IN THE HIGH COURT OF ALLAHABAD
Nasirullah Beg and V. D. Bhargava, JJ.
NAWAB SYED HASAN ALI KHAN - Appellant
Versus
NAWAB ASKARI BEGAM - Respondents
First Appeal from Order 23 Of 1956
Decided On : 03/11/1959
ARBITRATION ACT - SECTION 3, FIRST SCHEDULE, PARAGRAPH 3 - AWARD WITHIN FOUR MONTHS OF ARBITRATOR ENTERING REFERENCE - INTERPRETATION OF "THE ARBITRATORS" IN PARAGRAPH 3 - DATE OF ENTERING REFERENCE FOR ALTERNATIVE ARBITRATOR.
Fact of the Case:
An arbitration agreement appointed Nawab Sajjad Ali Khan as the arbitrator, with Maulana Ibne Hasan as the alternative arbitrator in case of refusal. Nawab Sajjad Ali Khan entered reference on 19-10-1948 and later refused to act. Maulana Ibne Hasan entered reference on 19-1-1949 and gave the award on 18-5-1949, within four months of his entering reference. The trial court dismissed the application for filing the award on the ground that it was given beyond time.
Finding of the Court:
The court held that the award was within time as it was made within four months of Maulana Ibne Hasan entering reference, the relevant date for calculating the limitation period. The court interpreted "the arbitrators" in Paragraph 3 of the First Schedule to refer to the arbitrator who actually made the award, not including arbitrators who refused to act or whose proceedings became infructuous.
Issues: 1. Whether the award was given beyond the prescribed period of four months under Paragraph 3 of the First Schedule of the Arbitration Act. 2. Whether the date of entering reference should be taken as the date when the original arbitrator entered reference or the date when the alternative arbitrator entered reference.
Ratio Decidendi: 1. The court interpreted Paragraph 3 of the First Schedule to mean that the period of four months for making the award starts from the date the arbitrator who actually made the award entered reference. 2. In the case of alternative arbitrators, the date of entering reference is the date when the arbitrator who ultimately made the award entered reference, not the date when the original arbitrator entered reference.
Final Decision: The court allowed the appeal, set aside the trial court's order, and remanded the case for proceeding with the disposal of the case according to law.
( 1 ) THIS first appeal arises out of an application given under Section 14 of the Arbitration Act. It appears that on 23-9-1948, parties executed a deed of agreement by which they appointed Nawah sajjad Alt Khan as arbitrator to decide the dispute between them regarding the moveable property left by Zohra Begam deceased, the mother of the parties. There was also a provision in this agreement that in case Nawab Sajjad Ali Khan refused to act as an arbitrator, Maulana Ibne hasan should act as an arbitrator. Under the aforesaid agreement Nawab Sajjad Ali Khan entered on reference on 19-10-1948. He took the necessary proceedings as an arbitrator under the arbitration Act. Some time in January 1949, however, Nawab Sajjad Ali Khan refused to act as an arbitrator. Under the terms of the agreement, therefore, Maulana Ibne Hasan, who was to act as an arbitrator in case of the refusal of Nawab Sajjad AH Khan, became the proper person to act as an arbitrator. Accordingly, Maulana Ibne Hasan, entered on reference on 19-1-1949. He delivered his award on 18-5-1949,. e. within four months of his entering on reference to arbitration. On 2-6-1949. an application was given under the Arbitration Act for the filing of the award given by Maulana Ibne Hasan. On 23-8-1955, objections to this award were filed on behalf of the respondent. On 2-3-1956, after hearing the arguments of the parties the learned civil Judge of Mohanlalganj rejected the application for the filing of the award on the ground that the award was given beyond time. Aggrieved with the said order, the appellant has filed this appeal in the High Court.
( 2 ) BEFORE the arguments started the learned Counsel for the respondent raised a preliminary objection to the hearing of the appeal. He argued that the present appeal is not maintainable under Section 39 of the Arbitration Act, Section 39 of the Arbitration Act provides for appeals against orders setting aside or refusing to set aside an award.
( 3 ) HAVING heard learned Counsel for the respondent, we are of opinion that the order in the present case is an appealable one. It is admitted that an application under Section 14 of the arbitration Act was given in the trial Court. It is further admitted that the award was filed in court as a result of that application, and objections to the said award were invited. Thereafter the respondent filed objections and the Court adjudicated on those objections after going into the matter. The Court finally dismissed the application for filing the award. The order of the trial court, therefore, amounts to an order setting aside the award and would, therefore, be appealable. Reference in this connection may be made to a decision of the Patna High Court in jagdish Mahton v. Sundar Mahton, AIR 1949 Pat. 393.
( 4 ) ON merits also we are of opinion that there is force in this appeal. The view of the trial court that the award was given beyond time appears to us to be erroneous. In this connection reference might be made to Section 3 of the Arbitration Act, which provides that an arbitration agree-merit, unless a different intention is expressed therein, shall be deemed to include the provisions set out in the First Schedule in so far as they are applicable to the reference. Paragraph 3 of the First Schedule runs as follows : 3. The arbitrators shall make their award within four months after entering on the reference or after having been called upon to act by notice in writing from any party to the arbitration agreement or within such extended time as the Court may allow. " there being nothing contrary to the above provision in the agreement the said provision will apply to the present case. The award would, therefore, be within time if the arbitrator who entered on the reference has made the award within four months of the date of his entering on the reference. Maulana Ibne Hasan admittedly entered on the reference on 19-1-1949, and gave his award on 1. 8-5" 1949,. e. within four months o
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