AMICUS AI
Citation Codes
Equivalent Citations
citation codes
Case Number
Judges
Acts
  • ARBITRATION ACT 1940
  • SECTION 21 ARBITRATION ACT
  • provision is Order 64 Rule 14
  • Article 178 of the Limitation Act
  • Section 508 of the Code of the Civil Procedure of 1832
  • sub-section (2) of Section 14.
  • sub-section (1) of section 14.
  • Section 516 of the Code of Civil Procedure of 1882
  • provisions of Section 508 of the Code of Civil Procedure, 1882,
  • provisions of clause (1) of Section 23
  • provisions of clause (2) of Section 23
  • provisions in sub-section (2) of Section 14
  • Kuara,2 the provisions of Section 508 of the Code of Civil Procedure, 1882
  • Section 49 and the Schedule IV of the Arbitration Act of 1940
  • provisions of the third clause of Section 505 of the Code of Civil Procedure, 1882,
  • clause (1) of Section 23 of the Indian Arbitration Act (hereinafter called the Act)
  • Sections 19 and 30 of the Indian Arbitration Act
  • Section 508 of the Civil Procedure Code of 1882 and Section 315 of the Civil Procedure Code of 1859.
  • clause (1) of Section 3 of Regulation VII of 1827
  • Article 158 of the Limitation Act
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Judges
Acts
  • ARBITRATION ACT 1940
  • SECTION 21 ARBITRATION ACT
  • provision is Order 64 Rule 14
  • Article 178 of the Limitation Act
  • Section 508 of the Code of the Civil Procedure of 1832
  • sub-section (2) of Section 14.
  • sub-section (1) of section 14.
  • Section 516 of the Code of Civil Procedure of 1882
  • provisions of Section 508 of the Code of Civil Procedure, 1882,
  • provisions of clause (1) of Section 23
  • provisions of clause (2) of Section 23
  • provisions in sub-section (2) of Section 14
  • Kuara,2 the provisions of Section 508 of the Code of Civil Procedure, 1882
  • Section 49 and the Schedule IV of the Arbitration Act of 1940
  • provisions of the third clause of Section 505 of the Code of Civil Procedure, 1882,
  • clause (1) of Section 23 of the Indian Arbitration Act (hereinafter called the Act)
  • Sections 19 and 30 of the Indian Arbitration Act
  • Section 508 of the Civil Procedure Code of 1882 and Section 315 of the Civil Procedure Code of 1859.
  • clause (1) of Section 3 of Regulation VII of 1827
  • Article 158 of the Limitation Act

    Badarla Ramakrishnamma And Others v. Vattikonda Lakshmibayamma And Others

    Jaganmohan Reddy, J.:— These three C.M.As 3/53, 349/56 and 351/56 are against the orders of the Principal Subordinate Judge, Masulipatam, dated 7-10-1952 in I.A 105/1951 in O.S 25/1948, I.A 133/1951 in O.S 11/1948 and I.A 106/1951 in O.S 29/1940. The plaintiff in O.S 11/1948 is a creditor and that in O.S Nos. 25 and 29 of 1948 is another creditor of a partnership firm called Sri Sitarama Rice Mill Contractors Company, Avanigadda. Both the plaintiffs seek to recover amounts advanced to the suit firm. In another suit O.S 23/48 the plaintiff alleged that he and defendants 1 to 10 entered into a partnership to work the above rice mills which was the property of the 11th defendant for one year, viz., 1947. In that suit the plaintiff alleged that though the partnership was dissolved as and from 31-12-1947, defendants 1 to 3 who are responsible for the management of the business refused to render a true and correct account of the partnership or to concur in taking and settling the same. As a result the suit was filed for dissolution of partnership if need be and for settlement of accounts of the partnership and payment of his share. The defendants filed written statements and issues were also framed. Form the issues framed it appears that the plea of the contesting defendants was that there was a valid settlement of accounts in respect of the partnership. As already observed in the three suits O.S Nos. 11, 25 and 29 of 1948 the contesting defendants raised the plea that the plaintiffs in these suits are not possessed of any means to advance the amounts and the entries made in the account books were dishonest and nominal and consequently the claim was not true. When all these four suits came up for trial the parties filed separate petitions in each of the suits on 14-9-1950 under Section 21 of the Arbitration Act to refer the matter in these suits for arbitration to three named persons. The court passed orders on all these petitions on 26-9-1950 to which we shall advert later on. The arbitrators after taking some adjournments ultimately filed three awards in court in each of these suits on 14-12-1950. The awards the subject-matter in these three C.M.As, bear the date 4-12-1950 while the one in O.S 23/48, subject-matter of another C.M.A which is not before us, bears the date 12-12-1950. One of the defendants in all these four suits, namely, Badarla Ramakrishnamma has filed applications under Sections 19 and 30 of the Indian Arbitration Act (X of 1940) to set aside the award made in respect of the suits. It may also be stated that on the petitioners' applications, one witness namely the 12th defendant, L. Ramamurty, Legal Representative of the deceased 11th defendant in O.S 23/48, was examined. The petitioner in the three suits O.S Nos. 11, 25 and 29/48 raised the same objections impeaching the validity of the award on various grounds and after due consideration of these grounds the Subordinate Judge, Masulipatam, held that there was neither illegality nor misconduct apparent on the face of the record in the three suits, nor was there anything to show that the arbitrators were guilty of misconduct or of having misconduted the proceedings. In this view he refused to set aside the awards and decreed the suits according to the awards.

    2. So far as I.A 104/51 in O.S 23/48 was concerned, he held that the arbitrators had misconducted the proceedings and were also guilty of misconduct in giving the award and consequently set aside the award. With respect to this order C.M.A 350/56 was filed. As we have already observed we are only concerned with C.M As arising out of the orders in I.A Nos. 105, 103 and 106 of 1951 in O.S Nos. 25, 11 and 29 of 1948 respectively.

    3. Before us the learned advocate for the appellants, Sri P. Somasundaram apart from requesting us to take intoconsideration the fact that the arbitrators have been found guilty of misconduct in I.A 104/51 in O.S 23/48 in determining these three C.M As, has urged the following four points against the validity of the awards viz., (1) that the orders passed by the Subordinate judge in all the three I. As., were not in accordance with clause (1) of Section 23 of the Indian Arbitration Act (hereinafter called the Act) or with the second part of the said clause thereof (2) that notice of the making and signing of the award by the arbitrators was not given to the parties as required by clause (1) of Section 14 of the Act which vitiates the awards; (3) that the Court did not extend the time after 11-10-1950 but only posted the matter to be called on 12-12-50 and from 12-12-1950 to 13-12-1950; (4) that the arbitrators did not take part in the making of the award; (5) that the statements given by one party were not put to the other party and were accepted without giving such an opportunity. We shall now proceed to deal with the above points seriatum.

    4. With respect to the argument that the provisions of clause (1) of Section 23 of the Act have not been complied with and in particular, the mandatory provisions of the second part of the said clause, the contention is based on the orders passed by the court on the I.As filed in the respective suits. In all the three suits, the subject-matter of these appeals, separate I. As 1092, 1092 and 1093 of 1950 were filed under Section 21 of the Arbitration Act for referring the matter to the arbitration of three named arbitrators, viz., Yenduri Mangaraju Garu, Cherukuru Anjayya Garu and Vemuri Venkataratnam Garu. Exs. A-3, A-1 and A-4 are the said applications in O.S Nos. 23, 11 and 29 of 1948 and A-3(a), A-1(a) and A-4(a) are the orders passed on the respective applications by the Subordinate Judge of Bundar. The applications stated that these petitions were filed by the parties under Section 21 of the Act, that the parties who have signed have agreed to the afore-mentioned three arbitrators to give awards on the entire matters in dispute in the said suits after examining the oral and documentary evidence, and that the parties agreed to treat the decision (award) to be given by the above three arbitrators unanimously or by the majority of them as the final decision. They therefore, prayed that the court may be pleased to hand over the record in the above suits to Yenduri Mangaraju Garu, the first arbitrator, for the purpose of the award to be given by the above mentioned three arbitrators. The court in all the three suits passed similar orders dated 26-9-1950 as under:—

    “Plaintiff and defendants pray that the suit maybe referred to the named arbitrators. The matter is therefore referred to the arbitration of the arbitrators mentioned in the petition. Necessary papers may be given to the first arbitrator mentioned in the petition.”

    5. Learned Advocate for the appellant submits that the court has no where in these orders specified any time for the making of the award and consequently the provisions of Section 23 which are mandatory are contravened. In support of this contention he has cited Nuseerwanjee Pestonjee v. Meer Mynoodeen Khan1, Raja Harinarain Singh v. Chaudhrain Bhagwant Kaura2, Lachman Das v. Apprakash3, and Robindra v. Jogendra4. Clause (1) of Section 23 of the Act is in the following terms:—

    “The Court shall, by order, refer to the arbitrator the matter in difference which he is required to determine, and shall in the order specify such time as it thinks reasonable for the making of the a ward”.

    6. This section is substantially similar to part (3) of the second Schedule of the Civil Procedure Code of 1908, which in turn corresponded to Section 508 of the Civil Procedure Code of 1882 and Section 315 of the Civil Procedure Code of 1859. A plain reading of clause (1) of the said section shows that it deals with two matters, viz., that in order to comply with the clause the court must by its order make a reference and secondly that it must fix such time as it thinks reasonable for the making of the award. There is no doubt that these two requirements are mandatory and unless complied with do not vest any jurisdiction in the arbitrator. If they are complied with then the provisions of clause (2) of Section 23 preclude the Court, except in the manner and to the extent provided in the Act, to deal with the matters in the suit referred to arbitration. The fixing of the time by the Court within which the arbitrators have to make their award is mandatory and not directory. This proposition is no longer Res Integra. The Privy Council over a century ago in Nusserwanjee Pestonjee v. Meer Mynoodeen Khan,1 dealing with the arguments advanced namely that under clause (1) of Section 3 of Regulation VII of 1827 pertaining to sub-mission to arbitration, the requirement relating to the insertion of time within which the award is to be made was directory only, felt at a loss to construe it in that way. It was there further argued that the insertion of time in the third Section was done keeping in view the provisions of the 7th Section in which it was indicated that if a suit be instituted pending arbitration that suit may the stayed, upon proof that the suit and arbitration related to one matter and that the time for making the award has not expired. This was considered to be an ingenious and far-fetched argument. Their Lordships, after adverting to the delays which took place in the Panchayata as the reason for the insertion of the provision relating to time in the third Section of the Regulation, examined the argument that this provision could be waived by the consent of the parties and observed at page 161 as follows:

    “If, indeed, we could have been satisfied that the time wat merely directory, the cue might have been very different. Their Lordships are all quite clearly of opinion that they must take it that the Legislature of India meant distinctly to prescribe that any deed of reference under which an award was to be made, to have the force of a decree of the Zilla Court should contain all those matters which are specified in the section of the Regulation to which I have already referred. And these matters being omitted, their Lordships have, therefore, come to the conclusion that, although the award may have been a very good one in itself, it cannot have the force which this Regulation would have given to it if it had contained all the requisites which the sections specify.”

    7. In Raja Harnarain Singh v. Chaudhrain2, the Privy Council again held that the provision relating to the time in Section 508 of the Code of the Civil Procedure of 1832 was not merely directory, but mandatory and imperative otherwise Section 521 which declares that no award shall be valid unless made within the period allowed by the Court, would be rendered inoperative. In Lachman Das v. Apprakash3, a Bench of the Allahabad High Court held that where an order of reference to arbitration made by a Court omits to fix a date for the delivery of the award, such omission is not a mere irregularity, but is a defect fatal to the order and to all subsequent proceedings founded thereon. Sir George Rankin in Robindra v. Jogendra4, dealing with the provisions of the third clause of Section 505 of the Code of Civil Procedure, 1882, dealt with the matter at page 425 in the following words:—

    “If after an order of reference a Court wrongly proceeded to try the suit, it would contravene an express prohibition. If by the order of reference no time is fixed at all, the error is of the same class: no time limit means no control; and the Court is not authorised to abandon control save to the extent and upon the terms laid down.”

    8. As against these decisions the learned advocate for the respondent has referred us to a Bench decision of the Madras High Court in Mutherkutti Narain v. Acha Naraian,1 where following Harnarain Singh v. Bhagwant Kuara,2 the provisions of Section 508 of the Code of Civil Procedure, 1882 were held to be directory and not mandatory. The decision of the Privy Council in Raja Har Narain Singh's case2 which arose directly on the provisions of Section 508 of the Code of Civil Procedure, 1882, does not appear to have been citied. The Privy Council in the above case was dealing with an order of reference made by the Court which did not specify directly any time but merely fixed a date for the hearing of the case. In these circumstances their Lordships held that the requirements as to time in Section 508 were mandatory, though in the particulr circumstances of the case they held that the extension of time was valid under Section 514. Generally speaking, therefore, where there is no time limit fixed for the return of the award, the reference is a nullity inasmuch at the provision for fixing a time is mandatory. It is thus clear that if the order of the Court in Exs. A-1(a) and A-2(a) A-3(a), was the only order, the contention of the learned counsel for the appellant would have great force; but in this case though the order on the application did not specifically mention the time, the orders on the note paper made on the same day clearly indicate that time was fixed in all the three cases for the filing of the award. In O.S 11/48 the order dated 26-9-1950 is as follows:—

    “I.A 1990 of 1950 filed under Section 21 Arbitration Act and allowed. Matter referred to the Arbitration. For award 24-10-1950.”

    9. Similar orders were passed in O.S Nos. 29 and 25 of 1948 with reference to I.As 1093 and 1092 of 1950 respectively. Thereafter the note paper of all the three suits shows that time was extended on seven occasions and on the last date, viz., 13-12-1950 the note reads thus:

    “Arbitration award filed. For objection if any 12-1-51.”

    10. Learned advocate for the appellant contends firstly that the time should have been specified in the order passed on the application itself and the orders on the note sheet cannot be taken into consideration and secondly that the orders on the note sheet do not indicate that they were made by the Court. Both these contentions, in our view, are untenable. The contention that the orders in the note paper are not made by the court is evidently based upon a copy of the note paper prepared by the office and kept in the records sent in the appeals. On a reference to the original note paper, which was sent for, we found that each of the orders passed in the suits was signed by the Judge and were, therefore, the orders of Court. It is, therefore, clear that the court by its orders dated 26-9-1950 not only allowed the applications for reference of the matter to arbitrators, but also fixed the time for filing of the award. The orders on the I.As as well at the orders on the note sheet must be read together and if they are so read, the requirements of the mandatory provisions of clause (1) of Section 23 are fully complied with and, the awards cannot be assailed on that ground.

    11. It is then contended that the notice of the signing and making the award by the arbitrators as required by clause (1) of Section 14 of the Act was not given to the parties and that the omission to do so vitiates the awards. Section 14 is as follows:—

    “(1) When the arbitrators or umpire have made their award, they shall sign it and shall give notice in writing to the parties of the making and signing thereof and of the amount of feel and charges payable in respect of the arbitration and award.

    (2) The arbitrators or umpire shall, at the request of any party to the arbitration agreement or any person claiming under such party or if so directed by the Court and upon payment of the fees and charges due in respect of the arbitration and award and of the costs and charges of the filing the award, cause the award or a signed copy of it, together with any depositions and documents which may have been taken and proved before them, to be filed in court, and the Court shall thereupon give notice to the parties of the filing of the award.

    (3) Where the arbitrators or umpire state a special case under clause (b) of Section 13, the court, after giving notice to the parties and hearing them, shall pronounce its opinion thereon and such opinion shall be added to, and shall from part of, the award.”

    12. Clause (1) of the above section requires two things to be done by the arbitrators when they made their award (a) that they shall sign it and (b) that they shall give notice in writing to the parties of the making and signing there of and the amount of fees and charges payable in respect of the arbitration and award. The question is whether the provision relating to the giving of notice in writing to the parties is mandatory or directory. Learned advocate for the respondent cootends that the provision relating to the giving of notice is directory inasmuch as the intention of the legislature was merely to intimate to the parties to the submission that an award has been made and as the Court has given notice under sub-section (a) of Section 14 of the award having been filed in terms of Ex. B-1 on 12-1-1251 no prejudice has been caused. The only reason for the provision relating to the giving of notice of signing of the award, according to the learned advocate for the respondent, is that any of the parties to the submission may apply either to have the award set aside or remitted or for having the same made a rule of the Court. There can be no doubt that under the section the signature of the arbitrator or arbitrators to the award is absolutely necessary. The arbitrator when making an award must make up his mind upon the matter referred to and if there are more than one, they should or the majority of them where the decision is to be by the majority act together and finally make up their minds by arriving at a decision which must be expressed in writing and signed. This requirement is imperative. This imperative requirement of the signing of the award is expressed by the word ‘shall’. The absence of any of the requirements relating to the making of the award would make the award a nullity. The question is whether after the making and the signing of the award the next requirement relating to the giving of notice in writing to the parties of the making and signing thereof is mandatory. No doubt the same word ‘shall’ has been used with respect to this requirement which exifacie would appear to indicate that this is a mandatory provision. In order to determine whether a particular provision is mandatory or directory, it would be necessary to ascertain whether the omission to comply with the requirement affects the very foundation or authority for the proceedings so as to make it void and incapable of being validated. It is always difficult to demarcate with any degree of accuracy in a particular case what is mandatory and what is directory or what is irregularity and what is a nullity. When a question arises as to how far the proceedings are affected by the contravention of any provision it is necessary to Bee the scope and object of the particular provision which is said to be violated. It is true, as submitted by the learned advocate for the appellant, that the word ‘shall’ is generally understood to be mandatory. It is also true that the same word should not be interpreted in two different ways in the same section. This is an established proposition and requires no elaborate examination of the case law. Their Lordships of the Supreme Court in K.N Guruswamy v. State Of Mysore. 1955 (1) S.C.R 305 observed:—

    “……………The same word appearing in the fame lection or the same set of rules must be given the same meaning unless there is anything to indicate the contrary”.

    13. Whether the same word used in the same section intends to express the same meaning or a different meaning would depend upon what the Legislature intended to provide in each case. Though the word ‘shall’ is ordinarily in he imperative sense, it has been understood to give the meaning attached to be word ‘may’ and similarly the word ‘may’ sometimes has been used to convey the force of ‘shall’. As aptly observed by Bowen, L.J in Cooke v. New River Company2:

    ……………After all the word ‘shall’ is only the furture tense and colourless, but it may receive, and it does receive, in ordinary language either a compulsory colour or an optional colour from the context, and I do not think there is anything very violent (although it is not altogether an apt way of using it) in giving the optional meaning to it where you find it coupled with the phrase ‘at their own instance’, just as you say that a person shall, if he chooses, go out for a walk, which means that he shall have the power of doing it”.

    14. In that case Section 41 of the New River Company Act which is in the following terms came up for consideration:—

    “That the company shall, at the request of any consumer of water for purposes other than the purposes for or in respect of which the rates or charges are herein before provided or limited, or at their own instance, afford a supply of water by means of a meter or other instrument or mode for measuring and ascertaining the quantity of water so supplied……………”

    15. The provision was so drafted that a plain reading would indicate that the authority was to act upon the request of any consumer and after thus using the words of compulsion, the Legislature passed on to use words of option, still retaining the word ‘shall’ when it deals with the action to be taken by the company on its own initiative. It is with respect to this provision that Bowen, L.J at page 69 said:

    “……………the word ‘shall’ is compulsory when it is dealing with the action of the company set in motion by the request of the consumer, but that when it passes to the act of the company upon its own initiative it takes a colour from the words ‘at their own instance’ which give the word ‘shall’, not altogether inappropriately, the meaning of ‘may’”.

    16. The object of the Legislature in providing for the giving of a notice in writing of the making and signing of the award was evidently for the purposes of Article 178 of the Limitation Act where 90 days have been prescribed for the filing in Court of an award from the date of service of the notice of the making of the award. Prior to the Arbitration Act of 1940 which repealed a similar provision in the Civil Procedure Code, Art. 178 which was also amended to the present from provided for six months limitation from the date of award. Section 49 and the Schedule IV of the Arbitration Act of 1940 reduced the period to one of 90 days and changed the starting point from the date of the award to the date of service of notice of making the award. There is nothing in sub-section (1) of Section 14 to say that the notice of signing of the award must be given at the same time as the signing of the award. It therefore follows that it can be given at any time subsequent without making the award which is otherwise valid, invalid by the omission to give such notice. The Article of the Limitation Act in the present form does not apply to an arbitrator filing the award either on his own motion or on the request of the party, but only to an application by a party under sub-section (2) of Section 14 to be filed within 90 days of the service of notice of the making of the award and once it is filed, the Court is required to give notice to the parties of the filing of the award. On such notice being given the time for applying to have the award remitted or set aside, prescribed in Article 158 of the Limitation Act is 30 days from the date of the service of the notice. There is no provision under the English Law as is provided under Section 14 of the Act. The only provision is Order 64 Rule 14 which is framed for the calculation of time, which is six weeks from the publication of the award to the parties for applying to set aside the award and consequently the English decisions relating to publication are of no assistance in arbitrations governed by the Act. It is, therefore, clear that the provision relating to the giving of notice of the signing of the award by the arbitrator under sub-section (1) of Section 14 was directory for the purposes of limitation under Article 178 of the Limitation Act entitling either party for applying to have the award filed. Non-compliance with this provision doss ait, therefore, vitiate the award as such and cannot bar the right of a party to file an application as time would not commence to run.

    17. Learned advocate for the appellant relies on the authority of Palaparthi Venkataramoyya v. Duggina Papayya 1943 II M.L.J 152 in support of his contention that the omission to give notice of the signing of the award is a material irregularity which warrants the setting aside of the award. This is a judgment of Horwill J. There the award was filed on 26th of April, 1941 signed by three of the arbitrators only and as that was the last day on which the court sat before the summer vacation it was ordered to be called on 11-6-1941 on which date no petition to set aside the award was filed and the suit was decreed in terms of the award. In the revision the validity of the award was challenged on the ground that the provisions of the Arbitration Act were not complied with in that no notice was given cither by the arbitrators or by the court, that they had no opportunity to file objections and that the decree is, therefore, a nullity. It was held that from an examination of the B memo it did appear probable that the pleaders of the parties did not know of the filing of the award. Horwill. J. relying upon the authorities in Rangaswami v. Muthusami2 which was followed by the Allahabad and Calcutta High Courts in Chatarbuj Das v. Ganeshram3 and Ranjit Chaudry Ram v. Dissay Ram (1926) Cal. 1018 observed:

    “I am therefore not at all sure that the failure to comply with the mandatory provisions of the Arbitration Act did not lead to an injustice in preventing the defendants from raising objections to the award.”

    18. He further found that this was not the only defect, for, all those who expressed the opinion in the award had not signed it and the fifth arbitrator who filed the award was not one of the dissentients and yet he had not signed. The award in the above case was set aside for non-compliance with the provisions relating to the signing of the award and the notice to be given by the Court under sub-section (2). As we have already stated the provision relating to the making and signing of the award is mandatory and the omission to do so would vitiate the award. It is equally true that the omission by the Court to intimate the parties of the filing of the award is also against a mandatory provision because it is designed to give an opportunity to the parties to file their objections against the award, the non-compliance of which will certainly vitiate the award. There appears to be no consideration of the question whether the omission by the arbitrators to give notice to the parties of the making and signing of the award would be a material irregularity affecting the foundation of the award. In Rangaswami v. Muthusami2 the question was again whether the omission by the arbitrators to give notice of the filing of the award to the parties as required by Section 516 of the Code of Civil Procedure of 1882 was a material irregularity and the bench of the Madras High Court held that it was so. As the decree was passed in terms of the award without notice to the parties and without hearing the objections of the petitioners who were entitled to be heard, the decree was set aside. Section 516 of the Code merely provided for the giving of the notice by the arbitrators about the filinig of the award and there was no provision similar in nature to that in sub-section (1) of Section 14. It is obvious that the non-compliance of any notice relating to the filing of the award in Court would be fatal because the parties who have a right to urge their objections and to be heard would have no opportunity if that provision is not complied with.

    19. On the other hand in Janardanaprasai v. Chandrasekkar, I.L.R 1950 Nag 983 Bose C.J, (as he then was) and Deo J. dealing with the question whether the non-compliance of the provision relating to the notice under sub-section (1) of Section 14 would make the award invalid observed:

    “…………….The award becomes valid and final so far as the arbitrators or umpire are concerned the moment it is made and signed by them. The provision for giving notice in writing to the parties of the making and signing thereof and of the amount of fees and charges payable in respect of the arbitration and the award is for the purpose of limitation under Article 178 of the Limitation Act, entitling cither party to apply to the Court for the filing in Court of the award. No time is fixed for the giving of such notice by the arbitrator and it has been held in several cases, that it may be done within reasonable time either by the arbitrator or his agent. A notice may be given to one party and may not be given to another for a much longer period. It cannot be said that an award becomes final so far as the first party is concerned and Dot against the other entitling the arbitrators to scrap the award and make a fresh one.”

    20. They summed up the position as follows:—

    “…………..There is thus a fundamental difference between the making, signing and delivery of a Judgment and making and signing and giving notice of an award. In the former case all three must be simultaneous acts and parts of the same transaction. In the latter case the first two may be simultaneous and the notice of the award can be postponed. That award does not become invalid because notice of the making of it has not been given. An arbitrator is entitled to file an award in Court under Section is sub-section (2). If he does so, the Court is bound to given notice to the parties of the filing of the award.”

    21. In that case the arbitrators had made and signed an award on 11-1-1944. It was presented for registration and was registered on 13-1-1994. Thereafter the arbitrators made a second award on 26-1-1944. It was contended that as they did not pronounce the award by issuing a notice of having signed it, they had not become functous officio and could, therefore, make and deliver the second award dated 26-1-1944. On these facts and contentions the learned Judges refused to hold that the first award was not final and could be superceded by the second award, because no notice was given before 26-1-1944. We also agree with this view that the non-compliance with the requirement of giving notice under sub-section (1) does not make the award invalid. In the case before us the award was made on 4-12-1950 and filed in Court on 13-12-1950 when the Court made an order fixing 12-1-1951 to file objections, if any, as required under sub-section (2) of Section 14. The parties, therefore, had full notice of the making and signing of the award and of its having been filed in order to enable them to take such steps as would be open to them under the Act.

    22. We may further observe that the provisions of Section 14 are in Chapter II which deals with the arbitration without the intervention of the Court, while Chapter III deals with arbitration with the intervention of the Court where no suit is pending and Chapter IV, Sections 21 to 24, deals with arbitration in suits pending before the Court. Sections 25 states that the provisions of the other chapters shall, so far as they can be made applicable, apply to arbitration under this Chapter. It is clear, therefore, that the provisions of Section 14(1) are applicable so far as it is possible to apply to cases of arbitration in suits pending before the Court. Where, therefore, a court has fixed time for making and filing the award, the objection of giving notice of the making and signing of the award which is so necessary in private arbitration loses its significance because of the provisions in sub-section (2) of Section 14 and no question of limitation would arise if the award is filed within the time which the Court has to fix under Sec, 23 or within such time as the Court under Section 28 may have extended. That apart the reason why notice has to be given in private award is to enable the parties to apply to the arbitrators or the Court for having the award filed in Court. If this is the object and the same has been achieved in the case of arbitration in suits pending before Courts then the only mandatory provision of Section 14 would be that relating to the notice being given by the Court of the award having been filed. In our view, therefore the award cannot be delared invalid on this ground also.

    23. The third contention, namely, that the Court had not extended time after 11-12-1950 and consequently the award was filed after the expiration of the date fixed by the Court has also no force on the facts on record.

    24. The Court has been extending time upto 11-12-1950 and on that date the proceedings read thus:—

    “Arbitration by Maagaraju garu not filed. Time extended to 12-12-1950.”

    25. On 12-12-1950 again time was extended to 13-12-1950 and on 13-12-1950 the arbitration award was filed. Under Section 28 of the Act even if the time had expired the Court has always the power to extend it if it thinks fit, whether the award has been made or not. This the Court can do sua moto and without any application from the arbitrators.

    26. The fourth and the fifth contentions relate to the misconduct viz. that the arbitrators did not take part in the making of the award and the statements made by one party were not put to others and were accepted without giving such an opportunity. The question of any statements given, by one party being put to the other party is not relevant because no evidence or statement was in fact given by any of the parties, particularly by the petitioner, in the three suits which are the subject matter of these appeals. It would be observed that a notice was served on all the parties calling upon them to produce their documents and let in evidence by 6-10-1950. Pursuant to this most of the parties signed a memo that they would give their statements, file their documents and produce evidence by 6-10-1950 before the arbitrators and if they do not do so the arbitrators may proceed ex-parte in the matter. This memo as the subordinate Judge finds, is in the record. It appears that some of the parties have filed there statements on 6-10-1950 and that in none of the statements have the claims of the plaintiffs in the three suits been disputed nor the parties tendered any evidence before the arbitrators. The only evidence let in by the parties related to O.S No. 23/1948 which is not the subject matter of these appeals. The arbitrators, it appears, looked into the accounts and the statements given by the parties including the petitioner in which they raised no objection regarding the claims of the plaintiffs. In these circumstances on the material on record they found that the claims made by the plaintiffs are true and they gave their award accordingly. If the parties to whom notice to produce evidence was given do not choose to give evedence, it is not the fault of the arbitrators, nor can it be said that the proceedings were misconducted. The fact that they admitted the claims of the plaintiffs in the suits is also borne out by a statement filed on 10-12-1950 after the award by one Uppalapati Venkataratnam, the working manager of the firm, accepting the various amounts due to various persons as per the credit entries in the account books of the firm. As the learned Subordinate Judge quite rightly observed though this document was filed after the award, it is significant and the petitioner who signed it never at any time contested the claim of the plaintiffs. With respect to the contention that ill the arbitrators did not take part in the making of the award, it may be stated no such contention was urged with respect to the award relating to these three suits in the lower court. The objection was only urged with respect to the award in O.S 23/48 where oral evidence and all the statements were recorded by the arbitrators and gave their award based on such evidence and the statements. There is no substance in these contentions.

    27. In the result all the three appeals are dismissed with costs.

    Ch. R.

    28. Appeals dismissed.

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    Badarla Ramakrishnamma And Others v. Vattikonda Lakshmibayamma And Others
    (Feb 15, 1957)