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Sharafat Ali Vs. Mt. Bhagwati and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty;Civil
CourtAllahabad
Decided On
Reported inAIR1929All763; 122Ind.Cas.678
AppellantSharafat Ali
RespondentMt. Bhagwati and ors.
Excerpt:
- .....that an application to refer the dispute in a pending suit to arbitration must be made by all the parties interested in the matter in controversy, otherwise the case has to be tried as between parties one of whom did not join in the reference-a mischief which it is the object of the rule to avoid. the question is whether the expression ''parties interested' means only persons having an interest in the property in dispute, or includes those who happen to be parties, but have no interest in the property nor claim any, but are otherwise interested in the result of the suit. if a person has been impleaded as a defendant on the allegation that he has such an interest or, at least, claims to have it, there can be no question that he is a person interested within the meaning of that rule......
Judgment:

Sulaiman, J.

1. This is an application in revision from an order directing a decree to be prepared in terms of the award and exempting the applicant. The applicant, Sharafat Ali, was a co-judgment-debtor with Jagpal, against whom Hamid Uddin had obtained a money decree. Certain property was attached in execution of that decree, and Mt. Bhagwati objected on the ground that it was her property and not of Jagpal. Her objection was disallowed and she instituted the suit, out of which this revision has arisen, for a declaration that the property was her property. She impleaded the decree-holder, judgment-debtor Jagpal and the Official Receiver of the estate; and she also impleaded Sharafat Ali. Sharafat Ali did not put in any appearance. The parties before the Court referred the dispute to arbitration, and an award was delivered under which it was held that the property did belong to Mi. Bhagwati. The Court below has passed decree in terms of the award, and has exempted Sharafat Ali.

2. The applicant contends before us that reference to arbitration was invalid. The first objection raised here, which was not taken in the Court below, is that the application for reference to arbitration was not signed by the decree-holder. There is no suggestion that the decree-holder had not consented to it, and it is patent that he appeared before the arbitrator. The omission of the signature caused no defect in the application, as para. 1, sub-para. 2, Sch. 2 does not require the application to be actually signed: Umed Singh V. Sobhag Mal A.I.R. 1915 P.C. 79.

3. It is also clear that, if Sharafat Ali had been a party interested in the matter in difference, which was referred to the arbitrator, the mere fact that he had not put in appearance and had not contested the suit would not have cured the defect. I do not think that an interested party would cease to be a party within the meaning of this paragraph merely because he did not put in an appearance and file a written statement. If the plaintiff discloses that he is not merely a pro forma defendant, he should be joined in the application, for it is obvious that the suit cannot be determined by means of the award as between some of the parties and on its merit by the Court itself as against the others. The non-appearance does not in any way involve a confession of judgment.

4. The main question to be considered in this case is whether Sharafat Ali was an interested party. The dispute related entirely to the question of ownership of the property in suit, and that was between the decree-holder, Mt. Bhagwati and the judgment-debtor, Jagpal or his Official Receiver. Sharafat Ali was not interested in the question of ownership of the property. He had been impleaded merely as a pro forma defendant, and might not have been impleaded at all. At any rate it was open to the plaintiff to exempt him at any stage of the suit. He has, in fact, been exempted. The learned advocate for the applicant con tends that Sharafat Ali was interested in the matter of difference, because if it was held that the property belonged to Jagpal and the attachment were to continue and the property were to be sold and sufficient money were to be realized, the applicant might not be called upon in the first instance to make repayment. This line of reasoning makes too many assumptions, and any of the contingencies which are supposed to take place may not actually come into existence. I do not think that in such a far-fetched view of the case the applicant comes within the meaning of the expression 'party interested in the matter of difference.' I, therefore, think that there was no defect in the reference and that the award was in no way vitiated.

Niamatullah, J.

5. I agree. It cannot be disputed that an application to refer the dispute in a pending suit to arbitration must be made by all the parties interested in the matter in controversy, otherwise the case has to be tried as between parties one of whom did not join in the reference-a mischief which it is the object of the rule to avoid. The question is whether the expression ''parties interested' means only persons having an interest in the property in dispute, or includes those who happen to be parties, but have no interest in the property nor claim any, but are otherwise interested in the result of the suit. If a person has been impleaded as a defendant on the allegation that he has such an interest or, at least, claims to have it, there can be no question that he is a person interested within the meaning of that rule. There may, however, be cases in which a person has no interest in the property in dispute nor does he claim to have any interest in it and yet he may be interested in the sense in which that expression has been used in the aforesaid paragraph. It will depend on the circumstances of each case, having regard to the pleadings of the parties. An important test, to my mind, is to consider whether he is a necessary party or such that, if not originally impleaded, the Court would direct him to be joined under Order 1, Rule 10, Sub-rule 2, Civil P.C, that is, a person

who ought to have been joined whether as plaintiff or defendant, or whose presence before the Court may be necessary in order to enable the Court effectually and completely to adjudicate upon and settle all the questions involved in the suit.

6. The fact that in a remote contingency a defendant should be enabled to recover what may hereafter be found due to him from the principal defendant's property in dispute is not one that would justify his retention in the array of parties. On the other hand, I entirely agree with the view taken by my learned brother that the mere fact that a defendant who has chosen to remain absent and to allow ex parte proceedings to be taken against him is not necessarily a person not interested in the subject-matter of the suit. Cases are easily conceivable in which a person who is vitally interested in the result of a suit may not consider it worth his while to put in appearance, relying upon his co-defendant, who, he is certain would prosecute the defence common to himself and the absent defendant. It cannot be suggested that, if the contesting defendant behind the back of his co-defendant against whom proceedings have been ordered to be ex parte consents to arbitration, such a reference would be valid in law. For these reasons, I agree in dismissing this revision.

7. The revision is dismissed with costs.


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