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IN THE HIGH COURT OF BOMBAY
Nain, J.
Appellants: Shrinath Brothers
Vs.
Respondent: Century Spg. and Mfg. Co. Ltd.
Civil Revn. Appln. No. 2083 of 1964 Decided On: 21.11.1967
Counsels:
For Appellant/Petitioner/Plaintiff: D.R. Dhanuka, Adv.
For Respondents/Defendant: S.M. Jhunjhunwala, Adv.
{'KEYWORD': 'Arbitration Act, 1940', 'SUBJECT': 'Service of Notice of Filing of Award', 'ACT SECTION LIST': ['Section 14(2)', 'Section 17', 'Section 41', 'Order 30, Rules 3 and 5', 'Order 5, Rule 21-A'], 'SUMMARY': 'The court held that the service of notice of filing of an arbitration award on a partnership firm by registered post to a person named Raja Shankar, without specifying his capacity as a partner or manager in charge of the business, was insufficient and invalid. The court emphasized the importance of complying with the provisions of Order 30, Rules 3 and 5 of the Code of Civil Procedure, which require that a summons for a firm must be served on a partner or manager and that the person served must be informed of the capacity in which they are being served.'}
Fact of the Case:
In this case, an arbitration award was made against the petitioners, a partnership firm, on 7th June 1962. The arbitrator filed the award in court on 23rd March 1963, and a notice of filing was issued and sent to the petitioners by registered post on 11th April 1963. The acknowledgment for the registered cover was signed by a person named Raja Shankar on 25th April 1963, but it was not specified whether he was a partner or manager of the petitioners' firm.
Finding of the Court:
The court found that the service of the notice of filing of the award on Raja Shankar was insufficient and invalid because it did not comply with the requirements of Order 30, Rules 3 and 5 of the Code of Civil Procedure. The court held that the provisions of Order 30, Rules 3 and 5 are applicable to notices under Section 14(2) of the Arbitration Act, and that the failure to properly serve the notice deprived the court of jurisdiction to pass judgment in terms of the award.
Issues: 1. Whether the service of the notice of filing of the arbitration award on Raja Shankar was valid and sufficient. 2. Whether the court had jurisdiction to pass judgment in terms of the award without proper service of the notice.
Ratio Decidendi: The court held that the service of the notice of filing of the award on Raja Shankar was invalid because it did not comply with the requirements of Order 30, Rules 3 and 5 of the Code of Civil Procedure. The court emphasized the importance of complying with these provisions, which require that a summons for a firm must be served on a partner or manager and that the person served must be informed of the capacity in which they are being served. The court also held that the provisions of Order 30, Rules 3 and 5 are applicable to notices under Section 14(2) of the Arbitration Act, and that the failure to properly serve the notice deprived the court of jurisdiction to pass judgment in terms of the award.
Final Decision: The court allowed the revision application and set aside the order of the City Civil Court making the respondents' notice of motion for passing judgment in terms of the award absolute. The judgment and decree were also set aside.
2. The facts leading to this case, briefly stated, are :-That on 7th June 1962, there was an award made against the petitioners in favour of the respondents. On 23rd March 1963, the arbitrator filed the said award in the Court. On 11th April, 1963, notice of filing of the award was issued by the Court and despatched to the petitioners, who are a partnership firm, in a registered cover addressed to the firm. The acknowledgment for this registered cover appears to have been signed on 25th April 1963 by a person signing as Raja Shankar. It is not stated in the acknowledgment as to whether this Raja Shankar was a partner of the petitioners firm or the manager in charge of the business firm or the manager in charge of the business at the time of service. Whether this is sufficient service of notice of filing of the award or not is a matter in controversy with which I shall deal later. On 3rd July 1963, the respondents took out a notice of motion for judgment in terms of the award relying on the acknowledgment dated 25th April 1963. On the next day, i.e., 4th July 1963, the petitioners in this revision application filed a petition in the City Civil Court for setting aside the award dated 7th June 1962 on grounds stated in the said petition. The petitioners, however, stated in the said petition that the notice of filing of the award had not been served upon them by the Court. The respondents filed an affidavit in reply to the petition alleging that the notice of filing of award had been served on the petitioners on 25th April 1963 and also controverting the grounds on which the award was sought to be set aside. On 24th July, 1964, the petition for setting aside the award was dismissed. The order on the said petition is Exhibit "A" to this petition and reads as under:-
"This petition to see aside an award can be disposed on a short point, viz., whether it is maintainable.
2. The facts necessary to this petition may be briefly stated. The dispute between the parties were referred to arbitration and the arbitrators made their award on 7th June 1962. It appears that on 11th April 1963 notice of filing of the award was issued and was served on the petitioners on 25th April 1963. But the petitioners deny that notice was ever served upon them. Assuming that statement as correct, then in my opinion, the petitioners were not entitled to file by any petition at all, till they were served with the notice of filing of the award because under Article 158 of the Indian Limitation Act the period of limitation of 30 days would begin from the date of service of notice of filing of the award and if the petitioners say that they were not served with the notice of filing the award I do not see why at all it was necessary for them to file a petition in this Court to have that award set aside. But the petitioners say that they took search of the proceedings on 24th June 1963 and thereafter on 4th July 1963 they filed the present petition. If the statement of the petitioners is to be accepted as correct, that they were not served with the notice of filing of the award, the petition is misconceived by and not maintainable. The petition is, therefore, dismissed. Petitioners to pay the respondent the costs of the petition.
3. I must here that the learned Judge on the one hand says that it appeared to him that on 11th April 1963 the notice of filing of the award was issued and the same was served on the petitioners on 25th April 1963, on the other hand, he dismissed the petition as premature on the footing that the notice of filing of the award had, as alleged by the petitioners, not been served on them. The learned Judge decided the matter as if on a plea of demurrer. I am
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