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1950 Supreme(Nagpur) 26

HIGH COURT OF NAGPUR
Bose, Deo
JANARDHANPRASAD – Appellant
Versus
CHANDRASHEKHAR AND ORS – Respondent
Miscell Appeal No. 137 of 1946
Decided on : 04-04-1950

Advocates Appeared:
A Razak, P R Padhye, S C Dube, Advocates

Arbitrators become functus officio on making and signing the award and cannot make a second award.

Headnote:

ARBITRATION - AWARD - FILING - PROCEDURE - ARBITRATORS BECOMING FUNCTUS OFFICIO - AWARD MADE AND SIGNED - NOTICE OF AWARD - GIVING OF NOTICE - TIME - LIMITATION - CIVIL PROCEDURE CODE (V OF 1908), ORDER 20, RULES 1 AND 3 - ARBITRATION ACT (X OF 1940), SECTIONS 14, 15, 16, 30 AND 17.

Fact of the Case:

A dispute between Janardanprasad and his brother Chandrasekhar was referred to arbitration. The arbitrators made and signed an award on 11-1-1944, which required registration as it related to the partition of immovable property. A document purporting to be an award was presented for registration on 12-1-1944 and was registered on 13-1-1944. Thereafter, the arbitrators made a second award on 26-1-1944. Janardanprasad applied to set aside the second award, alleging that the first award was made and that the second award was procured under the circumstances stated in the application. The lower Court held that the arbitrators had become functus officio on delivery of the first award and had no power to deliver the second award dated 26-1-1944. As regards the first award, the lower Court held that it was not materially altered as alleged by Chandrashekhar but it was vitiated due to the misconduct of the arbitrators and was accordingly set aside.

Finding of the Court:

The court held that the arbitrators had become functus officio on making and signing the first award and were not entitled to make and deliver the second award dated 26-1-1944. The court also held that the first award was final and could not be superseded by a second award because written notice was not given to either party before 26-1-1944. The court further held that the proper procedure had not been followed by the Court below and remanded the case for trial de novo from the stage subsequent to the filing of the award by the arbitrators under Section 14(2), Arbitration Act.

Issues: 1. Whether the arbitrators had become functus officio on making and signing the first award? 2. Whether the first award was final and could be superseded by a second award because written notice was not given to either party before 26-1-1944? 3. Whether the proper procedure had been followed by the Court below?

Ratio Decidendi: 1. The court held that the arbitrators had become functus officio on making and signing the first award, relying on the provisions of Schedule 1, Arbitration Act, which prescribes the implied terms of arbitration agreements, and the decisions in Asad-ul-lah v. Muhammad Nur, Arumugam Chetti v. Arunachalam Chetti, Umersey Premji v. Shamji Kanji, and Akshoy Kumar v. S.C. Dass and Co. 2. The court held that the first award was final and could not be superseded by a second award because written notice was not given to either party before 26-1-1944, relying on the provisions of Order 20, Rules 1 and 3, Civil Procedure Code, and the decision in Firm Ram Kishan Das Brij Mohan v. Firm Sushil Chandra Das. 3. The court held that the proper procedure had not been followed by the Court below, as the procedure laid down by the Act in Sections 14, 15, 16, 30 and 17 had not been followed in chronological order.

Final Decision: The order of the lower Court was set aside and the case was remanded for trial de novo from the stage subsequent to the filing of the award by the arbitrators under Section 14(2), Arbitration Act.

JUDGMENT

1. This appeal arises out of a proceeding under Section 30, Arbitration Act, commenced by the appellant Janardanprasad.

2. A dispute between Janardanprasad and his brother Chandrasekhar, respondent 1, was referred to the arbitration of their sister Mt. Umabai, respondent 3 and her husband Dwarkaprasad respondent 2 under an arbitration agreement dated 3-8-1943.

3. The arbitrators made and signed an award on 11-1-1944. It required registration as it related to the partition of immovable property. A document purporting to be an award was presented for registration on 12-1-1944 and was registered on 13-1-1944. It is Ex. 1 N.A. 4. Thereafter the arbitrators made a second award on 26-1-1944 (Ex.1 N.A. 3).

4. On 24-4-1944 Janardanprasad made an application purporting to be under Section 30, Arbitration Act of 1940, alleging that the arbitrators gave their first award on 11-1-1944 and that:

these arbitrators being influenced by other persons misconducted themselves to such an extent that second award wag procured from them which was mala fide full of irregularities invalid and illegal. Janardanprasad therefore desired that the Arbitrators 1 and 2 should be directed by the Court to file the awards dated 11-1-1944 and 27-1-1944 in Court so that the rights of the parties may be justly and properly determined by the Court.

The date of the second award is wrongly stated as 27-1-1944.

5. Thereafter it was alleged that the parties agreed to repartition the property and on 6-5-1944 a partition was made by the same arbitrators and a deed was executed. In pursuance of this partition, the parties were placed in separate possession of both movable and immovable property probably on 24-6-1944 on which date the brothers executed separate agreements in token of ratifying the partition according to the deed dated 6-5-1944.

6. Janardanprasad therefore applied for amendment of his application by including these averments and submitted (para 5):

That the applicant desires that the arbitrators 1 and 2(should be directed by this Court to file the awards dated 11-1-1944 and 27-1-1944 in Court and both the awards be ordered to be set aside for the reasons stated below.

These reasons are the alleged subsequent partition dated 6-5-1944. In the prayer clause Janardanprasad submitted:

that the awards dated 11-1-1944 and 27-1-1944 be set aside and declared to be void being superseded with the consent of the parties by the subsequent award dated 24-6-1944. The partition deed and agreement dated 24-6-1944 be treated as the final award of the Panchas and the same be ordered to be filed and judgment be pronounced in terms of the partition deed dated 6 5-1944 and as ratified by written agreements dated 24 6-1944.

7. The Defendant Chandrasekhar denied these allegations of subsequent partition and agreement and contended that those averments cannot be enquired into in these proceedings for setting aside the awards dated 11-1-1944 and 26-1-1944. He contended that the award dated 11-1-1944 was substantially unfair to him and the award as originally made and signed by the arbitrators was not the award which was registered. It was alleged that the second and third pages of the award were removed after its execution and replaced by the second and third pages in the registered award. It was alleged that this was done by Janardanprasad while the document was in his possession.

8. The lower Court held that the arbitrators bad no right to bring about the partition alleged to have been made in May 1944 as there was no fresh reference and the parties did not agree to the matter being resettled. Both parties accept the decision and have not attacked that part of the order before us. The lower Court held that the arbitrators had become functus officio on delivery of the first award and had no power to deliver the second award dated 26-1-1944. As regards the first award, the lower Court held that it was not materially altered as alleged by Chandrashekhar but it was vitiated due to the m












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