1954 Supreme(Nagpur) 59
HIGH COURT OF NAGPUR
R Kaushalendra Rao, Bhutt
SHEODUTT – Appellant
Versus
PANDIT VISHNUDATTA AND ANOTHER – Respondent
Miscellaneous First Appeal No. 154 of 1949
Decided on : 01-07-1954
Important Points
Subject
Arbitration Law - Validity of Reference and Award
Act Referred
Headnote
ARBITRATION - Reference - Validity - Indefiniteness and vagueness - Award - Validity - Arbitrators' misconduct - Failure to act together - Importation of personal knowledge - Examination of non-applicant behind the back of the appellant.
Fact of the Case:
The appellant challenged the validity of an arbitration reference and the award made pursuant to it, alleging indefiniteness, vagueness, and misconduct on the part of the arbitrators. The appellant also claimed that the award was vitiated by the arbitrators' failure to act together, their importation of personal knowledge, and their examination of the non-applicant behind the appellant's back.
Finding of the Court:
The court held that the reference was invalid due to indefiniteness and vagueness, as the parties were not 'ad idem' about the dispute to be decided by the arbitrators. The court also found that the award was vitiated by the arbitrators' misconduct, including their failure to act together, their importation of personal knowledge, and their examination of the non-applicant behind the appellant's back.
Issues: 1. Whether the reference was valid. 2. Whether the award was valid.
Ratio Decidendi: 1. The court held that the reference was invalid due to indefiniteness and vagueness, as the parties were not 'ad idem' about the dispute to be decided by the arbitrators. The court relied on the fact that the two documents of reference contained different terms, and that the appellant had altered one of the documents to remove a clause about a previous partition. 2. The court held that the award was vitiated by the arbitrators' misconduct, including their failure to act together, their importation of personal knowledge, and their examination of the non-applicant behind the appellant's back. The court found that the arbitrators had not acted in accordance with the principles of natural justice, and that their misconduct had resulted in a substantial miscarriage of justice.
Final Decision: The court allowed the appeal, holding that the reference was invalid, the award was a nullity, and was liable to be set aside.
A S Bobde, R K Pandey, T P Naik, Advocates
1. This appeal is by the applicant whose application under section 33 of the Arbitration Act for declaring that reference to arbitration made on 19-7-1945 was a nullity and the award given in pursuance thereto was also a nullity was rejected by the learned trial Judge.
2. In his application the appellant alleged 'inter alia' that the reference was void for indefiniteness and vagueness and also because the reference failed to specify exactly the nature of the dispute or the property with respect to which the relief of partition was claimed. The appellant also alleged that two of the arbitrators expressed unwillingness to act and signed a piece of paper giving up their authority under agreements of reference and requested one of the arbitrators to send the same to the parties. Nothing was done in the direction of making a partition. The appellant learnt that the arbitrators were colluding with the respondents-non-applicants. So the appellant sent a registered notice to one of the arbitrators to inform the former if there was a completed award and calling upon him to file the award, if any. No reply being received, the appellant made the present application. He alleged that the award, if any, was invalid because the arbitrators did not act together in giving the decision, and their deliberations were made in the absence of the appellant and without his knowledge. Further, it was alleged that the arbitrators ignored all law of procedure in sitting, hearing and examining evidence and even went outside the reference in that the arbitrators acted on their personal knowledge.
3. The nor-applicant-respondents denied the allegations and alleged that the arbitrators made and signed the award on 1-8-1945. published it and gave notice of the award and sent its copies to the appellant and the respondent on 6-8-1945. They pleaded that the applicant's right to challenge the award was barred by time.
4. The learned trial Judge dismissed the application negativing the objections raised by the appellant to the validity of the reference and the award and further holding that the application was barred by time.
5. In appeal it was contended by the appellant that the learned trial Judge was in error in holding that the application was barred by time. It was submitted that there was no valid reference to the arbitrators and consequently the award itself was a nullity. It was further contended that the award was vitiated by reason of the arbitrators' examining the non-applicant and taking evidence behind the back of the appellant, by their importing personal knowledge in giving the award, and, finally, by their failure to act together in making the award.
6. The first point for decision is whether the application was barred by time. The learned trial Judge held that time began to run from 6-8-1945 when notice was given to the appellant by the arbitrators under S. 14(1), Arbitration Act, The learned Judge was presumably of the view that the application was governed by Art. 178, Limitation Act, because he reckoned limitation from the date of the service of the notice of the making of the award. But the application in question is not one for filing in Court the award but one under S. 33. That being so, Art. 178 has no application to the case. In fact, the learned counsel for the respondent did not dispute this. He, however, strenuously contended that the application should have been thrown out as premature and incompetent because it was made before the filing of the award in Court. The learned counsel relied upon - ' Ratanji Virpal & Co. v. Dhirajlal Manilal, 1942 AIR(Bom) 101' (A); - ' Bengal Jute Mills Co. Ltd. v. Jewraj Hiralal, 1944 AIR(Cal) 304"(B) and - 'Bishun Prasad v. Gopal Das,1950 ILR(All) 50'(C).
These cases are however distinguishable. The application in question in each of the cited cases was held to be incompetent and rejected because the award was not filed in Court before the disposal of the case. In the present case, the award was fi