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Shambhu Dayal and ors. Vs. Pt. Basdeo Sahai - Court Judgment

LegalCrystal Citation
SubjectArbitration
CourtAllahabad High Court
Decided On
Case NumberCivil Revn. No. 1200 of 1963
Judge
Reported inAIR1970All525
ActsCode of Civil Procedure (CPC) , 1908 - Sections 115; Arbitration Act, 1940 - Sections 12, 14, 17, 23, 30, 38, 38(1) and 39; Hindu Law; Evidence Act, 1872 - Sections 114
AppellantShambhu Dayal and ors.
RespondentPt. Basdeo Sahai
Appellant AdvocateR.B. Pandey, Adv.
Respondent AdvocateD.S. Tewari, ;C.P. Srivastava and ;Naresh Chandra, Advs.
DispositionRevision allowed
Excerpt:
(i) civil - power of revision - section 115 of code of civil procedure, 1908 - whether order of setting aside of award is subject to revision - setting aside of award amounts to a 'case decided' - order is revisable under section 115. (ii) arbitration - misconduct - sections 30, and 38 of arbitration act, 1940 - excess fee demanded and failed to decide on an issue - issue not important to actual decision of matter - held, demand of excess fee will not amount to misconduct - neither will his omission in deciding an issue which was not important. - - i, however, think it proper to examine the question and not to rest my decision thereon on the concession of the learned counsel, particularly because in some cases of this court it has been clearly held that an order setting aside an award.....gangeshwar prasad, j. 1. this application in revision has been, laid before this full bench upon a reference made by dhavan, j. it is directed against an order of the judge small cause court, agra (exercising the powers of a civil judge) by which he reversed in appeal an order of the munsif fatehabad, agra, refusing to set aside an award and sent back the case t9 him with the direction to hear, and decide the suit in which the award was given.2. the relevant facts are these. basdeo sahai, plaintiff, filed suit no. 121 of 1949 in the court of the civil judge, agra, against gauri shanker, basant lal and sukh ram for a declaration that he was in possession of the property in suit which is a house situate in qasba fizabad, district agra as its exclusive owner and that the defendants had no.....
Judgment:

Gangeshwar Prasad, J.

1. This application in revision has been, laid before this Full Bench upon a reference made by Dhavan, J. It is directed against an order of the Judge Small Cause Court, Agra (exercising the powers of a Civil Judge) by which he reversed In appeal an order of the Munsif Fatehabad, Agra, refusing to set aside an award and sent back the case t9 him with the direction to hear, and decide the suit in which the award was given.

2. The relevant facts are these. Basdeo Sahai, plaintiff, filed Suit No. 121 of 1949 in the court of the Civil Judge, Agra, against Gauri Shanker, Basant Lal and Sukh Ram for a declaration that he was in possession of the property in suit which is a house situate in Qasba Fizabad, district Agra as its exclusive owner and that the defendants had no right to disturb his possession over it in any manner. The suit was transferred to the court of the Munsif Fatehbad, Agra, by an order of the District Judge. During the pendency of the suit Gauri Shanker and Basant Lal defendants died and their heirs were brought on record. The case of the plaintiff was that the house in suit was the self-acquired and exclusive property of Saktoo who was an adopted son of Mukund and his wife and who succeeded to the entire property left by them as such. It was alleged that after the death of Saktoo his property devolved upon his son Gur Dayal and that the plaintiff was the son of Gur Dayal's sister, Smt. Jamuna Devi. It was further alleged that Gur Dayal executed a will dated. January 16, 1916 providing that after his death his entire property would go to his wife Smt Gulab Kuer and that the plaintiff would become the owner thereof after the death of Smt. Gulab Kuar. In accordance with the provisions of the aforesaid will Smt. Gulab Kuar got the property left by her husband and she too executed a will dated May 4, 1947,bequeathing all her property to the plaintiff. The plaintiff laid claim to the house in dispute under the two wills mentioned above and, alternatively, as an heir of Gur Dayal by virtue of being his sister's eon. The plaintiff asserted that he had been exercising rights of ownership in the disputed house but as the defendants had recently put forward a claim in respect of it by filing an objection under Order XXI, Rule 100, C.P.C. in proceedings for execution of a decree for ejectment obtained by him against a tenant of the house and as their objection had been allowed he was compelled to institute the suit. The defendants resisted the suit and repudiated the title of the plaintiff. They denied that the plaintiff was Gur Dayal's sister's son or related to Gur Dayal in any manner and stated that neither Gur Dayal nor his widow Smt. Gulab Kuar had executed any will. They further contended that the house in dispute had been acquired by Saktoo from joint family funds, that his son Gurdayal was the owner thereof by right of survivorship after the death of Saktoo, that Gur Dayal had adopted as his son one Raghubir Prasad who died six months after the death of Gur Dayal and that Smt. Gulab Kuar inherited the house thereafter as a limited owner. According to the defendants, neither Gur Dayal nor his widow Smt Gulab Kuar was competent to execute any will in respect of the house and the wills, if executed, were totally ineffective.

3. During the pendency of the suit the parties agreed that the whole matter in difference between them in the suit be referred to the arbitration of Sri Mathura Prasad Kacker, an Advocate of Agra, and the learned Munsif, accordingly, made a reference on September 21, 1951. Sri Mathura Prasad Kacker entered upon the arbitration and after hearing the parties, taking the evidence produced by them and making a local inspection gave an award on January 5, 1953. According to the award the plaintiff was not entitled to any relief and his suit was to be dismissed with costs. The plaintiff preferred objections to the award but they were rejected by the Munsif who pronounced judgment in terms of the award and dismissed the suit with costs on April 18, 1953. On an appeal filed by the plaintiff, the predecessor-in-office of the learned Judge who passed the order under revision set aside the order of the Munsif and sent back the case to him with tne direction, that he should remit the award to the arbitrator and then dispose of the case according to law. Against the said appellate order the plaintiff came up in revision to this court. On April 14, 1961, that revision was allowed, the order passed in appeal was set aside and the case was sent back to the appellate courtfor being decided afresh. The case was, accordingly, reheard and the order against which this application in revision Is directed was passed on July 18, 1963.

4. The legality of the award was assailed before the appellate Judge on three grounds viz., that the omission of the arbitrator to decide the question of adoption of Saktoo amounted to misconduct on his part, that the award was given beyond time and that the arbitrator accepted as his remuneration an amount in excess of what had been fixed by the court and he also accepted from the plaintiff a fee for inspecting the house in dispute. The learned Judge found no force in the second ground mentioned above but the remaining two grounds commended themselves to him and he set aside the award as being vitiated by misconduct of the arbitrator.

5. The first question that arose for consideration before Dhavan, J. was whether by means of the order of the appellate Judge setting aside the award any case can be said to have been decided within the meaning of Section 115 of the Code of Civil Procedure, and it was on account of the conflict that the learned Judge found in the decisions bearing on the question that he made the reference as a result of which this application in revision came up before this Bench. At the hearing before us, Sri N. C. Upadhya-ya, learned counsel for the plaintiff, conceded that the order under revision amounts to a case decided and my brother Hari Swarup, J. has, therefore, not thought it necessary to discuss this question in his judgment which I have had the advantage of reading. I, however, think it proper to examine the question and not to rest my decision thereon on the concession of the learned counsel, particularly because in some cases of this court it has been clearly held that an order setting aside an award is not a decision of a case within the meaning of Section 115 of the Code of Civil Procedure.

6. The most important case of this court dealing specifically with this question is the Full Bench case of Govind Das V. Mst. Indrawati, : AIR1938All557 where all the earlier cases of this court were reviewed and some cases of other High Courts were also referred to. It would, however, appear that Bennet Ag. C. J. who delivered the judgment of the Full Bench really based it on some earlier cases of this court in which it was held that the order superseding an arbitration and setting aside an award would not amount to a case decided, and the only reason which he himself gave in support of the above view was that since Section 104 of the Code of Civil Procedure did not provide for an appeal against an orderunder Para 15 of the Second Schedule to the Code it appeared that the Code did not intend that such an order should be the subject of reference to the higher courts.

The earliest case of this court referred to in the judgment of the Full Bench is Chattar Singh v. Lekhraj Singh, (188S) ILR 5 All 293 in which the termination of a proceeding for arbitration was held not to be a decided case for the purpose of a revision under Section 622 of the former Code of Civil Procedure on the ground that the proceeding was of an interlocutory character only. The next case to which reference was made is Budhoo Lal v. Mewa Ram AIR 1921 All 1 (FB) decided by a Full Bench of five Judges. The question involved in that case was whether the decision of an issue relating to the jurisdiction of a court to try a case amounted to a decision of a case for the purpose of Section 115 of the Code of Civil Procedure, and the majority view was that it did not amount to such a decision. It would be seen that all the cases of this court in which it was held that an order superseding an arbitration and setting aside an award does not amount to a case decided were founded on Budhoo Lal's case. Muhammad Fakhruddin v. Rahimullah Shah : AIR1925All458 ; Rudra Prasad Pahdey v. Mathura Prasad Pandcy : AIR1925All566 ; Risal Singh v. Faqira Singh : AIR1932All452 and Tulsi Ram v. Bindaban Das, 1936 All LJ 547 which took the view that was accepted by the Full Bench in : AIR1938All557 based themselves entirely on Budhoo Lal's case, AIR 1921 All 1 (FB) and indeed, they proceeded on the footing that Budhoo Lal's case, AIR 1921 All 1 (FB) left no scope for a different view.

The decision in AIR 1921 All 1 (FB) has, however, been expressly overruled by the Supreme Court in S.S. Khanna v. F.J. Dillon : [1964]4SCR409 , and the very foundation of the Full Bench decision in : AIR1938All557 and all other decisions referred to above has, therefore, been completely destroyed and they must be regarded as having altogether lost their authority. The consideration from which Bennet Ag. C. J. derived support for the opinion expressed by him in the case of Govind Das is also out of quettion now in view of the fact that Section 39 of the Arbitration Act of 1940 specifically provides for an appeal against an order setting aside an award and it can no longer be urged that such an order is not intended to be challenged before a higher court separately from and independently of the decree that may ultimately be passed in the suit in which the award has been made.

7. In : [1964]4SCR409 , (supra) it was observed that the view taken in BudhooLal's case proceeded upon the fallacy that because the expression 'case' includes a suit in defining the limits of the jurisdiction conferred upon the High Court the expression 'suit' should be substituted in the section when the order sought to be revised is an order passed in a suit, and their Lordships held that the expression 'case' is one of comprehensive import and it includes civil proceedings other than suits and is not restricted by anything contained in the section to the entirety of the proceedings in a Civil Court. On the authority of the above decision of the Supreme Court it has been recently held by a Full Bench oi five Judges in Rama Shanker Tewari v. Maha Deo, 1968 All LJ 109 that even an order allowing or refusing an amendment of a pleading under Order VI, Rule 17 C.P.C. is a case decided within the meaning of that expression in Section 115 C.P.C. and the Full Bench case of Mst. Suraj Pal v. Ariya Pratinidhi Sabha, : AIR1936All686 in which a contrary view was expressed has been overruled. An order setting aside an award stands on a much higher footing than an order allowing or refusing amendment of a pleading and the reasons for holding that it amounts to a case decided are much weightier. Such an order does not merely dispose of a branch of the suit or mark the termination of a stage of the suit; it precludes decision of the suit in accordance with the award and opens the controversy which would be set at rest if the award is not set aside. The provision for an appeal against such an order also indicates that the legislature intended that the question whether an award should be sustained or set aside has to be decided by a higher court prior to and independently of the appeal against the decree which may eventually be passed as a result of the setting aside of the award. It seems, therefore, clear that an order setting aside an award decides a case within the meaning of Section 112 C.P.C. and is revisable under that section.

I may here call attention to the Division Bench decision of this Court in Mohd. Yakub Khan v. Sirajul Haq, : AIR1949All771 . In that case an appellate Court had disposed of the appeal before it by setting aside an award and a decree passed thereon by the trial Court and had ordered that the suit in which the award was made be heard on merits. On a revision filed against the appellate order it was held that there was a case decided within the meaning of Section 115 C.P.C. and the order was open to revision. The Full Bench case of : AIR1938All557 was distinguished by the Division Bench on the basis that in the aforesaid case the trial Court had itself decided that the award in question was invalid and the order setting aside the award was thusan interlocutory order but in the case before the Division Bench the award had been set aside by the appellate Court and the appeal had been completely disposed of.

It was also pointed out by the Division Bench that : AIR1938All557 was decided before the coming into force of the Arbitration Act of 1940 which provides for an appeal against an order setting aside an award. In- view of the pronouncement of the Supreme Court in S, S. Khanna's case it would not be correct to say that no interlocutory order is open to revision and the decision in : AIR1938All557 cannot, therefore, be now regarded as good law. In the instant case tod, as in the case of : AIR1949All771 the order setting aside an award was passed by the appellate Court and it can consequently be said that the appeal has been completely disposed of by the appellate Court. This would be a sufficient answer to an objection against the maintainability of an application in revision against the appellate order; but I would base my decision on the broader ground that a revision would lie against an order setting aside an award no matter whether such an order passed by the trial Court has been confirmed in appeal or whether it has been passed in appeal by reversing a contrary order passed by the trial Court. By means of the order under a revision a case has, in my opinion, been decided within the meaning of Section 115, Civil P. C. and the revision is clearly entertainable.

8. What has then to be considered is whether in holding that the arbitrator was guilty of misconduct in the arbitration proceedings the learned Civil Judge can be said to have exercised a jurisdiction not vested in him by law or to have acted in the exercise of his jurisdiction illegally or with material irregularity. In the circumstances of the case it, however, appears to me necessary that I should first examine the finding of the learned Civil Judge as to misconduct of the arbitrator and the reasons on which it is founded and then proceed to a consideration of the above question, As noted above, the learned Civil Judge held that the omission on the part of the arbitrator to decide the question of adoption of Saktoo and the acceptance by the arbitrator of a remuneration in excess of the amount fixed by the Court and of a fee for local Inspection constituted acts of misconduct, I will deal with these items in the order in which they have been stated.

9. In paragraph. 3 of the plaint It was stated by the plaintiff that the property in suit was a self-acquired and exclusive property of Saktoo. In paragraph 3 of the written statement filed by the defendants it was admitted that the disputedproperty had been purchased by Saktoo but in paragraph 24 it was alleged that the property had been acquired by Saktoo out of joint family funds. On the plaintiff's case his claim did not at all depend upon the fact of adoption, although he' did state in paragraph 2 of the plaint that Saktoo was an adopted son of Mukund and his wife Smt Bhawani. The plaintiff based his title to the property on the two deeds of will mentioned above and on his being related to Saktoo's son, Gurdayal, as his sister's son. If these bases of his alleged title failed it was a matter of no consequence whatsoever the family in which he was born or was adopted by Mukund and Smt. Bhawani. The arbitrator found that the wills had not been proved and they were, at any rate, ineffective for the purpose of creating any title in the plaintiff. He further found that Saktoo had no daughter and the plaintiff was, therefore, not related to Gurdayal as his sister's son. In view of those findings the question whether Saktoo had been adopted by Mukund and Smt. Bhawani became devoid of all significance and the finding thereon could in no manner affect the findings actually recorded by the arbitrator or his ultimate decision regarding the title of the plaintiff.

It will be noticed that apart from saying that the contents of paragraph 2 of the plaint were not admitted the defendants did not in the written statement, say anything about the alleged adoption and no issue on the question of adoption was framed by the trial Court. The only bearing that the question of adoption could have on the controversy between the parties was that in the event of an adoption Raghubir (who was found by the arbitrator to have been adopted as a son by Gurdayal) could be the only coparcener of Gurdayal and the members of the family of Gudayal's natural father could not have remained his coparceners, with the result that the existence of Raghubir alone could render Gurdayal incompetent to execute the will which he was alleged to have executed In case the property in dispute was a coparcenery property. If, however, the will alleged to have been executed by Gur Dayal was not really executed by him or the plaintiff failed to satisfy the arbitrator of its execution no question as to the competency of Gurdayal to execute it could arise, It is true that after unhesitatingly discarding the will and expressing the definite opinion that the plaintiff had failed to prove the will said to have been executed by Gurdayal the arbitrator also held it to be unenforceable and observed: 'As such I am inclined to hold that this property was not his self-acquired property and as such he was not competent to dispose of it by will especially as Raghubir had been adopted by him as I am holding under Issue No. 4,' Inview of the finding on the factum of the execution of the will, however, the additional finding as to the incompetency of Gurdayal to execute a will was entirely unnecessary.

Moreover, the existence of Raghubir could by itself create the incompetency if the house in suit was a coparcenery property and it cannot, therefore, be urged that the omission of the arbitrator to consider the question of adoption led to any error in the finding as to the ineffectiveness of the will. In any case, the acceptance of the plaintiff's case regarding adoption could in any manner either establish or improve his claim to the property in dispute in view of the clear finding of the arbitrator that the plaintiff had failed to establish that Gurdayal had made any will. The learned Civil Judge observed in his judgment that the question of adoption had an important bearing on the rights of the parties to the property in dispute but he did not give the least indication as to how it could have any bearing in face of the finding that Gurdayal had hot executed the will set up by the plaintiff. Reference was made by the learned Civil Judge to Khublal v. Bishanbhar Sahai : AIR1925All103 where it was observed by a Division Bench of this Court that if an arbitrator chooses to undertake the decision of a variety of matters with the consent of the parties, and he deliberately or by an oversight without the consent of the parties omits from his decision anything really material it is sufficient to destroy the award. I have already pointed out that a decision on the question of adoption became wholly immaterial after a finding that the will which Gurdayal was said to have executed had not been executed by him. The observations relied upon by the learned Civil Judge really support the award in question inasmuch as they necessarily imply that if the decision of a matter is not material for the decision of the dispute before the arbitrator his omission to decide that matter does not vitiate the award. I may further note that in above case the award was actually upheld because the Court found that the task which the arbitrator had omitted to perform by means of the award, was in the circumstances, impossible for him to perform.

And just as an award Is not liable to be set aside on the ground of the arbitrator's omission to perform a certain task which he had undertaken to perform, if the omission Is due to the fact that it Is not possible for him to perform it, an award is not liable to be set aside on the ground of the arbitrator's omission, deliberate or, by oversight to decide a matter which could not in any manner affect the ultimate actual decision of the dispute referred to arbitration. It may be that the matteromitted from decision could In the context of a certain finding, if given by the arbitrator, have assumed importance and could have a vital bearing on the ultimate decision; but that would not invalidate the award if on the findings actually given by the arbitrator the omission becomes wholly immaterial and no finding on the said matter could have altered the final conclusion reached by the arbitrator respecting the subject-matter of the dispute referred to him. In Madanlal v. Nabi Buksh, AIR 1947 Lah 177 it was held that there is no rule of law that an arbitrator must decide all the issues framed in the suit expressly as long as the whole suit is decided by him. To the same effect s the decision in S.K. Roy and Co. Ltd. v. Union of India, AIR 1955 NUC (Cal) 887 where it was observed that an arbitrator is not bound to give an award on each point raised and that if he gives an award on the whole case he would not be guilty of misconduct merely because he does not decide a specific issue.

It would be recalled that no issue on the question of adoption was framed by the trial Court and I may repeat that the necessity of a decision on that question did not arise in view of the other findings arrived at by the arbitrator. The arbitrator had to adjudicate upon the respective claims of the parties to the property in dispute and he was under no obligation to disclose the mental process by which he arrived at the adjudication. However, he did disclose in his award his method of approach to the matter in controversy and, his line of reasoning and they do not suffer from any error of law either by reason of omission to decide any matter or by reason of the nature of the decision actually given.

10. It was contended on behalf of the plaintiff opposite party that even if the alleged will of Gurdayal is ignored and his widow Smt. Gulab Kuar is regarded as having been in possession of the house In dispute as a life estate holder under the Hindu Law a will executed by her was not wholly ineffective, as the arbitrator thought, and it created in favour of the plaintiff a title which could be defeated or challenged only by the next reversioner. The. contention does not appear to me to be acceptable. In Mahalakshamma v. Vemi Reddi, AIR 1923 Mad 367 a Division Bench of the Madras High Court held that a person who claimed to be the legal representative of a woman under a will in respect of property possessed by her as a widow of her deceased husband was not entitled to be brought on record in her place. This decision was followed in A.R. Shrinivasachariar v. A. Raghavachariar, AIR 1924 Mad 676 where a legatee under the will of a Hindu widow by which she bequeathed her husband's property was held to have derived no titleunder the will and to have been incompetent to maintain a suit for ejectment even against a trespasser.

Relying on the above case and on some other cases, a Division Bench of the Patna High Court ruled in Jagdeo Singh v. Mst Raja Kuar, AIR 1927 Pat 262 that a legatee under a will made by a Hindu widow in respect of her husband's property takes no interest whatsoever in that property because the widow is incapable of creating any interest beyond her life time. Reference may also be made to Tejmal v. Sawaii, AIR 1931 Nag 194 where it was held that a Hindu widow is incompetent to make a testamentary disposition of the property which devolves on her from her husband. I am in respectful agreement with the view taken in the above cases and it seems to me obvious that a person acquires no interest at all under a will from a Hindu widow in respect of her husband's property held by her as such and that a claim based on a will of that kind is unenforceable not only against the next reversioner but even against a. person in wrongful possession of the property. A will, unlike a transfer inter vivos operates only after the death of the testator and since the interest of a Hindu widow holding her husband's property as such terminates upon her death the interest possessed by her is incapable of devolving upon the legatee. The view of law taken by the arbitrator cannot, therefore, be said to be erroneous and in fact it has abundant authority in support of it. But I may again point out that the arbitrator did not find that even the execution of the will alleged to have been executed by Smt. Gulab Kuar had not been satisfactorily established.

11. I may now pass on to the chargeof misconduct based on the arbitrator's acceptance of a remuneration in- excess of the amount fixed by the Court It cannot be disputed that the arbitrator, who was an advocate, was entitled to reasonable remuneration for acting as such. Even if the fee of arbitrator had not been fixed by the Court before making a reference, the arbitrator could have claimed a fair and reasonable amount of fee for the performance of the task entrusted to him. In Llandrindad Wells Water Co. v. Hawksley, (1904) 20 TCR 241 it was observed that where the parties have chosen their own arbitrator they must be taken to have intended to pay him at the rate ordinarily charged by reason of his experience and they must pay his fees unless it is proved that the charges are extortionate. This case was cited in Girdharilal v. Surendranath Mukerjee, and followed in Bulchand Khimandas v. Thakurdas Udhavdas, AIR 1933 Sind 300. It will be noticed that the Arbitration Act, 1940 does not provide for the fixation ofthe fee of the arbitrator by the Court at the time of making reference to arbitration nor at any time prior to the award, presumably because it is not possible for the Court to have a correct idea of the magnitude of the task which the arbitrator is called upon to perform or 'the quantity of work which he would be required to do. The arbitrator too is not in a position to know before hand the time and the labour which the arbitration proceedings would demand and his fair and proper remuneration for conducting them. It is only when the proceedings are over and the award has been made that a proper assessment of the remuneration of the arbitrator can be made and that seems the reason why the Act makes provision for assessment of the fee of the arbitrator by the Court after the making of the award. Section 14(1) of the Act provides that when the arbitrator has made his award he shall sign it and shall give notice to the parties of the making and signing thereof and of the amount of fees and charges payable in respect of the arbitration and the award.

Under Section 14(2) the duty of the arbitrator to cause the award or a signed copy of it to be filed arises only upon payment of the fees and charges due in respect oS the arbitration of the award. These provisions are in Chapter II which deals with arbitration without the intervention of a Court, but by virtue of Section 25 they apply, as far as they can be made applicable, to arbitration in suits as well. Then there is Section 38 in Chapter V which applies to all arbitrations. That section runs as follows:--

'Section 38(1):-- If In any case an arbitrator or umpire refuses to deliver his award except on payment of the fees demanded by him, the Court may, on an application in this behalf, order that the arbitrator or umpire shall deliver the award to the applicant on payment into Court by the applicant of the fees demanded, and shall, after such inquiry, if any, as it thinks fit, further order that out of the money so paid into Court there shall be paid to the arbitrator or umpire by way of fees such sum as the Court may consider reasonable and that the balance of the money, if any, shall be refunded to the applicant.

(2) An application under Sub-section (1) may be made by any party to the reference unless the fees demanded have been fixed by written agreement between him and the arbitrator or umpire, and the arbitrator or umpire shall be entitled to appear and be heard on any such application.

(3) The Court may make such orders as It thinks fit respecting the costs of an arbitration where any question arises respecting such costs and the award contains no sufficient provision concerning them.'

Both these sections viz. 14 and 38 being applicable to arbitrations they have to be construed harmoniously and in a manner that gives, effect to both of them and does not render either of them redundant or nugatory. Now Section 39(1) contemplates or includes both a situation in which the fee of the arbitrator has not been previously fixed and a situation in which the fee has been fixed, and in either of these situations it empowers the Court to order delivery of the award to the applicant on payment into Court of the fee demanded by the arbitrator and then to direct that out of the fee so deposited the arbitrator shall be paid such sum as the Court considers reasonable. The obvious implication and effect of Section 32(1), therefore, is that the mere fact that the fee of the arbitrator has been fixed does not preclude the arbitrator from demanding an amount in excess of what has been fixed nor does it preclude the Court from ordering payment of a lee in excess of what has been fixed even though there may be nothing to expressly indicate that the fixation was only of a tentative nature, In determining what would be the reasonable fee of the arbitrator the Court will certainly take into account what fee, if any, has been previously fixed but it has the power to order payment of such higher fee as it considers reasonable. It will also be seen that if a party making an application under Section 38(1) has agreed by means of a written agreement between himself and the arbitrator to pay the fee demanded by the arbitrator. Section 38(2) bars the making of such an application. This agreement may as far as the applicant is concerned, fix the fee for the first time or even vary the fee. originally fixed and in either case It will prevent the making of an application under Section 38(1).

In arbitrations in suits the fixation of the arbitrator's remuneration prior to his entering upon the arbitration may be done In two ways viz. by an agreement between the parties or by an order of the Court. There is, as I have already said, no specific provision in the Act for fixation of the arbitrator's fee by the Court prior to the making of reference but an order to that effect cannot be said to be incompetent because the Court has the power to ultimately determine in the event of an application made under Section 38(1), what would be the reasonable fee of the arbitrator. If, after the fixation of fee by the Court, the parties choose to proceed with the arbitration and the arbitrator enters upon it, an agreement between the parties and the arbitrator is implied in their conduct. But, whether the fixation of the fee at this stage rests on the basis of anagreement or an order of the Court it cannot be regarded as final and is subject to variation both by subsequent agreement and by order of the Court. The agreement, if it is to operate as a bar to an application under Section 38(1), has to be in writing; but that does not mean that no other kind of agreement can either be made or taken into consideration by the Court. It is open to the parties to the reference to fix or enhance the fee of the arbitrator just as it is open to the Court to do so. Section 14(2) empowers the Court to direct the arbitrator, upon payment of the fees and charges due in respect of the arbitration and of the costs and charges of filing the award, to cause the award or a signed copy of it to be filed in Court.

What meaning Is to be attached to the word 'due' may be a question of some controversy because if there has been no agreement between the parties or, in the case of an arbitration in a suit, there has been neither an agreement between the parties nor an order of the Court the amount 'due' as fee can mean either an amount regarded as due by the arbitrator or determined as payable to the arbitrator by the Court, But whatever meaning may be ascribed to the expression 'due' occurring in Section 14(2) or to the word payable in Section 14(1) there seems to be no doubt about the fact that an enhancement in the arbitrator's fee whether fixed by an agreement or by an order of the Court can be made by means of an agreement, express or implied, between the parties or by an order of the Court, and such an enhancement is permissible and is not outside the contemplation of the Act.

12. Where the enhancement in the fee of the arbitrator has been brought about by an agreement the propriety of the manner in which that has been done is, of course a matter of utmost importance. The arbitrator has to act throughout with complete fairness, candour and probity and there should be no element whatsoever of pressure, persuation, importunity, manipulation or secrecy in the conduct of the arbitrator in relation even to the fixation or enhancement of his fee nor should there be any attempt, on his part to charge a fee disproportionate to the work done by him or to take advantage of his position as an arbitrator, Further, if the fee of the arbitrator has originally been fixed by an order of the court it is undeniably proper and desirable that an order of enhancement of the fee be obtained from the Court and the enhancement should receive its sanction. But, if it is clear that the parties to the reference had agreed to an enhancement In the fee and it is also clear that the conduct of the arbitrator in relation, to enhancement was not tainted by any of the vices indicated above, the acceptance of the enhanced fee would not amount to misconduct and would not vitiate the award.

Let me now examine the circumstances relating to the remuneration of the arbitrator in the present case. The case was referred to arbitration on September 21, 1951 by an order of the Court providing that the arbitrator would get Rs. 100/- as fee in half and half from both the parties. The proceedings before the arbitrator continued for a long period of time and the award came to be made on the January 5, 1953. An idea of the protracted nature of the proceedings and the arduousness of the task performed by the arbitrator may be had from the order-sheet which the arbitrator maintained and which is on record. The order-sheet makes it evident that the proceedings must have consumed considerable time and energy of the arbitrator. The fee of Rs. 100/- fixed by the Court was obviously very inadequate and there can be no doubt that if the Court had foreseen the time and the labour that the arbitration would require it would have fixed a much larger amount and it would, in any case, have appreciably enhanced the fee under Section 38(1) of the Arbitration Act if an order under that provision had become necessary.

The arbitrator candidly mentioned in his award that the parties had paid him Rs. 100 each on account of his fee. This statement of the arbitrator, like a statement of a judge as to what took place before him in relation to a proceeding should be regarded as almost conclusive and at any rate its correctness has to be presumed unless there is strong proof to the contrary vide. In the Matter of the Arbitration Act and In the Matter of the Reference to Arbitration by M/s. M. Narsimhalu Chetty & Co. and P.S. Subraminia Ayer 75 Ind Cas 850 : (AIR 1924 Mad 274). In his objection dated January 4, 1953 filed against the award, the plaintiff stated that during the proceedings the arbitrator 'always impressed upon the parties that the case was very complicated and the fee awarded is very small and he would dismiss the case if further fee is not paid.' No allegation of any threat of the above kind or of any protest against the demand of a larger fee was, however, made in the application filed by the plaintiff in Court on January 3, 1953 i.e. just two days before the making of the award, although according to the evidence led by the plaintiff the demand was made long before the making of the award.

Indeed there was nothing in that application about the demand of an extra remuneration and all that was stated was that under some influence the arbitrator wanted to decide the case against the plaintiff and the arbitrator be, therefore, directed not to make an award and thearbitration proceedings before him be superseded. Having regard to this application the learned Munsif did not accept the allegation of the plaintiff regarding the threat of dismissal of his suit and, in my opinion, quite correctly and properly. It was not alleged by the plaintiff either in his objection or in his deposition before the Court that the additional sum was paid to the arbitrator entirely by the defendant. Even in his deposition he stated that he had refused to pay the extra fee of Rs. 50 demanded by the arbitrator from him and that the arbitratorhad told him of having received Rs. 50/-from the opposite party. If there was anything which must have found a mention in the application for superseding the arbitration made by the plaintiff on January 3, 1953 it was the fact of his refusal to the demand of extra fee of Rs. 50/-. The manifest conclusion is that the story that the plaintiff had not paid the extraamount of Rs. 50/- was an afterthought and was altogether untrue. The plaintiff, besides examining himself, examined one Mavasi Lal in support of the above allegation but the statement of the said witness too deserves to be totally rejected on the same ground.

Further, according to the statement of Mavasi Lal the demand was made prior to his being examined as a witness for the plaintiff before the arbitrator and the reply that the plaintiff opposite party gave to the demand was that he could not pay the amount unless ordered by the Court. If the allegation of the plaintiff opposite party had been true, it is inconceivable that the arbitrator should not have made an application to the Court for enhancement of his fee, that he should have proceeded or been allowed by the plaintiff to proceed with the arbitration, and that the plaintiff should have, without the least indication of any protest or dissatisfaction, taken part in the arbitration proceedings and later paid Rs. 30/- to the arbitrator for local inspection as he admits to have done. The irresistible conclusion from the fact and circumstances to the case is that regard being had to the time and labour involved in the arbitration proceedings and the gross inadequacy of the remuneration fixed by the Court the parties willingly agreed to pay and actually paid an extra fee of Rs. 50/- each to the arbitrator. The learned counsel for the plaintiff has urged that since the arbitrator was not examined as a witness in the case the allegation of the plaintiff stood uncontroverted and it should not be rejected. In regard to this argument J need only say that it was for the plaintiff to substantiate his objection to the award and this he altogether failed to do. The evidence adduced by a party may be rejected as untrue on account of its intrinsic defect and improbability without beingcontroverted, but here the evidence of the plaintiff is also effectively controverted by his own application dated January 3, 1953. The result is that although the advisable course for the arbitrator was to obtain an order for enhancement of his fee from the Court he was not guilty of misconduct in accepting an extra amount of Rs. 50/-from each of the two parties as his remuneration for arbitration.

13. I have not been able to lay my hand on any reported decision dealing with the situation resembling the one in the present case. There are, however, some authorities which may be taken as illustrating the proper view to be taken in the matter of acceptance of remuneration by an arbitrator from the parties to the reference to arbitration. In Subrava Prabhu v. Maniunath Bhakta, (1906) ILR 29 Mad 44 a Division Bench of the Madras High Court made the following observations:--

'Passing to the remaining contention on behalf of the respondent, we are unable to agree that in the circumstances of the case the acceptance by the arbitrators of the offer of a fee for their services involved any misconduct. The evidence shows beyond doubt that the offer proceeded from the parties themselves, and was made under meeting of the arbitrators at which both the parties were present, and that it was accepted formal record thereof being made in the proceedings of the arbitrators. We must, therefore, reverse the decree of the District Judge and direct that the award be filed.'

The facts of the above case have not been stated in the judgment in detail but the observations quoted above seem to lend some support to the view that I have taken. The case of Akshoy Kumar Nandi v. S.C. Dass and Co. : AIR1935Cal359 is more to the point. I do not, however, think it necessary to set out the facts of the case and would only quote the following portion of the headnote which accurately sums up the position in that case and the decision given by the Court:--

'Where the arbitrators took money as tees from one of the parties and it was done by way of mutual arrangement between the contending parties the award is not vitiated by reason of any misconduct on the part of the arbitrators.'

Upon an examination of the circumstances of the case I am clearly of the view that the objection of the plaintiff to the validity of the award on the ground of acceptance by the arbitrator of a remuneration in excess of the amount fixed by the Court was not entertainable and the award was not vitiated on that account.

14. As to the sum of Rs. 30/- paid to the arbitrator as his fee for local inspection much need not be said. It was on the application of the plaintiff himselfthat the arbitrator decided to make an inspection of the house in dispute. The application for local inspection was allowed subject to payment of. Rs. 30/- as additional fee. The amount was paid by the. plaintiff and the local inspection was then made by the arbitrator on the November 5, 1952, The amount charged by the arbitrator was not at all excessive and the plaintiff never objected to the demand. In these circumstances the acceptance of Rs. 30/- as fee for local inspection did not constitute a misconduct on the part of the arbitrator.

15. Now the finding of the learned Judge totally ignores the facts admitted and proved in this case and has been arrived at without considering the effect of those facts on the question of mis-Conduct. The learned Civil Judge failed to notice that the fact whether Saktoo had been adopted by Mukund and his wife as their son had totally lost its importance In view of the findings of the arbitrator that the two wills set up by the plaintiff had not been proved and that the plaintiff was not Gurdayal's sister's son as claimed by him. On the conclusion reached by the arbitrator regarding the genuineness and the execution of the wills and the plaintiffs alleged relationship with Gurdayal the plaintiff could have no title to the property in dispute even if it was assumed that Saktoo had been taken in adoption by Mukund and his wife. The arbitrator also found that the two wills were ineffective in law and the fact of adoption could not have affected this finding. As to the misconduct attributed to the arbitrator on the ground of his having accepted as his fee a sum in excess of what had been fixed by the court, it would be seen that the learned Civil Judge has observed that 'there was no dispute that the arbitrator was awarded Rs. 100/- by way of fee of the parties and that in fact he accepted Rs. 100/- from each party.'

Naturally, the Civil Judge did not hold that the plaintiff had not paid his share of the extra amount of Rs. 100/- and proceeded on the footing that both the parties had paid Rs. 100/- each and the case of the plaintiff that he had paid Rs. 50/-only as directed by the Court was incorrect. The learned Judge also appears to have thought that the parties had willingly agreed to pay the extra sum of Rs. 100/-and, at any rate, he did not find that there was any element of force, compulsion or unfairness in the demand or the payment. The circumstances also clearly indicate that the payment made by the parties was a willing payment made in a lawful manner and no undue advantage of his position was taken by the arbitrator. The learned Civil Judge was evidently called upon to consider the effect of the willingness and agreement of the parties, to make the extra payment and their continuedparticipation and acquiescence in the arbitration proceedings. This aspect of the matter, however, the learned Judge completely omitted to consider and his finding on this part of the alleged misconduct Is, therefore, obviously vitiated. Similar Is the case with regard to the finding of the learned Judge as to the alleged misconduct in the acceptance by the arbitrator of Rs. 30/- as fee for local inspection.

The learned Judge did not notice the facts that the plaintiff had himself made an application before the arbitrator for local inspection, that the application had been allowed subject to the payment of Rs. 30/- as fee for the local inspection and that the fee had been willingly paid by the plaintiff. For the reasons stated above I think that under such circumstances a case for revision under Section 115 of the Civil P. C. has been clearly made out. If a Court omits to consider a material on record having a bearing (in this case the material had a vital bearing) on the question to be decided by it or fails to apply Its mind to or to record a finding on a crucial aspect of the case which cannot be Ignored in the determination of the controversy before the Court, it certainly acts illegally or at least with material irregularity in the exercise of its jurisdiction. I may refer in this connection to Sher Singh v. Joint Director of Consolidation, 1969 All LJ 38.

16. Further, the question whether an arbitrator has been guilty of misconduct Is, in my opinion, clearly a question relating to a jurisdictional fact, and Section 23 of the Arbitration Act, 1940, seems to be conclusive on this point. It runs as follows:

'Section 23(1). The Court shall, by order, refer to the arbitrator the matter in difference which he is required to determine, and shall in the order specify such lime as it thinks reasonable for the making of the award.

(2) Where a matter Is referred to arbitration, the Court shall not, save in the manner and to the extent provided in this Act, deal with such matter in the suit.'

Once a matter has been referred to arbitration under Sub-section (1) of Section 23 the jurisdiction of the Court to adjudicate upon that matter ceases, and Sub-section (2) of the section precludes the Court from adjudicating upon it unless it regains the jurisdiction to do so under the provisions of the Act. That regaining of jurisdiction by the Court over the subject-matter of the reference can be brought about only by supersession of the reference or setting aside of the award given by the arbitrator. An order setting aside an award is, therefore, an order which has the effect of revesting jurisdiction in the Court in regard to the subject-matter of the reference, a jurisdiction of which the Courthad been divested on account of the reference and which it cannot again acquire except as a result of supersession of the reference or setting aside of the award. It is true that even after the making of a reference the Court retains jurisdiction over the suit and it is the Court which has to finally dispose of the suit in accordance with the award. But the distinction between the jurisdiction to dispose oi the suit and the jurisdiction to decide that particular matter which had been referred to arbitration should not be lost sight of While the Court retains jurisdiction over the suit even after a reference has been made under Section 23(1), the jurisdiction to decide the matter of reference is transferred to the arbitrator and the Court cannot get seized of the latter jurisdiction unless the reference is superseded or the award is set aside. If an award has been made and has not been set aside the Court has no power to decide the matter which formed the subject-matter of reference and it has to pronounce judgment according to the award. It is, therefore, manifest that in determining whether an arbitrator has been guilty of misconduct and his award has consequently to be set aside the Court determines a jurisdictional fact. The Court certainly possesses jurisdiction to decide whether or not an arbitrator has committed a misconduct but the decision that he has committed a misconduct and the. award should on that account be set aside has the effect of reconferring upon the Court the jurisdiction to decide a matter which but for the setting aside of the award, it could not have been competent to decide. That being so, the Court exercises a jurisdiction not vested in it by law if it decides wrongly the question whether an arbitrator has been guilty of misconduct and his award should on that account be set aside.

17. My learned brother Hari Swarun, J. has expressed the opinion that in holding that the award in question was vitiated by misconduct of the arbitrator the Civil Judge did not decide any jurisdictional fact, but for the reasons stated above. I find myself unable to agree with him. The fact that the Court had initially the jurisdiction to entertain the suit does not lead to the conclusion that no decision given by it during the progress of the suit can relate to a jurisdictional fact. If at an intermediate stage of the suit the Court loses its jurisdiction over a particular matter, involved in the suit, an order having the effect of bringing back that matter within the jurisdiction of the Court must be held to be dealing with a question touching its jurisdiction. In S. Rama lyer v. Sundaresa Ponnapoondar : [1966]3SCR474 their Lordships of the Supreme Court observed:

'In the present case, no question of revision under Sub-section (c) of Section 115 arisesand we are concerned only with the power of revision under Sub-sections (a) and (b) of Section 115. Sub-section fa) empowers the High Court to correct an erroneous assumption of jurisdiction; Sub-section (b) empowers it to correct an erroneous refusal of jurisdiction. The decision of the subordinate Court on all questions of law and fact not touching its jurisdiction is final and, however, erroneous such a decision may be, it is not re-visable under Sub-sections (a) and (b) of Section 115. On the other hand, if by an erroneous decision on a question of fact or law touching its jurisdiction e.g. on a preliminary fact upon the existence on which its jurisdiction depends, the subordinate Court assumes a jurisdiction not vested in it by law or fails to exercise a jurisdiction so vested, its decision is not final, and is subject to review by the High Court in its revisional jurisdiction under Sub-sections (a) and (b) of Section 115.'

These observations which have been emoted by my learned brother Hari Swarup J. also in his judgment seem to me to support the view that in making the order under revision the learned Civil Judge exercised a jurisdiction not vested in him by law. I am also fortified in this view by the decisions of the Supreme Court in Chaube Jagdish Prasad v. Ganga Prasad Chaturvedi : AIR1959SC492 and Roshan Lal Mehra v. Ishwar Dass. : [1962]2SCR947 .

18. The learned counsel for the plaintiff placed reliance on Mst. Swarswati v. Wall : AIR1935All456 where it was held by Niamatullah, J. that the question whether a certain act amounts to misconduct on the part of the arbitrator is one arising in the case which the Court has every jurisdiction to decide and that if in deciding that question the Court took an erroneous view of law or made an incorrect inference from the facts, provided all that can be attributed to the Court is an error of judgment, it cannot be said that there was an illegality or irregularity in the exercise of jurisdiction. Attention of the learned Judge does not appear to have been invited in that case to para 3 of the Second Schedule of the Code of Civil Procedure which corresponded to Section 23 of the Arbitration Act, 1940, and, in any case, the bearing of that section was not considered. The view taken in that case is also opposed to what has been laid down in the decisions of the Supreme Court mentioned above. With great respect to the learned Judge, therefore, I think that the opinion expressed by him in the above case cannot be said to have been correct.

19. As a result of the foregoing discussion I am of the opinion that this revision should be allowed, the order of the learned Civil Judge dated 18-7-1963 shouldbe set aside and the order of the learned Munsif dated 18-4-1953 should be restored. The opposite party should also be made to bear the costs of the applicant in this Court.

H. Swarup, J.

20.Two points arise in this revision. The first is whether the decision of the Court below under Section 39 of the Arbitration Act amounts to a 'case decided' within the meaning of Section 115, Civil P. C. and the second is whether assuming that the order amounts to a 'case decided' this Court can interfere with the order on one of the grounds mentioned in Section 115, Civil P. C.

21. In a regular civil suit the parties made an application for reference of the dispute to an arbitrator. The Court referred the dispute under Section 23 of the Arbitration Act to the arbitrator. The arbitrator gave an award. The plaintiff filed objections to the award and, inter alia, took the plea that the arbitrator had misconducted himself and the proceedings and urged that the award be set aside, The trial Court did not accept this objection and passed a decree in terms of the award 'dismissing the suit. The plaintiff went up in appeal and the lower appellate Court held that the award was liable to be set aside on the ground that the arbitrator had misconducted himself in accepting from the parties a fee in excess of that which was payable to him by the parties to the reference under the order of reference made by the Court by which the dispute was referred to Sri Mathura Prasad Kakkar. The lower appellate Court also held that the arbitrator had not decided the question about the adoption of Sattu by Makund and it went to the root of the matter and amounted to mis-conduct of proceedings by the arbitrator: On these findings the appellate Court allowed the appeal and set aside the award and- remanded the case to the trial Court for decision according to law. The defendant has filed a revision against the appellate order passed under Section 39 of the Arbitration Act. The revision was referred to the Full Bench for decision.

22. The learned counsel for the plaintiff-opposite party has rightly conceded before us that the order passed in appeal under Section 39 of the Arbitration Act amounts to a 'case decided' within the meaning of Section 115, Civil P. C. He has, however, contended that the order passed by the Court below was within its jurisdiction and it suffers from no error so as to make it liable to be interfered with this Court in exercise of its powers under Section 115, Civil P. C.

23. The learned counsel for the petitioner has, however, contended that the decision by the lower appellate Court that the arbitrator had misconducted himself and the proceedings amount to the decision of a jurisdictional fact and by a wrongdecision of the same the learned Judge assumed jurisdiction to set aside the award and hence this Court had jurisdiction under Section 115, Civil P. C. to revise the decision of the Court below on merits.

24. The jurisdiction of the trial Court to decide about the misconduct of the arbitrator and the proceedings arose under Section 17 read with Section 30 of the Arbitration Act. He had the jurisdiction to decide whether the arbitrator had or had not misconducted himself or the proceedings. This had to be on the basis of the evidence produced before the court. It had to be a decision on merits. The jurisdiction to decide the question did not depend upon the final decision of the issue. The decision could be made only after the court assumed jurisdiction and, therefore, such a decision cannot be held to be a jurisdictional act. The jurisdiction of the court had already arisen by the making of the reference under Section 23 of the Arbitration Act and the subsequent filing of the award under Section 14 of the Arbitration Act Section 17 of the Arbitration Act gave the Court the jurisdiction to decide whether the award was to be set aside or confirmed. The reasons on which the award was to be set aside or not are given under Section 30 of the Arbitration Act and the finding of those reasons has to be given under Section 17 of the Act. It cannot, therefore, be said that the trial Court did not have the jurisdiction to decide whether the facts existed justifying the setting aside of the arbitration award. Similarly' the appellate Court exercising the powers under Section 39 of the Arbitration Act had the jurisdiction to decide whether the circumstances existed for the setting aside of the award. The circumstances have been mentioned in Section 30 of the Arbitration Act and if the court on the basis of the evidence before it came to the conclusion that circumstances existed to establish the misconduct of the arbitrator or the arbitration proceedings within the meaning of Section 30 it had the duty and the jurisdiction to set aside the award under Section 17 of the Arbitration Act.

25. Section 39 of the Arbitration Act prohibits a second appeal and the High Court in exercise of the powers under: Section 115 of the Arbitration Act cannot exercise the appellate powers and set aside the order of the court below passed under Section 39 of the Act. It was pointed out in the case of State of Kerala v. K.M. Charia Abdullah & Co. : [1965]1SCR601 by Subba Rao J. that 'there Is an essential distinction between an appeal and a revision. The distinction is based on differences implicit in the said two expressions. An appeal is a continuation of the, proceedings; in effect theentire proceedings are before the appellate authority and it has power to review the evidence subject to the statutory limitations prescribed. But in the case of a revision, whatever powers the revisional authority may or may not have, it has not the power to review the evidence unless the statute expressly confers on it that power. That limitation is implicit in the concept of revision'. The High Court cannot, therefore, in exercise of the powers under Section 115 reconsider the evidence on the basis of which the court below has come to the conclusion that the arbitrator had misconducted himself and the proceedings.

26. It has been pointed out in Pandurang v. Maruti : [1966]1SCR102 and in Ratilal v, Ranchhodbhai : AIR1966SC439 that points of law which do not relate to the questions of jurisdiction cannot be redecided by the High Court under Section 115 C.P.C. and that an erroneous decision on a question of law having no relation to questions of jurisdiction will not be corrected by the High Court under Section 115 C.P.C.

27. In the case of : [1966]3SCR474 It was said that:

'Sub-section fa) empowers the High Court to correct an erroneous assumption of jurisdiction; Sub-section (b) empowers it to correct an erroneous refusal of jurisdiction. The decision of the subordinate Court on all questions of law said fact not touching its jurisdiction is final and, however, erroneous such a decision may be, it is not revisable under Sub-sections (a) and (b) of Section 115. On the other hand, if by an erroneous decision on a question of fact or law touching its jurisdiction, e.g., on a preliminary fact upon the existence on which its jurisdiction denends, the subordinate Court assumes a jurisdiction not vested In it by law or fails to exercise a jurisdiction so vested, its decision is not final, and is subject to review by the High Court in its revisional jurisdiction under Sub-sections (a) and (b) of Section 115.'

28. In the present case the court has not decided any preliminary fact upon the existence of which its jurisdiction depended. The reference to the arbitrator had been made within jurisdiction in the proper exercise of jurisdiction and on the award being filed the Court's jurisdiction to give a decision under Section 17 of the Arbitration Act came Ento being automatically. The subsequent decision of the matter on merits was not the decision of a preliminary fact on the existence of which depended the jurisdiction of the court.

29. Learned counsel for the defendant-petitioner relied on the case of : AIR1959SC492 and on the decision in the case of Prem Raj v. The D. L. F. Housing and Construction (Private) Ltd., : [1968]3SCR648 in support of his contention. In the case of Chaube Jagdish Prasad, : AIR1959SC492 (supra) the order under revision was passed under Section 5(4) of the U. P. (Temporary) Control of Rent and Eviction Act. The jurisdiction to entertain -such a suit depended on the decision whether the construction in dispute had been made before or after June 30, 1946. The decision of the fact whether the property had been constructed was necessary for the determination of the jurisdiction of the court. It was not a fact on which depended the decision on merit under Section 5(4) of the Act. It was, therefore, held by the Supreme Court to be a jurisdictional fact subject to review by the High Court under Section 115 C.P.C. In the present case the jurisdiction of the Court depended on the reference to the arbitrator and the filing of the award and the decision of the question of misconduct was not a preliminary fact which gave rise to the jurisdiction of the Court to deal with the matter. In the case of Prem Raj, AIR 1968 SC 1335 (Supra) the plaintiff had filed a suit for a declaration that a certain contract against him was void and inoperative having been obtained by undue influence and in the alternative had asked for the relief of specific performance of the same contract. The trial court had decided that it had the jurisdiction to entertain such a suit. It was held by the Supreme Court 'that In holding that the appellant (plaintiff) was entitled in the alternative to ask for the relief of specific performance the trial Court had committed an error of law and so had acted with material irregularity or illegality in the exercise of its jurisdiction within the meaning of Section 115(c) of the Civil Procedure Code. It was, therefore, competent to the High Court to interfere, in revision, with the order of the trial Court on this point. To put it differently the decision of the trial Court on this question was not a decision on a mere question of law, but it was _a decision on a question of law upon which the jurisdiction of the High Court on the ground of a particular relief depended. The question was, therefore, one which involved the jurisdiction of the High Court; the trial Court could not, bv an erroneous finding upon that question confer upon itself a jurisdiction which it didnot possess and its order, therefore, was liable to be set aside by the High Courtin revision.'

30. In the case before the Supreme Court the decision of the question of law affected the jurisdiction of the trial Court to entertain the suit itself. It did not-deal with any question of law which arose for decision on merits In the case. According to their decision the trial Court had no jurisdiction to entertain asuit for such a relief. In the present case the granting of the relief which the Court had granted is within the jurisdiction of the courts below and the right to decide the issue arose not because bf the decision of that issue but because the award. had been filed by the arbitrator. This case, therefore, does not help the petitioner in the present case as the court below has not decided any matter which deals with its jurisdiction to decide the case on merits and to grant the relief.

31. In the case of Abbas Bhai v. Gulamnabi, : [1964]5SCR157 it was held that the decision of the District Court that the tenant established or failed to establish his readiness and willingness to pay the standard rent did not affect the jurisdiction of the Court conferred by law upon it and by wrongly deciding that a tenant was or was not entitled to protection under law the Court did not assume to itself jurisdiction which was not vested In it by law or refused to exercise the jurisdiction which vested in it by law.

32. The decision of the trial Court was based on interpretation of the various sections of the Rent Act. The Supreme Court observed that the High Court was in error in setting aside the decree of the District Court in exercise of the powers under Section 115 C.P.C. as the trial Court by arriving at an erroneous conclusion on the plea of the tenant as to his readiness and willingness did not ad illegally or with material irregularity in the exercise of its jurisdiction. Again in the case of R.P. Mehta v. I.A. Sheth : [1964]8SCR1 it was observed as below:--

'The question raised was whether a decree in ejectment should be passed on the ground of personal requirement under Section 13(1)(g) of the Act where It was proved that the landlord wanted to pull down the premises and build another and then occupy it It was said that in such a case he had to proceed under Clause (hh) of Section 13(1). It is clear that the question so raised is one of interpretation of these two clauses. Section 28 of the Act gives jurisdiction to the Court specified in it to try a suit or proceeding between a landlord and tenant relating to possession of the premises. That section expressly provides that no other Court, subject to the provisions of Sub-section (2) which do not apply to this case, has jurisdiction to entertain such suits. It is clear from, this section that the trial Court had full jurisdiction to entertain the suit for ejectment. That being so, it had jurisdiction to interpret whether Clause (g) of Section 13(1) would apply to the present case. The appellate Court had jurisdiction to hear the appeal. The High Court could not, therefore, interfere in revision with the decision of the appellate Court, evenif it had gone wrong, on facts or law, in the exercise of the jurisdiction. It follows that the revision application had to be dismissed by the High Court and that this appeal too must fail.

33. In. the present case the trial Court had the jurisdiction to decide whether the conditions mentioned in Section 30 of the Arbitration Act existed and whether on the basis thereof the award was liable to be set aside or not. The appellate Court had jurisdiction to hear the appeal and thus had the jurisdiction to decide whether the arbitrator had misconducted himself of the proceedings within the meaning of Section 30 of the Arbitration Act and whether on the basis of those findings the award was liable to be set aside. The court below has done nothing else but to decide the appeal after arriving at certain findings of fact and applying the law thereto. Whether the judgment of the court below is erroneous as regards its findings of fact or erroneous in law cannot be enough to give this Court jurisdiction under Section 115 C. P. C. to interfere with that judgment.

34. It was held by this Court in the case of : AIR1935All546 : 'It cannot be disputed that the lower Court had jurisdiction to set aside the award on proof of misconduct. The question whether a certain act amounts to misconduct on the part of the arbitrator is one arising in the case which the Court has every jurisdiction to decide. If in deciding that question the Court took an erroneous view of law, or made an incorrect inference from the facts proved, all that can be attributed to the Court is an error of judgment. It cannot be said that there was any illegality or irregularity in the exercise of jurisdiction.' In my opinion this is the correct view.

35. In the view that I am taking it is not necessary to express any opinion as regards the merits of the findings arrived at by the court below.

36. In the present case the court below has not decided any fact the decision of which was necessary for the assumption of jurisdiction by the court below to decide the appeal or to decide whether the award was liable to be set aside. The proceedings had been initiated by the reference made by the court to the arbitrator and by the filing of the award and objections thereto and the court below was only exercising the jurisdiction which arose on the proceedings. going on before it. The order of the court below is thus not liable to be interfered with by this Court under Section 115 C.P.C. and the revision is liable to be dismissed.

37. In the result the revision is dismissed.

Trivedi, J.

38. The detailed facts giving rise to this revision have been given in the judgment of brother Gangeshwar Prasad, J. The relevant pedigree set up by the plaintiffs is as under:

SAKTU (ADOPTED SON OF MAKUND)

|

----------------------------------

| |

Jamuni Dei Gurdayal Gulab

| Kunwar

Basdeo Sahai (Plaintiff)

39. The plaintiff claimed the property on the basis of wills executed by Gurdayal and Gulab Kunwar and in the alternative by succession as the sister's son of Gurdayal. Defendant denied the wills and also the relationship. According to the finding of the arbitrator the execution of the wills was not proved.

40. The next plea of the plaintiff that he was the daughter's son of Saktu was also negatived by the arbitrator. The arbitrator further found that Raghubir was the adopted son of Gurdayal and defendants are the nearest reversioners of Raghubir.

41. The objection of the plaintiff appellant against the award was dismissed by the learned Munsif. In appeal the lower appellate court formulated three points out of which the following two are relevant:

'(1) That the omission of the arbitrator In not deciding the question of adoption of Saktu amounted to misconduct on his (arbitrator's) part.

(2) That the arbitrator had accepted the fee more than what was actually awarded by the court and further that he also accepted fee for inspecting the house in dispute from the plaintiff.' The lower appellate Court held that the question that Saktu was the adopted son was an important point to be decided by the arbitrator and had material bearing on the rights of the parties and the omission on the part of the arbitrator amounted to misconduct. On the second point also the lower appellate Court remarked that the acceptance of additional fee amounted to misconduct. The award was thereafter set aside by the court below.

42. The findings of fact of the lower appellate Court are not challenged and cannot be challenged in revision. All that is contended is that the facts proved did not amount to any misconduct and the arbitrator could not be disqualified on proof of the above facts.

43. Under the Indian Arbitration Act the court is bound to refer a dispute to the arbitrator on a valid agreement. An award by an arbitrator can be set aside on the ground enumerated in Section 30 of the said Act. The ground relevant for the purposes of this case is that the arbitrator or umpire has misconducted himself or the proceeding.

44. An award can also be challenged under Section 15 which provides for its correction and modification and also underSection 16 which provides reconsideration by remission.

45. It is settled now that the phrase 'misconducted himself or the proceedings' does not' necessarily imply moral turpitude, but includes neglect and breach of duties and responsibilities which result in miscarriage of justice. It comprehends action opposed to rational and reasonable principles. The lower appellate Court has not shown how the question about the adoption of Saktu was material, relevant and essential after the alleged will of Gurdayal was held not proved. According to the plaintiff the property in suit was the self-acquired property of Saktu and was inherited by his son Gurdayal. On the other hand the defendant's case was that Gurdayal succeeded by survivorship, and was incompetent to bequeath the property by will. Both parties were claiming from Saktu. The question about the nature of succession would have been material if the will propounded by the plaintiff was found genuine. Saktus adoption was never in issue either before the arbitrator or before the learned Munsif on the basis of objections raised by, the plaintiff. If no issue was framed and no rinding was given in respect of an irrelevant plea raised by the defendant, the grievance for the same could be of the defendant and not of the plaintiff. The court below obviously acted illegally in exercise of its jurisdiction by holding that Saktu's adoption had material bearing on the rights of the parties. If the facts proved do not exclude the jurisdiction of the arbitrator the finding of the court below in disqualifying the arbitrator is a jurisdictional error, and a revision under Section 115 C.P.C. is maintainable.

46. The next irregularity of the arbitrator, according to the lower appellate Court was acceptance of fee in excess of that what was awarded by the court. The objection was in respect of two items, one of Rs. 30 and the other of Rs. ,100, The nature of allegations and the evidence adduced by the plaintiff was in the nature of moral turpitude and was not found correct. The question therefore remained if the aforesaid payments which were in the nature of irregularities amounted to legal misconduct and the arbitrator could be said to have misconducted the proceedings. It is not disputed that the plaintiff himself had applied for local inspection and his prayer was accepted, A sum of Rs. 30 was charged from him towards the fee or charges for local inspection. The fee demanded was paid without any protest. Likewise, the additional fee of Rs. 100 was paid to the arbitrator by the parties without any protest. The Arbitration Act does not bar the demand of additional fee. Payment of additional fee, coupled with certainfacts, i.e. when the same is paid by one party alone which is likely to give an impression on the impartiality of the arbitrator can amount to misconduct.

47. Section 38 of the Arbitration Act Is indicative of the fact that the mere demand by the arbitrator of additional fee is neither illegal nor improper. The demand will become improper and illegal if other facts coupled with the fact of payment go to establish the bad motive of the arbitrator, or neglect of any duty which had resulted in miscarriage of duty. A party cannot be allowed to He by and join in the submission and then if and when it suits his purpose attack the award on that ground. If the finding of misconduct of the arbitrator is not borne out from the facts proved the finding is an error affecting the jurisdiction of the arbitrator and will amount to illegal exercise of the jurisdiction vested in the lower appellate Court.

48. On the question whether the order setting aside the award is 'case decided' under Section 115 C.P.C., I agree with brother Gangeshwar Prasad, J. and have nothing more to add.

49. For the reasons given above, I agree with brother Gangeshwar Prasad, J. and am of the opinion that the revision should be allowed with costs.

Gangeshwar Prasad, J.

50. In accordance with the majority opinion, the revision Is allowed, the order of the Civil Judge dated July 18, 1963 is set aside and the order of the Munsif dated April 18, 1953 is restored. The opposite party shall pay the posts of the applicant in the proceedings before this court.


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