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1932 Supreme(SC) 72
PRIVY COUNCIL [ON APPEAL FROM THEEAST INDIES]
LORD WRIGHT, SIR GEORGE LOWNDES, AND SIR DINSHAH MULLA.
JNANENDRA MOHAN BHADURI - Appellant
Versus
RABINDRA NATH CHAKRAVARTI - Respondents
On Appeal from the High Court at Calcutta.
Decided On : December 19, 1932.
Solicitors for appellants :Watkins & Hunter. Solicitors for respondent: W. W. Box & Co.
An arbitration award filed in court is enforceable as a decree under Section 15 of the Indian Arbitration Act, 1899. A formal decree passed by a court to implement such an award is a nullity, but the award remains enforceable regardless of procedural errors in the execution application.
Headnote:(A) Indian Arbitration Act, 1899 - Section 15 - Enforceability of award - An award on a submission, once filed in Court and not remitted or set aside, is enforceable as if it were a decree of the Court. The Act does not provide for the formal creation of a decree based on an award; any such decree passed by a Court is without jurisdiction and a nullity. (Paras 15-17)
(B) Execution of Award - Form vs. Substance - Where an application is filed for the execution of a decree that is a nullity, but the underlying award is valid and enforceable, the Court may, in its discretion, treat the application as one for the execution of the award. The objection to the form of the application is one of form only and not of substance. (Paras 18-19)
(C) Variation of Award - Rights of Minors - A variation of the terms of an award agreed upon by some parties does not affect the rights of a party who did not consent to such variations, particularly where that party was a minor at the time of the agreement. (Para 20)
Facts of the case:
A dispute regarding the construction of a will was referred to arbitration. An award was made and filed in Court. Subsequently, a formal decree was passed by the Court to carry the award into effect. Years later, a beneficiary, who was a minor at the time of the award and decree, applied for the execution of the said decree. The lower court dismissed the application on the ground that the decree was a nullity as the Court lacked jurisdiction to pass a decree on an award under the relevant arbitration legislation. The High Court reversed this, directing that the application be treated as one for the execution of the award.
Findings of Court:
The decree passed by the Court was indeed a nullity because the Indian Arbitration Act does not empower the Court to make a formal decree on an award. However, under Section 15 of the Act, the award itself is enforceable as if it were a decree. Since the respondent's rights under the award remained intact and were not affected by subsequent variations agreed to by other parties, the application for execution should be entertained.
Issues: Whether a decree passed by a Court to carry an arbitration award into effect is a nullity if the Act does not provide for such a decree, and whether an application for the execution of such a null decree can be treated as an application for the execution of the underlying award.
Ratio Decidendi: Under the Indian Arbitration Act, an award is enforceable as a decree by operation of law without the need for a formal decree to be passed. A formal decree passed in such circumstances is without jurisdiction. However, such a procedural error in the application for execution (seeking execution of the decree rather than the award) is a matter of form, not substance, and does not preclude the enforcement of the valid award.
Result: Appeal dismissed.
Legal Category Hierarchy
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practice and procedure
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civil procedure
- execution of decrees
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civil procedure
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arbitration
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indian arbitration act 1899
- enforceability of awards
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indian arbitration act 1899
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family law
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wills and probate
- construction of wills
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wills and probate
Judgement
Appeal (No. 106 of 1931) from an order of the High Court (December 14, 1930), reversing an order of the third Subordinate Judge of Hooghly (June 29, 1929), and directing that an application by the respondent for execution of a decree should be entertained as an application for execution of an award.
facts relevant to the appeal appear from the judgment of the Judicial Committee.
Law Rep. 60 Ind. App. 71 ( 1932- 1933) Jnanendra Mohan Bhaduri V. Rabindra Nath C hakravarti
225
1932. Nov. 22, 24, 25. De Gruyther K.C. and Pringle for the appellants.
Dunne K.C. and Parikh for the respondent.
[Reference was made to Jnanendra Mohan Bhaduri v. Annapurna Debi (( 1927) 31 C. W. N. 517.) and Ganendra Mohan Bhaduri v. Bhavani Charan Chakrevarti (( 1929) 34 C. W. N. 268.), both arising out of the same arbitration proceedings; also to the Indian Arbitration Act, 1899, ss. 11, 13, 15, 20, and to the Code of Civil Procedure, 1908, s. 89.]
Dec. 19. The judgment of their Lordships was delivered by
SIR DINSHAH MULLA. This is an appeal from an order of the High Court of Judicature at Fort William in Bengal, dated December 11, 1930, which set aside an order of the third Subordinate Judge of Hooghly, dated June 29, 1929, and directed that an application for execution of a decree presented by the respondent to the Court of the Subordinate Judge be entertained as an application for execution of an award.
The appellants are two of the executors of the will of Rajendra Lal Goswami, who died on August 21, 1917. The testators widow, Annapurna Debi (since deceased), was also an executrix of the will. The will is dated November 18, 1916, and it was admitted to probate on December 19, 1917.
The appellants are residuary legatees under the will. The respondent, the testators widow, and Radhika Lal Goswami are beneficiaries under the will.
Disputes arose as to the construction of the will, and by an agreement in writing, dated December 22, 1917, the matters in difference were referred to the sole arbitration of Byomkesh Chakravarti. The respondent was then a minor, and was represented by his father and natural guardian, Bhawani Charan Chakravarti.
The arbitrator made his award on July 29, 1918. The terms of the award more particularly affecting the respondent are contained in clauses 6 and 10. By clause 6 it was declared that the gift to the respondent of the properties mentioned in a schedule to the will was good subject to a charge for the payment of Rs. 13,063-12-0, and the executors were directed to make over the properties and all documents relating thereto, together with all accounts from the date of the death of the testator, to the respondents father or such other person as may be appointed guardian of his person and property. By the same clause, it was declared that the respondent was entitled to a life policy mentioned in clause 13 of the will. By clause 10, the executors were directed to make up an account of all sums received and spent by them, and to hand over the balance to such persons as were declared entitled thereto.
On August 1, 1918, the arbitrator filed his award in the High Court at Calcutta. The first appellant filed objections to the award, but the parties eventually came to terms, and the award was modified by two agreements. The only modification which might possibly have affected the respondent was that contained in clause 5 of the first agreement, by which it was provided that the properties should be handed over to the respondents father on his giving security for Rs. 12,000 to the satisfaction of the Registrar of the High Court, but this was not carried into effect.
The first appellant afterwards applied for a decree to the High Court at Calcutta, and on February 14, 1919, a decree was passed by consent of parties by which it was directed that " the said award as
Law Rep. 60 Ind. App. 71 ( 1932- 1933) Jnanendra Mohan Bhaduri V. Rabindra Nath C hakravarti
226
modified by the said terms of settlement ought to be carried i
