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Nawab Syed Hasan Ali Khan Vs. Nawab Askari Begam - Court Judgment

LegalCrystal Citation
SubjectArbitration
CourtAllahabad High Court
Decided On
Case NumberFirst Appeal from Order No. 23 of 1956
Judge
Reported inAIR1959All777
ActsArbitration Act, 1940 - Sections 14 and 39
AppellantNawab Syed Hasan Ali Khan
RespondentNawab Askari Begam
Appellant AdvocateNaziruddin, Adv.
Respondent AdvocateM.P. Srivastava, Adv.
DispositionAppeal allowed
Excerpt:
(i) arbitration - award and limitation - sections 39, 14 and 3, schedule i, para 3 of arbitration act, 1940 - after adjudication the trial court dismissed the application for filing the award - order held amounted to setting aside award and was appealable. (ii) limitation - sections 3, schedule i, para 3 of arbitration act, 1940 - first arbitrator refused to act who was substituted by new one and gave award within four months of his entering upon reference but beyond four months from date when first arbitrator entered on reference - held, award within time. - - the award would, therefore, be clearly within the prescribed period of four months and cannot be thrown out on the ground that it was given beyond limitation......maulana ibne hasan should act as an arbitrator. under the aforesaid agreement nawab sajjad ali khan entered on reference on 19-10-1948. he took the necessary proceedings as an arbitrator under the arbitration act. some time in january 1949, however, nawab sajjad ali khan refused to act as an arbitrator. under the terms of the agreement, therefore, maulana ibne hasan, who was to act as an arbitrator in case of the refusal of nawab sajjad ah khan, became the proper person to act as an arbitrator. accordingly, maulana ibne hasan, entered on reference on 19-1-1949.he delivered his award on 18-5-1949, i.e. within four months of his entering on reference to arbitration. on 2-6-1949. an application was given under the arbitration act for the filing of the award given by maulana ibne hasan......
Judgment:

N.U. Beg, J.

1. This first appeal arises out of an application given under Section 14 of the Arbitration Act. It appears that on 23-9-1948, parties executed a deed of agreement by which they appointed Nawah Sajjad Alt Khan as arbitrator to decide the dispute between them regarding the moveable property left by Zohra Begam deceased, the mother of the parties. There was also a provision in this agreement that in case Nawab Sajjad Ali Khan refused to act as an arbitrator, Maulana Ibne Hasan should act as an arbitrator. Under the aforesaid agreement Nawab Sajjad Ali Khan entered on reference on 19-10-1948. He took the necessary proceedings as an arbitrator under the Arbitration Act. Some time in January 1949, however, Nawab Sajjad Ali Khan refused to act as an arbitrator. Under the terms of the agreement, therefore, Maulana Ibne Hasan, who was to act as an arbitrator in case of the refusal of Nawab Sajjad AH Khan, became the proper person to act as an arbitrator. Accordingly, Maulana Ibne Hasan, entered on reference on 19-1-1949.

He delivered his award on 18-5-1949, i.e. within four months of his entering on reference to arbitration. On 2-6-1949. an application was given under the Arbitration Act for the filing of the award given by Maulana Ibne Hasan. On 23-8-1955, objections to this award were filed on behalf of the respondent. On 2-3-1956, after hearing the arguments of the parties the learned Civil Judge of Mohanlalganj rejected the application for the filing of the award on the ground that the award was given beyond time. Aggrieved with the said order, the appellant has filed this appeal in the High Court.

2. Before the arguments started the learned Counsel for the respondent raised a preliminary objection to the hearing of the appeal. He argued that the present appeal is not maintainable under Section 39 of the Arbitration Act, Section 39 of the Arbitration Act provides for appeals against orders setting aside or refusing to set aside an award.

3. Having heard learned Counsel for the respondent, we are of opinion that the order in the present case is an appealable one. It is admitted that an application under Section 14 of the Arbitration Act was given in the trial Court. It is further admitted that the award was filed in Court as a result of that application, and objections to the said award were invited. Thereafter the respondent filed objections and the Court adjudicated on those objections after going into the matter. The Court finally dismissed the application for filing the award. The order of the trial Court, therefore, amounts to an order setting aside the award and would, therefore, be appealable. Reference in this connection may be made to a decision of the Patna High Court in Jagdish Mahton v. Sundar Mahton, AIR 1949 Pat. 393.

4. On merits also we are of opinion that there is force in this appeal. The view of the trial court that the award was given beyond time appears to us to be erroneous. In this connection reference might be made to Section 3 of the Arbitration Act, which provides that an arbitration agree-merit, unless a different intention is expressed therein, shall be deemed to include the provisions set out in the First Schedule in so far as they are applicable to the reference. Paragraph 3 of the First Schedule runs as follows :

''3. The arbitrators shall make their award within four months after entering on the reference or after having been called upon to act by notice in writing from any party to the arbitration agreement or within such extended time as the Court may allow.'

There being nothing contrary to the above provision in the agreement the said provision will apply to the present case. The award would, therefore, be within time if the arbitrator who entered on the reference has made the award within four months of the date of his entering on the reference. Maulana Ibne Hasan admittedly entered on the reference on 19-1-1949, and gave his award on 1.8-5' 1949, i.e. within four months of his entering on the reference. The award would, therefore, be clearly within the prescribed period of four months and cannot be thrown out on the ground that it was given beyond limitation.

5. On behalf of the respondent, however, it has been argued before us that the date of entering on the reference should be taken to be 19-10-1948, i.e. the date on which Nawab Sajjad Ali Khan entered on the reference. No doubt if that is taken to be the date of the starting point of the period of four months prescribed under paragraph 3 cited above, it would have to be held that the award was given beyond the prescribed period. We are, however, of opinion that the correct date for calculating the period of limitation should be 19-1-1949, the date on which Maulana Ibne Hasan entered on the reference, and not 19-10-1948, the date on which Sajjad Ali Khan entered on the reference.

In our opinion, the date on which Nawab Sajjad Ali Khan entered on the reference should be ignored in taking into consideration the period of four months, because Nawab Sajjad Ali Khan subsequently refused to act as an arbitrator. The arbitration proceedings which took place before Nawab Sajjad Ali Khan, therefore, became infruc-tuous. In our opinion 'the arbitrators' referred to in Paragraph 3 of the First Schedule cited above are not the arbitrators who refuse to make the award. In the present, case the arbitrator who made the award was Maulana Ibne Hasan and not Nawab Sajjad Ali Khan. Hence the date on which the Maulana Ibne Hasan entered on the reference should be taken to be the relevant date.

The argument on behalf of the respondent is that the noun used in paragraph 3 is a plural one, i.e. 'the arbitrators', hence it would include all arbitrators, whether they are to act simultaneously or alternatively. The argument might have been worthy of consideration if the provision in the award had related to arbitrators who had to act simultaneously. In the present case, however, the arbitrators were to aet alternatively. Hence the date of entering on the reference should be the date on which the arbitrator who was to act in the alternative entered on the reference. For the above reasons, we are of opinion that the judgment of the lower Court is erroneous and must be set aside.

6. We accordingly allow this appeal, set aside the order of the trial court and remand the case to the trial Court for proceeding with the disposal of the case according to law in the light of the observations made by us above. The appellant will be entitled to his costs.

7. The stay order is discharged.


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