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Harbans Singh Vs. Punjab State - Court Judgment

LegalCrystal Citation
SubjectArbitration
CourtPunjab and Haryana High Court
Decided On
Case NumberCivil Revn. No. 490 of 1958
Judge
Reported inAIR1960P& H182
ActsIndian Arbitration Act - Sections 28 and 33; Code of Civil Procedure (CPC), 1908 - Sections 21
AppellantHarbans Singh
RespondentPunjab State
Cases Referred(see Ghulam Khan v. Muhammad Hassan
Excerpt:
.....of the circumstances, allows an arbitration to proceed and takes part in it and then seeks to evade it, later on, by raising a number of objections which have never occurred to him before (see venkatachellam v. it is well settled that court cannot be expected to go into the entire proceedings before the arbitrator and make a sifting investigation or enquiry in the merits. the petitioner harbans singh appears to have approached the wrong court under section 33 of the act but this objection have neither been raised in the court below nor before me loses its importance because under section 21 of the code of civil procedure objections as to the territorial jurisdiction, are hardly of any value in the appellate or revisional court unless raised in the court of first instance at the..........of the indian arbitration act.(2) on 19-4-1954 an agreement was entered into at amritsar between shri harbans singh petitioner and the state of punjab for the construction of grain storage bin at batala and contingent works. in the agreement, provision was made in clause 25-a for arbitration by superintending engineer of jullundur circle. this clause in brief provided that if any question, difference or objection whatsoever arose in any way connected with or arising out of this instrument or the meaning or operation of any part thereof * * * * *every such matter shall be referred for arbitration to the superintending engineer of jullundur circle and his decision shall be final and binding * * * * *.disputes having arisen between the parties, shri harbans singh by his letter dated.....
Judgment:
ORDER

(1) This revision is directed against the order of the learned Subordinate Judge, 1st Class, Amritsar, dated 17-5-1958, dismissing the application of Shri Harbans Singh Petitioner under S. 33 of the Indian Arbitration Act.

(2) On 19-4-1954 an agreement was entered into at Amritsar between Shri Harbans Singh petitioner and the State of Punjab for the construction of grain storage bin at Batala and contingent works. In the agreement, provision was made in clause 25-A for arbitration by Superintending Engineer of Jullundur Circle. This clause in brief provided that if any question, difference or objection whatsoever arose in any way connected with or arising out of this instrument or the meaning or operation of any part thereof * * * * *every such matter shall be referred for arbitration to the Superintending Engineer of Jullundur Circle and his decision shall be final and binding * * * * *.

Disputes having arisen between the parties, Shri Harbans Singh by his letter dated 20-9-1954 moved for a reference to be amde to the Superintending Engineer, Jullundur Circle, P. W. D. (B and R branch), Jullundur Cantonment. The matter came up before S. Hukam Singh, the then Superintending Engineer, who issued notices to the parties to appear before him on 19-11-1954 (Exhibit R. 12). On 5-11-1954, S. Hukam Singh, Superintending Engineer (Arbitrator), informed both Shri Harbans Singh and the Executive Engineer that the Executive Engineer, Amritsar Provincial Division, had represented that for want of certain information, permission of the Government was not likely to come in time and the date for hearing fixed for 19-11-1954 might be postponed; the parties were thus informed that the date of hearing was being postponed to 2-12-1954 at 10-30 A.M. in his office at Jullundur Cantonment (Exhibit R. 13).

On 9-11-1954, Harbans Singh wrote a letter to the Superintending Engineer, Jullundur Circle, acknowledging receipt of his letter dated 21-10-1954 and intimating that the date as contained in the above letter was not clear. If it was 10-11-1954, then he could not attend but if it was the 19th, then the same may be confirmed. He also enquired from the Superintending Engineer, if the Executive Engineer had obtained the sanction of the Chief Engineer so that if the sanction of the Chief Engineer so that if the sanction had not been obtained, he (Harbans Singh) may be saved of the expenses because he had to come from Allahabad (Exhibit R. 14). On 18-11-1954, a letter was issued from Shri D. C. Sharma, Superintending Engineer (Arbitrator) to Shri Harbans Singh stating that perhaps the registered letter issued from his office on 5-11-1954 to Shri Harbans Singh's address had not been received by him in which it had been notified that the date of hearing had been postponed to 2-12-1954 in his office at Jullundur Cantonment.

The change of date was stressed in this letter of 18-11-1954. Shir Harbans Singh was also informed that the Executive Engineer, Amritsar Provincial Division, was being sounded if he was desirous of a change in the date for want of the Chief Engineer's sanction (Exhibit R. 8). On 22-11-1954, the Executive Engineer wrote a letter to the Superintending Engineer requesting for a change in the date as sanction from the Chief Engineer was not likely to be received by 2-12-1954 (Exhibit R. 10).

On 30-11-1954, another letter had been addressed by Harbans Singh, from Allahabad as usual, to the Superintending Engineer, Jullundur Cantonment, intimating that since he had not heard about the sanction of the Chief Engineer having been received by the Executive Engineer, he would not be coming on 2-12-1954, the date of hearing (Exhibit R. 15). By means of a letter dated 7-12-1954, Shri D. C. Sharma informed both Shri Harbans Singh and the Executive Engineer that the date of hearing had been postponed 30-12-1954 at 10-30 A.M. in his office at Jullundur (Exhibit R. 16). On 7-12-1954, the Executive Engineer concerned again sought adjournment of the date of hearing to be extended and fixed on or about 11-1-1955 (Exhibit R. 11).

Shri D. C. Sharna thereupon postponed the date to 11-1-1955 and informed both Shri Harbans Singh and the Executive Engineer (Exhibit R. 17). This date appears again to have been postponed to 24-1-1955, with information to both the parties (Exhibit R. 18), which date was again adjourned to 25-1-1955 (Exhibit R. 19). On 16-1-1955, a registered letter was sent by Shri Harbans Singh from Allahabad to the Superintending Engineer, requesting for a copy of the pleading and defence filed by the Executive Engineer. On 20-1-1955, Shri D. C. Sharma wrote to Shri Harbans Singh reminding him of the date fixed for 25-1-1955.

On 2-2-1955, Shri Harbans Singh wrote another letter to the Superintending Engineer stating that the could not attend the Arbitrator's office on 25th and asked for information about the next date of hearing (Exhibit R. 20). It appears that Shri D. C. Sharma also wrote to the Senior Subordinate Judge, Gurdaspur, for extension of time under S. 28 of the Indian Arbitration Act and the Executive Engineer on 22-3-1955 informed the Superintending Engineer that the Court had given 24-3-1955 as the next date because the contractor was not present in the Court at the previous hearing.

On 17-4-1955, again the Executive Engineer wrote to the Superintending Engineer that as Shri Harbans Singh had not turned up, the hearing of the case stood adjourned to 25-4-1955. It appears that on 26-4-1955 the Executive Engineer informed the Superintending Engineer that on 25-4-1955 he (Executive Engineer) had attended the Court in connection with the extension of time. The contractor, however, again did not appear but the Court granted extension up to 30-6-1955. Shri D. C. Sharma thereupon informed both Shri Harbans Singh and the Executive Engineer by means of letter No. SE/1156263/G dated 7-5-1955 that the Court had granted extension of time for giving the award up to 30-6-1955.

The parties were informed that he would hold the hearing on 6th of June 1955 and they were requested to attend with all their connected papers (Exhibit R. 22). This letter was acknowledged by Shri Harbans Singh on 19-5-1955 stating that he had another engagement with the Superintending Engineer, Jodhpur Circle in Rajasthan, in the first week of June 1955 and that if that other engagement was postponed, he would be attending the hearing at Jullundur on 6th June, otherwise a request for adjournment to the second week of June would have to be made by him. He also requested the Arbitrator to get produced from the Executive Engineer some documents mentioned in that letter (Exhibit R. 6).

Siri D. C. Sharma in reply to Exhibit R. 6 informed Shri Harbans Singh that it would not be possible to change the date fixed for 6-6-1955. It was expressly stated in this letter that the Court of the Senior Subordinate Judge at Gurdaspur had to be approached for extension of time which had been granted up to 30-6-1955 before which the award had to be given (Exhibit P. 7) before which the award had to be given (Exhibit P. 7). On 26-5-1955, Shri Harbans Singh again wrote a letter to the Superintending Engineer stating that he would be definitely reaching Jullundur on 6th of June (Exhibit P. 23).

It appears that on 6th of June the parties conducted their case before the arbitrator and after the hearing, Shri D. C. Sharma gave his award on that very day and in the end of the award it is clearly stated that both parties having nothing more to say, the hearing was concluded which apparently means that the award was given in the presence of the parties. The arbitrator by means of his decision allowed a sum of Rs. 1,182/3/- as against Rs. 26,175/1/- as claimed by Shri Harbans Singh.

(3) Nothing seems to have been done for more than two years, when on 19-11-1957 a petition was filed in the Court of the Subordinate Judge at Amritsar under Section 33 of the Arbitration Act by Shri Harbans Singh praying that the award of Shri D. C. Sharma be declared as invalid, null, void and ineffective and the effect of the same may be determined by the Court. The principal ground kept in the forefront was that Shri D. C. Sharma was not competent to hold nay arbitration proceedings in the matter not to give any award as he had no jurisdiction in the matter which was never referred to him, because the reference had been made to Shri Hukam Singh whose authority had not been revoked in accordance with law and that Shri Hukam Singh was seized of the matter and had jurisdiction to Act as arbitrator.

Another objection raised related to the award not being on stamp paper and thus inadmissible and invalid. It was also alleged that Shri D. C. Sharma had not taken any arbitration proceedings and had misconducted them. It was expressly stated that the award had not so far been filed in any Court to the knowledge of the applicant nor had any notice for filing the award been served on him. The trail Court framed the following issues for trial:

1. Whether Shri D. C. Sharma had no jurisdiction in the matter?

2. Whether the grounds mentioned in para (8) of the application exist and the award is liable to be set aside?

3. Relief;

and in a very detailed and well-reasoned judgment, he disallowed the application, holding that there was no misconduct on the part of the arbitrator as the applicant never prayed for adducing evidence or for any other purpose which was refused by the arbitrator. Some of the documents which were not summoned by the arbitrator from the Executive Engineer were also held irrelevant by the learned Subordinate Judge. The dispute referred to the arbitrator was also held not to be beyond the scope of the arbitration clause. The argument that the award was perverse was also not sustained.

With respect to the contention based on the award not being properly stamped, the learned Sub-ordinate Judge disagreeing with the decision reported as Ramkumar v. Kushalchand Ganeshdas, AIR 1928 Nag. 166 held that the award in question could not be considered to be a nullity. On the main question raised by the applicant with respect to the jurisdiction of Shri D. C. Sharma, the Court below held that the arbitration in the present case had not been made to any particular individual but to the incumbent of the office of the Superintending Engineer and therefore it was within the competence of Shri D. C. Sharma to Act as an arbitrator.

(4) Feeling aggrieved by this decision, Shri Harbans Singh has come up to this Court on revision, and the same contention has been Court on revision, and the same contention has been repeated before me by his learned counsel. Mainly, stress has been laid on the power of Shri D. C. Sharma to Act as an arbitrator. To begin with, Mr. S. K. Jain has relied on Dault Ram Raja Ram, v. State of Punjab, AIR 1958 Punj 19. In that case also the relevant arbitration clause stated that 'in the matter of dispute, the case shall be referred to the Superintending Engineer of the Circle'; this expression was construed by Chopra J. to mean 'the gentleman holding the office when the dispute arises'.

This observation must be held to be confined in the context in which it is made and to the particular facts of that case. the contention that was being repelled by the learned Judge was that the arbitration was vague and unenforceable inasmuch as it did not specify the Superintending Engineer to whom the matter was required to be referred. The learned Judge was not expressing any opinion whether if at the time of coming into existence of the dispute, there is one Superintending Engineer and when the enquiry is actually to be held, there is a different Superintending Engineer, then does this expression completely and unequivocally exclude the competence of the successor Superintending Engineer to Act as an arbitrator.

To this aspect of the case the attention of the learned Judge was not attracted as this question did not arise for decision; the observation on which reliance has been placed is thus no authority for holding that in the present case Mr. D. C. Sharma was not intended by the parties to Act as arbitrator in pursuance of the arbitration clause with which I am dealing.

(5) The counsel next relied on East Indian Film Studios v. P. K. Mukherjee, AIR 1954 Cal. 41 for the proposition that another arbitrator in place of one already appointed could only be appointed when the first appointed arbitrator had neglected or refused to Act or was incapable of acting or had died. This was a case of reference under the Defence of Indian Act and the person who was appointed as an arbitrator was still readily available. The observations in this case, in my opinion, are similarly to be confined to the facts and circumstances of that particular case. Reliance is next placed on Jai Dayal Pearey Lal v. Chunnilal Parshotam Das, AIR 1951 All 359. In this case each party to the dispute had appointed its own arbitrator. One of the arbitrators subsequently ceased to be qualified to be an arbitrator, with the result that the arbitration proceedings were thus carried on before the remaining sole arbitrator and the award was given. The bye-laws of the Association, in accordance with which, the reference had been made did not provide in express terms that an arbitrator was to cease to have authority as such by ceasing to be representative of a member of the Association as was the case in the reported decision.

The Court came to the conclusion that no steps having been taken to move the Court for revocation of the authority of the said arbitrator under S. 5 of the Arbitration Act, he did not cease to have authority as an arbitrator and therefore the award given by the remaining arbitrator was invalid. This again is of practically no relevance to the case before me. Ismail v. Hansraj, AIR 1955 Raj 153 has been merely cited in support of the proposition that authority of arbitrators cannot be revoked except with the leave of the Court and that where no such leave is granted, the mere fact that the party has applied for revocation of the reference and has also served a notice on the arbitrators, does not make the award invalid.

In Ram Protap Chamaria v. Durga Prasad Chamaria, AIR 1925 PC 293 the Judicial Committee held that an award not contemplated or authorised by the order of reference of the Court is invalid. The suggestion that one and the same arbitration could be held as to matters within the jurisdiction of the Court and matters without jurisdiction of the Court between the parties to the suit and between them and other persons and partly upon an order of reference and partly under an agreement was repelled. This proposition of law has also nothing to do with the question that I am called upon to decide.

(6) The question which I am called to determine is whether or not the reference clause in the instant case is intended by the parties to cover the case of a Superintending Engineer who happens to be the incumbent of the office at the time when the dispute is to be investigated and adjudicated upon. The expression used in the agreement may be considered to be capable of two meanings, namely, the Superintending Engineer who happens to hold the office at the precise moment when the dispute arises and the person who is the incumbent of the office at the time when the dispute actually and in fact comes up for investigation, adjudication and decision.

The question in the circumstances of the present case is essentially one of intention of the parties, to determine which their conduct is of vital importance. Looking at the history of the dispute, after the present petitioner had decided to have the matter decided by arbitration, conclusively shows that the parties though that Mr. D. C. Sharma was fully competent and authorised under the arbitration clause to Act as an arbitrator. The present petitioner willingly and without protest took part in the proceedings suffered even extension of time to be granted by the Court, and look his chance of the decision going more or less favourable to him.

In these circumstances, I have not the slightest hesitation, in concluding that his intention, by agreeing to the arbitration clause, was that the individual Superintending Engineer who holds the office at the time of the enquiry into the dispute and of its adjudication was the arbitrator empowered by him to give the award. It is well settled that a Court would be wholly unwilling to assist a party who, with full knowledge of the circumstances, allows an arbitration to proceed and takes part in it and then seeks to evade it, later on, by raising a number of objections which have never occurred to him before (see Venkatachellam v. Suryanarayanamurty, AIR 1941,Mad 129 and Arban. Jupiter General Insurance Co. Ltd., v. Corporation of Calcutta, (S) AIR 1956 Cal 470). Sir James W. Colvile while delivering the judgment of the Judicial Committee in Chowdhri Murtaza Hossein v. Mt. Bibi Bechunnissa, 3 Ind App. 209, made the following important observations at page 220:

'On the whole, therefore their Lordships think that the Appellant, having a clear knowledge of the circumstances on which he might have founded an objection to the arbitrators proceeding to make their award, did submit to the arbitration going on; that he allowed the arbitrators to deal with the case as it stood before them, taking his chance of the decision being more or less favourable to himself; and that it is too late for him, after the award has been made, and on the application to file the award, to insist on this objection to the filing of the award.'

It is true that, as submitted by the learned counsel for the petitioner, jurisdiction of the arbitrators is always to be proved affirmatively but it is not disputed that the parties had actually agreed to have their dispute decided by the Superintending Engineer, Jullundur Circle. The only controversy before me is whether by the language used in the agreement clause it is the incumbent of the office at the precise moment when the dispute arises or one who holds the office when the dispute comes up for investigation. This question would hardly attract the proposition of law that the jurisdiction of the arbitrator has to be proved affirmatively. I have therefore, no hesitation in repelling the contention raised by the petitioner.

It may also be remembered that it is always open to the parties, if they wish and the arbitrator consents, to enlarge the arbitrator's jurisdiction from time to time. It is indisputable that it was open to the parties to agree that Mr. D. C. Sharma should Act as their arbitrator and if by their conduct they can be conclusively deemed to have agreed to construe the reference clause to mean that Mr. D. C. Sharma, who is the incumbent of the office at the time when the investigation takes place, should Act as arbitrator there could be nothing ultra vires or so contrary to law as to make his award a nullity.

(7) Dealing with the question of absence of stamps, the counsel has repeated his reliance on AIR 1928 Nag 166. In this case Kinkhede, A. J. C., observed that unless and until an award is engrossed on a stamp paper it has no validity and cannot operate as an award. It has not valid existence and the Court cannot be justified in looking at it, or in acting upon it, far less, can it pass a decree in terms thereof. This contention, however, has been fully answered by the learned Subordinate Judge and nothing substantial has been urged against the validity of the argument of the Court below.

The Court has not so far been called upon to Act upon the award, with the result that, in my view, at this stage it is hardly open to the petitioner to apply to the Court for determining this point. But this apart, in my vies, the Court generally looks with disfavour upon objections, taken merely, on account of the absence of stamps, this matter really relating to revenue. If and when a particular document becomes invalid and strikes at the root of the matter it may, of course, be relevant to raise the point. In the present case, before the award had been filed in Court, the present petitioner sought to raise the objection which was, in the circumstances, not in order.

(8) In so far as the allegations relating to misconduct of the arbitrator are concerned, nothing substantial has been urged by the counsel for the petitioner. It is well settled that Court cannot be expected to go into the entire proceedings before the arbitrator and make a sifting investigation or enquiry in the merits.

(9) In the end I may also observe that this is after all a revision and interference with award on revision is much more objectionable than on appeal (see Ghulam Khan v. Muhammad Hassan, ILR 29 Cal 167 (PC) at page 185).

(10) As noticed in an earlier part of the judgment, extension of time under Section 28 of the Arbitration Act was obtained from the Court of the Senior Subordinate Judge, Gurdaspur. Under section 31(4) of the Act an application having be made in the Court at Gurdaspur, the said Court alone would have jurisdiction over the arbitration proceedings and all subsequent applications arising out of the reference in the arbitration proceedings had to be made in the Gurdaspur Court, and in no other Court.

The petitioner Harbans Singh appears to have approached the wrong Court under section 33 of the Act but this objection have neither been raised in the Court below nor before me loses its importance because under section 21 of the Code of Civil Procedure objections as to the territorial jurisdiction, are hardly of any value in the appellate or revisional Court unless raised in the Court of first instance at the earliest possible opportunity and also unless there has been a consequent failure of justice. The Code of Civil Procedure is made applicable to proceedings under the Arbitration Act by virtue of section 41 of the said Act.

(11) For the reasons given above, this revision fails and is dismissed. There will, however, be no order as to costs of this revision.

KC/D.H.Z.

(12) Revision dismissed.


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