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1963 Supreme(Online)(Cal) 4

CALCUTTA HIGH COURT
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Prabartak Commercial Corporation v. Ramsahaimull More Lt.
Award Case No. 92 - G of 1952



Advocates:
For the Appellants/Petitioners: Modak
For the Respondents: Bachawat, Chakravartti

Disputes arising from separate contracts necessitate distinct arbitration references as mandated by rules; failure leads to award invalidation.

Headnote:(A) Arbitration Act - Rule 1(5) - Joint references - Disputes arising from separate contracts require separate arbitration references. The procedure laid out in the agreed rules must be followed; breach constitutes legal misconduct, which invalidates the award. (Paras 21, 24)

Facts of the case:
The petitioner contests awards for separate contracts consolidated into one arbitration. Claims were not properly separated, violating arbitration rules.

Findings of Court:
The arbitration conducted was improper, leading to a nullification of the awards.

Issues: Whether a single court can adjudicate distinct disputes under separate contracts.

Ratio Decidendi: Courts must adhere to procedural rules. Awards resulting from improper joint references are void ab initio.

Result: The award is set aside.

Table of Content
1. petitioner sold goods with defined delivery schedules. (Para 1 , 2)
2. claims arise from distinct settlement contracts. (Para 3 , 4)
3. petitioner argues against joint arbitration of distinct contracts. (Para 5 , 6 , 7 , 8)
4. court addresses procedural complexities in arbitration. (Para 10 , 11 , 12 , 13 , 14)
5. deviation from agreed arbitration procedure invalidates awards. (Para 15 , 16 , 17 , 18 , 19 , 20)
6. jurisdiction dictated by procedural adherence. (Para 21 , 22)
7. final ruling nullifies improper award. (Para 24 , 25)

1. This is an application that the Award dated 13 March 1957 made in Award Case No. 92 - G of 1952 filed in the said Award Case be declared null and void and / or be set aside.

2. By exchange of Sold Note and corresponding Bought Note both bearing No. 1185 and dated 10 September 1951, the petitioner sold and the respondent bought 6,00,000 bales of Heavy Cees at Rs.205/- per hundred bags, delivery during months of October, November and December 1951 at 2 lakhs bags per month. The petitioner failed to deliver whereupon on 12 November 1951 by a Settlement Bought Note No. 1332 the petitioner bought back from the respondent 2 lakhs of Heavy Cees in settlement of October delivery at Rs.238/- per hundred bags and on 28 November 1951 it bought back from the respondent under another Settlement Bought Note No. 1382 further 2 lakhs bags in settlement of the November delivery at Rs.247/- per hundred bags. Under all the aforesaid contracts each month's delivery was to be treated as distinct and separate contract and each of the contracts contained an arbitration clause in the standard form prescribed by the Indian Jute Mills Association.

3. Pursuant to the above two settlement contracts the respondents submitted to the petitioner two Difference Bills being No. G/D 3971A dated 13th November 1951 for Rs.73,298-8-9 pies in respect of Contract No. 1332 and No. G/D 3994 dated 30 November 1951 for Rs.93,289-2-9 pies in respect of Contract No. 1382 for payment, but the petitioner failed and neglected to do so in spite of demand. Disputes having thus arisen between the parties the respondent on 25 February 1952 made one application for arbitration to the Bengal Chamber of Commerce but in their statement included two distinct and separate claims against the petitioner which arose out of two different contracts being Contract No. 1332 and No. 1382 hereinbefore mentioned. The claim in Contract No. 1332 was Rs.73,298-8-9 with interest at 9 per cent per annum from 10 January 1952 and the claim under Contract No. 1382 was Rs.93,289-2-9 with interest 9 per cent per annum from 10 January 1952 for which two separate difference bills had been duly submitted but not paid. The respondent had also enclosed one cheque for Rs.800/-on account of the fees of the arbitration proceedings with their application dated 25 February 1952. Thus it appears that two distinct claims were made by the respondent in one application to the Bengal Chamber of Commerce and Industry which the Tribunal of Arbitration treated as one reference and marked as Case No. 92 - G of 1952.

4. On 8 March 1952 the Registrar of the Tribunal of Arbitration in Case No. 92 G of 1952 wrote to the petitioner that the respondent had applied for arbitration in a dispute regarding their claim for payment of difference in price of 2 lakhs bags of Heavy Cees October 1951 portion and 2 lakhs bags of Heavy Cees November 1951 portion under contract No. 1185 of 10 September 1951 and also forwarded the respondent's letter dated 25 February 1951 with the accompanying papers containing their claims and contention. By the said letter the Registrar also asked for the petitioner's statement of case in duplicate at an early date together with a deposit of Rs.450/- on account of fees and the original Sold Note. By a notice dated 8 April 1952 the Registrar informed the petitioner that he had "duly constituted a Court to adjudicate upon the disputes in this case". Thereafter the petit






































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