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Parkash Chand Ahuja Vs. Dinesh Finance and Chit Fund Co. (Pvt) Ltd. - Court Judgment

LegalCrystal Citation
SubjectArbitration
CourtPunjab and Haryana High Court
Decided On
Case NumberF.A.F.O. No. 123 of 1980
Judge
Reported inAIR1983P& H67
ActsArbitration Act, 1940 - Sections 30 and 33; Limitation Act - Schedule - Article 119
AppellantParkash Chand Ahuja
RespondentDinesh Finance and Chit Fund Co. (Pvt) Ltd.
Cases Referred and Joseph Philip v. Verkey Mathai
Excerpt:
.....227 of the constitution. - 119 of the limitation act, the period of limitation for an application to set aside the award under the arbitration act being to run from the date of service of the notice of the filing of the award'.faced with this situation, the learned counsel for the appellant contended that the objections were filed by him under section 30, as well as s. in view of this authoritative pronouncement, the judgment of the delhi high court cannot be said to be still good law......the award under ss. 30 and 33 of the arbitration act were filed on jan 4, 1978. according to the learned counsel for the appellant, the objection filed on jan. 4, 1978 were within time, because copy of the application filed by the arbitrator was provided to him on dec. 6, 1977. according to the findings of the learned subordinate judge, the copy of application filed by the arbitrator was given to the appellant on nov. 24, 1977 when he was served through summons for dec. 6, 1977. the endorsement made thereon in the hand of the appellant is that summons and the copy received. the summons is duly signed by parkash chand ahuja, appellant on nov. 24, 1977. admittedly, if the time is to run from nov. 24, 1977, then the objections filed on jan. 4, 1978 are bared by me, because under art. 119.....
Judgment:

1. This appeal is directed against the order of the Subordinate Judge I Class, Chandigarh whereby the objection petition under Ss. 30 and 33 of the Arbitration Act, 1940 filed on behalf of Parkash Chand Ahuja, appellant, was dismissed, being barred by time. The award dated Oct. 5, 1977 was given by the Arbitrator in which the appellant was found liable to pay Rs. 29,663/- with interest at the rate of 12 per cent per annum from the date of the award up to the date of actual payment to the claimant-respondent. This award was filed in Court by the Arbitration on Oct. 17, 1977. The learned Subordinate Judge Passed the following order thereon:--

'Present: The Arbitration in person.

Award has been filed. Notice to the parties be issued for filing the objections to the award on payment of process fee. To come up on 6-12-1977.'

Later on, the respondents also filed an application on Oct. 19, 1977 for making the said award to be a rule of the Court. An application for ad interim attachment of the property was also filed on which ex parte order was passed on Nov. 21, 1977. Application for vacation of the ex parte order of attachment was filed on behalf of the appellant on Nov. 22, 1977. However, on Dec. 6, 1977 an undertaking was given on behalf of the appellant with respect to the payment of the amount found due against him. Thus, on Dec. 6, 1977 the Court passed the following order :--

'Present : Counsel for the Dinesh Finance--D. H. and counsel for Parkash Chand, respondent.

Copy of application filed by the arbitrator has been provided to counsel for Parkash Chand, respondent. Counsel for D. H. has also filed an application for making the award a rule of the Court. Copy of the same has also been provided. To come up for filing the objection if any on 24-12-1977. Admittedly, the objections to the award under Ss. 30 and 33 of the Arbitration Act were filed on Jan 4, 1978. According to the learned counsel for the appellant, the objection filed on Jan. 4, 1978 were within time, because copy of the application filed by the arbitrator was provided to him on Dec. 6, 1977. According to the findings of the learned Subordinate Judge, the copy of application filed by the arbitrator was given to the appellant on Nov. 24, 1977 when he was served through summons for Dec. 6, 1977. The endorsement made thereon in the hand of the appellant is that summons and the copy received. The summons is duly signed by Parkash Chand Ahuja, appellant on Nov. 24, 1977. Admittedly, if the time is to run from Nov. 24, 1977, then the objections filed on Jan. 4, 1978 are bared by me, because under Art. 119 of the Limitation Act, the period of limitation for an application to set aside the award under the Arbitration Act being to run from the date of service of the notice of the filing of the Award'. Faced with this situation, the learned counsel for the appellant contended that the objections were filed by him under Section 30, as well as S. 33 of the Arbitration Act. In the objection petition he did not challenge the Award alone, but also alleged that there was no arbitration agreement on which any reference could be made. According to the learned counsel, the award was claimed to be a nullity in the absence of any valid arbitration agreement. Such objection, according him, was not the one under Section 30 of the Act and therefore, the objection petition was within time as Article 119 would not be attracted in that case which only provides for setting aside the award under the arbitration agreement and not for setting aside the arbitration agreement. In support of this contention, he mainly relied upon a Full Bench judgment of the Delhi High Court reported as Prem Sagar Chawla v. M/s. Security and Finance (P.) Ltd., (1967) 69 Pun LR 214: (AIR 1968 Delhi 21). The question referred to the Full Bench was as under :--

'Whether an application under Section 33 of the Arbitration Act, 1940, challenging the validity of an award on the ground of non-existence of the arbitration agreement, is governed by Art. 119(b) of the Limitation Act, 1963(previously Art., 158 of the Limitation Act,. 1908) ?'

The answer given to the question was that the non-existence and invalidity of an arbitration agreement are not grounds for setting aside the award under Section 30 of the Arbitration Act and Art. 158 of the Limitation Act, 1908 does not apply where the relief sought is to have the award declared null and void on the ground that there existed no arbitration agreement. Reference therein was also made to the judgment in United India Fire and General Insurance Co. Ltd. v. Bhagat Singh, AIR 1954 Punj 171 and Lal Chand v. Gopi Chand, AIR 1964 Punj 61. The view taken therein was not accepted by the Full Bench of the Delhi High Court. On the other hand, the learned counsel for the respondent referred to Union of India v. Om Parkash, AIR 1976 SC 1745 which was further followed in Devendra Singh v. Kalyan Singh, AIR 1978 Raj 134 and Joseph Philip v. Verkey Mathai, AIR 1978 Ker 208. After hearing the learned counsel for the parties, I am of the considered opinion that the learned Subordinate Judge rightly came to the conclusion that the objection petition filed on behalf of the appellant on Jan. 4, 1978 was barred by time as the period of limitation should be counted as prescribed under Art. 119 and not under the residuary Article of the Limitation Act, as contended by the learned counsel for the appellant. In Union of India's case (supra) it has been held that the words 'or is otherwise invalid' in S. 30(c) are wide enough to cover al forms of invalidity, including invalidity of the reference. There is no reason why the general and unqualified language of clause (c) should not include an award on an invalid reference which may be a nullity. Where such reference has been made and awards are passed in pursuance of such reference, such awards cannot be set aside as invalid on the ground that the reference was incompetent. In view of this authoritative pronouncement, the judgment of the Delhi High Court cannot be said to be still good law.

2. No other point arises. Consequently, this appeal fails and is dismissed with costs.

3. Appeal dismissed.


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