Ganga Prasad v. Kishori Lal — 1961 DIGILAW 316 (ALL)

JUDGMENT Mithan Lal, J. - This civil revision filed by the defendant arises out of the following circumstances. On 8th October, 1955, Kishori Lal, plaintiff, and Ganga Prasad defendant, the present petitioner, entered into an agreement to refer their dispute relating to their partnership in the plying of a truck, to a board of five Arbitrators who have been impleaded as opposite parties in this petition. The Arbitrators entered upon the reference and made and signed the award on 9th December, 1955 awarding a sum of Rs. 1,300 to the plaintiff. On 3rd January, 1956 the plaintiff-opposite party filed an application purporting to be under Secs. 14 and 17 of the Arbitration Act for filing the award as well as making it a rule of the Court. This application was registered as a plaint and summonses were issued to the defendant. The first date fixed in the case was 21st March. On that date the award and other papers were filed by the Arbitrators. The present petitioner who was defendant No. 1 took time for filing a written statement and one month's time was allowed. It may be stated that neither there is any order of the court giving notice of the filing of the award nor it appears from the record that any notice in that behalf was actually issued. Time prayed for by defendant No. 1 was allowed and the case was fixed for 5th October, 1956 for fixing a date for issues. On 21st April, 1956 the defendant was given another 15 days' time and it was on 7th May, 1956 that the defendant filed a written statement challenging the validity of the arbitration agreement as well as praying for setting aside the award on the grounds given in the written statement. After hearing the objections filed by the defendant the trial court upheld the award and dismissed the objections. The matter was taken up in appeal by the defendant and the Additional Civil Judge, Allahabad, dismissed the appeal as well. It is against these orders that the present revision has been filed. 2. Three points have been submitted in this revision. After hearing the objections filed by the defendant the trial court upheld the award and dismissed the objections. The matter was taken up in appeal by the defendant and the Additional Civil Judge, Allahabad, dismissed the appeal as well. It is against these orders that the present revision has been filed. 2. Three points have been submitted in this revision. The first is that Sec. 14(2) of the Arbitration Act makes a mandatory provision for issue of a notice of the filing of the award and as no such notice was issued the award could not be made a rule of the Court and the courts below have erred in doing so. The second contention of the learned counsel is that on 30th November, 1955 the defendant was given time for production of his evidence, but during this time the defendant learnt of the partiality of the Arbitrators and consequently he made an application before the Arbitrators on 8th December, 1955 that they may not proceed with the reference. This application was ordered to be put up on 9th December, 1955, but before passing any orders on this application the Arbitrators gave their award on that very date, that is 9th December, 1955. The third contention is that the defendant could not produce his evidence and the award which has been given merely on the plaintiff's statement was given on insufficient evidence and should be set aside. 3. The contention of the learned counsel for the opposite party is that there may be a statutory provision in Sec. 14(2) of the Arbitration Act for the issuing of a notice, but in a case where the defendant knew of the filing of the award, also took time to file a written statement and then actually filed a written statement challenging the award on a number of grounds he could not take shelter behind the fact that no notice was actually issued. His submission is that the purpose of issuing a notice of the filing of the award is that the defendant may be aware of the filing of the award and as the defendant was already aware of the filing of the award and took full opportunity in challenging the award he cannot be allowed to take this plea in the court of revision. It has further been submitted that no prejudice was caused to the defendant by non-issue of a notice and if the defendant did not produce any evidence before the Arbitrators it was all due to his own act and he cannot be allowed to take advantage of his own doings in a revisional court. The case is said to have been decided on evidence of the parties because both the parties are said to have been examined by the Arbitrator on 20th November, 1955 and the award is a legal document and has rightly been made a rule of the Court. 4. So far as the first point goes, it is not the case of the petitioner that he did not know about the filing of the award in court or that he did not file any objections to the same. His case is that there being a mandatory provision of law for giving a notice of the filing of the award to the parties and no notice having been given the whole proceedings are vitiated. The provision of notice is embodied in sub-sec. (2) of Section 14 which reads as follows:- "14(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 filing the award, cause the award or a signed copy of it, together with any depositions and document 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." 5. It may be stated at the very outset that under the present Arbitration Act a distinction has been made between notices of the making and signing of the award, which is required under sub-sec. (1), and the notice which has to be given by the Court for the filing of the award under sub-sec. (2). Before passing of the Arbitration Act, provision similar to sub-sec. (1) did not exist in the Second Schedule to the C.P.C. In the Code of 1877 Sec. 516 while in the Code of 1908 para. (1), and the notice which has to be given by the Court for the filing of the award under sub-sec. (2). Before passing of the Arbitration Act, provision similar to sub-sec. (1) did not exist in the Second Schedule to the C.P.C. In the Code of 1877 Sec. 516 while in the Code of 1908 para. 10 of the Second Schedule did make provisions for the giving of the notice of the filing of the award as is now contained in sub-sec. (2). There appeared to be no provision in the Code akin to sub-sec. (1) of Section 14 of the Indian Arbitration Act. In the authority of Chaturbhuj Das v. Ganesh Ram, ILR 20 All. 474 it was held that a decree based upon an award filed in Court notice of the filing of which, had not been given to the parties was bad. This strict view was also taken in the case of Ranga Swami v. Muthu Swami, ILR 11 Mad. 144 as well as in two Punjab cases Gurditta Mal v. Basanta Mal Panna Lal, AIR 1925 Lahore 619(1) and Punoo Ram v. Nebh Rai, AIR 1930 Lahore 228. But the latter trend of authorities, particularly after the passing of the Indian Arbitration Act has been otherwise. 6. In a Calcutta case Ganeshmal Bhawarlal v. Kesoram Cotton Mills, AIR 1952 Calcutta 10 a single Judge of that Court took the view as expressed in I. L.R. XX All. 4741, but in the case of Bhola Nath Mallick v. Mahadev Mallick, AIR 1952 Calcutta 226 the Division Bench took a lenient view and laid down : "Where a party who is already cognizant of the filing of the award appears in the case and applies to the Court for leave to examine the award and for time to file objections, service of notice of filing the award becomes unnecessary. In such a case even if the Court has failed to give notice to him, the date when he enters appearance in the proceedings will be deemed to be the date of the service of notice of the filing of the award The Nagpur High Court too has taken a lenient view in the case of Kawal Singh Akbar v. Baldeo Singh Akbar, AIR 1957 Nagpur 57 . While explaining the purpose of the notice to be given under Section 14 the Division Bench laid down :- "Sec. 14 of the Arbitration Act, 1940, contemplates a case where the Arbitrators or umpire file the award in Court when both the parties to Arbitration may be absent. It is for this reason that provision is made in Sub-Sec. (2) requiring the Court to give notice to the parties of the filing of the award. The terms of the section do not contemplate that notice has to be given even when the parties had knowledge of the filing of the award." 7. The learned counsel for the petitioner also made a reference to Rr. 6 and 7 made by the Court under the Arbitration Act. These rules only lay down the procedure for the issue of notices. Sub-R. (2) of R. 7 further requires the party, who has made an application under Sec. 14(2), to pay process fee and get the notices issued. These rules are consistent with the provisions of Sec. 14(2). They only lay down that who shall pay the fee for the issue of the notice and how the service of notices is to be made. These rules cannot be taken advantage of to show that if notice has not been issued the proceedings are vitiated. 8. To me it seems that the purpose of giving a notice is to inform the parties of the filing of the award so that they may file their objections to the award, i.e. whether it is vitiated by any of the grounds given in Section 30 or requires remission on any of the grounds given in Sec. 16. The provisions only aim at bringing the proceedings to the notice of the parties concerned. It seems to me that if a person concerned has already a due notice of it there appears to be no reason why the failure to issue a formal notice should be held to vitiate the proceedings. In the instant case the award was filed on 21st March. The defendant took time twice after the filing of the award and then filed his objections taking all possible pleas. In the instant case the award was filed on 21st March. The defendant took time twice after the filing of the award and then filed his objections taking all possible pleas. He had full notice of the filing of the award and consequently the mere omission on the part of the Court in giving a formal notice of the filing of the award cannot be made a ground for setting aside the award, when the petitioner has failed to achieve his object by getting the award set aside on other objections. It is not a case in which any prejudice was caused to the petitioner and consequently this contention of the learned counsel must be over ruled. 9. The other two contentions of the petitioner's learned counsel relating to questions of fact have equally no force. A perusal of the proceedings will go to show that from the very start the defendant was trying to keep aloof from the arbitration proceedings. When the defendant failed to appear before the Arbitrators, the Court was moved to get the defendant served with a notice. It was only after the service of the notice of filing of the award that the defendant appeared. The parties were examined on 20th November, 1955. On that date the Arbitrators required the parties to file their statements in writing by 30th November. There was also the order asking the parties to produce evidence both oral and documentary, on that date. No evidence was produced by the defendant on that date nor was any statement in writing given. On the other hand he moved an application for time. One week's time was granted and 8th December, 1955 was fixed. The defendant again failed to produce evidence on this date and on the contrary moved an application for stay. This application though ordered to be put up on 9th December, 1955, yet even between the 8th and 9th December, the defendant did not move the Court for stay of the proceedings. If he had really any grievance and if his application for stay before the Arbitrators had any merit, he should have acted like an ordinary prudent man and should have approached the Court, particularly when the parties belong to Allahabad, and should have got the proceedings stayed. This was not done. If he had really any grievance and if his application for stay before the Arbitrators had any merit, he should have acted like an ordinary prudent man and should have approached the Court, particularly when the parties belong to Allahabad, and should have got the proceedings stayed. This was not done. The defendant absented himself and consequently the Arbitrators were left with no alternative but to give their award on the plaintiff's evidence which was already before them. It cannot, therefore, be said that if the Arbitrators gave their award on 9th Dec. they acted in any illegal manner nor can this be made a ground for setting aside the award. There is also no question of insufficiency of evidence because the parties had already been examined on 20th Nov., 1955. The plaintiff had also given a statement in writing as required by the Arbitrators. The Arbitrators had sufficient material before them to decide the case and so the courts below were right in overruling the defendant's objection. The objections were rightly dismissed and the revision must fail. 10. The revision is dismissed with costs. The order passed by the courts below is confirmed. Record of the case shall be sent back to the court be low forthwith.