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1974 Supreme(MP) 5

High Court Of Madhya Pradesh
Shiv Dayal and Surajbhan, JJ.
STATE OF MADHYA PRADESH - Appellant
Versus
BABULAL PATHAK - Respondents
Misc. (First) Appeal 99 Of 1969
Decided On : 01/08/1974

Advocates Appeared:
A.P.TARE, R.K.Pandey

Headnote:(1) Arbitration Act, 1940 - Ss. 28 & 30 - award given beyond time - no party taking objection of limitation and participating in the proceedings - Court taking suo motu notice of delay and setting aside the award - exercise of discretion not proper - discretion should be exercised to give effect to the award and time should be extended.

       The policy of law is that the award of an arbitrator is ordinarily final and conclusive and that the Court should approach the award with a desire to support it, if that is reasonably possible, rather than destroy it by calling it illegal. 1965 JLJ 473 & AIR 1963 SC 1677 relied on. [Para 5

       Where none of the parties objected that the award is given beyond prescribed time, and both the parties actively participated in the proceedings, the Court should exercise the jurisdiction under section 28 and condone the delay. To set aside the award on the ground of delay is improper exercise of jurisdiction. 1970 JLJ 86, relied on. [Para 7

       (2) Arbitration Act, 1940 - S. 30 - award - nature of - powers of the Court to review the award.

       It is clear law that: (1) an award of the arbitrator is final, both on fact and law. (2) The Court cannot review the arbitrator's award and correct any mistake in his adjudication, unless there is an error of law on the face of the award. (3) An error of law on the face of the award means that some legal proposition, which is the basis of the award, is erroneous and such error is apparent in the award or the document actually incorporated thereto. AIR 1967 SC 1030, 50 IA 324, 2 SCC 861 relied on. [Para 8

SHIV DAYAL, J.

( 1 ) THIS is an appeal under Section 39 of the Arbitration Act from the judgment and order of the Additional District Judge, Betul, setting aside an award on the ground that it was made after "the prescribed time. The objection that the award was made beyond the time prescribed by law was not raised by any party. After disposing of the objections, which were raised before him under Section 30 of the arbitration Act, he raised the question of time limit suo motu.

( 2 ) THE facts as stated by the arbitrator in his award are that on January 12, 1960, babula' Pathak had purchased coupe No. 1, Bha;nsaghat, in public auction for Rs. 20. 000, the contract period being upto March 31, 1961. The forest staff detected some illicit felling in the coupe and the Divisional Forest Officer, South Betul division, Betul, imposed penalty, on the contractor. The contractor denied the allegations made against him. Thus a dispute arose. In his award, the arbitrator held that, Babulal Pathak was guilty of committing breach of Clause 7 of the deed of contract. The contractor filed objections under Section 30 of the Arbitration Act, whereupon the following issues were framed by the Court:--

"1. (A) Whether the arbitrator misconducted himself? (B) If so, its effect? 2. (A) Whether the non-stay by the arbitrator of the proceedings attract disqualification of Section 30 (b) of the Arbitration Act? (B) If so, its effect?

(A) Whether the award has been improperly procured? (B) If so, its effect? Relief and costs?"

( 3 ) THE learned Additional District Judge held that the non-stay of the arbitration proceedings by the arbitrator did not attract Section 30 (b) of the Arbitration Act and decided the other objections also in favour of the department, overruling the objections raised before him. He held that the award could not be set aside on any of the objections raised by the contractor. Having said all that, the learned Judge took up suo motu the question whether the award had been made beyond the prescribed period of four months (vide paragraphs 28 and 29 ). He found that the arbitrator entered upon the reference on April 23, 1963, while the award was made on August 14, 1964. Relying on Hari Shankarlal v. Shambhunath Prasad, air 1962 SC 78 he held that it is the Court which can extend time, but since no such prayer was made either, by the arbitrator or by the Divisional Forest Officer, he did "not deem it fit to condone the delay", and for that reason, he struck down the award as without jurisdiction being in contravention of Rule 3, Schedule 1, arbitration Act.

( 4 ) THE appellant's contention is that the respondent had not included that objection in his application under Section' 30 of the Act and that no opportunity was given to the appellants to make an application under Section 28 of the Act. It is further contended that this was a fit case where the Court should have, in exercise of its discretion, extended the time, particularly when the parties had acquiesced and continued to appear before the arbitrator all along without, any demur and took a chance for an award in their favour.

( 5 ) HAVING heard learned counsel for both sides, we have formed the view that the learned Additional District Judge was in error in striking down the award on a technical ground, when he had discretion to remedy the defect in the interest of substantial justice. The policy of the law is to uphold the award as far as possible. This is not a case where the Court was powerless, as when the bar of limitation rigidly steps in. Apart from the fact that the respondent had not raised any objection, it would have been only in fairness to the parties that the appellants should have been given an opportunity to make an application for extending the time. When the learned Additional District Judge found that the award was good and valid otherwise, and when he rejected all the objections raised by the respondent, he should have leaned towards the upholding of the award











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