HIGH COURT OF CALCUTTA
Ramendra Mohan Datta
RAMGOPAL LATH - Appellant
Versus
COMMONWEALTH ASSURANCE CO. LTD. - Respondent
Special Suit 3 Of 1965
Decided On : MARCH 28, 1973
ARBITRATION - Setting aside award - Grounds - Order under Section 20 of the Indian Arbitration Act, 1940 - Whether arbitrator directed to decide specific question - Legal misconduct - Erroneous appreciation of evidence - Principles applicable.
Fact of the Case:
Petitioner sought to set aside an arbitration award on two grounds: (1) the arbitrator was directed by the court to decide a specific question, and (2) the arbitrator was guilty of legal misconduct in making the award.
Finding of the Court:
The court found that the order under Section 20 of the Indian Arbitration Act, 1940 did not direct the arbitrator to decide a specific question, but rather left it to the arbitrator to decide the dispute between the parties. The court also found that the arbitrator was not guilty of legal misconduct, as there was sufficient material before the arbitrator to make the award and the arbitrator was competent to come to the findings regarding valuation.
Issues: 1. Whether the arbitrator was directed by the court to decide a specific question. 2. Whether the arbitrator was guilty of legal misconduct.
Ratio Decidendi: 1. The court held that the order under Section 20 of the Indian Arbitration Act, 1940 did not direct the arbitrator to decide a specific question, but rather left it to the arbitrator to decide the dispute between the parties. 2. The court held that the arbitrator was not guilty of legal misconduct, as there was sufficient material before the arbitrator to make the award and the arbitrator was competent to come to the findings regarding valuation.
Final Decision: The court dismissed the petition to set aside the arbitration award.
( 1 ) THIS is an application for setting aside the award dated June 25, 1970 made by Mrs. Pratibha Bonnerjea, an advocate of this Court mainly on two grounds. It is firstly argued that by the order made under Section 20 of the Indian Arbitration Act, 1940 the arbitrator was directed to decide the question whether or not the terms and conditions of the contract of insurance had been satisfied by the petitioner herein. The second argument is to the effect that the arbitrator was guilty of legal misconduct inasmuch as she was clearly wrong in appreciating the evidence adduced before her and in making her award for Rs. 20,000/-in favour of the claimant.
( 2 ) IN support of his first contention Dr. Das has referred to the order made by Mallick, J. , which reads as follows:--"as indicated before there is clearly a dispute as to whether the insurance company is liable to compensate. Whether or not, the terms and conditions have been satisfied and the petitioner is entitled to compensation are questions to be decided by the Arbitrator. It is not for me to express any opinion on it. Suffice it to state that in the facts of the case, it has been proved to my satisfaction that there is an arbitration agreement and that there is a dispute which is covered by the arbitration agreement. "before Mallick, J. , it was contended that there was no arbitration agreement which could be filed. In this case only the cover note was issued. Since the arbitration clause was in the policy, which had not been issued, there was no subsisting arbitration agreement between the parties. Mallick, J. , came to the finding that the cover note contained provisions to the effect that in consideration of the insured having paid or agreed to pay the premium, the goods set out in the proposal form were held covered against burglary and house breaking as from March 19, 1964 according to the terms and conditions of the company's usual form of policy unless notice had been previously given that the proposal had been declined. On the basis of the said clause the Court came to the finding that there was an arbitration agreement. The Court also was satisfied that there was a dispute between the parties which was covered by the said arbitration agreement and on that basis the Court made the order under Section 20 of the Indian Arbitration Act, 1940. Under these circumstances the above observations made by Mallick, J. , regarding the terms and conditions of the policy and whether the same had been satisfied or not cannot be construed to be an order directing the arbitrator to go into the said question. The above observations clearly meant that such questions, if raised before the arbitrator would be considered and gone into by the arbitrator and the Court had nothing to do with the same. The arbitration agreement is the creature of the parties alone and the Court cannot add to it. Accordingly, the first contention of Dr. Das cannot hold good and is rejected.
( 3 ) IN support of his second contention Dr. Das had sought to rely on the evidence adduced before the arbitrator and has contended that the evidence regarding the value of the lost articles and ornaments is such that the arbitrator was clearly wrong in making an award for a sum of Rs. 20. 000/-and in making such award the arbitrator is guilty of legal misconduct. Dr. Das draws my attention to the letter dated March 25, 1964 written to the Officer-in-charge of the Police Station at Rourkela wherein it was stated that the weight of the lost gold was to the extent of 200 tolas whereas Sitaram in his evidence has said that the weight of the gold would be about 100 tolas. Then again, Sitaram in his evidence has named the ornaments but such names of ornaments did not tally with the list of ornaments mentioned in the letter to the police written on March 25, 1969. Dr. Das also contends thai the contract of insurance is a contract of indemnity and accordingly the claimant must give evidence of valu
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