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T.L. Rangiah Chetty Vs. T. Govindasami Chetty and ors. - Court Judgment

LegalCrystal Citation
CourtChennai
Decided On
Judge
Reported inAIR1922Mad179; 71Ind.Cas.266
AppellantT.L. Rangiah Chetty
RespondentT. Govindasami Chetty and ors.
Cases Referred and Sooraparaju v. Narayanaraju
Excerpt:
arbitration - award--decree in terms of award before expiry of ten days, validity of--agreement not to object to award, effect of--fraud--material irregularity. - - 197is authority for saying that a decree passed on an award within the 10 days allowed by the limitation act is bad. 'if it were quite clear that the learned judge has exercised discretion wrongly in this case, we might be prepared to take the strong step of interfering in revision but the general policy of the legislature is clear that in these matters the judgment in accordance with an award should be final. 'as a general principle i incline to the view that an express term that fraud should not vitiate a contract would be bad in law......influence and that the former has not examined the chill a papers. on 31st march 1920 the sub-judge passed an order refusing time to the defendant and stating that there was no real objection to the award and that the objection of collusion cannot stand. he passed a decree the same day in terms of the award.3. the case in velu pillay v. appasami pandaram 9 ind. cas. 197is authority for saying that a decree passed on an award within the 10 days allowed by the limitation act is bad. this was the decision of a single judge (wallis, j., as he then was) but is supported by a decision of a bench of this court in sonraparaju v. narayanaraju 17 ind. cas. 431 , where it was held that such a procedure was without jurisdiction or was vitiated with material irregularity such as to call for.....
Judgment:

Odgers, J.

1. This is a petition to revise the decree passed on 31st March 1920 by the Sub-Judge of North Arcot. The decree was passed in terms of an award following a reference to arbitration, in Original Suit No. 59 of 1917, by the parties thereto. The suit was brought by the plaintiffs for an account of their family property which had been in the management of the defendant during the minority of the eldest member. The reference or muchilika, the terms of which are important, runs as follows (page 27 paragraphs 1 and 2, of the printed pleadings):

1. That the parties herein have agreed to refer all matters in dispute between them in this suit to the arbitration of M.R, Ry. Emuloor Bojjayya Chetty Garu of Tirupati.

2. The said arbitrator's decision shall be final and binding upon all the parties to the suit and they will not object to his award.

2. The award was issued on 29th March 1920 and on 30th March 1920, the defendant asked for further time (one month) to file objections to the award, although, under Article 158 of the Limitation Act, he had 10 days for this purpose. The defendant was examined orally by the Sub-Judge on 30th March, 1920, the very same day on which he put in his petition for time, and he there alleged that the award had been passed 'one-sidedly' by the arbitrator yielding to the plaintiff's influence and that the former has not examined the chill a papers. On 31st March 1920 the Sub-Judge passed an order refusing time to the defendant and stating that there was no real objection to the award and that the objection of collusion cannot stand. He passed a decree the same day in terms of the award.

3. The case in Velu Pillay v. Appasami Pandaram 9 Ind. Cas. 197is authority for saying that a decree passed on an award within the 10 days allowed by the Limitation Act is bad. This was the decision of a Single Judge (Wallis, J., as he then was) but is supported by a decision of a Bench of this Court in Sonraparaju v. Narayanaraju 17 Ind. Cas. 431 , where it was held that such a procedure was without jurisdiction or was vitiated with material irregularity such as to call for revision. In Batcha Sahib v. Abdul Gunny 21 Ind. Cas 308 relied on by Mr. C.V. Anantakrishna Aiyar, for the counter-petitioners (plaintiffs) in this case, the decision was that no appeal lay. The Court was asked to revise the decree appealed from and White C.J., said: 'If it were quite clear that the learned Judge has exercised discretion wrongly in this case, we might be prepared to take the strong step of interfering in revision but the general policy of the Legislature is clear that in these matters the judgment in accordance with an award should be final.' There is an obiter dictum in the judgment of the learned Chief Justice to the effect that, where 'an application to set aside the award had been made and refused it would have been open to the Court to pronounce judgment even though the ten days had not expired.' This was not, in my opinion, necessary to the decision, and in connection with the dictum a passage from Banerji's book is quoted on page 258 of the report with approval. The passage is to the effect that, in order to secure finality to the judgment, and decree the necessary conditions are that there has been no order remitting the award and that no application has been made to set aside the award within 10 days, or if an application has been made it has been refused after judicial determination by the Court. If it were necessary to ,do so, I should not be prepared to hold that the oral objections stated by defendant on 30th March 1920 in answer to question of the Subordinate Judge amounted to an application to set aside the award or that such application had been refused after judicial determination. It seems to me impossible to say that the summary, I may say informal, procedure adopted by the lower Court on 30th March 1920 was in fact a judicial determination of the matter.

4. The next question to consider is, whether the defendant by the terms of paragraph 2 of the muchilika has debarred himself from taking any objection to the award, and, if so, whether the Court has any right to assume jurisdiction not given to it by law in consequence of an agreement entered into by the parties. The case of parties contracting not to raise objections to an award has been dealt within several decisions It may here be stated that it was urged by the Vakil for the petitioner (defendant) and not contested by the Vakil for the counter-petitioners (plaintiffs) that the award has travelled into various extraneous matters not connected with the suit and not forming the subject-matter of the reference to arbitration. I am inclined to think this is so (e.g.,) with regard to the rasi account, the accounts of the property of plaintiffs' junior uncle 'Ramiah' and the matters contained in paragraph 33 of the award which have nothing to do with the share of the third brother. I do not think the agreement not to object can fairly be taken to cover these extraneous matters which are not properly the subject-matter of the award at all. It is also established that such an agreement does not cover fraud unless it is expressly excepted. Fraud may be expressly excepted, that is, the parties may agree that it shall not be raised. It was held by Chitty, J., in Tullis v. Jackson (1892) 3 Ch. 441 , that fraud may be expressly excepted, that is, the parties may agree that it shall not be raised, though in Pearson v. Dublin Corporation (1907) A.C. 351 , Lord James Hereford says: 'As a general principle I incline to the view that an express term that fraud should not vitiate a contract would be bad in law.' Again in Mackay, In the matter of (1834) 2 Ad. & E. 356 it was held that a clause precluding the parties from bringing actions against the arbitrators or impeaching their award unless for fraud did not debar a party to the deed from moving to set aside the award for illegality on the face of it, though no fraud or collusion appeared. It seems to 'me, therefore, that, in spite of Clause 2 of the muchlika, the defendant might lawfully have raised several grounds of objection to the award. In view of the proceedings of the Sub-Judge on 31st March 1920 on the application for time made by the defendant, and in view of the award which appears to me to travel outside the terms of reference and also from the fact that, in my opinion, the defendant would have been entitled to take objections to the award, I have come to the conclusion that the lower Court acted without jurisdiction or with material irregularity in passing the decree of 30th March, 1920 and that, for the reasons stated, it is no answer to say that the defendant had agreed not to raise objections to the award.

5. The Court, therefore, had no power to pass a decree before the expiry of the 10 days allowed by Article 158 of the limitation Act and the case falls under the decisions in Vein Pillay v. Appasawmi Pandaram 9 Ind. Cas. 197 and Sooraparaju v. Narayanaraju 17 Ind. Cas. 431 cited above. The decree must be set aside and the case remitted to the lower Court to be dealt with according to law. Costs will abide the result.

6. This Civil Revision petition having been posted to be spoken to this day, the Court delivered the following


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