ARBITRATION - AWARD - REGISTRATION - WHETHER COMPULSORY - ARBITRATION ACT (X OF 1940), SECS. 31 (2), 32 - REGISTRATION ACT (XVI OF 1908), SEC. 17 (1) (B) - TRANSFER OF PROPERTY ACT (IV OF 1882), SEC. 100.

Fact of the Case:

The appellants and the respondents constituted a Hindu joint family which owned considerable moveable and immovable properties. Differences arose between them and they considered it necessary to effect a partition of the joint properties. Consequently, on 20-5-1950, they executed an arbitration agreement, Ex. A-1 appointing V. Krishnaiah, B. Chinna Venkatarayudu and M. Ayyanna alias Venkataraju as arbitrators for partitioning the entire moveable and immoveable properties belonging to the joint family into four shares. Under this document, they also agreed to accept as final and binding the decision of the arbitrators.

Finding of the Court:

1. An award made without the intervention of Court after the coming into force of the Arbitration Act (Act X of 1940) does not at all require to be registered under any circumstance because such an award has no force or effect whatsoever until it is made a decree of Court under Section 17 of the Arbitration Act, hereinafter referred to as the Act. 2. An award which purports to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or contingent, to or in immovable property of the value of Rs. 100.00 and upwards does not require to be registered under Section 17 (1) (b) of the Indian Registration Act.

Issues: 1. Whether a private award passed after the curing into force of the Arbitration Act 1940 and which deals with immovable property of a value of more than Rs. 100.00 is compulsorily registrable under Section 17 of the Indian Arbitration Act 1940? 2. Whether an award which purports to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or contingent, to or in immovable property of the value of Rs. 100.00 and upwards does not require to be registered under Section 17 (1) (b) of the Indian Registration Act?

Ratio Decidendi: 1. The Act is a self-contained code with regard to the law of arbitration. The position which obtained under the old Arbitration Act of 1899 and under the repealed second schedule of the Code of Civil Procedure has been radically altered by the Act (Arbitration Act X of 1940). 2. The Act prohibits agitating questions relating to arbitration in any manner other than provided by the Act. And the Act provides a simple procedure for obtaining speedy decisions on questions relating to awards and the arbitration agreements. 3. If an award is not made a decree of Court under Section 17 of the Act, it cannot not be relied upon either by a plaintiff or by a defendant. 4. It will be open to the parties to revert to the original cause of action, that is, to the position which prevailed prior to the making of the unfilled award and work out their rights. 5. In other words, an award which is not made a rule of the Court cannot help or hinder any party in a litigation. 6. All this does not however, seem to us to lead to the conclusion that an award which purports to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or contingent, to or in immovable property of the value of Rs. 100.00 and upwards does not require to be registered under Section 17 (1) (b) of the Indian Registration Act. 7. There is no provision in the Act (Arbitration Act, 1940) dispensing with registration of a document compulsorily registrable under Section 17 (1) (b ). 8. Indeed, the amendment of Section 17 (2) (vi) of the Registration Act by Section 10 of the Transfer of Property (Amendment) Supplementary Act, 1929 clearly shows that an award no longer enjoys exemption from registration which it previously enjoyed. 9. After the amendment of 1929, which came into force on 1/04/1930, an award is compulsorily registrable if it purports or operates to create, declare, assign, limit or extinguish, whether in present or in future, any vested or contingent right, title or interest to or in the immoveable property of the value of Rs. 100.00 and upwards. 10. If the Arbitration Act of 1940 intended that an award did not require registration even if it effected immoveable property of the value specified in Section 17 (1) (b), one would expect some provision to that effect in the Act itself, or a suitable amendment of the Registration Act for the purpose. 11. One cannot reasonably attribute to the legislature any inadvertent omission in this regard. 12. The absence of any provision to indicate that an award need not be registered after the coming into force of the Arbitration Act of 1940 seems to point to the conclusion that the legislature considered that an award should be registered, if it purported to affect immoveable property as contemplated by Section 17 (1) (b) of the Registration Act. 13. To say that an award to be enforceable will have to be rendered a rule of the Court under Section 17 of the Act is not tantamount to saying that no other requirement of law needs to be complied with for making an award valid. 14. The registration of an award under Section 17 (1) (b) is a requirement of law which if not complied with would render the award invalid. 15. We are not able to see anything inconsistence between this requirement of the Registration Act and the requirement under the Arbitration Act, 1940 that an award could be rendered enforceable only if it is made a decree of Court under Section 17 of that Act. 16. Both these requirements must, in our view, be fulfilled to render an award valid and enforceable. 17. One requirement cannot be said to exclude the other or deemed to be redundant in view of the other. 18. The criterion for purposes of registration is what is expressed on the face of the document and not the weight or value or effect a Court may subsequently attach to it. 19. Therefore, if an award purports to create, declare, or assign, whether in present or in future, any right, title or interest vested or contingent, to or in immovable property of the value of Rs. 100 and upwards, it becomes compulsorily registrable under Section 17 (1) (b) of the Registration Act. 20. Whether the creation or declaration of this right, title or interest to or in immovable property will be eventually upheld or enforced by a Court is not a relevant consideration for determining the necessity to register the document.

Final Decision: Appeal allowed.