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Somasundara Nadar (Died) and ors. Vs. Bhusekarapandian - Court Judgment

LegalCrystal Citation
SubjectArbitration
CourtChennai High Court
Decided On
Reported in(1980)1MLJ136
AppellantSomasundara Nadar (Died) and ors.
RespondentBhusekarapandian
Cases ReferredIn Gadiraju Bangarayya v. Ramabhadriraju
Excerpt:
- .....which were admittedly non joint family properties, were denied. during the course of trial, the parties filed a memo. and in particular, an interlocutory application i.a. no. 278 of 1974 was filed, wherein the parties agreed for the appointment of two arbitrators to enquire:1. what are the properties, movables and immovables, for partition?2. what is the share to which the plaintiff is entitled?3. whether the plaintiff is entitled to any account on the income of the suit properties? and4. whether any amount is payable by the plaintiff?2. though two arbitrators were named in the joint memo. filed by all the parties, as one of the arbitrators was unable to function due to illness, the surviving arbitrator by consent was directed to enquire into the above issues. in fact, in another.....
Judgment:

T. Ramaprasada Rao, C.J.

1. This is an appeal against the judgment and decree in O.S. No. 38 of 1973 on the file of the Court of the Subordinate Judge of Kumbakonam. The defendants in the above suit are the appellants. The first defendant is the father of the plaintiff and defendants 2 and 3 are the elder brothers of the plaintiff. Claiming that the properties described by him in the plaint are joint family properties and were treated as such by all the members of the family, the plaintiff filed the suit for partition of his one-fourth share in the suit properties and himself being put in possession thereof after effecting division by metes and bounds. The defence was that all the properties are not joint family properties and the various claims put forward by the plaintiff as regard the properties, which were admittedly non joint family properties, were denied. During the course of trial, the parties filed a memo. and in particular, an interlocutory application I.A. No. 278 of 1974 was filed, wherein the parties agreed for the appointment of two arbitrators to enquire:

1. What are the properties, movables and immovables, for partition?

2. What is the share to which the plaintiff is entitled?

3. Whether the plaintiff is entitled to any account on the income of the suit properties? and

4. Whether any amount is payable by the plaintiff?

2. Though two Arbitrators were named in the joint memo. filed by all the parties, as one of the Arbitrators was unable to function due to illness, the surviving Arbitrator by consent was directed to enquire into the above issues. In fact, in another application I.A. No. 196 of 1975 the parties agreed to submit to the sole arbitration by one Mr. P. Shanmugham. The Arbitrator after due enquiry has given an award and filed the same into Court marked as Exhibit C-l. Apparently on an invitation made by Court, the defendants filed certain objections to the said award and the plaintiff did not file any. It should however be noticed at this stage that before the parties agreed to refer the principal matters in dispute to arbitration, the Court framed the following issues which arose under the pleadings.

1. Whether all the suit properties are joint family properties?

2. Whether the plaintiff was not a partner in the business run by the family?

3. Whether the defendants are in possession of the house-hold articles and utensils worth Rs. 5,000?

4. Whether the plaintiff is entitled to partition of his share only on payment of Rs. 5,000 and whether such an amount was paid to the plaintiff by the first defendant for the plaintiff's expenses?

5. What are the debts to be provided for?

6. Whether the defendants are not liable to render any account to the plaintiff?

7. Whether the suit is bad for non-joinder of parties?

8. To what relief is the plaintiff entitled?

After the arbitrator filed his award and the defendants filed their objections to it, the case came up for trial for passing a final decree, as the share of the plaintiff was not in dispute. The defendants appeared through counsel and repeated their objections which they made before the Arbitrator. The Court did not find any reason either to modify or correct the award. The Court also noticed there was no application filed by the defendants under Section 33 of the Arbitration Act, 1940, hereinafter referred to as the Act, to set aside the award. As the Arbitrator as the sole repository of power granted to him by the parties themselves acted within his authority and in accordance with the principles of justice and fair play and as the Arbitrator acted honestly, the Court was of the view that the award should be upheld. The defendants, who objected to the said award, contended that they did not have a full opportunity before the Arbitrator. The Court rightly referred to the fact that it was entirely due to the fault of the defendants, who not only failed to appear before the Arbitrator at the appointed hours, but also did not produce any oral or documentary evidence in support of their objections. The Court therefore, passed the final decree after accepting the award and decided the issues framed by it in accordance thereto. Ultimately, it passed the challenged decree and held that the plaintiff was not entitled to claim any account from the defendants and passed a final decree in terms of its judgment. It is as against this, the present appeal has been filed.

3. It is convenient to set down here the memo consent filed by the parties under which agreement the parties vested the necessary and requisite power in the Arbitrator to decide the disputes between themselves.

It was only pursuant to the above memo. or arbitration agreement, that the matter was taken up by the Arbitrator. Before us, counsel for the appellants could not convince us that the proceedings before the Arbitrator were not conducted fairly. The only contention raised was that they were not given a full hearing. In the memo. as above, a reference is made to a will but it is conceded that the defendants did not produce the will before the Arbitrator nor did they let in any evidence before him, even though they were called upon to do so. It was in those circumstances, that the Arbitrator considered the material before him and after taking into consideration the affidavit given by the village munsif and as the defendant did not take any interest in the proceedings, he decided the matter honestly, but in the light of the merits as found on the record. We are, therefore, unable to accept the contention of the learned Counsel for the appellants-defendants that the award of the Arbitrator is in any manner tainted.

4. The next question which was raised before us by the learned Counsel for the appellants is that, as no application under Section 33 of the Arbitration Act has been filed by any party to the Arbitration agreement, the objections filed by the defendants before the Court, on receipt of the award Exhibit C-l cannot be considered by him at all and his decision on the appreciation of the merits of the case should be treated as non est. We have seen that as soon as the award was filed into Court, the Court apparently called for objections from the parties without seriously adverting to the prescription in Section 33 of the Act and on receipt of the defendants' objections, went into the matter and accepted the award and gave its findings. This procedure adopted by Court is challenged before us in the main.

5. The Arbitration Act of 1940 is not only a consolidating but a codifying one. The legislative intent in creating a substituted process in the place of the recognised machinery for settling disputes in Ordinary Courts is of great significance. If, therefore, the parties to litigation expressly agreed in writing as in this case, that their main differences which have arisen in the suit, shall be referred to named Arbitrators, then the Court is well within its jurisdiction to make a reference of such issues to the named Arbitrators before it pronounces the judgment in main case. Chapter V of the Act which is general in its scope deals with various circumstances, under which an award so passed by an Arbitrator can be set aside. In particular Section 30 of the Act sets out the condition for setting aside the award. Section 31 of the Act invests the Court with jurisdiction under cover of which the Court is vested with jurisdiction to deal with all the questions, amongst other things with reference to the validity, effect or existence of an award. Section 32 of the Act imposes bar to sue in the Court when all contentions as regards the arbitration agreement or award, can be raised under the Act as prescribed. Section 33 of the Act which is relevant for our purposes runs as follows:

33. Any party to an arbitration agreement or any person claiming under him desiring to challenge the existence or validity of an arbitration agreement or an award or to have the effect of either determined shall apply to the Court and the Court shall decide the question on affidavits:

Provided that where the Court deems it just and expedient, it may set down the application for hearing on other evidence also, and it may pass such orders for discovery and particulars as it may do in a suit.

Thus it is seen that Section 33 of the Act prescribes the method by which an award or an arbitration agreement could be contested by the aggrieved person. Any party desirous of challenging the award inter alia should apply to the Court and the Court shall in its discretion either decide the question on affidavits or by admitting additional evidence including oral evidence. In the instant case, no application has been made by the appellants to the Court challenging the award. It is not in dispute however that on being invited to do so by the Court the defendants alone filed their objections to the award. The question is whether the mandate under Section 33 of the Act which enjoins the party challenging the award to file an application can be circumvented at all and if so, under what circumstances.

6. It is one of the salient principles of interpretation of statutes that in certain circumstances the word 'shall' appearing in a particular section of a statute may be sometimes understood as directory, if the justice of the case and the circumstances so demand. It may also happen that the Court which is in seizin of the matter, might overlook the necessity of the filing of an application under Section 33 of the Act and treat objections filed by the parties which was filed on its invitation, as an equivalent to a regular application under Section 33 of the Act. Thereafter the Court, after a full enquiry and judicial advertence to the objections filed may render its decision on the subject-matter and particularly on the effect and validity of the award. In those circumstances, such a treatment by the Court should only be held to be an irregularity and not an illegality. The argument of Mr. N. Vanchinathan is that the absence of a formal application under Section 33 of the Act makes the enquiry wholly a tainted one and as the filing of such an application goes into the root of the matter any supervening enquiry by a Court and delve into the objections of the parties without there being an application by the aggrieved party under Section 33 of the Act, should be ignored as illegal and ineffective. Though prima facie the argument is attractive yet, we are unable to subscribe to that view. Ignorance of law is no excuse. The defendants as challengers of the award did not file an application sunder Section 33 of the Act. They were however content with filing their objections to the award and called upon the Court to render its decision on their objections filed against the award. The Court was also persuaded to accept the opposition made only by the defendants and render its final conclusion. Here is therefore a case where the challenging defendants are partly to be blamed and partly the Court has erred in overlooking the absence of a regular application under Section 33 of the Act to challenge the award. A reconciliation has therefore to be made not only in the interests of justice but also because of the accepted maxim that the act of the Court shall prejudice no one, which is actus curiae neminem gravebit As a wellknown jurist has said this maxim is founded upon justice and good sense and affords a safe and certain guide for the administration of the law. Applying this maxim which evolves a norm for proper administration of law in certain exigencies, we are of the view that the absence of an application under Section 33 of the Act, in the circumstances of the case does not go to the root of the matter. It is because of an act of a Court partly and to a great extent because of the laches of the defendants, that the necessity for an application under Section 33 of the Act was not felt. Therefore, the procedure adopted by the Court has to be treated only as an irregularity.

7. Again a party who is guilty of laches in not having filed an application under Section 33 of the Act, but who has contemporaneously taken an active part in persuading the Court not to accept the award and requested the Court to pronounce its ultimate decision on the challenge made by them against the award, cannot be allowed to approbate as well as to reprobate. The appellants cannot take advantage of their own wrong. They cannot therefore contest before us that the decision of the Court in the circumstances as above to which partly the Court is also to be blamed is a nullity. This is again the reason why we cannot totally ignore the resultant conclusion of the Court which passed the final decree after accepting the award but after considering the objections to it by the challenging parties.

8. In Gadiraju Bangarayya v. Ramabhadriraju : AIR1947Mad315 in similar circumstances our Court took the view with which we respectfully agree that the procedure adopted by the lower Court was nothing more than an irregularity. There, the learned Judges were considering a case where the Court voluntarily sought for objection of the parties against an award which was filed in the Court and after filing of the objection dealt with the same and passed a decree in terms of the award. One of the parties took a preliminary objection that the objection filed by the other party could not be heard. The Court after referring to the facts and their reference to the parties to file objections was of the view that the mere absence of formal application under Section 33 cannot prevent the Court from hearing the objection and passing final orders. It was in these circumstances, they said that the non-filing of such an application is merely an irregularity.

9. Having regard to our discussion as above, we are of the view that the lower Court did have necessary jurisdiction in the circumstances of the case to deal with the objections of the parties to the award including that of the appellants and its decision was one which was passed within its jurisdictin and cannot therefore lightly be brushed aside.

10. After receiving the award and marking its Exhibit C-l and after the appellants-defendants filed their objections, the learned Judge considered the relevant issues and on each of those issues accepted the findings of the Arbitrator, as he ought to, and this was because he found that there was a just, honest and diligent appreciation of the facts placed before the Arbitrator. It was in those circumstances, the allotment made by the Arbitrator of the immoveable properties and the value of the land as estimated by the Arbitrator was accepted by the Court. The Court also found that no circumstances had been shown by the appellants under any of the provisions of the Arbitration Act which would compel him to modify or correct the award. The findings on all the issues rendered by the Court below have not even been seriously challenged before us by the learned Counsel for the appellants who, as already stated, laid an accent upon the non-filing an application under Section 33 of the Arbitration Act and the alleged consequential infirmity on the record. Under these circumstances, we accept the conclusion and the consequential judgment resulting in the final decree as passed by the Court below. We confirm the judgment of the learned Subordinate Judge. The parties are at liberty to make the non-judicial stamp papers available within six weeks from this date for the engrossment of the final decree.

11. The appeal is dismissed, but there will be no order as to costs.


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