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Ram NaraIn Roy Vs. Baij Nath Malla - Court Judgment

LegalCrystal Citation
SubjectArbitration;Limitation
CourtKolkata
Decided On
Judge
Reported in(1902)ILR29Cal36
AppellantRam NaraIn Roy
RespondentBaij Nath Malla
DispositionAppeal dismissed
Cases ReferredMalkarjun v. Narhari
Excerpt:
award - application to set aside award--limitation act (xv of 1877) article 158--arbitrators, misconduct of--civil procedure code (act xiv of 1882) section 521. - .....in accordance with it. it is, however, said that three of the arbitrators were not present at the time the award was made and that they did not affix their signatures to it. if the respondent' had made these allegations within the time allowed him by the legislature for the purpose, the munsif would have enquired into the matter and an appeal might have lain from his order. but the respondent did not choose to apply to the munsif in time and his right to demand an enquiry would seem to be gone, and there is therefore nothing to show that the award is other than what it purports to be.10. the subordinate judge says the award is not an award, but only 'a piece of forged document.' this seems to me to be begging the question. this is unquestionably a mere assumption on the part of the.....
Judgment:

Maclean, C.J.

1. This case comes before me under Section 575 of the Civil Procedure Code by reason of a difference of opinion between Mr. Justice Rampini and Mr. Justice Gupta.

2. The suit was a suit for recovery of a small amount of rent. The parties went to arbitration: the arbitrators made their award and submitted their decision on the 26th July 1899. On the 7th of August 1899, the defendant presented a petition asking to have the award set aside on various allegations and those allegations, if true, amount to serious misconduct on the part of the arbitrators.

3. The Munsif held that the applicant was out of time. Then there was an appeal to the Subordinate Judge, who held that he was in time and remanded the application to be tried out on the merits. There was then an appeal to this Court with the difference of opinion to which I have referred.

4. The only question is, whether the application to set aside the award was or was not out of time, and the answer depends upon whether or not the application falls within Article 158 of the Second Schedule of the Limitation Act. The article runs as follows: 'Under-the Code of Civil Procedure to set aside an award the period of limitation allowed is ten days from the time, when the award is submitted to the Court.' If that article applies the applicant was out of time by two days. It is, however, contended for the respondent that that article does not apply and that it only applies to applications for setting aside an award upon some or one of the grounds stated in Section 521 of the Code, and reliance is placed upon the case of Muhammad Abid v. Muhammad Asghar (1885) I. L. R. 8 All. 64, a decision of the Allahabad High Court. It is, however, unnecessary to discuss whether that case, which in its circumstances is very different from the present, applies here, because I am satisfied, after looking at the petition of the defendant to set aside the award, that it was clearly an application to set it aside upon the ground of the alleged misconduct of the arbitrators, a ground stated in Section 521. On reading the petition, that cannot be seriously disputed. In that view the argument of the respondent falls to the ground. The application was clearlyan application to set aside the award on the ground of misconduct of the arbitrators. It is true that the petition has not been printed in the Taper Book, but I can refer to it, especially as the learned Judge in the Court below refers to it, and his reference is not an accurate one, for he seems to have thought that the petition only alleged that ' three of the arbitrators did not sign the award, although it contained their names and that they took no part in the decision of the suit.' A reference to the petition itself shows that it makes many other charges of a grave nature.

5. On these grounds I think that the application falls within Article 158 of the Second Schedule of the Limitation Act, and was consequently out of time.

6. The decree of the Subordinate Judge is reversed and that of the Munsif restored.

7. The appellant is entitled to the costs of this hearing, but there will be no costs of the hearing before the two learned Judges, who made the reference.

Rampini, J.

8. This is an appeal against an order of the Subordinate Judge of Mozafferpur setting aside an order of the Munsif, decreeing a suit in accordance with the award of certain arbitrators to whom the case had been referred under Section 508, Civil Procedure Code. The arbitrators submitted their award purporting to be duly signed by all of them. After the lapse of twelve days from their doing so the present respondent objected before the Munsif to. the award on the ground that it had ' really been signed by only two of the arbitrators, and that the remaining three had not been present when the award was made and had not really signed it. The Munsif rejected this objection as barred under Article 158 of the schedule to the Limitation Act, which prescribes a period of ten days for preferring an objection to an award. The Subordinate Judge on appeal set aside the Munsifs decree. He held the award was not an award, and that, therefore, the provisions of Article 158 of the Limitation Act had no application. The party, in whose favour the award was made, now appeals.

9. It seems to me the Subordinate Judge has taken a mistaken view of the matter. The award is prima facie a legal and valid award, though it is impugned as irregular and illegal. But the award purports to be signed by all the five arbitrators, to whom the case was remitted, and there is nothing on the face of it to show that it is not what it purports to be, viz, a perfectly good and valid award. It has been acted on as an award, and a decree given in accordance with it. It is, however, said that three of the arbitrators were not present at the time the award was made and that they did not affix their signatures to it. If the respondent' had made these allegations within the time allowed him by the Legislature for the purpose, the Munsif would have enquired into the matter and an appeal might have lain from his order. But the respondent did not choose to apply to the Munsif in time and his right to demand an enquiry would seem to be gone, and there is therefore nothing to show that the award is other than what it purports to be.

10. The Subordinate Judge says the award is not an award, but only 'a piece of forged document.' This seems to me to be begging the question. This is unquestionably a mere assumption on the part of the Subordinate Judge. The objection of the respondent may or may not be well founded, but there is nothing on the record on which it can be held that the award is other than a legal one or anything but a perfectly good and valid award.

11. The pleader for the respondent goes further than the Subordinate Judge, and says this award is nothing but ' a piece of plain paper' and that the Article of the Limitation Act applicable is Article 120, which allows six years for ' suits for which no period of limitation is provided elsewhere in the schedule.' But the award is, in my opinion, not a mere piece of plain paper and the application of the objector is not a suit; so Article 120 of the Limitation Act cannot apply. I see no article that can be applied to the case except Article 158.

12. I am further of opinion that, even if the allegations of the objector be true, the award will still be an award, for it is admittedly signed by two of the arbitrators, so that it can neither be regarded as wholly a forgery, or entirely a piece of plain paper. It is unquestionably an award of at least two of the arbitrators. If the other three were not present at the making of the award, and did not sign it, there would be misconduct within the meaning of Section 521 on the part of all the arbitrators. But this would not make the award anything but an award. But as the award is prima facie a legal award, and is not shown to be anything else, it is unnecessary to consider this question any further.

13. The Subordinate Judge has relied on the case of Muhammad Abid v. Muhammad Asghar (1885) I. L. R. 8 All. 64, in which it has been held that Article 158 does not apply to an illegal award. With reference to that case it is sufficient for me to say that the facts of it are clearly distinguishable from those of the present. In that case the award had been signed by only one of two arbitrators and by an umpire, who had not been legally appointed. Such an award is prima facie an illegal award. No enquiry is necessary to establish this fact. This is a perfectly different case from the award we have now to consider, which is prima facie a legal award, and which can only be shown to be illegal, after an enquiry into the allegations of the objector has been made. The objector by his own laches has prevented any such inquiry taking place.

14. The object of the Legislature, in allowing so short a period for the preferring of objections to awards would seem to me to meet a case such as the present. Litigants may be very willing to have their cases referred to the decision of arbitrators, whom they regard as amicably disposed towards them, but the moment the arbitrators decide against them they do their utmost to resile from their agreement and to set aside the award. The Legislature has framed Article 158 of the Limitation Act with the object of discouraging and preventing such discreditable attempts. If the provisions of Article 158 are loosely interpreted, and if an award is to be held not to be an award simply because any sort of unsubstantiated objection is made against it, then the object of the Legislature will be defeated and the provisions of Article 158 will be practically erased from the Statute Book.

15. For these reasons, I would decree this appeal with costs, but as my learned brother Gupta does not agree, the case must be laid before the Hon'ble Chief Justice for reference to a third Judge.

Gupta, J.

16. I much regret that I am unable to agree with my learned brother Mr. Justice Rampini in this case. I am of opinion that Article 158 of the Limitation Act has no application in the case of an award, which is a forged document, or which is not signed by all the arbitrators appointed by the Court. Such an award is no award, but only a nullity in the eye of the law. Therefore there is no award to be 'set aside' within the meaning of Article 158. No decree can be based on such an award, and, if the fraud or alleged fraud is brought to the notice of the Court before a decree has been actually passed, the Court is bound to enquire. If the fraud is discovered after a decree has been passed the remedy would be by an application for review or by separate suit to set aside the decree on the ground of fraud within the period of limitation prescribed for such application or suit.

17. It was held in Muhammad Abid v. Muhammad Asghar (1885) I. L. R. 8. All. 64, that Article 158 of the Limitation Act applies only to applications to set aside an award on any of the grounds mentioned in Section 521 of the Civil Procedure Code. It may also be conceded that an award is not, reversible except under Section 521. But this pre-supposes that the award is an award of the arbitrators appointed by the Court and must therefore be signed by them. The Munsif's order on the order sheet shows that 12 days after the receipt of the award in Court the defendant put in a petition alleging that three of the five arbitrators (which' three were named) 'were not present at the time of making the award and their signatures on the award were not made by them.' The Munsif admitted that the application was not one falling under Section 521, but rejected it on the following grounds: ' I am not called upon to call in question the genuineness of the signatures ' and ' further the objection should have been made on the 5th instant.' The same day he decreed the suit in accordance with the terms of the award.

18. The Lower Appellate Court was of opinion that the rule of 10 days' limitation did not apply to this case and decreed the defendant's appeal holding that the 'Munsif was wrong in refusing to hear the objection of the defendant' and remanded the case ' for trial of the objection preferred by the defendant.'

19. There is no reported case exactly in point. But by way of analogy I may refer to the case of Malkarjun v. Narhari (1900) I. L. R. 25 Bom. 337, in which their Lordships of the Privy Council did not dissent from the principle that, where a judicial sale is null and void ab initio, and therefore a nullity in law, the rule of one year's limitation under Article 12 of the Limitation Act would not apply to a suit brought in order to the setting aside of the sale. The Bombay High Court had held that the particular sale in question was a nullity and that Article 12 had therefore no application. Their Lordships of the Privy Council reversed that finding on the ground that the sale had been held with jurisdiction and was therefore not a nullity.

20. In the case under consideration the objection taken was that the award was a forgery. If so, it would be a nullity, and I think the Munsif was bound to enquire into the genuineness of the signatures impugned.

21. For these reasons I am of opinion that the decision of the Lower Appellate Court is correct, and I would dismiss this second appeal preferred by the plaintiff with costs.


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