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HIGH COURT OF CALCUTTA
S. R. Das Gupta
SHAH AND CO. - Appellant
Versus
ISHAR SINGH KIRPAL SINGH AND CO. - Respondent
Award Case 244 Of 1953
Decided On : SEPTEMBER 03, 1953
ARBITRATION - AWARD - VALIDITY - JURISDICTION OF ARBITRATORS - APPLICATION TO SET ASIDE AWARD - LIMITATION - INDIAN ARBITRATION ACT, 1940, SECTIONS 30, 33, 37, 41 - INDIAN LIMITATION ACT, 1908, ARTICLE 181.
Fact of the Case:
The petitioner and the respondent entered into a contract on April 26, 1948, which contained an arbitration clause providing for disputes to be referred to the Calcutta Kirana Association. On September 25, 1948, the Calcutta Kirana Association went into voluntary liquidation, and a new association, the Calcutta Kirana (Spices) Merchants' Association, was formed. The respondent referred the disputes to the new association, which made an award in its favor on February 7, 1949. The petitioner filed an application under Sections 30 and 33 of the Indian Arbitration Act, 1940, to set aside the award and declare that there was no valid arbitration agreement.
Finding of the Court:
The court held that the application under Section 33 was barred by limitation under Article 181 of the Indian Limitation Act, 1908, as it was filed more than three years after the right to apply accrued. The court also held that the grounds raised by the petitioner in support of the application under Section 30 were all grounds relating to an application under Section 33 and could not be available in an application under Section 30. Therefore, the court dismissed the application under Section 30 with costs.
Issues: 1. Whether the application under Section 33 of the Indian Arbitration Act, 1940, was barred by limitation under Article 181 of the Indian Limitation Act, 1908? 2. Whether the grounds raised by the petitioner in support of the application under Section 30 were all grounds relating to an application under Section 33 and could not be available in an application under Section 30?
Ratio Decidendi: 1. The court held that Article 181 of the Indian Limitation Act, 1908, which provides a three-year limitation period for applications for which no period of limitation is provided elsewhere in the Act, applies to applications under Section 33 of the Indian Arbitration Act, 1940. The court reasoned that the incorporation of matters other than applications under the Code of Civil Procedure into the first schedule of the Limitation Act meant that the residuary Article 181 must apply to all other applications under the Indian Arbitration Act. 2. The court held that the grounds raised by the petitioner in support of the application under Section 30, namely, that the arbitrators who made the award had no jurisdiction to do so because they were not the persons to whom the parties agreed to refer, were all grounds relating to an application under Section 33 and could not be available in an application under Section 30. The court reasoned that the power conferred on the Court to set aside an award under Section 30 presupposes the existence of a valid reference and that if there is no valid reference, the award is a nullity and a declaration to that effect can be obtained under Section 33.
Final Decision: The court dismissed the application under Section 30 of the Indian Arbitration Act, 1940, with costs.
( 1 ) THIS is an application for an order: (a) That the existence, effect and/or validity of the said alleged arbitration agreement and all questions relating thereto be decided and determined by this Court. (b) That it be declared that there was no valid, binding or effective or subsisting arbitration agreement between the parties or that the disputes and differences, if any, are referable to such arbitration. (c) That the said purported award dated 7th February 1949 be set aside. (d) Costs and incidental expenses be paid to the applicant.
( 2 ) THE facts necessary for me to determine the merits of this application, shortly stated, are as follows:
( 3 ) ON April 26, 1948, there was a contract between the parties. The sowda in respect of the said contract has been set out in Annexture 'a' to the petition. The said sowda contains amongst others the following term:"all sowdas subject to rules and regulations of the Calcutta Kirana Association whose decision is final and binding on both the buyers and the sellers. "
( 4 ) ON September 25, 1948, the Calcutta Kirana Association went into voluntary liquidation by a special resolution passed on that date and one S. K. Chakravarty was appointed liquidator. Thereafter on October 29, 1949, another Association known as the Calcutta Kirana (Spices) Merchants' Association was incorporated and all the rules of the Calcutta Kirana Association were incorporated in the new Association and were filed with the Registrar. The special resolution which was passed on September 25, 1948, inter alia provides as follows: "resolved that the Calcutta Kirana Association be voluntarily wound up and the members of the Managing Committee be authorised to take all necessary steps to wound up the affairs of the Association. "resolved that the Association consents to formation of an Association in the name of the Calcutta Kirana Merchants' Association by some of the members of the Association of such other name similar or identical to the existing name of the Association. "disputes and differences arose between the parties with regard to the said sowda. The respondent referred such disputes to the Calcutta Kirana Merchants' Association. The petitioner received a letter from the Secretary of the said Kirana Merchants' Association dated 15th October 1948 asking the petitioner to attend the executive committee meeting of the said Association in respect of the said references made by the respondent to the said Association. The petitioner protested and refused to appear because the petitioner's case was that he never agreed to refer the disputes to the Calcutta Kirana Merchants' Association: the case of the petitioner being that the agreement to refer was to Calcutta Kirana Association as is embodied in the sowda itself. After a number of letters written to the petitioner asking the petitioner to attend the meeting of the said Association, the said Calcutta Kirana Merchants' Association on the 7th February 1949 made an award in favour of the respondent. It is with respect to that award that the petitioner has made the present application.
( 5 ) THE ground taken by the learned counsel appearing for the petitioner in support of this application is that the arbitrators who purported to arbitrate over the said disputes and made the said award had no jurisdiction to do so, because, as would appear from what I have already stated, the case of the petitioner before me is that the body to which the party agreed to refer their disputes was not this Calcutta Kirana Merchants' Association but the Calcutta Kirana Association, and the parties never agreed to abide by their arbitration and this Calcutta Kirana Merchants' Association had no right or authority to make the award. This is the substance of the contention of the learned counsel appearing on behalf of the petitioner and this is the only ground which has been urged before me in respect of this application.
( 6 ) MR. Kar appearing on behalf of the
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