Skip to content


The State of Madhya Pradesh and ors. Vs. Babulal Pathak - Court Judgment

LegalCrystal Citation
SubjectArbitration
CourtMadhya Pradesh High Court
Decided On
Case NumberMisc. (First) Appeal No. 99 of 1969
Judge
Reported inAIR1974MP179; 1974MPLJ191
ActsArbitration Act, 1940 - Sections 28 and 30
AppellantThe State of Madhya Pradesh and ors.
RespondentBabulal Pathak
Appellant AdvocateA.P. Tare, Dy. Govt. Adv.
Respondent AdvocateR.K. Pandey, Adv.
DispositionAppeal allowed
Cases ReferredPer State of Orissa v. Kalinga Const. Co.
Excerpt:
- - when the learned additional district judge found that the award was good and valid otherwise, and when he rejected all the objections raised by the respondent, he should have leaned towards the upholding of the award and thereby advanced substantial justice......not be set aside on any of the objections raised by the contractor. having said all that, the learned judge took up suo motu the question whether the award had been made beyond the prescribed period of four months (vide paragraphs 28 and 29). he found that the arbitrator entered upon the reference on april 23, 1963, while the award was made on august 14, 1964. relying on hari shankarlal v. shambhunath prasad, air 1962 sc 78 he held that it is the court which can extend time, but since no such prayer was made either, by the arbitrator or by the divisional forest officer, he did 'not deem it fit to condone the delay', and for that reason, he struck down the award as without jurisdiction being in contravention of rule 3, schedule 1, arbitration act.4. the appellant's contention is that.....
Judgment:

Shiv Dayal, J.

1. This is an appeal under Section 39 of the Arbitration Act from the judgment and order of the Additional District Judge, Betul, setting aside an award on the ground that it was made after 'the prescribed time. The objection that the award was made beyond the time prescribed by law was not raised by any party. After disposing of theobjections, which were raised before him under Section 30 of the Arbitration Act, he raised the question of time limit suo motu.

2. The facts as stated by the arbitrator in his award are that on January 12, 1960, Babula' Pathak had purchased coupe No. 1, Bha;nsaghat, in public auction for Rs. 20.000, the contract period being upto March 31, 1961. The forest staff detected some illicit felling in the coupe and the Divisional Forest Officer, South Betul Division, Betul, imposed penalty, on the contractor. The contractor denied the allegations made against him. Thus a dispute arose. In his award, the arbitrator held that, Babulal Pathak was guilty of committing breach of Clause 7 of the deed of contract. The contractor filed objections under Section 30 of the Arbitration Act, whereupon the following issues were framed by the Court:--

'1. (A) Whether the arbitrator misconducted himself

(B) If so, its effect

2. (A) Whether the non-stay by the arbitrator of the proceedings attract disqualification of Section 30(b) of the Arbitration Act

(B) If so, its effect

3. (A) Whether the award has been improperly procured? (B) If so, its effect

4. Relief and costs?'

3. The learned Additional District Judge held that the non-stay of the arbitration proceedings by the arbitrator did not attract Section 30(b) of the Arbitration Act and decided the other objections also in favour of the department, overruling the objections raised before him. He held that the award could not be set aside on any of the objections raised by the contractor. Having said all that, the learned Judge took up suo motu the question whether the award had been made beyond the prescribed period of four months (vide paragraphs 28 and 29). He found that the arbitrator entered upon the reference on April 23, 1963, while the award was made on August 14, 1964. Relying on Hari Shankarlal v. Shambhunath Prasad, AIR 1962 SC 78 he held that it is the Court which can extend time, but since no such prayer was made either, by the arbitrator or by the Divisional Forest Officer, he did 'not deem it fit to condone the delay', and for that reason, he struck down the award as without jurisdiction being in contravention of Rule 3, Schedule 1, Arbitration Act.

4. The appellant's contention is that the respondent had not included that objection in his application underSection' 30 of the Act and that no opportunity was given to the appellants to make an application under Section 28 of the Act. It is further contended that this was a fit case where the Court should have, in exercise of its discretion, extended the time, particularly when the parties had acquiesced and continued to appear before the arbitrator all along without, any demur and took a chance for an award in their favour.

5. Having heard learned counsel for both sides, we have formed the view that the learned Additional District Judge was in error in striking down the award on a technical ground, when he had discretion to remedy the defect in the interest of substantial justice. The policy of the law is to uphold the award as far as possible. This is not a case where the Court was powerless, as when the bar of limitation rigidly steps in. Apart from the fact that the respondent had not raised any objection, it would have been only in fairness to the parties that the appellants should have been given an opportunity to make an application for extending the time. When the learned Additional District Judge found that the award was good and valid otherwise, and when he rejected all the objections raised by the respondent, he should have leaned towards the upholding of the award and thereby advanced substantial justice. The learned Additional District Judge said in so many words that he had jurisdiction and discretion to extend time. Having taken notice of the defect suo motu, it would have only been consonant with justice to extend the time in exercise of the discretionary power. The policy of the law is that the award of an arbitrator is ordinarily final and conclusive and that the Court should approach the award with a desire to support it, if that is reasonably possible, rather than destroy it by calling it illegal. See Moolchand v. Kashi Prasad, AIR 1965 Madh Pra 118, where observations of the Supreme Court in several decisions have been relied on. In the present case, the learned Additional District Judge completely overlooked this celebrated principle. Instead of approaching the award with a desire to support it, he approached it with a desire to destroy it by calling it illegal. This runs counter to the instructive observations of the Supreme Court in Santa Sila v. Dhirendra Nath, AIR 1963 SC 1677 as also in Moolchand's case (supra).

6. We have perused the order sheet recorded by the arbitrator. We find that both the parties participated in the proceedings without demur. The contractor filed his list of witnesses on February 26, 1964. He actively took part in theproceedings, not only by inspecting documents and submitting applications, but also by examining his own witnesses as late as on May 4, 1964.

7. We have, therefore, no hesitation in extending the time under Section 28 of the Arbitration Act, upto the date on which the arbitrator actually made his award. The decision in Jamnaprasad v. Mahesh Prasad, 1970 MPLJ 30, is on all fours.

8. Shri Pandey, learned counsel for the contractor, made a faint attempt to take us through the findings reached by the arbitrator to show that they were not correctly arrived at. The Court cannot re appreciate the evidence for setting aside an award. See State of Orissa v. Kalinga Const. Co. (P.) Ltd., (1970) 2 SCC 861 = (AIR 1971 SC 1646). The objections to an award must be confined to those permissible under Section 30 of the Arbitration Act. The contractor did not raise any objection that there was an error apparent on the face of the award. It is clear law that : (1) an award of the arbitrator is final, both on fact and law, (2) The Court cannot review the arbitrator's award and correct any mistake in his adjudication, unless there is an error of law on the face of the award. (3} An error of Law on the face of the award means that some legal proposition, which is the basis of the award, is erroneous and such error is apparent in the award or the document actually Incorporated thereto See Firm Madanlal Roshanlal v. Hukumchand Mills, AIR 1967 SC 1030 and Champsey Bhara and Co. v. Jivraj Balloo Spg and Wvg. Co. Ltd., 50 Ind App 324 = (AIR 1923 PC 66). The Court cannot reappraise the evidence and it is not open to the Court to sit in appeal over the conclusion of the arbitrator. Per State of Orissa v. Kalinga Const. Co. (P.) Ltd. (supra). Therefore, the new objection sought to be raised before us is not tenable.

9. The appeal is allowed. The judgment and order of the Additional District Judge are modified to this extent that the award shall be deemed to have been made within the prescribed time, as we extend the time under Section 28 of the Arbitration Act, to the date on which the award was actually made. Maintaining the rest of the judgment of the Additional District Judge, we uphold the award and dismiss the contractor's objections under Section 30 of the Arbitration Act. The respondent shall pay costs to the appellants in both the Courts. Counsel's fee Rs. 100 in each Court.


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