Janardhanprasad v. Chandrasekhar And Others

1. This appeal arises out of a proceeding under Section 30 of the 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. 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).

3. On 24-4-1944 Janardanprasad made an application purporting to be under Section 30 of the Arbitration Act of 1940, alleging that the arbitrators gave their first award on 11.1.1944 and that

“these arbitrators being influenced by other persona misconducted themselves to such an extent that second award was 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.”

4. 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.”

7. 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“that the awards dated 11-1-1944 and 27-1-1944 be set aside and declared to be void being superseded with the consent of the parties by the subsequent award dated 24-6-1944.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.”

8. 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.

9. The lower Court held that the arbitrators had 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 Chandrasekhar but it was vitiated due to the misconduct of the arbitrators and was accordingly set aside.

10. Chandrasekhar has preferred Misc. App. No. 90 of 1946 against setting aside the award dated 26-1-1944 and Janardanprasad has preferred this appeal against the order setting aside the award dated 11-1-1944.

11. Very curious procedure was allowed by the lower Court to be followed in this case. There is no application under Section 14 of the Arbitration Act for filing the award. An application for filing an award under S. 14, sub-s. (2), has to comply with the rules made by this Court. All this was lost sight of. Without having the awards filed before it and without having given notice of filing of such awards as required by S. 14, sub-s. (2), the lower Court entertained the application of Janardanprasad under S. 30, which is for setting aside the award dated 26-1-1944. The ground on which he sought to set aside the award was firstly that the first award dated 11-1-1944 was made and secondly that the second award was procured under the circumstances stated in the application. The real scope of this application is therefore to set aside the second award. The lower Court should not therefore have considered the first award except to decide whether the arbitrators had become functus officio on making and signing the first award.

12. It is not disputed that the arbitrators made and signed an award on 11-1-1944. The applicant asserts that Ex. 1 N.A 4 is that award which is duly registered. It is in four sheets. The first sheet is, on a stamp-paper and on the last sheet the arbitrators had signed the award in the presence of witnesses. The award is written by a petition-writer. Non-applicant 3 contends that sheets 2 and 3 were replaced after execution of the award by the arbitrators while it was in the possession of the applicant and this was done without their knowledge and consent. It is alleged that this change was detected by the arbitrators at the time of registration and they

“did not subscribe to the allegations of the so-called award which was registered on 13-1-1944.”

13. It is further alleged that

“on 11-1-1944 on this stamp-paper and three other blank papers the award which was given out by the arbitrators was got scribed by the applicant through a petition-writer and after the said award was read over to the arbitrators they affixed their signatures on the last paper. After the execution of the award the applicant took the document and kept it with him. The award was not registered that day. The next day the award was unsuspectingly presented to the registrar for registration by non-applicant 1, and when the document was read over to him he at once denied to have divided the property in the way in which it was mentioned in the document presented before the registrar.”

14. The question therefore is whether the second and third sheet of the award were removed, after its due execution and before it was presented for registration, by the applicant. Non-applicant 3 who has made this allegation as true to information received and believed to be true has not entered the witness-box, nor has he examined his informant. The attesting witnesses and the scribe have not been examined. He had summoned the scribe but gave him up at the hearing. Janardanprasad has also not entered the witness-box. After examining the evidence on record the judgment proceeded: There is thus absolutely no material on record to found the plea of non-applicant 3 about the removal of the two pages. We, therefore, hold that the award Ex. 1 N.A 4, dated 11-1-1944 was made and signed by the arbitrators and it was registered.

15. The learned counsel for Chandrasekhar raised the contention that the arbitrators had not become functus officio as they did not pronounce the award and were therefore entitled to make and deliver the second award dated 26-1-1914. For the making of an award it is enough that the arbitrators act together and finally make up their minds and express their decision in writing. This writing must be authenticated by their signatures. The award is thus made aud signed and is complete and final so far as the arbitrators are concerned. This is the view taken in Asad-ul-lah v. Muhammad Nur, 27 ALL. 459 : (2 A.L.J 201) following Arumugam Chetti v. Arunachalam Chetti, 22 Mad. 22, Umersey Premji v. Shamji Kanji, 13 Bom. 119. In Akshoy Kumar v. S.C Doss and Co., A.I.R (22) 1935 Cal. 359 : (156 I.C 365), it has been held that an award is final if it is made in time and that submission, delivery, or filing in time is not essential to maintain its validity. Under sch. 1, Arbitration Act, which prescribes the implied terms of arbitration agreements, the arbitrators have to make-their award within four months. Under cl. 4, if they allow the time to expire without making an award, the umpire shall forthwith enter on the reference in lieu of arbitrators. Clause 5 provides that the umpire shall make his award within two months of entering on the inference. All this dearly shows that the award become 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 charge payable in respect of the arbitration and the award is for the purpose of limitation under Article 178, Limitation Act, entitling either 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 case that it may be done within reasonable time either by the arbitrator or by his agent. A notice may be given to one party and may not be given to another party for a much longer period. It cannot be said that an award becomes final so far as the first party is concerned and not as against the other entitling the arbitrators to scrap the award and make a fresh one.

16. The learned counsel relied on the provisions of the Code of Civil Procedure for delivery of judgment and contended that a Judge is entitled to tear off a judgment made and signed by him before its delivery and to make a fresh judgment and deliver it. Under O. 20, R. 9, a judgment shall be dated and signed by the Judge in open Court at the time of pronouncing it, and when once signed, shall not afterwards be altered or aided to, save as provided by S. 152 or on review. Under R. 1 the judgment has to be pronounced in the presence of parties immediately on bearing a case or on some future day, of which due notice must be given to the parties or their pleaders. There is thus a fundamental difference between the making, signing and delivery of a judgment and making, 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. The 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 S. 14, sub-s. (2) If he does so, the Court is bound to give notice to the parties of the filing of the award. We cannot, therefore, accept the contention of the learned counsel for Chandrasekhar that the first award is not final and can be superseded by a second award because written notice was not given to either party before 26-1-1944. There is no material on record to show whether any written notice was or was not given of the making and signing of the first award.

17. We do not propose to decide here whether the first award is liable to be set aside as contended by Chandrashekhar because in our view the proper procedure has not been followed by the Court below. As held in Firm Ram Kishan Das Brij Mohan v. Firm Sushil Chandra Das, A.I.R (10) 1923 ALL. 31, the procedure laid down by the Act in Ss. 14, 15, 16, 30 and 17 has to be followed in chronological order, beginning with giving notice by the Court of the filing of the award to the parties. The form of notice is to be found at p. 74 in Basu's Arbitration Act, Edn. 2. It is the form No. 6 under the rules framed by the Calcutta High Court. The order of the lower Court is, therefore, set aside and the case is remanded to the lower Court for trial de novo from the stage subsequent to the filing of the award by the arbitrators under Section 14(2) of the Arbitration Act. The appeal thus succeeds, but there will be no order as to costs here as the applicant is partly to be blamed for the procedure followed by him. The costs-in the lower Court will be borne by the parties as ordered by that Court.

18. Appeal allowed.