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Mrs. Tarabai Lalji Vs. Collector and ors. - Court Judgment

LegalCrystal Citation
SubjectArbitration
CourtGujarat High Court
Decided On
Judge
Reported in(1980)21GLR15
AppellantMrs. Tarabai Lalji
RespondentCollector and ors.
Cases ReferredKumbha Mawji v. Union India
Excerpt:
- - 3. in order to appreciate the multifarious contentions advanced on behalf of the plaintiff in proper perspective, it would be profitable to trace the history of this dispute which has a chequered career althrough out these years in the courts as well as before the arbitrator. the salt commissioner, however, neglected to enter upon the reference and the plaintiff, therefore, by her notice of september 15, 1970, called upon the state government as well as the collector, jamnagar, to concur in the appointment of a new arbitrator. ) jamnagar on november 3, 1970 by her application to fill up the vacancy by appointing a new arbitrator in place of the statutory arbitrator who had failed and neglected to enter upon the reference. 2. the order of reference of 30th april 1974 (hereinafter.....b.k. mehta, j.1. in this group of civil applications, the petitioner-mrs. tarabai lalji, who was plaintiff in civil suit no. 25 of 1968 on the file of the court of civil judge (s.d.) jamnagar, being suit under section 20 of the arbitration act, 1940 (hereinafter referred to as 'the plaintiff for the sake of convenience) challenges the award of april 22,1975 made by the arbitrator shri n.m. miabhoy, retired chief justice of this court, in the matter of damages pertaining to lease of certain lands admeasuring acres 2872-16 gunthas situate at village jodiya in jamnagar district, granted by the government of the state of gujarat to the plaintiff for manufacture of salt, on the grounds, inter alia, that the award being a nullity, and prays for setting aside the said award and for certain.....
Judgment:

B.K. Mehta, J.

1. In this group of Civil Applications, the petitioner-Mrs. Tarabai Lalji, who was plaintiff in Civil Suit No. 25 of 1968 on the file of the Court of Civil Judge (S.D.) Jamnagar, being suit under Section 20 of the Arbitration Act, 1940 (hereinafter referred to as 'the plaintiff for the sake of convenience) challenges the award of April 22,1975 made by the Arbitrator Shri N.M. Miabhoy, retired Chief Justice of this Court, in the matter of damages pertaining to lease of certain lands admeasuring acres 2872-16 gunthas situate at village Jodiya in Jamnagar district, granted by the Government of the State of Gujarat to the plaintiff for manufacture of salt, on the grounds, inter alia, that the award being a nullity, and prays for setting aside the said award and for certain consequential reliefs as a result thereof.

2. The State of Gujarat, which was defendant in the suit (hereinafter referred to as 'the State Government' for the sake of convenience) on the other hand, prays for a decree in terms of the aforesaid award by which the claim for damages was dismissed by the said Arbitrator.

3. In order to appreciate the multifarious contentions advanced on behalf of the plaintiff in proper perspective, it would be profitable to trace the history of this dispute which has a chequered career althrough out these years in the Courts as well as before the Arbitrator. The plaintiff had applied to the State Government for granting lease of the aforesaid land for purposes of manufacturing salt thereon by her application of December 17, 1962. She applied simultaneously on the same day to the Salt Commissioner of India for a licence to manufacture salt in reply of which the Salt Commissioner, by his letter of February 29, 1963 intimated the plaintiff that there would be no objection to the grant of the licence subject to certain conditions, inter alia, of the State Government granting lease to the plaintiff conferring proper legal title and providing therein for a clear approach road to the land in question. A copy of the said letter was sent to the State Government.

4. On June 12, 1963, the State Government granted the lease to the plaintiff for purposes of manufacturing salt and a lease deed containing terms and conditions with a site plan of the land in question was executed on August 17, 1963 between the parties, and it was registered on August 21, 1963 before the District Registrar of Jamnagar. It is claimed by the plaintiff that after taking over of the possession of the land in question, on September 14, 1963, she spent a considerable amount for construction of salt works according to the lay-out plan approved by the Assistant Salt Commissioner, Jamnagar. The plaintiff was also granted licence to manufacture salt being Licence No. 97 on October 14, 1963. It appears that some dispute arose between the plaintiff and the local authorities of the State Government about the use of the approach road to the leasehold site. It is claimed by the plaintiff that though the works were on the point of being commissioned, somewhere from October, 1965, the State Government closed down the approach road on or about August 5, 1965. The plaintiff, therefore, under Clause 19 of the said lease deed, made an application on August 14, 1965 to the Salt Commissioner of India in the matter sine; he was the statutory Arbitrator under the Salt Act. The plaintiff, by her application dated February 25, 1966, prayed for determination of compensation as claimed therein. However, it was the grievance of the plaintiff that the Salt Commissioner of India avoided to initiate arbitration proceedings and, therefore, she was compelled to move Civil Judge (S.D.), Jamnagar by her application dated April 12, 1966, being Civil Miscellaneous Application No. 41 of 1966, which was the competent court having jurisdiction in the matter, praying that the agreement be filed in the Court. This Civil Miscellaneous Application was later on numbered as Civil Suit No. 25 of 1968 on the State Government entering appearance for purposes of contest.

5. The Collector, Jamnagar, filed written statement on behalf of the State Government setting out the material particulars which, the plaintiff claimed, were not only inaccurate but intentionally misstated for purposes of confusing the real issue in dispute between the parties.

6. On July 6, 1970, the then learned Civil Judge (S.D.), Jamnagar, appointed the Salt Commissioner as Arbitrator and referred the dispute raised in paras 28 to 31 of the plaint in the said suit. The Salt Commissioner, however, neglected to enter upon the reference and the plaintiff, therefore, by her notice of September 15, 1970, called upon the State Government as well as the Collector, Jamnagar, to concur in the appointment of a new Arbitrator. The plaintiff also moved the Court of Civil Judge (S.D.) Jamnagar on November 3, 1970 by her application to fill up the vacancy by appointing a new Arbitrator in place of the statutory Arbitrator who had failed and neglected to enter upon the reference. The application was produced at Ex. 153 on the record of the trial Court.

7. Meanwhile, the State Government had filed Appeal in this Court, being First Appeal No. 690 of 1970 against the order of the learned Civil Judge of July 6, 1970 appointing Salt Commissioner as the Arbitrator. This appeal was rejected by J.M. Sheth, J. (as he then was) by his judgment and order of October 20, 1971.

8. It appears that thereafter on December 18, 1971, the plaintiff made a fresh application to fill up the vacancy by appointing a new Arbitrator. This application is produced at Ex. 157 on the record of the trial Court. On January 17, 1972, the Salt Commissioner of India sent a telegram to the learned District Government Pleader of Jamnagar intimating his refusal to act as sole Arbitrator. The plaintiff, therefore, made a third application, Ex. 172, to the Court to appoint a new Arbitrator. The learned Civil Judge, however, passed an order on the application (Ex. 157) rejecting the prayer for appointment of a new Arbitrator as in his opinion notice as prescribed under Section 8 of the Arbitration Act was not served on the State Government, which as a matter of fact was served. The plaintiff was, therefore, required to approach this Court, which she did by her Civil Revision Application No. 839 of 1972 against the said order. M.U. Shah J. (as he then was) allowed the said revision application on the concession being made by the learned Assistant Government Pleader ' that the prescribed notice under Section 8 of the Arbitration Act was served on the State Government.

9. Again, an application was made by the plaintiff for appointment of a new Arbitrator which was product at Ex. 199 on the record of the trial Court. The learned Civil Judge, on March 26,1973, granted the said application by appointing Shri N.J. Manlod, retired City Civil Judge, inspite of both the parties jointly praying for appointment of Shri N.M. I Miabhoy as Arbitrator, since his formal consent was not obtained The plaintiff, therefore, moved this Court again by her Civil Revision Application No. 460 of 1973. It is important to note here that in the said revision application, the plaintiff and the State Government made a joint application on April 30, 1974 praying for appointment of Shri N.M. Miabhoy as the Sole Arbitrator, P.D. Desai J. made the following order on the said application:

The petitioner and the first and second opponents have arrived at a settlement out of the Court in respect of the dispute which is the subject matter of this revision application. They have this day filed in the Court consent terms duly signed by the petitioner and by the learned Assistant Government Pleader on behalf of the first and second opponents. The third opponent is a formal party and though served has not filed appearance in these proceedings. Under the circumstances, I direct that consent terms to be taken on record and an order in terms of the consent terms is passed in this revision application. The only direction which is required to be given in addition to what the parties have agreed between themselves is that the Arbitrator should file the award in this Court. The petitioner is agreeable to this course and the learned Assistant Government Pleader, on behalf of the first and second opponents, states that he has no instruction to oppose the proposed direction. Accordingly I direct the Arbitrator to file the award in this Court within the time limited. Rule made absolute in terms aforesaid with no order as to costs in the circumstances of the case.

In other words, this Court in terms of the agreement between the parties, appointed Shri N.M. Miabhoy and with the consent of the petitioner-plaintiff and in view of no objection by the State Government directed the Arbitrator so appointed to file his award in this Court. It is this direction and the effect of the order of the learned Single Judge of this Court which is the matter of hot contest between the parties in this group of applications.

10. To continue the narration, pursuant to the aforesaid order of this Court of April 30, 1974 appointing Shri N.M. as the Arbitrator, the plaintiff filed her statement of case, before him. The State Government filed its written statement reiterating the same contentions, which were advanced in the written statement in the suit and urging two other points besides the same. It appears that the State Government by their application of July 21, 1974 moved the Arbitrator for allowing the amendments by introducing two paragraphs, namely, 28A and 29A in their original written statement in the suit incorporating the aforesaid two new points urged in the written statement before the Arbitrator. The plaintiff, by her reply of August 18, 1974, opposed the proposed amendments. The learned Arbitrator, by his order bearing No. 9-B of September 8, 1974, allowed the amendment sought for since the period fixed for filing the award was expiring on October 30, 1974. He also moved this Court by his letter of October 25, 1974, for extending time upto 30th April 1975. The plaintiff, therefore, by her civil application No. 2545 of 1974 of October 29, 1974 moved this Court seeking directions against the order of the Arbitrator allowing the amendments. This Court by its order of December 12, 1974 rejected the said Civil Application reserving the liberty to the plaintiff to agitate the said question, if and when she challenged the award, by appropriate proceedings. The plaintiff also moved this Court by her Civil Application No. 134 of 1975 on January 21, 1975 for removal of Shri Miabhoy as the Arbitrator between the parties. It appears that thereafter the plaintiff remained absent before the Arbitrator on January 19, 1975, who, by his order bearing No. 18 of February 2, 1975, directed to continue the proceedings ex-parte in the matter. The plaintiff claims that no notice as required under Section 42 of the Arbitration Act was served on her to remain present on January 19, 1975. Another I important fact which should be noted at this stage is, that this Court, speaking through D.P. Desai J., by its order of March 4, 1975, dismissed Civil Application No. 134 of 1975 of the plaintiff praying for removal of the Arbitrator. It appears that thereafter on April 22, 1975, the Arbitrator made an ex-parte award dismissing all the claims of the plaintiff. On the same day, the learned Arbitrator filed the said award as directed by this Court in this Court in the proceedings in Civil Revision Application No. 460 of 1973. The learned Government Pleader sought the direction of this Court on April 29, 1975 enjoining the Arbitrator to get the award registered. The plaintiff, therefore, filed two applications, being Civil Applications Nos. 2235 and 2237 of 1975, for setting aside the award and declaring it as a nullity under Section 30 and 32 of the Arbitration Act, 1940.

11. A number of miscellaneous applications have been made by the plaintiff in these two main applications. These miscellaneous applications are more or less of formal nature and the main application with which I am concerned are the aforesaid two applications, namely, Civil Applications Nos. 2235 and 2237 of 1975. However, the purpose of these miscellaneous applications may be shortly stated.

12. Civil Application No. 822 of 1976 and Civil Application No. 845 of 1976 are for purposes of seeking amendments by raising new points in Civil Application No. 2235 of 1975, which is for setting aside the award.

13. Civil Application No. 823 of 1976 is for seeking permission of this Court for initiating criminal prosecution against the Arbitrator under Section 340 of the Criminal Procedure Code. This application was withdrawn by the learned Advocate Mr. Chhatrapati, who appeared for the plaintiff on April 20, 1977 as noted in the minutes of this Court when this application came up for hearing before this Court.

14. Civil Application No. 846 of 1976 is similarly for amendment seeking to add some additional points in the main application No. 2235 of 1975 Which is for declaring the award a nullity.

15. Civil Application No. 1906 of 1977 is made in the main application No. 2235 of 1975 praying, inter alia, that the Arbitrator has no jurisdiction to give the award and to treat that question as a preliminary issue.

16. Civil Application No. 417 and Civil Application No. 1475 both of 1978 are the written arguments of the plaintiff in the aforesaid two main applications, namely, Civil Applications Nos. 2235 and 2237 of 1975.

17. On the other hand, the State Government has filed Civil Application No. 581 of 1976 in Civil Revision Application No. 460 of 1973 praying for a decree in terms of the aforesaid award, and Civil Application No. 1532 of 1977 is also filed by the State Government praying that their Civil Application No. 581 of 1976 be treated as a suit. This last application of the State Government is sought to be opposed by the plaintiff on the grounds stated in her Civil Application No. 5821 of 1977 by which she has ultimately prayed that, in any case, if all her objections to the last application of the State Government are rejected, this Court has no jurisdiction under any provision of law to decide the complicated questions arising between the parties out of the; aforesaid application filed in Civil Revision Application No. 460 of 1973 since this Court which is seized of the matter cannot decide the questions in exercise of its revisional jurisdiction.

18. It should be noted that the plaintiff had also made Civil Application No. 3123 of 1977 after the special leave was refused by the Supreme Court in the matter of her prayer for transfer of these applications from this Court praying for raising a number of issues and hearing them as preliminary issues before the Court embarks upon the regular inquiry in connection with the validity of the award. This Court has by its order of October 4/November 28, 1977, culled out the four main points of dispute between the parties and raised them as preliminary issues which are as under:

(1) Whether the High Court has jurisdiction to make an order of reference as it did by its order of 30th April 1974 to Arbitrator? If yes, whether the direction of the Court in the said order to file the award in this Court is justified in facts? Even if so justified, is it a nullity?

(2) Whether the order of reference of 30th April, 1974 is barred on principles of res judicata by the decision in First Appeal No. 690 of 1970 and Civil Revision Application No. 839 of 1972?

(3) Whether the award of this Court is a nullity for want of obtaining the extension of time by the Arbitrator when the award could not be made within the time stipulated in joint pursis of April 13, 1974?

(4) Whether the Arbitrator is liable to re-deposit the sum of Rest. 20,000/- in case it is held that the award was a nullity?

19. It should be stated that only these four questions have been raised, though a number of contentions was urged and a score of points suggested on behalf of the plaintiff by the memo of preliminary points filed by her Constituted Attorney on 29th September, 1977 before this Court after the matter was received from the Supreme Court. The subsidiary points which have been raised and referred to in the aforesaid order of this Court are merely different aspects of the same questions which have been included and covered by the aforesaid issues and, therefore, this Court has not thought fit to raise a specific issue for each of such subsidiary contentions and points urged in the memo of preliminary points filed on behalf of the plaintiff, as stated above, on 29th September 1977.

20. The real point at issue between the parties is about the jurisdiction of this Court to make an order of reference as it did by its order of April 30, 1974 to the Arbitrator, and the direction given by this Court therein to file the award in this Court. In other words, the real controversy is, whether the award is a nullity inasmuch as this Court had no jurisdiction to make the order of reference. Issue No. 4 raises merely consequential question as to whether the Arbitrator should be directed to re-deposit the amount of Rs. 20,000/- paid to him by way of his remuneration for his work. In other words, if at all such a direction would be necessary, apart from the legality or justification of such a direction, it would depend on the answer to issues Nos. 1 to 3 or any of them.

20A. I will, therefore, first take issue No. 3 The award has been challenged on the ground that it was not made within the prescribed period under the Arbitration Act. Clause 3 of the First Schedule to the Arbitration Act provides that the arbitrators shall make their award within four months after entering on the reference or after having been called upon to act by notice in writing from any party to the arbitration agreement or within such extended time as the Court may allow. Section 23 of the Arbitration Act empowers Court while making an order of reference to specify such litre as it thinks reasonable for making of the award. The combined effect of Clause 3 of the First Schedule to the Act and Section 23 thereof is that if a reference is made through Court, the Court has to fix the time in the order of reference. If it is not made through Court and if no time is fixed in the arbitration agreement, the award is to be made within four months. Before Clause 3 of the First Schedule to the Arbitration Act, 1940 was placed on the statute book, the arbitrators had the power to extend time in case when the reference is made outside the Court but now under Clause 3, the power to grant extension even in case where the arbitration is outside the Court is vested in the Court by virtue of Section 28. Section 28 empowers the Court only to enlarge time for making the award. I have, therefore, to see as to what time was specified by the Court while making the order of reference for making the award, and if the award was not made within that time, whether it was extended by the Court. As stated above, the original order of reference was made by P.D. Desai J. on April 30, 1974 appointing Shri N.M. Miabhoy as the Arbitrator, and directed him that he should file the award in this Court within six months from the date of the order, that is, on or before October 31,1974. It appears that the learned Arbitrator has by his letter of October 25, 1974 prayed for extension of time of six months for making his award. In effect, he therefore prayed for extension of time upto April 30, 1975. The Court has granted the extension as prayed for with the consent of the parties, and the Additional Registrar of this Court, by his letter of November 7, 1974, informed the learned Arbitrator that this Court has been pleased to grant extension of time upto April 30, 1975. It should be recalled that the award has been pronounced on April 22, 1975 and, therefore, it cannot be urged successfully that the award is a nullity since it has not been made within the prescribed period under law. The submission made on behalf of the plaintiff in connection with this issue No. 3 is to be found at item No. 14 of Civil Application No. 417 of 1978 where it has been urged that the contentions advanced in respect of issue No. 1 would cover and include the contentions in respect of issue No. 3. In other words, there is no dispute about the fact stated above that this Court has originally fixed up the time within which the reference was to be made and also about the grant of the extension of time to the learned Arbitrator for making his award on or before 30th April, 1975. The real dispute is, which Court can specify the time within which the award was to be made or can grant the extension if required. This aspect of the question would, therefore, depend on the answer which will be given to the issue No. 1 and will, therefore, decide the contention urged in respect of the present issue also. But so far as the factual aspect is concerned about the grant of time and extension thereof, there is no dispute. Issue No. 3 can, therefore, be answered for or against the plaintiff according to the answer of the question raised at issue No. 1 which pertains to the jurisdiction of this Court.

21. This, therefore, takes me to issue No. 2. The order of reference of 30th April 1974 (hereinafter called 'the impugned order') is challenged on the ground of it being bad on the general principles of res judicata, by the decision of this Court in First Appeal No. 690, of 1970 and Civil Revision Application No. 839 of 1972. In order to understand this challenge, it would be profitable to recapitulate shortly certain facts.

22. On July 6, 1970 the learned Civil Judge (S.D.) Jamnagar had appointed Salt Commissioner as Arbitrator and referred the dispute raised in paragraphs 28 to 31 of the plaint in the arbitration suit filed by the plaintiff. The Salt Commissioner neglected to enter upon the reference. The plaintiff thereafter made an application (Ex. 15) on the record of the trial Court) to fill up the vacancy by appointing a new Arbitrator in place of the statutory Arbitrator and moved the Court of Civil Judge (S.D.) Jamnagar accordingly, after calling upon the Government to concur in the appointment of the new Arbitrator. The State Government had preferred an appeal in this Court against the said order of the learned Civil Judge of July 6, 1970. This appeal was rejected by J.M. Sheth J. (as he then was) by his judgment and order of October 20, 1971. On December 18, 1971, it appears that the plaintiff made a fresh application to fill up the vacancy by appointing new Arbitrator (Ex. 157 on the record of the trial Court). The Salt Commissioner of India by his telegram of January 17, 1972 intimated his refusal to act as a sole Arbitrator. The plaintiff, therefore, made a third application (Ex. 172 on the record of the trial Court) to appoint a new Arbitrator. The learned Civil Judge, however, passed an order on the application, Ex. 157, rejecting the prayer for appointing a new Arbitrator as in his opinion, the notice as prescribed under Section 8 of the Arbitration Act was not served upon the State Government, which, as a matter of fact, was served. The plaintiff was, therefore, required to approach this Court which she did by her Civil Revision Application No. 839 of 1972 against the order of the Civil Judge (S.D.) Jamnagar on Application Ex. 157. This revision application was allowed by M.U. Shah, J. on the concession made by the learned Assistant Government Pleader appearing on behalf of the State Government that the prescribed notice under Section 8 was served. These two orders of the learned Single Judges of this Court, namely, in First Appeal No. 693 of 1970 and Civil Revision Application No. 839 of 1972 are relied upon for purposes of urging that the impugned order of reference is bad on the general principles of res judicata.

23. I have not been able to appreciate how the two orders made by the learned Single Judges of this Court, namely, J.M. Sheth, J. and M.U. Shah J. in First Appeal No. 690 of 1970 and Civil Revision Application No. 839 of 1972, respectively, would operate as res judicata, to the impugned order. It should be recalled that First Appeal No. 693 of 1970 was filed by the State Government against the order of Civil Judge (S.D.) Jamnagar of July 6, 1970, appointing the Salt Commissioner as Arbitrator and referring the dispute in the suit to him. Now, this appeal was rejected by the learned Single Judge. Similarly, Civil Revision Application No. 839/72 was against the order of Civil Judge (S.D.) Jamnagar on application, Ex. 157, filed by the plaintiff to appoint a new Arbitrator in place of the Salt Commissioner, who refused to enter upon the reference. The learned Civil Judge (S.D.) Jamnagar has rejected this application of the plaintiff, because, in his opinion, the notice as prescribed under Section 8 of the Arbitration Act was not served upon the State Government. The Revision Application was allowed by the learned Single Judge (M.U. Shah J.) since it was conceded on behalf of the State Government that the prescribed notice was served. Now, in these two matters, the question which was at issue was not the same as it was in Civil Revision Application No. 463 of 1973, in which finally, with the consent of the parties, the Arbitrator was appointed and an order of reference was made. 1 can do no better than merely reproducing this contention as elaborated in the written brief of submissions made on behalf of the plaintiff. The elaborate contention is to be found in sub-para (viii) of paragraph 13 of her Civil Application No. 417/78 which reads as under:

That in view of the decision of this Hon'ble Court in First Appeal No. 690 of 1970 and C.R.A. No. 839 of 1972, the decision so given earlier would be res judicata at all subsequent stages as held in : [1960]3SCR590 . So the order of reference made by the Court of the Civil Judge, Senior Division, Jamnagar in Special Civil Suit No. 25 of 1968 was an established fact, and Section 31(4) of the Act would come into play. Also the decision in C.R.A. No. 839/72, finally determined, that as a reference was already made earlier in Special Civil Suit No. 25 of 1968, the further proceedings were limited only to substituting name of an arbitrator under Section 8 and the order in C.R.A. No. 839 of 1972, gave specific directions to the Lower Court only to appoint a new arbitrator in place of No. 3 under Section 8(1)(b) of the Arbitration Act. The usurpation of jurisdiction by this Hon'ble court in C.R.A. No. 460 of 1973 to pass an order of reference dated 30-4-1974 and directing the arbitrator to file the award in High Court under the Revisional power under Section 115 of the Civil Procedure Code independently of Section 8 of the Arbitration Act was a nullity and a res judicata in view of decision in F.A. No. 690 of 1970 and C.R.A. No. 839 of 1972.

24. In my opinion, there is a clear confusion in this contention. In effect and substance, it appears that the plaintiff is seeking to contend that it is only the Court of Civil Judge (Senior Division), Jamnagar, which has the jurisdiction to make an order of reference, or for that matter to appoint an Arbitrator, and no other Court has power or authority to appoint an Arbitrator or to make an order of reference in view of the provisions contained in Section 31(4) of the Arbitration Act. This is purely a question of jurisdiction in respect of which issue No. 1 has been specifically raised. How the two orders of this Court in First Appeal No. 690 of 1970 and Civil Revision Application No. 839 of 1972 would operate as res judicata to the impugned order is not clear to me, nor it has been made clear in the written brief of the submissions filed on behalf of the plaintiff. It is an admitted position that in the aforesaid two matters, no question has been finally determined which was again a subject matter in issue in Civil Revision Application No. 463 of 1973. The question at issue in Civil Revision Application No. 460 of 1973 was, whether the appointment of Shri N.J. Mankad was proper or not, while the question at issue in First Appeal No. 690 of 1970 was, whether the appointment of Salt Commissioner was legal, and the question at issue in Civil Revision Application No. 839 of 1972 was, whether the order of the learned Civil Judge (Senior Division), Jamnagar, refusing to fill in the vacancy was legal and proper, because it proceeded on assumption that the prescribed notice under Section 8 of the Arbitration Act, 1940 was not served, though, in fact, it was. The impugned order appointing Shri N.M. Miabhoy as Sole Arbitrator and making reference to him has been made by this Court with the consent of both the parties. I have, therefore, not been able to appreciate how the two earlier orders of this Court in the aforesaid two matters can operate as res judicata. The question, whether this Court has jurisdiction or not, is a question apart which will be answered on its own merits. Issue No. 2 has, therefore, got to be answered in the negative and against the plaintiff.

25. This, therefore, takes me to the real controversy between the parties as to whether this Court has jurisdiction to make the impugned order, and, in any case, the direction of the Court to file the award in this Court was justified. In other words, the question is, whether the impugned order of reference is a nullity inasmuch as the only Court which has the jurisdiction to make the order of reference or for that matter to appoint an Arbitrator and to give him consequent directions in the matter is the Court of Civil Judge (S.D.) at Jamnagar. The burden of song of the plaintiff is that since the Court of Civil Judge (S.D.) at Jamnagar was the competent Court which had the jurisdiction in the subject matter of the suit, namely, the right of the plaintiff to claim damages as a result of the alleged breach of the agreement of lease in respect of the lands situate within the district of Jamnagar, that Court alone has jurisdiction over the arbitration proceedings and all subsequent applications arising out of that reference and the arbitration proceedings must be made in that Court, and in no other Court. It is, therefore, urged in the written brief of the submissions filed on behalf of the plaintiff, that this Court could not have made the impugned order of reference and gave direction to file the award in this Court, because, the application to file arbitration agreement in Court under Section 20 of the Arbitration Act, 1940 was made in the Court of Civil Judge (S.D.) at Jamnagar, since that Court had the jurisdiction to decide the question forming the subject matter of the reference as it was the competent Court to determine those questions if they had arisen in the suit. The entire challenge, raised on behalf of the plaintiff to the impugned order, and the various aspects canvassed, turned on the determination of this question, whether this Court had the jurisdiction to make the impugned order of reference and to give direction to the Arbitrator to file the award in this Court.

26. In the first place, the learned Government Pleader invited my attention to the fact that the impugned order of reference and the appointment of the Arbitrator were made by this Court with the consent of the parties. As a matter of fact, impugned order of reference was made by this Court in Civil Revision Application No. 460/73 preferred by the plaintiff as she was aggrieved by the order of Civil Judge (S.D.) Jamnagar appointing Shri N.J. Mankad as the Arbitrator. In course of hearing of this Civil Revision Application, the plaintiff as well as the State Government filed a joint pursis agreeing to the appointment of Shri N.M. Miabhoy as the Sole Arbitrator and for direction that he should file his award within six months and as per the provisions of the Arbitration Act applicable to the case. It was further pointed out by the learned Government Pleader that the plaintiff has althroughout these proceedings before the Arbitrator submitted to his jurisdiction and never questioned it. The learned Government Pleader also emphasised that the plaintiff had agreed before this Court for granting extension of time to the Arbitrator for making his award. It was only when bar claim was rejected by the Arbitrator and the award was made accordingly that the plaintiff has thought fit to question the very order of reference and challenged the jurisdiction of this Court in making a reference to him and giving the direction of filing the award in this Court. There is also another aspect of the conduct of the plaintiff which was pointed out by the learned Government Pleader that if the Court of Civil Judge (S.D.) Jamnagar was the only competent Court having jurisdiction in the matter under Section 20 of the Arbitration Act read with Section 31 thereof, the plaintiff could not have agitated the question regarding the validity of the award or for that matter the arbitration agreement between the parties in the terms of which this Court made the order of reference by making applications to this Court as she did. The main applications, namely, Civil Applications Nos. 2235 and 2237 of 1975 for setting aside the award and for declaring it as a nullity have been made to this Court in Civil Revision Application No. 460/73. The learned Government Pleader urged that the objection as to the local jurisdiction of the Court does not stand on the same footing as an objection to the competence of a court to try a case which goes to the very root of the jurisdiction and, therefore, cannot be waived, but an objection as to the local jurisdiction of the Court can always be waived. In support of his contention, he has relied on two decisions of the Supreme Court (i) Hiralal Patni v. Sri Kali Nath AIR 1952 SC 199, and (ii) Bahrein Petroleum Co. Ltd. v. P.J. Pappu and Anr. AIR 1966 SC 624.

27. This contention advanced on behalf of the Government was sought to be repelled on behalf of the plaintiff that where the Court, or the Arbitrator has no inherent jurisdiction, no amount of consent, acquiescence or waiver can be created and equally an estoppel against a party cannot confer a jurisdiction on a Court where it had none.

28. In my opinion there is much force in the contention of the Government that the plaintiff, having once agreed to this Court making an order of appointment of Shri N.M. Miabhoy as Arbitrator and making an order of reference of the dispute to him, is estopped from challenging the award as a nullity, since the impugned order of reference was made with his consent. It has been urged on behalf of the plaintiff that the consent cannot confer any jurisdiction on the Court, if it had none under the statute. It is axiomatic to assert this principle of law. It is a trite position of law that consent cannot confer jurisdiction. The question is not the confirment of jurisdiction, but a right of the party who has given its consent before the Court to the appointment of an arbitrator and making of an order of reference to him and as a result of that concession the opposite party agreeing to that course which is accepted by the Court, would it be open to such a party to challenge the consent order itself on the ground that the Court lacked the jurisdiction in making the order in terms of the compromise between the parties?

29. In Hira Lal Patni's case (supra), the Supreme Court was concerned with the validity of a decree in terms of an award made by an arbitrator in a pending suit in Bombay High Court challenged in execution proceedings in Executing Court at Agra on the ground of lack of inherent jurisdiction in the Bombay High Court which passed the decree in terms of the award. The Executing Court at Agra dismissed the objection and, dismissal was confirmed by the Allahabad High Court. In appeal before the Supreme Court, it was contended on behalf of the judgment-debtor that the suit instituted on the original side of the Bombay High Court was wholly incompetent for want of territorial jurisdiction and that, therefore, the award that followed on the reference between the parties and the decree of Court under execution were all null and void. Reliance was sought to be placed on behalf of the appellant in that case on the decision of the Privy Council in Ledgard v. Bull 13 Ind App. 134. Rejecting the contention Sinha C.J. (as he then was) speaking for the Court held that the validity of the decree can be challenged in execution proceedings only on the ground that the Court which passed the decree was lacking in inherent jurisdiction, in the sense that it could not have seized of the case because the subject matter was wholly foreign to its jurisdiction or that the defendant was dead at the time the suit had been instituted or decree passed, or some such other ground which could have the effect of rendering the court entirely lacking in jurisdiction in respect of the subject matter of the suit or over the parties to it. The objection as to the want of territorial jurisdiction was not considered tantamount to inherent lack of jurisdiction. The Supreme Court, therefore, held as under:

The objection to its territorial jurisdiction is one which does not go to the competence of the court and can, therefore, be waived. In the instant case, when the plaintiff obtained the leave of the Bombay High Court on the original side, under Clause 12 of the Letters Patent, the correctness of the procedure or of the order granting the leave could be questioned by the defendant or the objection could be waived by him. When he agreed to refer the matter to arbitration through court, he would be deemed to have waived his objection to the territorial jurisdiction of the court raised by him in his written statement. It is well settled that the objection as to local jurisdiction of a Court does not stand on the same footing as an objection to the competence of a court to try a case. Competence of a court to try a case goes to the very toot of the jurisdiction, and where it is lacking, it is a case of inherent lack of jurisdiction. On the other hand an objection as to the local jurisdiction of a court can be waived and this principle has been given a statutory recognition by enactment like Section 21 of the Code of Civil Procedure. Having consented to have the controversy between the parties resolved by reference to arbitration through Court, the defendant deprived himself of the right to question the authority of the court to refer the matter to arbitration or of the arbitrator to render the award. It is clear, therefore, that the defendant is estopped from challenging the jurisdiction of the Bombay High Court to entertain the suit and to make the reference to the arbitrator. He is equally estopped from challenging the authority of the arbitrator to render the award.

This principle was affirmed again by the Supreme Court in Bahrein Petroleum Co's case (supra), though on the facts and in the circumstances of that case before the Court the plea of waiver was not upheld. Bachawat J., speaking for the Court set out the principle in the following terms:.If the defendant allows the trial Court to proceed to judgment without raising the objection as to the place of suing and takes the chance of a verdict in his favour, he clearly waives the objection, and will not be subsequently permitted to raise it. It is even possible to say that long and continued participation by the J defendant in the proceedings without any protest may, in an appropriate case, amount to a waiver of the objection.

30. I am of the opinion that there is great force in the contention of the learned Government Pleader that the plaintiff, on the facts and in the circumstances of this case, is estopped from challenging the consent order as a result of which the reference was made to the Arbitrator. It was Urged on behalf of the plaintiff that it is a fundamental principle of law that where Court has no jurisdiction over a matter, its judgment and order are null and void.

31. In Ledgard v. Bull (supra) Lord Wordson in stating the judgment of the Board said that 'when Judge has no inherent jurisdiction over a subject matter of the suit, the parties cannot, by their mutual consent, convert it into a proper judicial process although they may constitute the Judge their Arbitrator and be bound by the decision on merits when they are submitted to him. But there are numerous authorities which establish that when in a cause which the Judge is competent to try the parties without objection join issue and go to trial upon the merits, the defendant cannot subsequently dispute his jurisdiction upon the ground that there were irregularities in the initial procedure which, if objected to at that time, would have led to the dismissal of the suit. The question in the ultimate analysis is about the absence of jurisdiction or exercise of jurisdiction'. The distinction, as pointed out by the Supreme Court in United Commercial Bank Ltd v. Their Workmen AIR 1951 SC 230, is between the jurisdiction to decide matters and the ambit of the matters I to be beard by a Tribunal having jurisdiction to deal with the same. In the second class, the question of acquiescence or irregularity may be considered and overlooked, but when, however, the question is of the jurisdiction of the Tribunal to make an award, no question of acquiescence or consent can affect the decision. I would, therefore, like to address myself to the real question, whether the award is a nullity, inasmuch as this Court had no jurisdiction to make the order of reference and give the directions as it did. Even if the plaintiff is not estopped from challenging the impugned order of reference, as her consent could not have conferred jurisdiction on this Court, the problem is, whether this Court had jurisdiction under the law to make the impugned order of reference. It would be necessary in this connection to refer to a few relevant provisions of the Arbitration Act.

32. Section 2(c) defines the term, 'court', which means a Civil Court having jurisdiction to decide the questions forming the subject matter of the reference if the same had been the subject matter of a suit, but does not, except for the purpose of arbitration proceedings under Section 21, include a Small Cause Court. Section 20 provides for an application to file arbitration agreement in the Court. Sub-section (1) thereof provides that where a difference has arisen between the persons who have entered into an arbitration agreement, they or any of them instead of proceeding under Chapter II, may apply to a Court having jurisdiction in the matter to which the agreement relates for filing of that agreement in the Court. Sub-section (2) predescribes that such an application is to be treated as a suit between the parties. Sub-section (3) of Section 20 requires the Court to issue notice of such application to all the parties to the said agreement, other than the applicant, calling upon them to show cause within the specified time why the agreement should not be filed. If no sufficient cause is shown by the parties opposing the application, the Court is required by Sub-section (4) to direct that the agreement be filed and to make an order of reference to the Arbitrator appointed by the parties under the agreement or otherwise, and in case of their disagreement, to an Arbitrator appointed by the Court. The arbitration is to proceed thereafter in accordance with and is governed by the other provisions of the Arbitration Act as prescribed by Sub-section (5) of Section 20. Section 31 provides for the jurisdiction of the Court. Sub-section (1) thereof requires that an award is to be filed in a Court having jurisdiction in the matter to which the reference relates. Sub-section (2) of Section 31 prohibits any Court, other than the competent Court having jurisdiction in the matter, to decide questions regarding the validity, effect or existence of an award or an arbitration agreement between the parties to the agreement, or persons claiming under them. Sub-section (3) of Section 31 enjoins that all applications regarding the conduct of arbitration proceedings or otherwise arising out of such proceedings are to be made to the Court where the award has been, or may be, filed, and to no other Court. Sub-section (4) empowers the Competent Court having jurisdiction in the matter to have control over the arbitration proceedings, and all subsequent applications arising out of the reference and the arbitration proceedings are to be made to that Court alone and to no other Court.

33. The Supreme Court in Kumbha Mawji v. Dominion of India (Now the Union of India) : [1953]4SCR878 considered the entire scheme of Section 31 of the Arbitration Act and observed as under:

Thus it will be seen on a comprehensive view of Section 31 that while the first Sub-section determines the jurisdiction of the Court in which an award can be filed, Sub-sections (2), (3) and (4) are intended to make that jurisdiction effective in three different ways, (i) by vesting in one Court the authority to deal with all questions regarding the validity, effect or existence of an award or an arbitration agreement, (2) by casting on the persons concerned the obligation to file all applications regarding the conduct of arbitration proceedings or otherwise arising out of such proceedings in one Court, and (3) by vesting exclusive jurisdiction in the Court in which the first application relating to the matter is filed.... The necessity for clothing a single Court with effective and exclusive jurisdiction, and to bring about by the combined operation of these three provisions the avoidance of conflict and scramble is equally essential whether the question arises during the pendency of the arbitration or after the arbitration is completed or before the arbitration is commenced....

34. It is in the context of these provisions that the question is to be determined, whether the impugned order of reference is without jurisdiction and consequently, therefore, the award is a nullity. On behalf of the plaintiff, in the written brief of her submissions, it has been emphasized over and over again that the application to file an arbitration agreement in the Court could have been made only to the Court of Civil Judge (S.D.) at Jamnagar, since it would have been the competent Court to determine questions arising in the reference, if they had arisen in the suit, and, in fact, the application under Section 20 (1) of the Arbitration Act was made to that Court and since the order of reference was also made by the said Court, this Court could not have made the impugned order of reference in the Civil Revision Application, and much less the State could have prayed for a decree in terms of the award rejecting the claim of the plaintiff by applying to this Court as it did, and the Arbitrator could not have filed the award in this Court as directed to be done by this Court, in view of the mandatory provisions contained in Sub-sections (1) to (4) of Section 31 of the Arbitration Act.

35. The next question, therefore, is: which is the competent Court to make the order of reference and appoint an arbitrator and to give all consequential directions in the matter? In other words, on the facts and in the circumstances of this case, whether the competent Court would be the Court of Civil Judge (S.D.) at Jamnagar to which the application under Section 20 was made by the plaintiff, and which initially made an order of reference and appointed ultimately Shri N.J. Mankad as the Arbitrator or this Court also in which a consent order was obtained by the plaintiff and the State Government in terms of the compromise between them that the dispute between the parties should be referred to the arbitration of Shri N.M. Miabhoy? The entire controversy centres round the meaning which can be assigned to the word, 'Court' in Section 20. Would it mean only the original Court or also revisional Court to which the applications have been made for exercise of revisional jurisdiction against the orders passed by the original Court? A somewhat similar situation arose before the Supreme Court in the Stale of Madhya Pradesh v. Saith and Skelton (P) Ltd. and Ors. : [1972]3SCR233 . In that case the facts were that the Government of erstwhile State of Madhya Bharat entered into a contract with M/s Saith and Skelton (P) Ltd for supply and erection of penstocks for Gandhi Sagar Power Station, Chambal Hydel Works by the said Company. Under the said contract, the Company was required to supply material for the five penstocks of F.O.R. Jhalwar Road Railway Station at a specified price and within the stipulated period. Clause 21 of the Contract provided for resolving the dispute through the arbitrators, one to be nominated by the State and the other by the Company, and in case of difference between them, the matter was to be referred to Unpire appointed by the arbitrators. Disputes arose between the State and the Company. One Shri T.R. Sharma was nominated as an arbitrator on behalf of the Company, and the State was called upon to nominate its Arbitrator. One Shri G.S. Gaitonde was nominated Arbitrator on behalf of the State. The State nominee, however, resigned with the result that Shri R.R. Desai was nominated his place on behalf of the State. The two arbitrators could not agree and the matter was required to be referred to the Umpire. The State objected to the validity of the appointment of Shri Desai since he was appointed by the Directorate General of Supplies and Disposals without authority, and consequently also to the validity of the appointment of the Umpire Shri R.C. Soni. The State Government, therefore, filed in the Court of Additional District Judge, Mandsaur, an application under Section 5 of the Arbitration Act for setting aside the nominations as arbitrators of Shri Sharma and Shri Desai as well as the appointment by them of Shri Soni as Umpire. The Additional District Judge, Mandsaur held that the appointments of Shri Desai as an Arbitrator and Shri Soni as an Umpire were invalid and not building on the State Government. The Company went in appeal before the High Court of Madhya Pradesh against the said order. The appeal was latter on treated as revision. The High Court, by its order of August 6, 1970 appointed Shri R.C. Soni as a Sole Arbitrator under Section 12(2) of the Act and modified the order of the Additional District Judge, Mandsaur. The State, therefore, carried the matter in appeal before the Supreme Court against the order of the High Court. The Company had entered the caveat. Ultimately, however, on January 29, 1971 the Supreme Court granted special leave and by consent of the parties appointed an Arbitrator whose award was sought to be made a decree of the Court by the Company, in its application, being Civil Miscellaneous Petition No. 5801/71, the State Government sought to set aside the award by making Civil Miscellaneous Petition No. 5802/71. In that set of the facts, the Supreme Court, speaking through Vaidialingam J. referred to the order of the Court by which special leave was granted and the appointment of Shri Soni as a sole Arbitrator by the High Court was set aside and in his place Shri V.S. Desai, Senior Advocate of the Supreme Court, was appointed as an Arbitrator by consent of the parties to go into all the questions in the matter and make an award. The Supreme Court thereafter referred to its order extending time for making the award with the consent of the parties. The Arbitrator gave his award and filed the same in the Supreme Court of which a notice was given to the parties. One of the contentions urged on behalf of the State Government before the Supreme Court was, that the Supreme Court was not the 'Court' as contemplated by Section 14(2) read with Section 2(c) of the Arbitration Act. Negativing this contention, Vaidialingim J. speaking for the Court, held:

According to Mr. Shroff, the award should have been filed not in this Court, but in the Court of the Addl. District Judge, Mandsaur, as that is the Court which will have jurisdiction to entertain the suit regarding the subject matter of the reference. We are not inclined to accept this contention of Mr. Shroff. It should be noted that the opening words of Section 2 are 'in this Act, unless there is anything repugnant in the subject or context,' Therefore the expression 'Court' will have to be understood as defined in Section 2(c) of the Act, only if there is nothing repugnant in the subject or context. It is in that light that the expression 'Court' occurring in Section 14(2) of the Act will have to be understood and interpreted. It was this Court that appointed Shri V.S. Desai on January 29, 1971 by consent of parties as an arbitrator and to make his award, it will be seen that no further directions were given in the said order which will indicate that this Court had divested itself of its jurisdiction to deal with the Award or matters arising out of the Award. In fact the indications are to the contrary. The direction in the order dated January 29, 1971 is that the arbitrator is 'to make his Award.' Surely the law contemplates further steps to be taken after the Award has been made, and quite naturally the forum for taking the further action is only this Court. There was also direction to the effect that the parties are at liberty to apply for extension of time for making the Award. In the absence of any other court having been invested with such jurisdiction by the order, the only conclusion that is possible is that such a request must be made only to the Court which passed that order, namely this Court.

20. That this Court retained complete control over the arbitration proceedings is made clear by its orders dated February 1, 1971 and April 30, 1971. On the former date, after hearing Counsel for both the parties, this Court gave direction that the record of the arbitration proceedings be called for and delivered to the Sole Arbitrator Mr. V.S. Desai. On the latter date, again, after hearing the Counsel, this Court extended the time for making the Award by four months and further permitted the arbitrator to hold the arbitration proceedings at Bombay. The nature of the order passed on January 29, 1971 and the subsequent proceedings, referred to above, I clearly show that this Court retained full control over the arbitration proceedings.

(Emphasis supplied by me)

The Supreme Court, therefore, rejected the contention and held that the expression 'Court' occurring in Section 14(2) of the Act is to be understood in the context in which it occurs, and so understood, the Supreme Court must also be held to be a Court under Section 14(2) where the Arbitration award could be validly filed.

36. In Nachiappa v. Subramaniam : [1960]2SCR209 , the question for consideration was, whether the trial Court had jurisdiction to refer the subject matter of a suit to an arbitrator when the appeal was pending before the High Court against the decree passed in the suit. The contention urged on behalf of the appellants before the Supreme Court was that since the reference and award were invalid the trial Court was not competent to make the order of reference under Section 21 of the Arbitration Act. The Supreme Court posed the question, whether 'Court', in the context of Section 21, would mean trial Court alone. The Court negatived the aforesaid contention of the appellants and held as under:

In considering this question it would be relevant and material to take notice of the fact that prior to the passing of the Act in 1940 the longstanding practice of Indian courts was to refer to arbitration disputes pending before the appellate court between the respective parties to the appeals. If the object of enacting Section 21 was to prohibit such reference at the appellate stage it would, as the High Court has observed, cause 'a revolution in the existing practice'. Was such a revolution really intended? Having regard to the fact that the words used in Section 21 are substantially the same as those used in Schedule II, paragraph 1, of the earlier Code, it would be difficult to sustain the plea that the enactment of Section 21 was intended to bring about such a violent departure from the existing practice. If that had been the intention of the Legislature it would have made appropriate changes in the words used in Section 21. Therefore the word 'court' cannot be interpreted to mean only the trial court as contended by the appellants. Similarly the word 'suit' cannot be construed in the narrow sense of meaning only the suit and not an appeal. In our opinion 'Court' in Section 21 includes the appellate court proceedings before which are generally recognised as continuation of the suit; and the word 'suit' will include such appellate proceedings. We may add that whereas Section 41 of the Act is consistent with this view, no other Section militates against it.

37. The neat question, as I have stated above, which arises for consideration in these applications is, whether the word, 'Court' in Section 20 would mean trial Court alone or this Court also in exercise of its revisional jurisdiction. Having regard to the entire set up of Section 20, and more particularly Sub-section (4) and Sub-section (5) thereof, it cannot be gainsaid that the word 'Court' in Section 20 would mean not only the trial Court but also the appellate Court and the revisional Court. Sub-section (4) empowers the Court to make an order of reference to the arbitrator appointed by the parties or appointed by the Court, if no sufficient cause is shown by the party opposing the application to file the arbitration agreement in the Court. In a given case, the trial Court may refuse to refer the matter to the arbitrator having agreed with the party opposing the application on the ground of sufficiency of the cause for not making the reference. The appellate Court, or the revisional Court, may reverse this order of the trial Court and refer the matter to the arbitrator. It cannot be urged successfully that if the trial Court refuses to make an order of reference, the appellate Court or the revisional Court will be without jurisdiction since it is the trial Court alone which has power under Section 20, Sub-section (1), because, it is that Court alone in which the f suit involving the same questions as those of the subject matter of reference can be filed. Sub-section (5) also provides that the arbitration shall 1 proceed in accordance with and be governed by the other provisions of I the Act including, amongst others, the provisions contained in Section 14 of the Arbitration Act. If the trial Court is the only Court, as contended I by the plaintiff herein, competent to entertain applications challenging the validity or legality of an award, and the arbitrator cannot file his award in the appellate Court or the revisional Court, which, as a matter I of fact, had made the reference, it would go against the established meaning of word 'Court' as explained by the Supreme court in Mis Saith and Skehon's case (supra). In the entire context of Section 20, therefore, I do not find any doubt that in order to effectuate the purpose of Section 20, the word 'Court' should not be narrowly construed, as contended on behalf of the plaintiff, but should also mean to include the appellate Court as, well as revisional Court. It has been urged on behalf of the plaintiff that the word 'Court' in Section 20 may include an appellate Court, but would not include revisional Court, and since in the present case the impugned order of reference has been made by the Court in exercise of its revisional jurisdiction, it should be held to be without authority and, therefore, the award made in pursuance of the said reference is a nullity.

38. In Shankar Ramchandra Abhyankar v. Krishnaji Dattatraya Bapat : [1970]1SCR322 , a question arose whether an aggrieved party can challenge by taking proceedings under Articles 226 and 227 of the Constitution of India the appellate order made under the Bombay Rent Act, 1947 when the revision application preferred from the said order was dismissed by the High Court. For purposes of answering the contention, whether the appellate order would merge in the order passed by the High Court in exercise of its revisional jurisdiction against the said appellate order, Grover J., (as he then was) speaking for the Court, examined as to what is in effect and substance the nature of revisional jurisdiction. The Court answered the question as under:

Now when the aid of the High Court is invoked on the revisional side it is done because it is a superior Court and it can interfere for the purpose of rectifying the error of the Court below. Section 115 of the Code of Civil Procedure circumscribes the limits of that jurisdiction but the jurisdiction which is being exercised is a part of the general appellate jurisdiction of the High Court as a superior Court. It is only one of the modes of exercising power conferred by the statute; basically and fundamentally it is the appellate jurisdiction of the High Court which is being invoked and exercised in a wider and larger sense. We do not therefore consider that the principle of merger of orders of inferior Courts in those of superior Courts would be effected or would become inapplicable by making a distinction between a petition for revision and an appeal.

39. In my opinion, therefore, the fact that this Court had made the impugned order of reference in exercise of revisional jurisdiction does not make any vital difference. The real question is, whether this Court, in exercise of its revisional jurisdiction, could have made the order of reference, after the appointment of Shri N.M. Miabhoy as Arbitrator in place of Shri. N.J. Mankad appointed by the Civil Judge (S.D.) Jamnagar, and giving him direction to file the award in this Court. It should be recalled that this Court was exercising its revisional jurisdiction in the matter of an application under Section 20 of the Arbitration Act where the power is conferred on the Court to order the agreement to be filed and further to make an order of reference to the Arbitrator appointed by the parties or in case of the disagreement between them to the Arbitrator appointed by the Court. In Union of India v. Shri Om Prakash : [1976]3SCR998 , a question arose whether the Court was functus officio after appointing Arbitrator under Section 8(2) of the Arbitration Act and had no jurisdiction to refer the cases to him. The short facts were that the respondent - Om Prakash - a contractor entered into seven agreements with the Military Department of the Government of India for construction of buildings. There was an arbitration Clause in these agreements providing for arbitration to different arbitrators, namely, Director of Farms (General) Headquarters, the Officer Commanding, Lucknow and a Quarter-Master at Delhi. Disputes having arisen between the parties, the respondent made applications in the Court of First Civil Judge, Meerut under Section 8(2) of the Act stating that the offices by reference to which the arbitrators were selected in the agreements had been abolished and it was therefore necessary to appoint new arbitrators. The respondent named several officers praying that one of them be appointed to act as Arbitrator. The Court appointed Col. Ranbir Singh, who was not included in the list given by the respondent to act as arbitrator in the respective disputes arising under the seven agreements and further directed the papers to be sent to him and requiring him to give his award within two months from the date of the order. Both the sides agreed to submit to the disputes to Col. Ranbir Singh for arbitration, who, however, returned the papers, after the Arbitrator had made some progress, to the Court as he was requested not to proceed further by the Government Counsel. The District Judge, Meerut transferred the cases to the Judge of Small Causes Court, Meerut presumably because the respoondent's application for appointment of arbitrator was pending in that Court. No objection was raised to the jurisdiction of the Judge of Small Causes Court, who ultimately appointed the Director of Farms (General) Headquarters, Simla to act as arbitrator in all the seven cases. He also directed that the said arbitrator should file his award within one month of the date of the order. The respondent applied to the Court for review of the order alleging that the said office had been abolished. He did not take part in the proceedings before the arbitrator appointed by the Judge of the Small Causes Court. The Arbitrator filed his award and filed the same in the Court. The review applications of the respondent were ultimately dismissed. The respondent, therefore, made applications for setting aside the award, but the Judge of the Small Causes Court over-ruled all the objections and confirmed the award and granted a decree in terms of the award in each case. The respondent carried the matter in appeal to the High Court which allowed the appeals accepting the contention that the Court was functus officio after appointing the arbitrator under Section 8(2) and had no jurisdiction to refer the case to the arbitrator. The Union of India, therefore, carried the matter in appeal before the Supreme Court. Gupta J., speaking for the Court, posed the question before the Court, whether having made the appointment the Court, acting under Sub-section (2) of Section 8, can also make an order of reference to the arbitrator, and held as under:..The Act contemplates three kinds of arbitration: (i) arbitration without intervention of a court, dealt with in Chapter II of the Act which includes Section 3 to Section 19, (ii) arbitration with intervention of a court where there is no suit pending, dealt with in Chap. III which consists of only one section, viz. Section 20; and (iii) arbitration in suits, which is covered by Chapter IV. It is clear from the provisions 'of Chapter II that after the appointment of arbitrator, the proceedings are to be outside court, and up to the stage of filing the award intervention of court is not contemplated unless any occasion arises requiring the court to remove the arbitrator under Section 11. An agreement to submit differences to arbitration implies an agreement to refer the differences to the arbitrator. Section 8 only empowers the court to appoint an arbitrator where the parties do not concur in the appointment. Section 20 occurring in Chapter III contains provisions for arbitration with the intervention of a court where there is no suit pending.

After setting out Section 20 in extenso, the Court pointed out the difference between the proceedings under Section 8(2) and proceedings under Section 20. The Court proceeded to observe after setting out Section 20 as under:

This Section confers power on the Court to order the agreement to be filed and further to make an order of reference to the arbitrator appointed by the parties, or, where the parties cannot agree upon an appointment, to an arbitrator appointed by the court. Sub-section (1) of Section 20 makes it plain that the provisions of the Section can be availed of only if, no proceeding under Chapter II has been initiated. Section 8 does not contain any provision empowering the court to make an order of reference to the arbitrator as one finds in Sub-section (4) of Section 20. Thus it seems clear that the court in the instant cases had no jurisdiction after appointing an arbitrator under Section 8(2) to proceed further to make an order referring the disputes to the arbitrator.

40. In Civil Appeal No. 1205 of 1969 decided on October 24, 1978, the Supreme Court, speaking through Kailasam J, in the context of the question that when the arbitration agreement contained adequate and exhaustive machinery for appointment of arbitrators including substitutional appointments in case the appointed arbitrator refuses to act, whether it should be construed as the arbitrator having been appointed under Sub-section (4) of Section 20 held as under:

Under Section 20(4) of the Arbitration Act when an agreement is filed, the Court is required to make an order of reference to the arbitrator appointed by the parties, whether in the agreement or otherwise, or where the parties cannot agree upon an arbitrator, to an arbitrator appointed by the court. The Sub-section requires that the court shall make an order of reference to the arbitrator appointed by the parties whether in the agreement or otherwise. If no such arbitrator had been appointed and when the parties cannot agree upon an arbitrator, the Court may proceed to appoint an arbitrator by itself. Thus if an arbitrator had been appointed whether in the agreement or otherwise, the Court shall make an order of reference to him.

41. In view of this settled legal position, it cannot be gainsaid that under Section 20 of the Act the Court does not cease to function after appointing an Arbitrator and can make an order of reference to him and give consequent directions as may be necessary and thought fit and proper. The contention urged on behalf of the plaintiff that the term, 'court' in Section 20 means only the trial Court which is, as defined in Section 2 (c) of the Arbitration Act, having jurisdiction on the subject matter of the reference if it had been the subject matter of the suit, is not well founded at all. It may be, in a given case, an appellate Court or a revisional Court; otherwise the very purpose underlying Section 20 would be stultified, because Section 20 which forms Chapter III provides for arbitration with the intervention of the Court and in a given case the trial Court may not appoint an arbitrator and make reference to him with the result that the parties may be required to go to the higher Court either by way of appeal or revision if which the arbitrator may be appointed and an order of reference is made. The effort made on behalf of the plaintiff to distinguish the orders made under Section 20 in exercise of the appellate jurisdiction and those made in exercise of the revisional jurisdiction is without any difference. It has been contended in the written brief of the submissions filed on behalf of the plaintiff that Section 20 is merely a machinery provision and the substantive rights of the parties are found in Section 8(1)(b) of the Arbitration Act and, therefore, in the facts of the present case, when the order of reference was already made by the Court of Civil Judge (S.D.) at Jamnagar by appointing Shri N.J. Mankad, the only question in revision application No. 460 of 1973 by the plaintiff was that the learned Civil Judge acted illegally and failed to exercise his jurisdiction in not appointing Shri N.M. Miabhoy as an Arbitrator even though the parties agreed before him that any one out of Shri N.M. Miabhoy, retired Chief Justice or Shri A.S. Sarela, retired Judge of this Court be appointed as an Arbitrator. It is, therefore, contended in other words, that this Court, in exercise of its revisional jurisdiction, was called upon to correct that error only by appointing Shri N.M. Miabhoy in place of Shri N.J. Mankad and that could have been done only under Section 8 (2) of the Arbitration Act. In support of this contention reliance has been sought to be placed on the decision of the Supreme Court in Prabhat General Agencies etc. v. Union of India and Anr. : [1971]2SCR564 . I am afraid that this contention is not well founded obviously for the following reasons: In the first place, I have not been able to appreciate how the decision of the Supreme Court in Prabhat General Agencies' case (supra) can be of any assistance to the cause of the plaintiff. The only question before the Supreme Court in that case was that what is the requirement for application of Section 8(1)(b) of the Arbitration Act; whether it is the intention of the parties to supply the vacancy or their intention not to supply the vacancy. The Court ruled that to take the case within Section 8(1)(b) whit is required is not the intention of the parties to supply the vacancy but their intention not to supply the vacancy. The agreements before the Supreme Court in that case related to the exploitation of certain forest produce. The disputes that had arisen between the parties were not of technical nature requiring any specialised knowledge on the part of the Arbitrator. The terms of the agreement did not disclose that the Judicial Commissioner was appointed as an Arbitrator because of any special or technical knowledge possessed by him. Hegde J, speaking for the Court, read the relevant provisions of the Act, namely, Section 8(1) and Section 20(4) of the Arbitration Act. In that context the Court observed that Section 20 is merely a machinery provision and the substantive rights of the parties are found in Section 8(1)(b). It is not the case here that any application was made to the Court under Section 8(2) of the Arbitration Act. What has been done here in the present case was that an application was made under Section 20 for filing of the arbitration agreement between the parties, and on the statutory arbitrator refusing to enter upon the arbitration, the Court was moved to appoint an arbitrator in his place. I do not think, therefore, that the decision of the Supreme Court in Prabhat General Agencies' case (supra) can take the case of the plaintiff any further.

42. A subsidiary contention is also urged in the written brief of the submissions made by the constituted attorney of the plaintiff that the learned Single Judge of this Court, who made the impugned order of reference, travelled beyond the consent terms filed before him, and, therefore, to that extent the order was bad. The consent terms effected between the parties merely prayed for setting aside the order of Civil Judge (S.D.) Jamnagar appointing Shri N.J. Mankad as arbitrator and 'appointing Shri N.M. Miabhoy as a sole arbitrator for arbitrating upon the disputes mentioned in paras 28 to 31 of the plaint, Ex. 1, of Special Civil Suit No. 25 of 1968, and that the arbitrator should file his award within six months and as per the provisions of the Arbitration Act applicable to the case'. It is, therefore, contended that this Court acted beyond its jurisdiction in making an order of reference and directing the arbitrator to file his award in this Court. I must confess that this subsidiary contention does not appeal to me at all. In the first place, if this Court was making an order, though in exercise of its revisional jurisdiction, in a proceeding under Section 20 of the Arbitration Act, it was completely within its jurisdiction to make an order of reference. Secondly, the prayer in the content terms which have been set out above inter alia required the arbitrator to file his award within six months and as per the provisions of the Arbitration Act applicable to the case. The arbitrator was bound to file his award in the Court having jurisdiction to which the matter relates and as held above by me, this Court had jurisdiction in the matter to appoint an arbitrator and to make an order of reference under Section 20, and therefore, the direction which has been given is completely according to law.

43. On behalf of the plaintiff, in the written brief of her submissions, some reliance is sought to be placed on the decision of the Supreme Court in Union of India v. Surjeet Singh Atwal AIR 1970 SC 189 in support of her contention that the only Court as prescribed under Section 31(4) of the Arbitration Act that had jurisdiction to receive the award and pass all consequential orders was the Court of Civil Judge (S.D.) Jamnagar and not this Court. The question before the Supreme Court in Surjeet Singh's case (supra) was, whether application for stay under Section 34 can be treated as an application in a reference under Section 31(4). Ramaswami J., speaking for the Court, referred to the earlier decision of the Supreme Court in Kumbha Mawji v. Union India : [1953]4SCR878 for purposes of explaining the scheme of Section 31 and said that applications under Section 8 as well under Section 20 are clearly applications anterior to the reference and are, therefore, undoubtedly applications 'in the matter of a reference' and may fall within the purview of Section 31(4) of the Act. There cannot be any dispute with this principle of law but the real question as stated above is, whether the competent Court would only be the trial Court, namely, Civil Judge (S.D.) Jamnagar in the present case or would also take within its meaning and include the appellate Court as well as revisional Court. I am of the opinion that the question is no more open to debate that the word, 'Court' in Section 20 would include appellate Court and for that matter revisional Court in view of the legal position settled by the Supreme Court in Saith & Sketton's case (supra) and Shri Om Prakash's case (supra). In view of the foregoing discussion. I am of the opinion that the question at issue No. 1 should be answered as under:

This Court has jurisdiction to make an order of reference as it did by its order of 30th April, 1974 and has the power to give direction to the Arbitrator to file the award in this Court and the award which has been made by the Arbitrator and filed in this Court is not a nullity on that court.

The question whether the award is vitiated or not on account of the alleged misconduct of the arbitrator will be decided on its merits.

44. The question at issue No. 4 cannot be decided at present since it [depends ultimately on the decision of this Court, whether the Arbitrator's award is vitiated on account of his misconduct or for any other reason. This Court may be required to decide in that case as to what suitable direction should be given if and when the challenge of the plaintiff to the award on those counts is upheld.

In the result Civil Applications Nos. 417 of 1978, 1906 of 1976 and 1475 of 1973 are disposed of as dismissed with no order as to costs.


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