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Sm. Bharati Mukherjee Vs. Shiva Trading Co. and ors. - Court Judgment

LegalCrystal Citation
SubjectArbitration
CourtKolkata High Court
Decided On
Case NumberA.F.O.O. No. 224 of 1981
Judge
Reported inAIR1983Cal416
ActsArbitration Act, 1940 - Section 42
AppellantSm. Bharati Mukherjee
RespondentShiva Trading Co. and ors.
Appellant AdvocateP.K. Das and ;D.K. Bose, Advs.
Respondent AdvocateR. Pal, Adv.
DispositionAppeal dismissed
Cases ReferredR.L.E. Cook Ltd. v. Kaljian Corporation.
Excerpt:
- .....firm. the arbitrator gave a notice to the appellant enclosing a copy of the statement of claim filed by the respondents and giving direction to file counter statement. the appellant's case before us, however, is that she did not receive any notice from the arbitrator nor did she receive a copy of the statement of claim on that dale.2. it appears that a suit was also filed by smt. bharati mukherjee (suit no. 353 of 1980). in that suit it was alleged that all the instalments due under the hire purchase agreement had been paid and a declaration was prayed that the plaintiff was the owner of the vehicle no wga 3453. on 16th june. 80 an application was made under section 34 of the arbitration act. 1940 by the respondent no. 1 for stay of the suit. on 24th sept. 1980 an order was.....
Judgment:

Suhas Chandra Sen, J.

1. The appellant, M/s. Shiva Trading Company and others, the Respondents herein, had hired out a motor vehicle to the appellant, Smt. Bharati Mukherjee on the terms and conditions mentioned in the hire purchase agreement dt. 22nd March, 1976. Under the hire purchase agreement twenty four consecutive monthly rents of Rs. 1,400/- were payable. The first instalment, however, was to be of Rupees 1,800/- commencing from 1st June, 1976. The appellant, however, failed to pay any of the monthly hire which became due in spite of repeated demands. On or about 29th February, 1980 the hire purchase agreement was determined by the Respondents. The dispute between the appellant and the respondents was referred to arbitration on 6th April, 1980 at the instance of the respondent firm. The Arbitrator gave a notice to the appellant enclosing a copy of the statement of claim filed by the respondents and giving direction to file counter statement. The appellant's case before us, however, is that she did not receive any notice from the Arbitrator nor did she receive a copy of the statement of claim on that dale.

2. It appears that a suit was also filed by Smt. Bharati Mukherjee (Suit No. 353 of 1980). In that suit it was alleged that all the instalments due under the hire purchase agreement had been paid and a declaration was prayed that the plaintiff was the owner of the Vehicle No WGA 3453. On 16th June. 80 an application was made under Section 34 of the Arbitration Act. 1940 by the Respondent No. 1 for stay of the suit. On 24th Sept. 1980 an order was passed staying the suit.

3. Thereafter on 24th/29th November, 1980, the Arbitrator sent a notice for a meeting to be held on 6th December, 1980. The Arbitrator's notice was on the following terms :--

'Please note that a meeting will be held on 6th December, 1980 at my office of Criminal Court, 6, Baker Road, Alipur at 3-30 P. M. You are requested to appear with all your evidence on that date failing which reference would be proceeded ex parte.'

4. On 6th December, 1980 both the parties appeared before the Arbitrator but at the request of the appellant the meeting was adjourned till 20th December, 1980 on the ground that the appellant had been taken ill. The appellant had filed a petition for adjournment and the minutes of the proceeding before the Arbitrator are as follows:--

'Sri Ghosal files a petition for adjournment for reasons stated in his petition.

Considered and heard both parties. The meeting will be held on 20-12-1980 at 3 P. M. at the same address i. e. at 6, Baker Road in the Chamber of the Arbitrator.

No further adjournment will be granted'

Thereafter another notice was sent to the appellant dated 8th December, 1980 and in that meeting the appellant asked for further adjournment of the case. But the prayer for adjournment was refused. The minutes of the meeting held on 20th December, 1980, are as follows:--

'Mr. M. R. Bose states that he has received instructions from Smt. Bharat Mukherjee to pray for an adjournment to prefer an appeal in the Hon'ble High Court. Mr. D. P. Bajoria objects to any further adjournment and submits his claim. Heard both parties. Prayer for further adjournment is rejected. I will make my award and publish the same in due course.'

5. Thereafter an award was made by the Arbitrator on 5th February, 1981, wherein it was stated inter alia, that 'I have read and considered the papers filed before me and I have heard and considered the evidence and submissions made before me and I make the following award.'' On 24th March, 1981, the appellant was served with a notice dated 17th March. 1981, under Section 14(2) of the Arbitration Act stating that the award had been filed in Court on 11th March, 1981 and that judgment upon award will be pronounced on 28th April, 1981. On 16th April, 1981, the present application for setting aside the award was made by the appellant. That application was heard by Salil K. Roy Chowdhury, J. In that application the only ground that was urged was that the Arbitrator had misconducted himself by not giving the petitioner a reasonable opportunity for making out her case before the Arbitrator. In fact in the petition the ground that was taken was as follows:--

'That the said Arbitrator made his said award without hearing your petitioner and without allowing her any opportunity to prove her defence before him.'

The learned Trial Judge, considered the petition affidavit-in-opposition, the award and also the records of the case forwarded by the Arbitrator and came to the conclusion that the petitioner had reasonable opportunity of being heard before the Arbitrator and the petition was, therefore, dismissed.

6. The appellant before us has contended that the learned trial judge had failed to appreciate the facts of this case properly. There were only two minutes of the proceedings before the Arbitrator which were also before the Court and from those two minutes of the proceedings it will appear that the statement of facts was filed only on the 2nd and the last day of hearing, i. e., on 20th December. 1980. No opportunity was given to the petitioner to deal with the allegations made in the statement of claim. Directions were not given for filing any counter statement. The petitioner was also not given any opportunity to produce any evidence in support of her case. It has also been alleged that the appellant had also not produced any evidence. Only a statement of claim was furnished. The Arbitrator adjourned the case and pronounced his award wit without giving any hearing to the parties. In any event the Arbitrator should have granted the adjournment as prayed for by the petitioner. In para (9) of the petition it has also been stated that the petitioner had prayed for an adjournment on the ground of her illness which was refused by the Arbitrator. It has next been contended that even if it is assumed that the Arbitrator had entered upon the Arbitration Agreement earlier on 18th April, 1980, when the Arbitrator sent a notice to the petitioner, the award was made beyond the period of limitation and was of no legal effect whatsoever.

7. In our opinion neither of the two grounds canvassed by the appellant is of any substance. From the records of the proceedings before the Arbitrator it appears that a notice dated the 18th April, 1980, enclosing a statement of claim and giving direction for filing counter affidavit was sent by the Arbitrator to the petitioner. The contention that the notice was not sent by registered post is also not of any substance. Section 42 which has been relied upon by the appellant deals with 'any notice required by this Act to be served.' In this case the notice dated the 18th April, 1980, is not a notice required by the Arbitration Act to be served upon any party.

8. On 16th April. 1580, there was a letter to the Arbitrator calling upon him to enter upon the reference. On 18th April, 1980, a notice was sent by the Arbitrator to the petitioner -- enclosing a statement of claim. On 22nd April, mo, the suit No. 353 of 1980 was filed by the appellant. In the petition itself there is no averment that a statement of claim had not been filed nor served upon the petitioner. It has also not been alleged specifically anywhere that the petitioner was not given any time or opportunity to deal with the allegations made in their statement of claim.

9. It appears from the proceedings before the Arbitrator that it was the appellant who was asking for adjournment before the Arbitrator. If the appellant's case is correct and the statement of claim had not been filed by the Respondents, there was no reason for the appellant to pray for adjournment. In that event, it was for the respondents to pray for time for filing a statement of claim. It also does not appear from the minutes of the proceedings that the appellant had prayed for a copy of the statement filed by the respondents.

10. Strong reliance has been placed on the minutes of the meeting held on 20th December, 1986, wherein it has been recorded 'Mr. D. P. Bajoria objects to any further adjournment and submits his claim.' The appellant has contended that this would go to prove that the statement of claim was actually filed on the 20th December, 1960. But, in our opinion, from the facts set out hereinbefore this does not refer to the statement of claim. This can only mean that submissions were made by Mr. D. P. Bajoria and he made his claim before the Arbitrator. The Arbitrator has recorded thereafter that he had heard both the parties.

11. There is another aspect of this matter which also calk for comment in this case. The petitioner had prayed for an adjournment 'to prefer appeal in the Hon'ble High Court'. This clearly goes to show that the petitioner was not wanting any time to deal with the statement of claim or to deal with any allegation or any evidence that had been adduced against the petitioner. The petitioner merely prayed for an adjournment for preferring an appeal to the High Court. The petitioner in the petition, however, has stated that she had wanted time on the ground of her illness which was refused.

12. We are unable to uphold the contentions that the petitioner was not given any opportunity of being heard in this case. The case was fixed for hearing twice but the petitioner prayed for adjournment on the ground of illness on the first occasion. On the second occasion, the petitioner wanted adjournment so that she could prefer an appeal to the High Court. The petitioner did not ask for any time to deal with any of the allegations made against the petitioner. Therefore, in the background of these facts the petitioner cannot be heard to say that the petitioner was not given any hearing or any opportunity for dealing with the allegations made against her.

13. We shall now deal with the point of limitation. Schedule 1 para 3 lays down:

'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.'

It has been contended in this case that the Arbitrator had entered on the reference on the 18th April, 1980 and the award was made more than a year thereafter. Therefore, the award is a nullity. In the alternative, it has been argued that after having been called upon to act on a notice in writing from the party the Arbitrator should have completed the proceedings and made his award within four months from 16th April. 1980 and in that view of the matter the award that was made was without any jurisdiction.

14. In our opinion, this point is also without any merit. Schedule 1 para 3 requires the Arbitrator to make the award within four months after entering on the reference. In thus case, the Arbitrator had issued a notice on 18th April, 1980 but that was only a ministerial act. The Arbitrator was called upon to enter on reference and the statement of claim, in triplicate, was given to the Arbitrator by the applicant the respondent herein. On receiving that application the Arbitrator sent a notice to the appellant calling upon her to file her counter-statement. In our opinion, that did net amount to entering on the reference as contemplated by Schedule 1, para 3 of the Arbitration Act. This point has been gone into by a Full Bench of this Court in the case of Ramanath Agarwalla v. Goenka & Co., : AIR1973Cal253 wherein the law on this point has been summarised in the following words:--

'(1) An Arbitrator does not enter on the reference as soon as he assumes the office of an Arbitrator. An Arbitrator does not necessarily enter on the reference when he actually commences the decision of the matter in the presence of both parties or ex parte. An Arbitrator enters on a reference when he first applies his mind to the dispute or controversy before him depending on the facts and circumstances of each case.'

15. It has been contended on behalf of the appellant that the period of four months must be computed from the date when the Arbitrator was called upon to act by a notice which was given in this case on 16th April, 1980. Schedule 1, para 3 does not say that the Arbitrator shall make his award within a period of four months from the date he is being called upon to act or called upon to enter on the reference.

16. Reliance has been placed upon the decision in the case of Hari Shankar Lal v. Shambhu Nath, : [1962]2SCR720 which has been considered and explained by the Full Bench of this Court in the case of Ramanath Agarwalla v. Goenka & Co., : AIR1973Cal253 and, therefore, we need not specifically deal with that case.

17. Reliance was also placed on behalf of the respondents upon the decision in the case of Premchand Manickchand v. Fort Gloster Jute .. : AIR1959Cal620 and also on the case of Haji Ebrahim Kassam Cochinwalla v. Northern India Oil Industries Ltd., : AIR1951Cal230 for the proposition that a ground not taken at the Trial Court cannot be urged in the Appeal Court. We need not go into that controversy in view of our decision on the first two Points.

18. A further point was urged on the basis of decision in the case of R.L.E. Cook Ltd. v. Kaljian Corporation. AIR 1955 NUC (Call 2914 that the material particulars of the misconduct, of the Arbitrator were not given in this case but only a vague averment was made that the Arbitrator has misconducted himself by not giving reasonable opportunity to the petitioner of being heard. We also need not go into that controversy in this case. In our opinion, the appellant had reasonable opportunity of being heard in this case and the award made by the Arbitrator was not barred by limitation.

19. In that view of the matter, this appeal is dismissed. Ad interim orders, if any are vacated.

20. In the facts and circumstances of the case, each party will pay and bear its own costs.

21. Learned Advocate for the appellant prayed for a stay of operation of this order. But, in the facts and circumstances of the case, we do not find any reason for staving the operation of this order and we, therefore, refuse that prayer.

Sabyasachi Mukharji, J.

22. I agree.


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