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Bengal Jute Mills Vs. Jewraj Heeralal - Court Judgment

LegalCrystal Citation
SubjectArbitration;Limitation
CourtKolkata
Decided On
Reported inAIR1944Cal304
AppellantBengal Jute Mills
RespondentJewraj Heeralal
Cases ReferredRatanji Virpal v. Dhirajlal Manilal
Excerpt:
- .....is open to a party to the arbitration to proceed under section 14(2), arbitration act, to have the award filed in court.' it is clear that under the arbitration act of 1940 the validity of an arbitration agreement or an award can only be challenged by means of an application. under the previous act it: was considered possible to challenge the validity of an award by means of a suit. section 32 of the 1940 act provides that no suit shall lie for the challenging of an arbitration agreement or an award.3. there is no doubt that the award in the present application has not been filed and it is contended that the award cannot now be filed owing to the amended arts. 158 and 178, limitation act. article 178 provides a period of 90 days from the date of service of notice of the making of the.....
Judgment:

McNair, J.

1. This is an application for setting aside an award. The award in question was made on 19th May 1942, and the application to set aside that award was made on 1st August 1942. A preliminary point has been taken on behalf of the respondents to the effect that the application is misconceived because the award has not been filed and is not before the Court. The question now before me was raised in the Bombay High Court in Ratanji Virpal v. Dhirajlal Manilal ('42) 29 A.I.R. 1942 Bom. 101. The head-note of that case is as follows:

2. Under the Arbitration Act, 1940, till the award has been filed in Court, it is not competent to a party to an arbitration to file a petition to set aside the award. In cases where it is necessary to have the validity of an award ascertained and the award has not been filed in Court it is open to a party to the arbitration to proceed under Section 14(2), Arbitration Act, to have the award filed in Court.' It is clear that under the Arbitration Act of 1940 the validity of an arbitration agreement or an award can only be challenged by means of an application. Under the previous Act it: was considered possible to challenge the validity of an award by means of a suit. Section 32 of the 1940 Act provides that no suit shall lie for the challenging of an arbitration agreement or an award.

3. There is no doubt that the award in the present application has not been filed and it is contended that the award cannot now be filed owing to the amended Arts. 158 and 178, Limitation Act. Article 178 provides a period of 90 days from the date of service of notice of the making of the award within which an application may be made for the filing in Court of the award. Article 158 provides that an application to set aside an award must be made within 30 days of the date of service of the notice of the filing of the award. The award has been made, and the notice of the making of the award was served on or about 19th May 1942. 90 days have elapsed since the date of service of the notice, and it is argued that under Article 178 no application can now be made for the filing of the award. It follows that no application can now be made to set aside the award. It is pointed out, however, that the arbitrators have the power to file the award by forwarding it under a sealed cover to the Registrar with a letter of request that the award be filed. This is provided under Rule 13 of the Rules of the Original Side of this Court made under Section 44, Arbitration Act. Learned counsel on behalf of the petitioner argues that the Court has power under Section 31, Arbitration Act, to set aside the award. Section 31(2) provides, so far as is material, that all questions regarding the validity, effect or existence of an award shall be decided by the Court in which the award has been or may be filed and by no other Court. Stress is laid on the words 'may be filed' and it is argued that the arbitrators still have the power to file the award without making any substantive application. In my opinion Section 31 is not an enabling section, but a section which merely defines the jurisdiction. The marginal note refers to jurisdiction and the entire Section 31, including Sub-section (2) defines the particular Court or Courts which may deal with questions regarding the validity, effect or existence of an award, that is to say, this Court is given jurisdiction to deal with those questions because this Court is a Court in which the award may be filed.

4. The scheme of the Act appears to me to contemplate the consideration of an award by the Court only when the award has actually been filed in Court. Section 14 provides in Sub-section (1) that when the arbitrators or umpires have made their award, they shall sign it and give notice in writing to the parties; Sub-section (2) provides that they shall, at the request of the parties or if so directed by the Court upon payment of fees and costs, cause the award to be filed in Court. Section 14 (2) then provides: 'and the Court shall thereupon give notice to the parties of the filing of the award.' Those words appear to me to be important as indicating that it is only when the award has been filed in Court that the Court takes seizin of the award and informs the parties that it is prepared to consider any questions connected with the award.

5. It must be remembered that arbitration proceedings are proceedings whereby the parties select their own tribunal. The Court may, on application, interfere in the course of arbitration proceedings within the limits prescribed by the Legislature, but the award is the decision of the tribunal which the parties themselves have selected and until it is filed in Court the intention of the Legislature appears to be that the Court should not interfere. Once the award has been made, it may be impossible or difficult to enforce its terms or correct injustice and it is then that the award is filed in Court in Order to enable the parties to obtain satisfaction through the machinery of the Court. The question has been considered in some detail by the Bombay High Court in the case to which I have already referred. There the learned Judge held that it is not competent to apply to set aside an award till the award has been filed. On a consideration of the scheme of the Arbitration Act I have arrived at the same conclusion and this application must be dismissed with costs.


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