Malik, C.J:— One Babulal Taliwal obtained a decree against Shiamlal and Kishan Prasad, father and son, for a sum of Rs. 6,000 from the High Court of Bombay in the year 1936. In the same year the decree was transferred to the court of the Civil Judge, Aligarh, for execution. Several objections were taken to the execution of the decree by the judgment-debtors, but these objections were dismissed and the appeals against them were dismissed by this Court. After the disposal of the objections, the decree was executed and several items of property belonging to the judgment-debtors were sold on the 3rd February, 1939. Certain objections were filed to the sale under Order 21, rule 90 of the Code of Civil Procedure. In September, 1940 the objections were dismissed for default and on the 25th September, 1940, the sale was confirmed and thereafter the appellant Munnilal alias Rup Kishore, who had purchased the property at an auction, obtained possession of the property. It is said that, after having obtained possession of the property, the auction purchaser spent a sum of about Rs. 5,000 in rebuilding the house. Some time after the 25th September, 1940, an application was made by Shiamlal and Kishan Prasad for restoration of their objections which they had filed under Order 21, rule 90 of the Code of Civil Procedure. At this stage on the 12th December, 1940, the parties appointed Mr. Misrilal, Advocate, an arbitrator to decide the application for restoration as well as the objections under Order 21, rule 90 Civil Procedure Code. On the 6th March, 1941 Mr. Misrilal gave his award by which he set aside the order of dismissal for default the objections under Order 21, rule 90. He however held that the objections had no force as there was no material irregularity in conducting the sale and the price fetched at auction was adequate. He, therefore, dismissed the objections on merits.
The judgment-debtors filed objections to the award but on the 13th December, 1941, a fresh settlement was arrived at between the parties and statements were made on behalf of both the judgment-debtors, Shiamlal and Kishun Prasad, that the objections to the award be dismissed. Kishun Prasad again came forward with the allegation that the settlement of 13th December, 1941, had been entered into by his counsel without his authority and his objections should, therefore, be heard on the merits. On the 16th May, 1942, the learned Judge granted this objection and on the 12th September, 1942, the objections of Kishun Prasad to the award was restored on payment of Rs. 5 as costs. The learned counsel for the appellant has stated that the sum of Rs. 5 was never paid. On the 8th August, 1942, the objections of Kishun Prasad under Order 21, rule 90, Civil Procedure Code, were again dismissed for default. On the 12th September, 1942, however, it was again restored and on the 26th August, 1943, the learned Judge came to the conclusion that no reference could be made to an arbitrator by a court executing a decree and the award was therefore void—the reference itself being illegal. On the merits he decided in favour of the appellant that the award was not vitiated by any misconduct on the part of the arbitrator. The auction purchaser has filed this appeal under section 39 of the Arbitration Act. The only point for decision in this case is whether a civil court executing a decree has jurisdiction to refer the dispute between the parties to arbitration.
The lower court has relied on a ruling of the Calcutta High Court in T. Wang v. Sona Wangdi, where it was held that a court executing a decree cannot refer the objection of the judgment-debtor, that the decree was satisfied out of court, to arbitration and the award made by the arbitrator was invalid and unenforceable. The basis of the decision is that paragraph 1 of the second schedule empowers reference to arbitration of a dispute between the parties to a suit and section 16 of the second schedule provides that a decree should follow the award.
Following the previous decision of their own court and a decision of the Madras Court the Bench came to the conclusion that Order 21 relating to execution is self-contained and exhaustive and the special procedure relating to suits including reference to arbitration was not applicable to execution proceedings. This decision was followed by a learned single Judge of this Court in Bechanlal v. Amar Singh. A bench of this Court however, in Mohammad Habibullah v. Tikamchand, has held that—“the word ‘suit’ as used in section 24 of the Code of Civil Procedure includes execution proceedings and a court can under section 24 transfer an application for execution from the one court to another.” In Jafar v. Abdul Ghaffar(3), a learned single Judge of the Oudh Chief Court has held that there is no reason to restrict the meaning of the word “suit” in section 21 in such a way as to exclude execution proceedings which are only a continuation of the suit.
We have had occasion to consider this matter carefully in the case of Balram Singh v. Dudhnath(4). We are of the opinion that it is not necessary to give such restricted meaning to the word “suit” as to exclude execution proceedings, appeals and other proceedings before the civil court which are in the nature of suits in which civil courts decide disputes between the parties of a civil nature. We have further said that even if we were of the opinion that the Arbitration Act did not apply, there seemed to be no valid ground for refusing to record the compromise under Order 23, rule 1 of the Civil Procedure Code as a valid adjustment between the parties.
In Zumaklal Motiram v. Fulchand Tarachand(5) a Bench of the Bombay High Court has held that an adjustment of a claim with the assistance of an arbitrator may be recorded as valid adjustment and the procedure prescribed in schedule II may be applied to it. They distinguished the decision of the Calcutta High Court in T. Wang v. Sona Wangdi on the ground that the Court had not considered the award as a valid adjustment to an existing decree.
Mr. C.B Agarwala on behalf of the respondent has urged that the appeal is not competent. We have already said that the appeal was filed under section 39 of the Arbitration Act and if the Arbitration Act applies the appeal would be clearly maintainable under that provision. Even if we were to hold that no appeal lies, we can interfere in this case in our revisional jurisdiction. There was a valid adjustment of the decree, under Order 21, rule 2 of the Code of Civil Procedure. It was the duty of the Court to have recorded the adjustment. The court having refused to do so on the ground, that it has no jurisdiction the revision would clearly be maintainable under section 115 of the Code of Civil Procedure.
The appeal is therefore allowed. The order of the lower court is set aside. The appellant is entitled to his costs in both the courts.