High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE A R LAKSHMANAN
National Bank For Agriculture and Rural Development - Appellant
Versus
Gautham Construction and Fisheries Private Limited and Another - Respondents
No
Decided On : 20 November 1990
Arbitration Act - Service of Notice - Section 17 - Section 30 - Section 14(2) - Section 44 - [KEYWORD] - Accommodation Contract - 14(2), 17, 30, 44 - The court discussed the provisions of Section 17, Section 30, Section 14(2), and Section 44 of the Arbitration Act, emphasizing the mandatory requirements for service of notice and the conditions for passing a decree in terms of the award. The court highlighted the need for strict compliance with the provisions and the court's inherent jurisdiction to recall a decree passed irregularly without complying with the statutory requirements.
Fact of the Case:
The applicants entered into a contract with the respondent for accommodation. Disputes arose, and the matter was referred to arbitration. The respondent filed a petition under Sec. 14(2) of the Arbitration Act, and a decree was passed in their favor. The applicants filed an application to set aside the decree, citing irregularities in the service of notice and non-compliance with statutory provisions.
Finding of the Court:
The court found that the decree passed in favor of the respondent was irregular as it did not comply with the mandatory provisions of the Arbitration Act, particularly regarding the service of notice and the conditions for passing a decree in terms of the award. The court exercised its inherent jurisdiction to recall the decree and set aside the judgment passed irregularly.
Issues: The issues revolved around the irregularities in the service of notice, compliance with statutory provisions, and the court's inherent jurisdiction to recall a decree passed without meeting the statutory requirements.
Ratio Decidendi: The court emphasized the need for strict compliance with the provisions of the Arbitration Act, particularly regarding the service of notice and the conditions for passing a decree in terms of the award. The court also highlighted its inherent jurisdiction to recall a decree passed irregularly without meeting the statutory requirements.
Final Decision: The court recalled the decree passed in favor of the respondent and set aside the judgment, restoring the matter to be heard along with the application filed by the applicants to set aside the decree.
Lakshmanan, J.
The facts are fairly clear and simple. But certain important questions arise for consideration in this case. The applicants had entered into a contract with the respondent under which the respondent had agreed to provide accommodation to the applicant on a ownership basis on the terms and conditions, set out in the agreement. There were disputes between the applicants and the respondent. The disputes were eventually referred to the arbitration. The sole arbitration (Mr. Justice M. R. A. Ansari (retired) made an award in favour of the respondent Gautham Construction & Fisheries Private Ltd., on 24th May, 1980). He made the award and sent a copy of the award and enclosing the same to both the parties and authorised them to file the signed copy of the award on his behalf in this court and inform him so that he shall send the original award and the records of the proceedings to this court. The respondents herein on receipt of this signed copy of the award from the arbitrator filed O.P. No. 216/90 under Sec. 14(2) of the Arbitration Act, 1940 praying.
x x x x x
2. It is seen from the receiving seal of the original side of this court that the O.P. 216/90 was filed by the respondent herein on 21.6.1990. On 30.7.1990 I passed the following order,
"Award filed. Receive the award, Notice returnable by three weeks. Private notice is also permitted" *
.
3. On 31.7.1990 Mr. J. Krishnamachary counsel for the respondent herein and petitioner in O.P. 216/90 sent a private notice to the petitioner herein by registered post acknowledgment due. The counsel, in the said notice informed the petitioner that the notice was sent as directed by this court returnable on 20.8.1990 and requested the petitioner to enter appearance on that date. The counsel for the respondent has also filed an affidavit of service stating that the notice sent by registered post acknowledgment due to the petitioner has been received and in token of such service the acknowledgment received by him has been filed in this court. It is seen from the acknowledgment card produced alongwith the affidavit of service that the notice was served on the petitioner on 4.8.90 itself. On 20th Mr. J. Krishnamachari counsel for the respondent mentioned before me that the notice ordered by this court has been served on the petitioner on 4.8.90 and hence he may be permitted to move the O.P. 216/90 on 21.8.90. On 21.8.90, the said counsel appeared before me and invited my attention to the affidavit of service filed. Further the matter was adjourned by me on 21.8.90 by one week for appearance of the respondent. When the matter was listed before me on 28.8.1990 I again adjourned the matter on 4.9.90 and the matter was again listed before me on 5.9.90 and after hearing Mr. J. Krishnamachari learned counsel for the petitioner in O.P. 216/90. I passed the following order.
4. On 30.7.1990, I passed the following order :
"Award filed. Receive the award. Notice returnable by three weeks. Private notice also permitted.
Accordingly, the counsel for the petitioner sent a notice by registered post acknowledgment due to the first respondent on 31.7.1990. It is seen from the acknowledgment now produced by the learned counsel for the petitioner that the notice has already been served on the first respondent on 4.8.90 itself. The counsel for the petitioner has also filed an affidavit of service along with the copy of the notice and the acknowledgments. Inspite of service of notice on the first respondent as early as on 4.8.1990, the first respondent did not choose to appear before this court. In the result, there will be a decree in terms of the Award passed by the Arbitrator in favour of the petitioner. The Arbitrator has himself awarded interest from the date of final bill i.e. 21.12.1987 till the date of payment of the decree of the court whichever is earlier. Considering the award and the sake involved in these proceedings, I order payment of a sum of Rs. 5, 000/- as the petitioners Advo
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