1. The circumstances which have led to this application are somewhat unusual. The plaintiff opposite party filed a suit in the Small Cause Court of Allahabad, which was transferred to the Court of the honorary Munsif. The matter was referred to arbitration on 9th November 1935. On 5th February 1934, a report was received from the arbitrator by the Court to the effect that the defendant had failed to appear on some of the dates fixed, that be had finally failed to appear on the 27th January which had been fixed for final disposal and that the arbitrator had therefore no alternative, but to recommend that the plaintiff's claim be decreed ex parte, adding that the defendant might however get the decree set aside by a proper motion if he so desired, as the recommendation made by the arbitrator was an ex parte one. No notice was issued to the defendant on the receipt of this report, and the Court ordered the matter to be put up on 15th February 1934, i.e., after ten days. In February the Court passed an order that no objection had been received and that the suit was decreed in accordance with the award. A few days later the defendant made an application to the Court to the effect that the award was an ex parte one, that the defendant had received no notice and that the decree was also ex parte. The Court apparently considered this as an objection to the award, and after several hearings disposed of it on the 31st August in the following order:
The grounds on which it is prayed that the award be set aside are not sufficient. We therefore confirm the award and pass a decree in accordance with the award.
2. It will be observed that the decree in accordance with the award had already been passed on 15th February 1934, and that this order of the 31st August was merely a repetition of the former one. The main ground on which the present application is based is that no notice of the filing of the award was given to the defendant as required by para. 10, Schedule 2, Civil P.C.
3. That such a notice is necessary is clear from the provisions of para. 10 of the Schedule, and also from the decisions in several cases, among which may be quoted those of Chatarbuj Das v. Ganesh Ram (1898) 20 All 474 and Udit Singh v. Ram Lakhan Singh 1933 All 313. It has been argued however that there was no award and therefore no notice was necessary. The arbitrator in forwarding the report to the Court was acting it is said, under Clause (2), para. 7 of Schedule 2, in which it is provided that persons making default before the arbitrator shall be subject to the like disadvantage by order of the Court on the representation, of the arbitrator as they would incur for the like offences in suits tried before the Court. If a party fails to appear before the Court, it is open to the Court to proceed ex parte, and it is therefore argued that the Court on the recommendation of the arbitrator proceeded ex parte and pronounced a decree, which required no notice.
4. No authority has been quoted which will cover the proceedings in the present case. It appears to me however that the application is bound to succeed, because what the Court did was to give a decree in accordance with the award without issuing the notice required by para. 10. When the arbitrator made his report under para. 7, the proper procedure apparently was for the Court to pass an order directing that as the defendant had defaulted in appearance, the proceedings should be ex parte, and the arbitrator should then have pronounced his award and filed it in Court, after which notice could have been issued under para. 10 and the ordinary procedure relating to arbitration would have followed. The Court had no jurisdiction to deal with the matter as if there had been no arbitration, for two reasons. In the first place, the arbitration bad not been superseded, and in the second place, the Court had no evidence before it on which to base even an ex parte decree. It could not treat the report of the arbitrator as evidence. Indeed it appears to be clear from the wording of the orders passed that the Court was dealing with the report of the arbitrator as if it had been an award. This being so, the failure to issue a notice to the defendant is clearly fatal to the validity of the decree.
5. I therefore allow the application with costs, set aside the decree and order of the Court and direct that the suit be readmitted on its original number and disposed of according to law. The arbitration not having been superseded, I must direct that the Court shall deal with the report of the arbitrator as one made under para. 7 of Schedule 2 and pass orders on it in the light of the above remarks.