Skip to content


Kanchhed Mal Vs. Ganga Prasad and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtAllahabad
Decided On
Reported inAIR1937All582
AppellantKanchhed Mal
RespondentGanga Prasad and ors.
Excerpt:
- - the learned munsif who heard these objections came to the conclusion that the conduct of the arbitrator was perfectly fair and honest and that he had proceeded, in the fairest manner possible. it was, argued on behalf of the plaintiffs that the conduct of the arbitrator did not amount to a refusal to act and therefore the award which he made was perfectly valid and binding between the parties. on the trial of the suits he may succeed and there may be no occasion for him to complain of the order passed by the learned subordinate judge......and dismissed the claim. the plaintiffs appealed to the lower appellate court and the learned civil judge who heard the appeal came to the conclusion that the learned munsif was wrong in setting aside the award and eventually reversed the decree of the court below and decreed the plaintiffs' suit in terms of the award. it is against that decision that the present appeal is preferred.2. as i have stated previously, the parties during the proceedings before the learned munsif referred the matters in dispute to the arbitration of one shyam lal and this appears to have been done on 9th december 1931. the defendants soon changed their minds and on 7th january 1932 they made an application to the court to recall the reference to arbitration on the ground that the arbitrator had been.....
Judgment:

Harries, J.

1. This is a defendant's appeal against a decree of the lower appellate Court reversing a decree of the Court of first instance dismissing the plaintiffs' claim. The plaintiffs' suit was for a declaration that he was the owner of certain property set out in the plaint, and during the course of the proceedings in the Court of the learned Munsif the parties agreed to refer the questions in dispute to arbitration. Consequently one Shyam Lal was nominated as arbitrator, and in due course he made his award. The learned Munsif however set aside this award on the ground that at one stage in the proceedings the arbitrator appointed had refused to act and that thereafter he had no jurisdiction to make an award relating to the matters in dispute. Having set aside the award, the learned Munsif considered the plaintiffs' claim upon its merits and dismissed the claim. The plaintiffs appealed to the lower appellate Court and the learned Civil Judge who heard the appeal came to the conclusion that the learned Munsif was wrong in setting aside the award and eventually reversed the decree of the Court below and decreed the plaintiffs' suit in terms of the award. It is against that decision that the present appeal is preferred.

2. As I have stated previously, the parties during the proceedings before the learned Munsif referred the matters in dispute to the arbitration of one Shyam Lal and this appears to have been done on 9th December 1931. The defendants soon changed their minds and on 7th January 1932 they made an application to the Court to recall the reference to arbitration on the ground that the arbitrator had been influenced by the plaintiffs. Upon this application of 7th January 1932 the Court passed an order that the arbitrator should make his award after giving due notice to the parties concerned. On 14th January 1932, another application was made to the Court praying that the reference to arbitration be recalled and this was ordered to be put up on 18th January 1932 on which date the Court ordered it to be filed. It appears that on 7th January 1932 the defendants, who had on that date made their first application to the Court to recall the arbitration, also sent a communication to the arbitrator, Shyam Lal, asking him not to proceed with the arbitration as the Court had been moved to set aside the reference. On receipt of this communication from the defendants, the arbitrator on 18th January 1932 sent back the papers to the Court with the remark that he was sending back the papers to the Court because Kanchhed Mal did not wish him to arbitrate and also because in future he would have no leisure to carry out the work. The order of the Court upon the defendants' application to recall the reference was communicated to the arbitrator on the following day, namely, 19th January 1932. That order, as I have stated, directed the arbitrator to make his award after consulting the parties. On receipt of this order the arbitrator wrote to the Court that he had already returned the papers but if the papers were sent back to him he would have no objection to arbitrate. The papers were sent back to the arbitrator and the time for delivering the award extended. In due course the arbitrator on 23rd February 1932 made his award which was filed in Court.

3. Against this award certain objections were filed and the defendants assailed the award on three grounds : (1) That the arbitrator was related to the plaintiffs and was intimate with them and had colluded with them. (2) That there was no meeting held. (3) That the award was not sustainable. It should be observed that no specific objection was raised on the ground that no award could possibly have been made after the arbitrator had returned the papers and had refused to act. The learned Munsif who heard these objections came to the conclusion that the conduct of the arbitrator was perfectly fair and honest and that he had proceeded, in the fairest manner possible. He however held that as the arbitrator had returned the papers on 18th January 1932 he could not thereafter act as arbitrator and make an award. The return of the papers by the arbitrator in the circumstances was tantamount to a refusal to act and consequently he had no jurisdiction thereafter to consider the matter and make an award. The learned Munsif thereupon set aside the award of Shyam Lal and heard the case upon its merits. He found in favour of the defendants and dismissed the plaintiffs' claim.

4. Before the lower appellate Court it wag contended that the learned Munsif was wrong in setting aside the award. It was, argued on behalf of the plaintiffs that the conduct of the arbitrator did not amount to a refusal to act and therefore the award which he made was perfectly valid and binding between the parties. The lower appellate Court came to the conclusion that the arbitrator had not in fact refused to act, though he had returned the papers, and that he had jurisdiction throughout to determine the questions and to make his award. It would appear that the validity of the award was not seriously challenged in the lower appellate Court upon the ground of partiality or misconduct. As I have stated, the learned Munsif found that the conduct of the arbitrator had been everything which it should be, and the learned Civil Judge points out in the concluding portion of his judgment that there was nothing found to vitiate the award under Para. 15, Schedule 2, Civil P.C. In other words, there was no ground whatsoever suggesting that the arbitrator was guilty of any misconduct or had colluded in any way with the plaintiffs, Holding as he did that the award had been wrongly set aside, the learned Civil Judge allowed the appeal, set aside the decree of the learned Munsif and decreed the suit in terms of the award.

5. In the first place it is argued before me by Mr. Pathak on behalf of the appellant that the learned Civil Judge could not, on appeal to him from the learned Munsif, hold that the order of the learned Munsif setting aside the award was invalid. It is argued that from such an order there is no appeal and that is so. An order setting aside an award is not amongst appealable orders set out in Section 104 and Order 43, Rule 1, Civil P.C. Consequently it is argued that if the lower appellate Court is entitled to go into this matter in appeal, it is tantamount to allowing an appeal from the order setting aside the arbitration. On the other hand it is argued by Mr. Chandra Bhan Agarwala that the learned civil Judge had a right to consider the legality or propriety of the order setting aside the arbitration by reason of Section 105, Civil P.C. On behalf of the appellant a number of cases have been cited before me which show that in circum. stances such as existed in the present case an appellate Court was held to have no right to consider the propriety of an order setting aside an award. This point was expressly decided in Ganga Prasad v. Kura (1906) 28 All. 408. It is to be observed however that in this case which was decided by a Bench, no reference whatsoever is made to Section 591, Civil P.C., then in force which corresponds to Section 105 of the present Code. The learned Judges held that as there was no appeal from the order setting aside an award, the propriety of that order could not be questioned on appeal. This case was followed by a single Judge of this Court in Kalyan Das v. Pyare Lal (1907) 4 A.L.J. 256.

6. Counsel for the appellant also relies upon a recent Full Bench case of this Court, namely the case in Radha Mohan Datt v. Abbas Akli Biswas : AIR1931All294 . In that case the meaning of the words 'affecting the decision of the case' in Sub-section (1), Section 105, Civil P.C., is considered. This Full Bench case is not concerned with orders setting aside awards and is merely relied upon by the appellant for the meaning of the words 'affecting the decision of the case'. It was held that those words in Section 105, Sub-section (1), Civil P.C., must be construed in the sense of affecting the decision of the case on the merits. The words 'on the merits' are not to be found in the sub-section, but this must be supplied by necessary implication, being necessarily involved in the connotation of the word 'affect', having regard to the context. In my judgment however this case is concluded by direct and recent authority which binds me sitting as a single Judge. In Ram Antar Tewari v. Deoki Tewari A.I.R. 1915 All. 247 it was expressly held by a Bench of this Court that an order of a Court setting aside the award of an arbitrator, and deciding that the case shall be tried by the Court, is an order affecting the decision of the case within the meaning of Section 105, Civil P.C. and is therefore liable to be challenged in appeal against the decree. At p. 460 the learned Judges remark:

It has been held that the words 'affecting the-decision of the case in Section 105, mean 'affecting, the decision of the case on the merits,' but even 80 we think that the order of the Munsif setting, aside the award was liable to be challenged in appeal against the decree.

7. Giving the words 'affecting the decision' of the case' the meaning given to them in the Full Bench case in Radha Mohan Datt v. Abbas Ali Biswas : AIR1931All294 , yet I am bound to hold upon the authority of Ram Autar Tewari v. Deoki Tewari A.I.R. 1915 All. 247 that the order of the learned Munsif in this case could be considered by the learned civil Judge in appeal. The learned Judges, who decided the case in Ram Autar Tewari v. Deoki Tewari A.I.R. 1915 All. 247, relied upon earlier cases of this Court, in particular Nanak Chand v. Ram Narain, a Full Bench decision reported in Nanak Chand v. Ram Narain (1878) 2 All. 181, and a later Bench decision, Ram Jiwan v. Nawal Singh (1908) 5 A.L.J. 644. This latter case Ram Jiwan v. Nawal Singh (1908) 5 A.L.J. 644, is directly in point and the same decision was arrived at as in Ram Autar Tewari v. Deoki Tewari A.I.R. 1915 All. 247. The Full Bench case Nanak Chand v. Ram Narain (1878) 2 All. 181 is also strongly in favour of the view taken by the Court below in this case, though the precise point argued before me does not appear to have been argued in that Full Bench case. The matter does not rest there because in two recent cases learned Judges of this Court have approved of the decision in Ram Autar Tewari v. Deoki Tewari A.I.R. 1915 All. 247. In Shah Muhammad Fakhruddin v. Rahimullah Shah : AIR1925All458 a Bench of this Court held that no application in revision would lie from an order setting aside an award, but at p. 122 they pointed out that the applicant was not without his. remedy. They stated:

We may add that the applicant is not without his remedy. On the trial of the suits he may succeed and there may be no occasion for him to complain of the order passed by the learned Subordinate Judge. If the decision on the merits goes against him he can appeal on the merits of the case and also urge the ground that the trial Court ought to have accepted the compromise and the award as final between the parties.

8. In Rudra Prasad v. Mathura Prasad : AIR1925All566 a Bench of this Court, held that no application in revision would lie against an order superseding an award made in a pending case and directing the suit to proceed on the merits, but they pointed out that if the suit ultimately went against the applicant, it would be open to him to attack the order superseding the arbitration under the provisions of Section 105, Civil P.C. For these reasons I am bound to hold that there is nothing in the Full Bench case Radha Mohan Datt v. Abbas Ali Biswas : AIR1931All294 , which throws any real doubt upon the view of the learned civil Judge that he could on appeal to him consider the legality and propriety of the order of the learned Munsif setting aside the award in question. The matter is in my view concluded by abundant authority which is binding upon this Court. Holding as I do that the learned civil Judge could go into the merits of the order setting aside the award, it is necessary to consider whether the decision of the learned civil Judge is right. He held that there had been no refusal by the arbitrator to act, and consequently there was no ground whatsoever for setting aside the award.

9. It is true that the arbitrator in this case did return the papers to the Court with a note that he was doing so as one of the defendants did not wish him to act and also because he had no leisure in future to carry out the task. That he never intended to refuse to act is quite clear because on the following day he, after receipt of the Court's order, asks that the papers be returned to him and informs the Court that he would be prepared to carry on the arbitration. Upon a fair reading of the note made by the arbitrator when he returned the papers, it would appear that all he intended was to intimate to the Court that he did not wish to carry out his duties as arbitrator if the parties did not desire him to do so and in any event that he was not anxious to perform the work because of the fact that he had little leisure to do so. This communication of the arbitrator cannot be regarded as a flat refusal to act. The learned civil Judge was in my mind entitled to regard the subsequent conduct of the arbitrator in order to assist him in ascertaining whether or not there had been a refusal by the latter to act. In my judgment this case is very similar to the case in Mahadeo Prasad v. Badri Das : AIR1928All740 in which a Bench of this Court held that in'very similar circumstances the act of the arbitrators in sending in their resignation did not amount to a refusal to act. The Court is allowed to inquire into all the circumstances to ascertain what the arbitrator really meant and intended. In Joy Mungul Singh v. Mohun Ram (1875) 23 W.R. 429, it was actually held by their Lordships of the Privy Council that an arbitrator, who wrote in these terms, 'I can discover no other alternative to be-left me than herewith to submit my resignation,' was not functus officio and had never formally divested himself of his character of arbitrator.

10. In my judgment there was material in this case upon which the lower appellate-Court could find that Shy am Lai, the arbitrator, had not refused to act in this case and had not divested himself of his character as an arbitrator, and that being so the award which he made could not be attacked on that ground. As I have stated, the learned civil Judge finds that no ground for attacking the award was made-out under para. 15, Schedule 2, Civil P.C. and. that being so the award should never have been set aside by the learned Munsif. In my opinion the learned civil Judge was right in holding that the award was improperly set aside and that it was a valid and subsisting award which bound the parties and consequently he rightly allowed the appeal and decreed the suit in terms of the award. For the reasons which I have given, this appeal is dismissed with costs and the decree of the lower appellate Court confirmed. As there is considerable conflict of authority in this case, leave to appeal under the Letters, Patent is granted.


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