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1933 Supreme(Pesh) 13

HIGH COURT OF PESHAWAR
Saaduddin, AJC
Punjab National Bank – Appellant
Versus
R S Choudhri Kewal Krishan – Respondent
Decided On : 28-03-1933

JUDGMENT

Saaduddin, A J C - Respondent R.S. Choudhri Kewal Krishan, a member of the Tank Bar, had dealings with the Punjab National Bank Ltd. at Dera Ismail Khan. In connection with these dealings the parties entered into arbitration out of Court and an award was given whereby the arbitrator allowed the Bank's claim and made the amount payable by instalments. This award was filed in the Court of District Judge, Dera Ismail Khan, under the provisions of Sch,2, Civil P.C, and a decree was passed in accordance therewith. Respondent failed to make payment of any instalment in accordance with the award and the Bank took out execution. The execution proceedings went on for some time and finally the respondent took objection that the decree was a nullity, inasmuch as it contravened the provisions of Section 152, Indian Companies Act which made the Arbitration Act applicable to the reference and therefore it could not be executed. His objection was upheld by the present Senior Sub-Judge who has replaced the Court of the former District Judge, and the Bank has come up on appeal here.

2. Various questions have been raised in arguments, some of which are the subject of conflict of authority in the Courts in India. It has been urged by the respondent that under Section 152, Indian Companies Act, the power of Companies to ontor into arbitration is restricted and that only arbitration under the Arbitration Act can take place. Further it has been contended that the proceedings under Schedule 2, Civil P.C., taken in this case were without jurisdiction and the decree passed in accordance with the award is a nullity and is not capable of execution. It has also been contended that the executing Court is entitled to ignore the decree which was passed without jurisdiction and refuse execution. Naturally appellant controverts all these contentions. It is however unnecessary for us to go into them, because in our opinion the matter can be satisfactorily decided on a short issue.

3. In case it is held that Section 152, Indian Companies Act, is merely an enabling section and not restrictive of the power of the companies to enter into a contract referring disputes to arbitration, no question arises. The agreement to refer did not contain any provision that the arbitration would be under the Arbitration Act. Consequently, the award could have been, as infact it was filed under the ordinary provisions of Civil P.C. and a decree passed in accordance therewith. The decree then being with jurisdiction was not open to any objection, and the executing Court could not refuse execution. But if on the other hand it is that Section 152, Indian Companies Act is restrictive of the power of the Companies and that arbitration can. only take place under the Arbitration Act, it is not contended that because in the agreement of reference it was not specially stipulated that it was under the Arbitration Act, it was inoperative. The mere face that the company entered into this agreement shows that the reference was under the Arbitration. Act. Now, Section 11, Arbitration Act, provides for the filing of the award and Section 15, Clause (1) lays down that an award on being filed in Court shall be enforceable as if it were a decree of the Court. The Court; under the Arbitration Act means outside the Presidency towns the Court of the District Judge. This award was filed in the Court of the District Judge and the fact that a decree was passed an accordance therewith may be taken as superimposition and may well be ignored. So far as the provisions of Section 15 are concerned, the mere filing of the award in Court is enough and it can be executed as a decree. The execution application, though it purports to pray for the excution of the decree in substances asks for the enforcement of the terms of the award, and we do not see any reason why, the technicalities apart, the execution should not proceed, not as an execution of the decree, but of the award itself. This is exactly the

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