Union of India v. K. Satyanarayan & Co. — 1994 DIGILAW 362 (CAL)

Judgment Sinha, J. This matter has been referred to the Full Bench by a Division Bench of this Court for answering the following questions of law:- "1. Does the Arbitration Act, 1940 permit an appeal under Section 39(1) of the said Act from an Order directing reference of the disputes to an Arbitrator not appointed under the Arbitration Agreement not agreed to by the parties when the Court by an earlier Order already directed filing, of the said Arbitration Agreement and directed reference to an Arbitrator against which no appeal has been preferred? 2. If the answer to the above question is in the negative, is such an order appealable as judgment under Clause 15 of the Letters Patent ? 3. Does an appeal lie from an Order passed under the Arbitration Act, in case not covered by Section 39(1) of the said Act, under Clause 15 of the Letters Patent where no question of jurisdiction involved? 4. Was the case of (1) Messrs Unit Construction Co. (Pvt.) Ltd. v. University of North Bengal, reported in 1986 (2) Calcutta High Court Notes 275 correctly interpreted the decision of Supreme Court in Babulal Khimji's case, reported in AIR 1981 SC 1786 and the case of the (3) Union of India v. Mohindra Supply Co., reported in AIR 1962 SC 256 ? 5. Has the case of Messrs, Unit Construction Co. Pvt. Ltd. v. University of North Bengal, (ibid) correctly decided that although no appeal lies under Section 39(1) of the Arbitration Act, there may be an appeal under Clause 15 of the Letters Patent." 2. The fact of the matter lies in a very narrow compass. The parties, admittedly, entered into an agreement on 15.6.73 for execution of earth work in form1tion, bridge work and miscellaneous works. The fact of the matter lies in a very narrow compass. The parties, admittedly, entered into an agreement on 15.6.73 for execution of earth work in form1tion, bridge work and miscellaneous works. The said contract contains• an arbitration agreement, which reads as follows:- “Clause 63(1) : "If the contractor be dissatisfied with the decision of the Railway on any matter in question dispute or difference on any account or as to the withholding by the Railway of any certificate to which the contractor may claim to be entitled to or if the Railway fails to make a decision within a reasonable time, then and in any such case but except in any of the Excepted Matters referred to in Clause 63 of those conditions, the contractor shall within 10 days of the receipt of the communication of such decision or after the expiry of the reasonable time as the case may be, demand in writing that such matter in question, dispute or difference be referred to Arbitration. Such demand for Arbitration shall be delivered to the Railway by the Contractor and shall specify the matters which are in question, dispute or difference and only such dispute or difference for which the demand has been made and no other shall be referred to Arbitration. (2) Work under contract, shall unless otherwise directed by the Engineer, continue during the Arbitration proceedings, and no payment due or payable by the railway shall be withheld on account such proceedings provided however it shall be open for the Arbitrator or Arbitrators to consider and decide whether or not such work should continue during Arbitration proceeding. (a) Matter in question, dispute or difference to be Arbitrated upon shall be referred for decision to: (i) A Sole Arbitrator who shall be the General Manager or a person nominated by him in that behalf in cases where the claim in question is below Rs.3,00,000 and case where the issues involved are not a complicated nature. The General Manager shall be the sale judge to decide whether or not the issues involved are of a complicated nature. The General Manager shall be the sale judge to decide whether or not the issues involved are of a complicated nature. (ii) Two Arbitrators, who shall be Gazetted Railway Officers of equal status to be appointed in the matter laid down in clause (3)(b) for all claim of Rs.3,00,000 and above, and for all claims irrespective of the amount or value of such claims if the issues involved' are of a complicated nature, the General Manager shall be the sale judge to decide whether the issues are of a complicated nature or not. In the event of the two Arbitrators being divided in their opinions the matter under dispute will be referred to an Umpire to be appointed in the manner laid down in Clause (3)(b) for his decision. (b) For the purpose of appointing two Arbitrators as referred to in sub-clause (a)(ii) above, the Railway will send a panel of more than three names of Officers of the appropriate status of different departments of the Railway to the contractor, who will be asked to suggest, panel of three names out of the list so sent by the Railway, the General Manager will appoint one Arbitrator out of this panel as the Contractor's nominee and then appoint a second Arbitrator of equal status as the Railway's nominee either from the panel or from outside the penal ensuring that one of the two Arbitrators so nominated is invariably from the Account Department. Before entering into reference, between the two Arbitrators. (c) The Arbitrator or Arbitrators or the Umpire shall have power to call for such evidence by way of affidavit or otherwise as the Arbitrator or Arbitrators or Umpire shall think proper, and it shall be the duty of the parties what to do or cause to be done all such things as may be necessary to enable the Arbitrator or Arbitrators or Umpire to make the Award without any delay. (d) It will be no objection that the person appointed as Arbitrator. Arbitrators, the umpire are Government Servants and that in the course of their duties as Government servants they have expressed any view on all or any of the matter in dispute. (e) Subject as aforesaid, Arbitration Act, 1940, and the Rules hereunder and any statutory modification thereof shall apply to the Arbitration Proceedings under this Clause". 3. Arbitrators, the umpire are Government Servants and that in the course of their duties as Government servants they have expressed any view on all or any of the matter in dispute. (e) Subject as aforesaid, Arbitration Act, 1940, and the Rules hereunder and any statutory modification thereof shall apply to the Arbitration Proceedings under this Clause". 3. The respondent firm filed an application on 2.3.82 before this Court under Section 20 of the Arbitration Act praying therein that the respondents be directed to file the aforementioned arbitration agreement dated 15.6.73 and for appointment of an Arbitrator in terms thereof. Pratibha Bonnerjea, J., by an order dated 23.6.82 directed the respondent to file the said Arbitration Agreement. It was further directed therein that the Arbitrators would be appointed in terms of the arbitration agreement and the appellant was directed to submit a panel of names of Arbitrators to the claimant within three weeks from the said date whereupon the Arbitrators were to enter upon reference forthwith and to pass an award within 6 months from the date of entering into reference. According to the appellant the Law Officer of the South Eastern Railways requested the Ministry of Law for extension of time for three weeks on 28.7.82 so as to enable them to comply with the said order whereupon the matter war mentioned and by an order dated 28.7.82 Pratibha Bonnerjea, J. while rejecting the prayer of the appellant appointed Sri P.K. Pal. Barrister-at-Law as the Sole Arbitrator and directed him to make an award within 6 months. 4. The appellant preferred an appeal under Clause 15 of the Letters Patent of this Court against the second order dated 28.7.82 and not against the first order, i.e. the order dated 26.3.82. The appeal came up for hearing before a Division Bench of this Court wherein a preliminary objection was taken with regard to the maintainability of the said appeal. 5. Before the Division Bench, the appellant, inter alia, relied upon a decision of this Court in Messrs. Unit Construction Co. Pvt. Ltd. v. University of North. Bengal, reported in 1986 (2) CHN 275. The Division Bench doubted the correctness of the said decision and referred the matter to a larger Bench. 6. Mr. 5. Before the Division Bench, the appellant, inter alia, relied upon a decision of this Court in Messrs. Unit Construction Co. Pvt. Ltd. v. University of North. Bengal, reported in 1986 (2) CHN 275. The Division Bench doubted the correctness of the said decision and referred the matter to a larger Bench. 6. Mr. S.K. Mitra, Learned Counsel appearing on behalf of the appellant, has, inter alia, submitted that the impugned order would be deemed to be an order passed under sub-section (4) of Section 20 of the Arbitration Act, inasmuch as any appointment of an Arbitrator de hors the arbitration agreement amounts to an order refusing to direct filing of the arbitration agreement. The Learned Counsel submitted that from a perusal of the order of reference of the Division Bench, it would appear that it was held their in that the order passed by the Learned Single Judge on merit could not be sustained. The Learned Counsel submitted that keeping in view the fact that the appellant received the copy of the said order dated 23.6.82 after two weeks it was not in a position to comply with the said order within the time granted by it. It was pointed out that the matter was brought under the heading "To be Mentioned" only for the purpose of obtaining an extension of time on 28.7.82 and, in that view of the matter, the Learned judge had no jurisdiction to pass an order appointing Mr. P.K. Pal, Barrister-at-Law, as the Sole Arbitrator. The Learned Counsel in support of his contention that appointment of an Arbitrator de hors the arbitration agreement amounts to refusal to direct filing of arbitration agreement relied upon two Division Bench decisions of this Court. viz. (4) Union of India v. M/s. Himco (India) Private Ltd. AIR 1965 cal 404 and (5) Union of India v. M.S. Grewal & Co., AIR 1968 Cal 333 . It was further submitted that the impugned order passed by the Learned Single Judge is vitiated in law as no reason has been assigned in support thereof. 7. Mr. Mitra further submitted that Clause 15 of the Letters Patent of this Court must be held to prevail over the provisions of Section 39 of the Arbitration Act. It was further submitted that the impugned order passed by the Learned Single Judge is vitiated in law as no reason has been assigned in support thereof. 7. Mr. Mitra further submitted that Clause 15 of the Letters Patent of this Court must be held to prevail over the provisions of Section 39 of the Arbitration Act. The Learned Counsel submitted that this Court is bound by the decision of the Supreme Court of India in Babulal Khimji's Case (supra), AIR 1981 SC 1786 ; wherein however the decision of the Supreme Court in the case of The Union of India v. The Mohindra Supply Co. reported in AIR 1962 SC 256 was not referred to. It was submitted that the decision of the Supreme Court in Mohindra Supply Co. (supra) has no Application to the facts and circumstances of the present case inasmuch as the Supreme Court in that case was considering the effect of the sub-section (2) of Section 39 of the Arbitration Act. 8. Mr. Pratap Chatterjee, Learned Counsel appearing on behalf of the respondent, on the other hand, submitted that in view of the fact that the appellant did not question the order dated 23.6.82 passed by this Court and having preferred an appeal only against the order dated 28.7.82, it cannot be said that the said order in a composite order under Section 20(4) of the Arbitration Act, the Learned Counsel further submitted that the decisions of this Court reported in 1965 Cal. 404 and 1968 Cal. 333 are not applicable to the fact, and circumstances of this case. Mr. Chatterjee submitted that the impugned order cannot be said to be without jurisdiction inasmuch as in terms of the order dated 23.6.82, the matter was to be placed before the Court 5 week thereafter and pursuant thereto the matter was placed before the Learned Single Judge on 28.7.82. 9. Mr. Chatterjee next contended that the decision of the Supreme Court of India in Union of India v. The Mohindra Supply Co., 1962 SC 256 has laid down the law within the meaning of Article 141 of the, constitution of India and, thus, the same being binding upon this Court should be preferred to the 'obiter dictum' of the Supreme Court in Babulal Khimji's case (supra). 10. Mr. 10. Mr. Chatterjee submitted that the Supreme Court subsequently in the case of (6) Union of India v. Gauranga Chatterjee, reported in 1993 (3) SCC 1 , has clearly held that an appeal under Clause 15 of the Letter’s Patent of any High Court would not be entertainable if the same does not come within the purview of any of the clauses referred to in Section 39 of the Arbitration Act. Mr. Chatterjee contended that the judgment of this Court in Messrs Unit Construction's case has subsequently been explained by another Division Bench of this Court in (7) Santosh Kumar Agarwal v. Phalguni Banerjee & Anr., reported in 1994(1) CHN 113 . It was pointed out that in both the aforementioned decisions, Prabir Kumar Mazumdar, J. was a party. 11. The order dated 23.6.82 passed by the Learned Single Judge of this Court reads thus:- "It is ordered that the Arbitration agreement contained in the agreement No. DCE/BC/5/73 dated the fifteenth day of June one thousand nine hundred and seventy three being Annexure 'C' to the said petition be filed as of records herein. And it is further ordered that the parties herein be at liberty to appoint Arbitrators in terms of the said agreement within a month from the date hereof. And it is further ordered that the defendant do within three weeks from the date hereof submit a panel of the names of the Arbitrators to the plaintiff. And it is further ordered that all matters in difference in this suit between the parties hereto including the question of the costs of this suit and of the reference hereby directed be referred to the Arbitration of the Arbitrators so appointed. And it is further ordered that the Arbitrators so appointed do enter upon the reference forthwith and make their award in writing and submit the same to this Court together with all proceedings and depositions recorded and exhibits filed before them within six months from date of entering upon such reference. And it is further ordered that the Arbitrators so appointed do enter upon the reference forthwith and make their award in writing and submit the same to this Court together with all proceedings and depositions recorded and exhibits filed before them within six months from date of entering upon such reference. And it is further ordered that in case of difference of opinion between the said Arbitrators the matters involving such difference be referred to the decision of an Umpire to be nominated by the said Arbitrators before they take up such reference who, in the event of a reference being made to him shall make his award in writing and shall submit the same in the like matter to this Court within two months from the date of such reference to him or within such further time as he may allow himself by an endorsement on the office copy of this order. And it is further ordered that the said Arbitrators or the Umpire as the case may be at liberty to examine the parties to this suit and their witnesses upon oath or Solemn affirmation which they are hereby empowered to administer. And it is further ordered that the said Arbitrators or the Umpire as the case may be, shall have such powers as are vested in an Arbitrator under the provisions of the Arbitration Act, 1940. And it is further ordered that this application be placed in the list of marked to be mentioned on the expiry of five weeks from the date hereof. And it is further ordered that the costs of and incidental to this application be costs in the Arbitration proceedings. And it is further ordered that the said Arbitrators and all parties concerned do act on a copy of the minutes of the order signed by an officer of this Court being produced before them". It is stated that the signed copy of the minutes of the said order was served on the Law Officer of the appellant on 8.7.82. On 26.7.82 the Law Officer of the appellant requested the Ministry of Law to pray for extension of time. The matter appeared in the list on 28.7.82 whence a prayer was made on behalf of the appellant for three weeks' extension to comply with the said order. On 26.7.82 the Law Officer of the appellant requested the Ministry of Law to pray for extension of time. The matter appeared in the list on 28.7.82 whence a prayer was made on behalf of the appellant for three weeks' extension to comply with the said order. The said prayer was rejected by the learned Trial Judge by the fallowing order:- "It is ordered that all matters in dispute and difference in this suit between the parties hereto including the question of the casts of the reference hereby directed be referred to the Arbitration of Mr. P.K. Pal, Barrister-at-law, who is hereby appointed the sale Arbitrator in this suit at a remuneration of thirty Gold Mohurs per each effective sitting irrespective of hours to be shared equally by both the parties. And it is further ordered that the said Arbitrator shall enter upon the reference forthwith and shall make his award in writing and submit the same to this Court together with all proceedings and depositions recorded and exhibits filed before him within six months from the date of entering upon such reference aforesaid. And it is further ordered that the said Arbitrator be at liberty to examine the parties to this suit and their witnesses upon oath of Solemn affirmation which he is hereby empowered to administer. And it is further ordered that the said Arbitrator shall have such powers as are vested in an Arbitrator under the provisions of the Arbitration Act, 1940. And it is further ordered that the costs of and incidental to this application be costs in the Arbitration proceedings. And it is further ordered that all parties including the said Arbitrator do act on a copy of the minutes of this order signed by an officer of this Court being produced before them". 12. It may be stated that both the aforementioned orders were drawn up separately as two separate orders. It would not, therefore, be correct to contend that the second order could be an order refusing to file an arbitration agreement. 13. 12. It may be stated that both the aforementioned orders were drawn up separately as two separate orders. It would not, therefore, be correct to contend that the second order could be an order refusing to file an arbitration agreement. 13. In the case of Union of India v. M/s. Himco (India) Private Ltd. reported in AIR 1965 Cal 404 , the question which arose for consideration before this Court was as to whether by reason of the composite order passed by the Court in terms of sub-section (4) of Section 20 of the Arbitration Act, the arbitration agreement stood modified or not. The said decision was followed in the case of Union of India v. M.S. Grewal & Co. reported in AIR 1968 Cal 333 . In this case, however, as noticed hereinbefore the aforementioned two orders have been drawn up separately and the appellant has chosen to file appeal only as against the second order being dated 28.7.82. The appellant cannot, therefore, raise any grievance as against the first order whereby and whereunder the arbitration agreement was directed to be filed. Once the arbitration agreement was directed to be filed in respect whereof the appellant did not raise any grievance, in my opinion, it would not be correct to contend that the subsequent order dated 28.7.82 would be deemed to be an order of this Court refusing filing of the arbitration agreement for the reason that the arbitrator appointed by the Court was not an arbitrator named is the arbitration agreement entered into by the parties and as contained in clause 63(1) of the contract. 14. Section 20 of the Arbitration Act reads as follows:- "Section 20. Application to file in Court Arbitration agreement: (1) Where any persons have entered into an Arbitration agreement before the institution of any suit with respect to the subject-matter of the agreement or any part of it, and where a difference has arisen to which the agreement applies, they or any of them, instead of proceeding under Chapter II, may apply to a Court having jurisdiction in the matter to which the agreement relates, that the agreement be filed in Court. (2) The application shall be in writing and shall be numbered and registered as a suit between one or more of the parties interested or claiming to be interested as plaintiff or plaintiffs and the remainder as defendant or defendants, if the application has been presented by all the parties, or, if otherwise, between the applicant as plaintiff and the other parties as defendants. (3) On such application being made, the Court shall direct notice thereof to be given to all parties to the agreement other than the applicants, requiring them to show cause within the time specified in the notice why the agreement should not be filed. (4) Where no sufficient cause is shown, the Court shall order the agreement to be filed, and shall make an order of reference to the Arbitrator appointed by the parties, whether in the agreement or otherwise, or, where the parties cannot agree upon an Arbitrator, to an Arbitrator appointed by the Court. (5) Thereafter the Arbitration shall proceed in accordance with and shall be governed by, the other provisions of this Act so far as they can be made applicable". Section 20 of the Act is, therefore in two parts. 15. In the case of (8) M/s. Dhanrajmal Govindram v. M/s. Shamji Kalidas & Co., reported in AIR 1961 SC 1285 , the Supreme Court of India while considering the scope of Sub-section (4) of Section 20 of the Arbitration Act held as follows:- "But the crux of the argument is that the provisions of Sub-section (4) of Section 20 read with Sub-section (1), ibid, cannot apply, and the Court, after filing the agreement, will have to do nothing more with it, and this shows that Section 20 is not applicable. This argument overlooks the fact that this is a statutory arbitration governed by its own rules, and that the powers and duties of the Court in Sub-section (4) of Section 20 are of two distinct kinds. The first is the judicial function to consider whether the arbitration agreement should be filed in Court or not. That may involve dealing with objections to the existence and validity of the agreement itself. Once that is done, and the Court has decided that the agreement must be filed the first part of its powers and duties is over. The first is the judicial function to consider whether the arbitration agreement should be filed in Court or not. That may involve dealing with objections to the existence and validity of the agreement itself. Once that is done, and the Court has decided that the agreement must be filed the first part of its powers and duties is over. It is significant that an appeal under Section 39 lies only against the decision on this part of Sub-section (4) Then follows a ministerial act of reference to Arbitrator or Arbitrators' appointed by the parties. That also was perfectly possible in this case, if the parties appointed the Arbitrator or Arbitrators. If the parties do not agree, the Court may be required to make a decision as to who should be selected as an Arbitrator, and that may be a function either judicial, or procedural, or even ministerial; but it is unnecessary to decide which it is. In the present case the parties by their agreement have placed the power of selecting an Arbitrator or Arbitrators (in which we include also the umpire) in the hands of the chairman of the Board of Directors of the East India Cotton Association Ltd. and the Court can certainly perform the ministerial act of sending the agreement to him to be dealt with by him. Once the agreement filed in Court is sent to the Chairman, the Bye-laws lay down the procedure for the Chairman and the appointed Arbitrator or Arbitrators to follow, and that procedure, if inconsistent with the Arbitration Act, prevails. In our opinion, there is no impediment to action being taken under Section 20(4) of the Arbitration Act." (Underlining is mine for emphasis) In view of the aforesaid decision there cannot be any doubt that four situations are contemplated in terms thereof mainly (1) the circumstances under which a party may apply to a Court having jurisdiction in the matter to which the agreement relates, that the agreement be filed in Court. Sub-section (2) provides as to how the said application is to be dealt with. Sub-section (3) provides giving of notice to all parties requiring them to show cause why the agreement should not be filed. Sub-section (4) provides that where no sufficient cause is shown the Court shall order the agreement to be filed. Sub-section (2) provides as to how the said application is to be dealt with. Sub-section (3) provides giving of notice to all parties requiring them to show cause why the agreement should not be filed. Sub-section (4) provides that where no sufficient cause is shown the Court shall order the agreement to be filed. It further provides that the Court shall thereupon make an order of reference to the Arbitrator appointed by the parties, whether in the agreement or otherwise or where the parties cannot agree upon an Arbitrator, to an Arbitrator appointed by the Court. The said provisions, therefore, contemplate two kinds of order although the same may be composite one. In terms of Section 39 of the Act only an order directing filing or refusing to file an arbitration agreement has been made appealable in terms of Clause 'iv' thereof. 16. However, this Court is not concerned in this case as to whether an order would be appealable as against a composite order as was the case in the decisions reported in AIR 1965 Cal. 404 and AIR 1968 Cal. 333 . 17. However, I agree with the following observation of the Division Bench:- “In our opinion, the order appealed against, that is, the second order which merely provides for appointment of Arbitrator and does not provide for filing or refusing to file the agreement is not appealable under Section 39 of the Act. The scheme of the Act shows different kinds of orders which can be passed under the same. It starts with leave to revoke the authority of the Arbitrator, that is, Section 5. Power for appointment or removal of Arbitrator under various circumstances is provided in Sections 8 to 11. Power to remit award is under Section 16. Power to pass interim orders is provided in Section 18. Power to make order of reference in pending suits is provided in Section 21, Section 30 read with Section 33 provides for power to set aside the a ward. Only in respect of some of these orders appeal has been provided and in cases of other orders no such appeal is provided, in this context it has to be pointed out that all orders relating to appointment or removal of Arbitrator generally under Sections 8 to 11 have been excluded from the scope of appeal. Only in respect of some of these orders appeal has been provided and in cases of other orders no such appeal is provided, in this context it has to be pointed out that all orders relating to appointment or removal of Arbitrator generally under Sections 8 to 11 have been excluded from the scope of appeal. In our opinion, the Legislature has intended that the order of appointment under Section 20 shall be treated at par with orders of appointment generally under Sections 8 to 11 and intentionally appointment of Arbitrator under Section 20 after direction for filing of the agreement has been excluded from the scope of appealability of order. What has been excluded is, in our opinion, impliedly barred. In this context it may be pointed out that in certain cases orders can be passed under a section either allowing or disallowing the prayer. In the case of filing of Arbitration Agreement both kinds of orders, viz. the order for filing and the order refusing to file have been made appealable but any order of reference or any order of appointment of Arbitrator has not been made appealable. Power has, been given to supersede arbitration under the Act but when an application for super-session is rejected that has not been made appealable." 18. The Division Bench further observed that in view of the, decision of the Supreme Court in the case of (9) Union of India v. Profulla Kumar Sonyal, reported in AIR 1979 SC 1457 , the second order passed by the Learned Single Judge cannot be said to be without jurisdiction. I am, however, of the view that the said question is irrelevant inasmuch as if an appeal does not lie in terms of Clause 15 of the Letters Patent of this Court, such an appeal would not be maintainable although order passed by the trial judge may be without jurisdiction. 19. In this view of the matter, Question No. 1 referred to by the Learned Division Bench must be rendered in negative. 20. Question Nos. 2 to 5 being inter-related, they are being dealt with together hereinafter. 21. 19. In this view of the matter, Question No. 1 referred to by the Learned Division Bench must be rendered in negative. 20. Question Nos. 2 to 5 being inter-related, they are being dealt with together hereinafter. 21. Clause 15 of the Letters Patent of this Court reads as follows:- “And we do further ordain that an appeal shall lie to the said High Court of Judicature at Fort William in Bengal from the judgment (not being a judgment passed in the exercise of appellate jurisdiction in respect of a decree or order made in the exercise of appellate jurisdiction by a Court subject to the superintendence of the said High Court, and not being an order made in the exercise of revisional jurisdiction and not being a sentence or order passed or made in the exercise of the power of superintendence under the provisions of Section 107 of the Government of India Act or in the exercise of criminal jurisdiction) of one Judge of the said High Court or one Judge of any Division Court, pursuant to Section 108 of the Government of India Act and notwithstanding anything hereinbefore provided an appeal shall lie to the said High Court from a judgment of one Judge of the said High Court or one Judge of any Division Court, pursuant to Section 108 of the Government of India Act made on or after the first day of February, One thousand nine hundred and twenty-nine in the exercise of appellate jurisdiction in respect of a decree or order made in the exercise of appellate jurisdiction by a Court subject to the superintendence of the said High Court, where the Judge who passed the judgment declares that the case is a fit one for appeal, but the right of appeal from other judgments of Judges of the said High Court or of such Division Court shall be to Us, Our heirs or successors in Our or Their Privy Council as hereinafter provided”. Section 39 of the Arbitration Act reads as follows:- "39. Section 39 of the Arbitration Act reads as follows:- "39. Appealable orders: (1) An appeal shall lie from the following orders passed under this Act (and from no others) to the Court authorised by law to hear appeals from original decrees of the Court passing the order:- An order – (i) superseding an Arbitration; (ii) on an award stated in the form of a special case; (iii) modifying or correcting an award; (iv) filing or refusing to file an Arbitration agreement; (v) staying or refusing to stay legal proceedings where there is an Arbitration agreement; (vi) setting aside or refusing to set aside an award; provided that provisions of this Section shall not apply to any order passed by a Small Cause Court. (2) No second Appeal shall lie from an order passed in api1cal under this section, but nothing in this section shall affect or take away any right to appeal to the Supreme Court." 22. There cannot be any doubt whatsoever that the Arbitration Act is a special statute and is a self-contained Code. The provisions of the Code of Civil Procedure apply to the cases filed under the Arbitration Act as the Arbitration Act expressly provides therefor as also in terms of Section 141 of the Code of Civil Procedure. 23. An appeal is a creature of a statute. The Parliament in its wisdom may not provide for an appellate forum against some orders and may provide appeals on limited ground against the orders passed by a Court or Tribunal. Such appeals may also be conditional ones; Even an appeal may be maintainable at the instance of one party; but only a limited appeal may be maintainable at the hands of the other e.g. an appeal under the Motor Vehicles Act. The right of appeal when it is provided is a substantive right. However, as indicated hereinbefore, an impairment of the right of appeal by putting restriction therein is permissible in law. 24. The right of appeal of a litigant being aggrieved by the order passed by the Court under the Arbitration Act vis-a-vis right of appeal under Clause 15 of the Letters Patent came up for consideration before various Courts. In the case of (10) R. Wright & Partner Ltd. v. Governor General in Council reported in ILR 1948(2) Cal. 24. The right of appeal of a litigant being aggrieved by the order passed by the Court under the Arbitration Act vis-a-vis right of appeal under Clause 15 of the Letters Patent came up for consideration before various Courts. In the case of (10) R. Wright & Partner Ltd. v. Governor General in Council reported in ILR 1948(2) Cal. 265 : 52 CWN 224, it has been observed that the right of appeal under Clause 15 of the Letters Patent is by Clause 44 subject to the legislative powers of the Governor General in Council and Section 39 of the Arbitration Act, 1940 has explicitly taken away the right. B.K. Mukherjea, J. (as His Lordship then was) in the aforementioned case made the following observation:- "Our conclusion, therefore, is that Section 39 of the Arbitration Act is sufficiently explicit to include an appeal under Clause 15 of the Letters Patent as well and as the provisions of Clause 15 of the Letters Patent have to be taken subject to the Legislative Powers of the Governor General in Legislative Council. We must hold that to this extent the right of appeals has been curtailed and modified." The said decision has been quoted with approval by the Madras High Court in the case of (11) Penugouda Radhakrishna Murthy v. V.A.Y. Ethirajulu Chetty, reported in AIR 1945 Mad. 184 . In the case of (12) Ranchhoddas Purshottam & Co. v. Ratanji Virpal & Co. reported in AIR (30) 1943 Bom 196, the Division Bench of the Bombay High Court felt that in view of the provisions contained in Sub-section (2) of Section 39 of the Arbitration Act no appeal lies to the Privy Council from an order passed by a single Judge under Section 33 challenging the validity of an Arbitration agreement as no appeal is provided for against it by Section 39(1). In the case of (13) Madhavdas Devidas and Ors. v. Vithaldas Vasudeodas & Ors. reported in AIR 1952 Bom. 229 a Division Bench of the Bombay High Court again held that if a Single Judge of the High Court disposes of an appeal under Sub-section (1) of Section 39 of the Arbitration Act, Sub-section (2) thereof bars further right of appeal under Clause 15 of the Letters patent. v. Vithaldas Vasudeodas & Ors. reported in AIR 1952 Bom. 229 a Division Bench of the Bombay High Court again held that if a Single Judge of the High Court disposes of an appeal under Sub-section (1) of Section 39 of the Arbitration Act, Sub-section (2) thereof bars further right of appeal under Clause 15 of the Letters patent. The matter came up for consideration before the Supreme Court in the case of Union of India v. Mohindra Supply Co., repotted in AIR 1962 SC 256 . The Supreme Court although, was concerned with regard to the right of second appeal under Letters Patent in view of Section 39(2) of the Arbitration Act but there cannot be any doubt that the question involved therein was that where a single Judge of the Punjab High Court disposed of an appeal under Section 39(1) of the Arbitration Act, whether there could be any further right of appeal under Clause 10 of the Letters Patent of that High Court or not. The Supreme Court considered the provisions of Section 39 of the Arbitration Act vis-a-vis Clause 10 of the Letters Patent of the Punjab High Court and held as follows:- "There is in the Arbitration Act no provision similar to Section 4 of the Code of Civil Procedure which preserves powers reserved to Courts under special statutes. There is also nothing in the expression "authorised by law to hear appeals from original decrees of the Court" contained in Section 39(1) of the Arbitration Act which by implication reserves the jurisdiction under the Letters Patent to entertain an appeal' against the order passed in arbitration proceedings. Therefore, in so far as Letters Patent deal with appeals against orders passed in Arbitration proceedings, they must be read subject to the provisions of Section 39 (1) and (2) of the Arbitration Act. Under the Code of 1908, the right to appeal under the Letters Patent was saved both by Section 4 and the clause contained in Section 104(1), but by the Arbitration Act of 1940, the jurisdiction of the Court under any other law for the time being in force is not saved; the right of appeal can therefore be exercised against orders in arbitration proceedings only under Section 39 and no appeal (except an appeal to this Court) will he from an appellate order". It further held :- "If the legislature being cognizant of this difference of opinion prior to the Code of 1908 and the unanimity of opinion which resulted after the amendment, chose not to include the reservation clause in the provisions relating to appeals in the Arbitration Act of 1940, the conclusion is inevitable that it was so done with a view to restrict the right of appeal within the strict limits defined by Section 39 and to take away the right conferred by other statutes. The Arbitration Act which is a consolidating and amending Act, being substantially in the form of a code relating to arbitration must be construed without any assumption that it was not intended to alter the law relating to appeals. The words of the statute are plain and explicit and they must be given their full effect and must be interpreted in their natural meaning, uninfluenced by any assumptions derived from the previous state of the law and without any assumption that the legislature must have intended to leave the existing law unaltered. In our view the legislature has made a deliberate departure from the law prevailing before the enactment of Act X of 1940 by modifying the law relating to appeals in Section 39". The Supreme Court followed the aforementioned decision and reiterated its views in no uncertain terms in the case of State of West Bengal v. M/s. Gourangalal Chatterjee, reported in 1993(3) SCC p. 1 wherein it was clearly held as follows:- "The argument appears to be without any substance as Subsection (1) of the Section 39 which is extracted below:- (1) An appeal shall lie from the following orders passed under this Act (and from no others) to the Court authorised by law to hear appeals from original decrees of the Court passing the order:- (i) superseding an arbitration; (ii) on an award stated in the form of a special case; (iii) modifying or correcting an award; (iv) filing or refusing to file an arbitration agreement; (v) staying or refusing to stay legal proceedings where is an arbitration agreement; (vi) setting aside or refusing to set aside an award; Provided that the provisions of this section shall not apply to any order passed by a Small Cause Court. (2) No second appeal shall lie from an order passed in appeal under this section, but nothing in this section shall affect or take away any right to appeal to the Supreme Court". Provides that an appeal could lie only from the orders mentioned in the sub-section itself. Since the order passed by the Single Judge revoking the authority of the Chief Engineer on his failure to act as an arbitrator was not covered in either of the six clauses mentioned in Section 39 it is obvious that no appeal could be filed against the order of the learned Single Judge." In Shah Babulal Khimji v. Jayaben D. Kania & anr., reported in AIR 1981 SC 1186 the Supreme Court was considering the question as to whether an appeal against the order of a Single Judge would be maintainable under clause 15 of the Letters Patent of the Bombay High Court refusing to appoint a receiver and passing an order of injunction. In that case the Division Bench of the Bombay High Court refused to entertain the Letters Patent appeal from an order passed by the learned Single Judge on the ground that such an order was not a judgment within the meaning of clause 15 of the Letters Patent. Before the Supreme Court it was only submitted that such an order is appealable in terms of Section 104 and Order 43 Rule 1 of the Code of Civil Procedure. 25. The Supreme Court, upon taking into consideration the provisions of Section 104 and other provisions of the Code of Civil Procedure, inter alia, held: "Thus, the test contained in Section 4 is not applicable in the instant case because even if the Letters Patent of the High Court be deemed to be a special law as contemplated by Section 4, the provisions of Section 104 do not seek to limit or affect, the provisions of the Letters Patent". Dealing' with the provisions of Section 104 of the Code of Civil Procedure and other provisions of the Code, it was observed: "Thus, a combined reading of the various provisions of the Code of Civil Procedure referred to above leads to the irresistible conclusion that Section 104 read with Order 43, Rule 1 clearly applies to the proceedings before the Trial, Judge of the High Court". 26. 26. Upon the aforesaid findings the Supreme Court came to the following conclusion:- "We find ourselves in complete agreement with the arguments of Mr. Sorabjee that in the instant case Section 104 read with Order 43, Rule 1 does not in any way abridge, interfere or curb the powers conferred on the Trial Judge by Cl. 15 of the Letters Patent. What Section 104 read with Order 43, Rule 1 does is merely to give an additional remedy by way of an appeal from the orders of the Trial Judge to a larger Bench. Indeed, if this is the position then the contention of the respondent that Section 104 will not apply to internal appeals in the High Courts cannot be countenanced. In fact, the question of application of the Code of Civil Procedure to internal appeals in the High Court does not arise at all because the Code of Civil Procedure merely provides for a forum and if Order 43 Rule 1 applies to a Trial Judge then the forum created by the Code would certainly include a forum within the High Court to which appeals against the Judgment of a Trial Judge would lie. It is obvious that when the Code contemplates appeals against orders passed under various clauses of Order 43, Rule 1 by a Trial Judge, such an appeal can lie to a larger Bench of the High Court and not to any Court subordinate to the High Court. Hence, the argument that Order 43 Rule 1 cannot apply to internal appeals in the High Court does not appeal to us although the argument has found favour with some of the High Courts". The Supreme Court having held so, considered the question as to whether the provisions of Section 104 of the Code of Civil Procedure was merely an additional or supplemental remedy by way of appeal. It, in this connection referred to the provisions of the Companies Act as also the Arbitration Act and observed:- "It cannot be contended by any show of force that the Order passed by the Trial Judge being an interlocutory order, no appeal would lie to the Division Bench or that the provisions of the Arbitration Act giving a right of appeal to a litigant from the order of a Trial Judge to the Division Bench in any way fetter or override the provisions of the Letters Patent". 27. Mr. 27. Mr. Mitra relying upon the observations of the Supreme Court in paragraphs 33 and 34 in Khimji's case submitted that from a perusal thereof it would appear that the Supreme Court has clearly held that Section 39 of the Arbitration Act would not be a bar in entertaining an appeal-under clause 15 of the Letters Patent. The contention of the learned Counsel cannot be accepted for more than one reasons. As indicated hereinbefore the Supreme Court in that case was concerned with the interpretation of the word 'Judgment' in clause 15 of the Letters Patent vis-a-vis the provisions of Section 104 and Order 43 of the Code of Civil Procedure. It is now well known that a decision is an authority for what it decides and not what can logically be deduced therefrom. 28. It is also a trite law that a judgment cannot be read as a statute. In (14) State Bank of India Staff Association, Local Head Office Unit, Patna & Ors. v. Election Commission of India & Ors., reported in 1993(2) BLJ 500 , a Division Bench of the Patna High Court (of which I was a member), observed as follows:- "It is well known, as was observed by Lord Halsbury in (15) Quinn v. Leathem, (1901) 3 All England Law Reports (Reprint) page 1 at page 6 that a decision is an authority for what it decides and not what logically can be deduced therefrom. It is also known that a judgment of the Supreme Court has to be read in a reasonable manner and like any other documents in its entirety". 29. In (16) Central Coalfields Ltd. v. State of Bihar, 1993(1) PLJR 617 , a Division Bench of this Court (of which I was a member), observed as follows:- "It is also well known that judgment of a court is not to be read as a statute". In (17) General Electric Co. v. Renusagar Power Co., 1987 (4) SCC 137 , it was held;- "As often enough pointed by us, words and expressions used in a judgment are not to be construed in the same manner as statutes or as word and expressions defined in statutes. In (17) General Electric Co. v. Renusagar Power Co., 1987 (4) SCC 137 , it was held;- "As often enough pointed by us, words and expressions used in a judgment are not to be construed in the same manner as statutes or as word and expressions defined in statutes. We do not have any doubt that when the words, adjudication of the merits of their controversy in the suit were used by this court in State of U.P. v. Janki Saran Kailash Chandra; the words were not used to take in every adjudication which brought to an end the proceeding before the court in whatever manner but were meant to cover only such adjudication as touched upon the real dispute between the parties which have rise to the action. Objections to adjudication of the disputes between the parties, on whatever grounds are in truth not aids to the progress of the suit but hurdles to such progress. Adjudication of such objections cannot be termed as adjudication of the merits of the controversy in the suit. As we said earlier, a broad view has to be taken of the principles involved and narrow bad technical interpretation which tends to defeat the' object of the legislation must be avoided". It is also well settled that a point not argued does not create a binding precedent with regard thereto. 30. In (18) Rajeshwar Prasad Mishra v. The State of West Bengal & Anr., AIR 1965 SC 1887 ; it was held;- "Article 141 empowers the Supreme Court to decide the law and not enact it. Hence the observation of the Supreme Court should not be read as statutory enactments. It is also well known that ratio of a decision is the reasons assigned therein". Dias on 'Jurisprudence' at page 139 observed;- "Knowing the law.-What is 'law in a precedent is its ruling or ratio decidendi, which concerns future litigants as well as those involved in the instant dispute. Knowing the law in this context means known how to extract the ratio decidendi from cases. Statements not part of the ratio decidendi are distinguished as obiter dicta and are not authoritative. Three shades of meaning can be attached to the expression ratio decidendi. The first which is the translation of it, is the reason for (or of) deciding. Even a finding of fact may in this sense be the ratio decidendi. Statements not part of the ratio decidendi are distinguished as obiter dicta and are not authoritative. Three shades of meaning can be attached to the expression ratio decidendi. The first which is the translation of it, is the reason for (or of) deciding. Even a finding of fact may in this sense be the ratio decidendi. Thus a judge may state a rule and then decide that the facts do not fall within it. Secondly, it may mean the rule of law preferred by the Judge as the basis of his decision; or thirdly it may mean the rule of law which other, regard as being a binding authority." There is temptation to suppose that a case his one fixed ruling which is there and discoverable here and now and once and for all. This is not so, for the ratio is not only the ruling given by the deciding Judge for his decision; but anyone of a series of rulings as elucidated by subsequent interpretations. The pronouncement of the Judge who decided the case is a necessary step towards ascertaining the ratio, but the process by no means ends there, subsequent interpretation is at least as significant, sometimes more so. ‘It is not sufficient’, said Jessel M.R. That the case should have been decided on a .principle is not itself a right principle, or one not applicable to this case; and it is for a subsequent Judge to say whether or not it is a right principle, and if not, he may himself lay down the true principle." 31. The observation of the Supreme Court in paragraph 34 of the judgment in Khimji's case is, in my opinion not even an obiter on the point at issue. 32. The Supreme Court in Khimji's case nowhere stated that an appeal under clause 15 of the Letters Patent would be maintainable despite the bar contained in Section 39 of the Arbitration Act. The Supreme Court merely while considering the question of right of appeal of a litigant under Section 104 of the Code of Civil Procedure gave some illustrations. 32. The Supreme Court in Khimji's case nowhere stated that an appeal under clause 15 of the Letters Patent would be maintainable despite the bar contained in Section 39 of the Arbitration Act. The Supreme Court merely while considering the question of right of appeal of a litigant under Section 104 of the Code of Civil Procedure gave some illustrations. What the Supreme Court intended to convey was that an appeal before a Division Bench from the judgment of the learned Single Judge would lie before the same High Court under Section 104 of the Code of Civil Procedure as well as the provisions of the Companies Act or Arbitration Act which are special statutes. There cannot be any doubt that an appeal from the order passed by the Learned Single Judge of a High Court would be maintainable before the Division Bench of the said High Court, in terms of the relevant provisions of the. Letters Patent thereof; but the same shall be subject to the restrictions imposed by special statutes. If an appeal does not lie from an order passed by the learned Single Judge in terms of Section 39 of the Arbitration Act, there cannot be any doubt whatsoever that such an appeal would not be maintainable under clause 15 of the Letters Patent. It is therefore evident that the Division Bench of this Court in M/s. Unit Construction Co. (P) Ltd. v. University of North Bengal reported in 1986(2) Calcutta High Court Notes page 275 wrongly interpreted the decision of the Supreme Court in Khimji's case (supra). However, Prabir Kumar Majumdar, J. who spoke for the Division Bench in M/s. Unit Construction Co. (P) Ltd. case (supra) himself explained the said decision in Santosh Kumar Agarwal v. Phalguni Banerjee & Anr., reported in 1994 (1) Calcutta High Court Notes page 113, holding that the Arbitration Act is a complete Code in itself. The Learned Judge also referred to an unreported decision dated 9.4.92 of the Division Bench of this Court presided over by N.P. Singh, C.J. (as His Lordship then was) in the case of Uttar Pradesh State Electricity Board v. Banerjee Electric Light & Power Co. Ltd., wherein it was held that the order under appeal before that Bench was neither an order appealable under Section 39 of the Arbitration Act nor an order under clause 15 of the Letters Patent. Ltd., wherein it was held that the order under appeal before that Bench was neither an order appealable under Section 39 of the Arbitration Act nor an order under clause 15 of the Letters Patent. The Division Bench in Santosh Kumar Agarwal (Supra) distinguished M/s. Unit Construction Co. (P) Ltd.'s case stating therein that the impugned order therein was passed at the threshold stage and same was in the nature of an order under Order 7, Rule 10 of the Code of Civil Procedure for which there was no corresponding provision in the Arbitration Act, 1940 and if that was not an order under the Arbitration Act, an appeal then can be entertained if it satisfied the test of the 'judgment' within the meaning of clause 15 of the letters Patent. In view of the subsequent decision of Prabir Kumar Majumdar, J. in Santosh Kumar Agarwal case, it must be held that the reliance placed by Mr. Mitra in M/s. Unit Construction Co.'s case (supra) before us is wholly misplaced. The Division Bench observed as follows:- "In our view this decision in the case of Unit Construction Co. (supra) is distinguishable as the order under that appeal was at the threshold stage of the arbitration proceedings and it was not an order under the Arbitration Act and could not be an order under the Arbitration Act as there was no provision for making an order to return the award for being filed in the proper court as contained in Order 7, Rule 10 of the Code of Civil Procedure. Therefore, it is not an authority in this case when we are confronted with the question that when an order is made under the Arbitration Act, 1940, whether such order is appealable under Section 39 of this Act. In the case of Unit Construction Co. (supra), the Division Bench of this Court also noticed another decision of the Division Bench of this Court in the case of (19) Tobu Enterprises Pvt. Ltd. v. Cameo Industries Ltd., reported in AIR 1984 Cal 24 , where it was held that the order refusing to grant leave under Letters Patent on an application under Section 20 of the Arbitration Act, was not an order under the Arbitration Act, and therefore, whether it was appealable or not could only be considered in the context of clause 15 of the Letters Patent. But, in the instant appeal there is no doubt that the order under appeal as made under Section 41(b) of the Arbitration Act is an order under the Act, i.e. the Arbitration Act, 1940. If it is an order under the Arbitration Act, then it can only be appealable if it brought under the purview of Section 39 of the Arbitration Act". 33. It may be noticed that the Supreme Court of India in the case of (20) Upadhaya Hargovind Devshankar v. Dhirendrasinh Virbhadrasinhji Solanki & Ors., reported in AIR 1988 SC 915 while considering as to whether the appeal would lie against the order passed by a Single Judge before a Division Bench of the High Court under the Representation of People Act or not, held that such an appeal would not be maintainable in view of the constitutional provisions as also the provisions of the Representation of people Act and as such a Letters Patent appeal would be barred by necessary implication. In (21) R. v. Middlesex Justices., Ex Parte Schock, reported in (1965) 2 All ER 68, Queen's Bench Division held that the provisions of the Betting, Coming and Lotteries Act, 1963, is a self contained Code dealing with the procedure on appeal against the refusal of a betting licensing committee to grant a betting office licence. In this view of the matter, it must be held that the Arbitration Act, 1940 having laid down as to which orders would be appealable in terms of Sub-section (1) of Section 39 of the Act, no 'appeal' under clause 15 of the Letters Patent of this Court would lie which does not come within the purview of the clauses i to vi thereof. 34. For the reasons aforementioned, I have no hesitation in holding that the appeal preferred by the appellant is not maintainable and the question Nos. 2 to 5 referred to by the Division Bench must be answered in the negative. In this view of the matter the appeal is dismissed as not maintainable. In the facts and circumstances of the case, however, there will be no order as to costs. Misra & Nand, JJ.: I agree.