on this point there as that question was not before their Lordships in that case. In AIR 1925 Lah 619 (1), AIR 1930 Lah 228, AIR 1926 Cal 1018 and ILR 20 All 474, this point has been considered and the view taken is that the fact that the party had knowledge of the award having been filed in Court aliunde does not amount to such a notice; whereas the High Courts of Nagpur and Calcutta in the cases of AIR 1957 Nag 57 and : AIR1952Cal226 have already laid down that the terms of section 14(2) do not contemplate that notice has to be given when the parties had knowledge of the filing of the award.

We are also of the opinion that Section 14(2) of the Arbitration Act is mandatory and notice has to be given of the filing of the award, but we do not agree with the view taken by the Lahore High Court in the case of AIR 1925 Lah 619 (1), AIR 1930 Lah 228, the Calcutta High Court in AIR 1S26 Cal 1018 and the Allahabad High Court in ILR 20 All 474 and accept the view taken by the Nagpur and the Calcutta High Courts in AIR 1957 Nag 57 and : AIR1952Cal226 that if a party to whom notice has to he issued has knowledge that the award has been filed, that would be sufficient compliance with Section 14(2) and no further notice would be necessary. The question whether a party has knowledge or not is a question of fact which has to be determined on the facts of that case.

11. Now, we have to see whether in the instant case as held by the trial court, the petitioner had the knowledge of the filing of the award. As stated earlier, on 4-1-55, the respondent filed a suit with the copy of the award, but that was not a certified copy and did not have the signature of the arbitrators or the Umpire. So, it cannot be said that the filing of the copy of such an award was sufficient to hold that the petitioner had knowledge of the filing of the award. On 28-3-1955, the Umpire filed a copy of the award along with some other documents. This copy also does not bear the signature of the Umpire or the arbitrators.

This also, in our opinion, would not be sufficient to assume knowledge of the other side. On 7-6-1955, the award signed, by the Umpire and the arbitrators was received in Court from the Collectorate office and objections to this award have been filed on 5-7-55, i.e., within thirty days as contemplated under Article 158, Limitation Act as prior to 7-6-55, there was no valid award in Court it cannot be said that the petitioner had any knowledge of the award-Learned counsel Shri Gopalakrishniah contended that the docket sheets of the court below dated 28-3-55, 11-4-55 and 21-4-55 and of subsequent dates would show that the revision petitioner had knowledge of the filing of the award. There is no force in this contention. The docket sheet of 28-3-55 shows that the Umpire filed certain papers.

That docket sheet does not disclose that the Umpire had not filed an award. The subsequent proceedings also do not indicate that an award has been filed. The court below on the fact that the defendant had taken time to file the written statement has come to the conclusion that the revision petitioner had knowledge of the filing of the award. This view of the court below cannot be accepted. The revision Petitioner we may point out, was directed by the court below to file his written statement even as far back as 24-1-55 when as a matter of fact no award had been filed. So, the fact of the defendant taking time to file his written statement would not amount to his having the knowledge of the filing of the award.

A perusal of the record of the Court below does not lead us to the conclusion that the revision petitioner had the knowledge of the filing of the award before 7-6-55 when the award was received in Court from the Collectorate office: As there was no valid award filed in court till 7-6-55, there was no question of limitation having started to run against the revision petitioner. The petition filed by the revision petitioner on 5-7-55 was, in our opinion, within time and the Court below was not right in coming to the conclusion that it was beyond time. As the court below has not considered this petition, this case will have to go back.

12. The revision petition is allowed, the order of the Court below is set aside and the case is remanded to that court with a direction that (it ?) should dispose of the matter after taking into consideration the petition of the revision petitioner dated 5-7-55. Costs of this revision to abide the result in the lower court. As the case is a very old one having been instituted in 1955, we direct the court below to dispose of the case as expeditiously as possible.


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