HIGH COURT OF CALCUTTA
P. B. MUKHARJI, J.
Haji Ebrahim Kassam Cochinwalla
Versus
Northern Indian Oil Industries Ltd.
Suit No. 110 of 1949
Decided On : 19-01-1950
ARBITRATION - Setting aside of Award - Misconduct of Arbitrator - Refusal to state a special case - Refusal to grant adjournment - Refusal to hear evidence - Filing of Award after the specified time - Error of law on the face of the Award.
Fact of the Case:
The applicant, Haji Ebrahim Kassam Cochinwalla, purchased 3 wagons of pure Mahuya Oil from the Northern India Oil Industries Ltd. by a contract dated 2-1-1949. The respondents claimed Rs. 3368-9-3 as damages for non-acceptance being based on the difference between the contract price and the market price. After some disputes, the respondents' solicitor informed the applicant of the appointment of Pannalal Kasera as the sole Arbitrator. The applicant applied to restrain the sole Arbitrator from acting and for allowing the applicant to appoint an Arbitrator on his behalf. The application was dismissed by Banerjee J. The Arbitrator made an award on 22-7-1949 and filed it on 20-8-1949.
Finding of the Court:
The Court held that the Arbitrator did not misbehave by not stating a special case for the opinion of the Court and in refusing to grant an adjournment for such purpose. The Court also held that the Arbitrator had sufficient evidence before him to hold that the Railway booking was closed on 3-1-1949 in Railway Stations in the U. P. and Behar. The Court further held that the filing of the Award on 20-8-1949 instead of 25-7-1949 as directed by the order of Banerjee J. was not a ground for setting aside the award as filing of an award is a ministerial act and not a judicial or quasi-judicial act of the Arbitrator.
Issues: 1. Whether the Arbitrator misconducted himself in not stating a special case for the opinion of the Court and in refusing to grant an adjournment for such purpose? 2. Whether the Arbitrator had sufficient evidence before him to hold that the Railway booking was closed on 3-1-1949 in Railway Stations in the U. P. and Behar? 3. Whether the filing of the Award on 20-8-1949 instead of 25-7-1949 as directed by the order of Banerjee J. was a ground for setting aside the award?
Ratio Decidendi: 1. Under the Indian Arbitration Act, 1940, Arbitrators do not have the power to state a special case for the opinion of the Court on any question of law involved. Therefore, the Arbitrator's refusal to state a special case was not misconduct. 2. The Court held that the Arbitrator had sufficient evidence before him to hold that the Railway booking was closed on 3-1-1949 in Railway Stations in the U. P. and Behar. 3. Filing of an award is a ministerial act and not a judicial or quasi-judicial act of the Arbitrator. Therefore, the filing of the Award on 20-8-1949 instead of 25-7-1949 as directed by the order of Banerjee J. was not a ground for setting aside the award.
Final Decision: The application to set aside the award was dismissed with costs.
2. The facts of the case may be stated briefly. By contract dated 2-1-1949 the applicant purchased from the Northern India Oil Industries Ltd., 3 wagons of pure Mahuya Oil. The respondents claimed Rs. 3368-9-3 as damages for non-acceptance being based on the difference between the contract price and the market price. After some disputes, by a letter dated 9-2-1949 the respondents solicitor informed the applicant of the appointment of Pannalal Kasera as the sole Arbitrator. An application was thereafter made by the present applicant on 24-5-1949 restraining the sole Arbitrator from acting and for allowing the applicant to appoint an Arbitrator on his behalf. That application was finally heard by Banerjee J., and by an order dated 5-7-1949 the learned Judge held that the application should fail and did not allow the applicant to appoint his Arbitrator as no sufficient cause had been shown. I would quote from my learned brothers judgment delivered on 5-7-1949 the following observations which I consider material for the purpose of the present application before me:
"I do not see any reason why I should set aside the appointment. No allegation has been made against Mr. Kasera. Petitioners counsel has said that the petitioner has confidence in Mr. Kasera who is a man of business and who deals in the contract commodity. His fitness to act as an Arbitrator has not been questioned." Those observations are material because although the applicant did not succeed before my learned brother he has repeated practically the same allegation of misconduct against the same Arbitrator in the present application before me.
3. The other part of the order of 5-7-1949, which is material for the purposes of the present application is :
"The Arbitrator must file the Award by 23-7-1949. If the Arbitrator thinks that he would not be able to complete the Award by that time he should forthwith inform the parties about his inability to do so."
4. Reliance has been placed upon this part of the order for the contention of the applicant that the Arbitrator did not file the Award within the time indicated in that order.
5.Mr. S. K. Das learned counsel for the applicant has made the following submissions on which be asks me to set aside the award of the Arbitrator :
(1) The Arbitrator misconducted himself in not stating a special case for the opinion of the Court and in refusing to grant an adjournment for such purpose as alleged in para. 11 of the petition.
(2) That the Arbitrator had no sufficient evidence before him to hold that the Railway booking was closed on 3-1-1949 in Railway Stations in the U. P. and Behar as alleged in paras. 12, 13 and 14 of the petition.
(3) That the award of the Arbitrator was filed on 20-8-1949 instead of 25-7-1949 as directed by the order of Banerjee J.
6. Section 13, Indian Arbitration Act, 1940 provides in sub-para. (b) thereof that the Arbitrators have power to state a special case for the opinion of the Court on any question of law involved. While English decisions offer valuable guide, it is essential to observe that there is a very important difference in this particular matter between Indian law and the English law. Section 9, English Arbitration Act, 1934, empowers the Court to direct an Arbitrator to state a question of law, but not so under the Indian Arbitration Act. There are no powers in the Courts in India under the Indian Arbitration Act, 1940, to direct the Arbitrator to state a special case. Mr. S. K. Das learned counsel for the applicant relied on the well known observation in Czarnikow v. Roth, (1922) 2 K. B. 478 : (127 L. T. 824) where it has been said that the Arbitrators are guilty of misconduct in not granting adjournment for enabling the parties to apply in Court for the statement of a special case. In my judgment that is not m
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