Bijoy Kumar Debnath v. New India Assurance Co. Ltd. , Silchar
1997-05-30
N.SURJAMANI SINGH
body1997
DigiLaw.ai
The order dated 24.5.1994 passed by the learned Assistant District Judge No. 1, West Tripura, Agartala, in Case No.TS (Arb) 18 of 1993 setting aside the award dated 8.2.1993 given by the learned Arbitrators and the Umpire is the subject matter under challenge in this appeal under section 39 (1) (vi) of the Arbitration Act, 1940. 2. The facts of the case in a short compass are as follows : The plaintiff/ appellant namely Sri Bijoy Kumar Debnath has a permanent business of purchasing and selling of cloths under relevant valid licence issued by the Sub Divisional Officer, Sadar, West Tripura, Agartala on and from 14.4.1985 atAmtali Bazar in a rented premise owned by Sri Tarani Mohan Ghosh with an initial capital of Rs.30,000/- (Rs. thirty thousand) only. In the said business, he insured the goods of all kinds of cloths and the readymade garments etc stored in his shop premises with the defendant/respondent, namely the New India Assurance Co Ltd for a sum of Rs. 1,50,000/- and accordingly the respondent-company issued a valid policy of insurance under No. 1153060500467 for a period of one year commencing from 5th March, 1990 upto 4th March, 1991, subject to the conditions laid down under the said policy with an assurance that the respondent-company would pay to the appellant/plaintiff the value of the insured properties in the event of loss or damage by fire as per policy. Unfortunately the shop premises of the plaintiff-appellant was gutted by fire on 14.10.1990. The Surveyor of the respondent/company, namely Sri AK Upadhaya, made official verification for the purpose of making assessment of damages, loss caused to the appellant/ plaintiff; and thereafter, the respondent-company offered Rs.80,150/- being the full and final settlement of the claim under its office letter dated 25.9.1991. But the appellant plaintiff expressed his inability to accept such an offer on the ground that the amount was much below the actual damages and informed the respondent-company, stating inter alia, that the stock-in-trade in his shop was valued at Rs. 1.48,265/- and the furniture was valued at Rs.5,800.10 and the total was Rs. 1.57.459.68, and he also claimed that he is entitled to full amount covering the policy.
1.48,265/- and the furniture was valued at Rs.5,800.10 and the total was Rs. 1.57.459.68, and he also claimed that he is entitled to full amount covering the policy. As the respondent-company did not make full and final settlement of the claim of the plaintiff, he served a notice on 26.12.1991 upon the respondent-company under clause 11 of the policy of the insurance to appoint a sole Arbitrator or constitute a Board of Arbitrators with an Umpire at head and to refer the dispute and difference to the sole Arbitrator or to the Board of Arbitrators as to the quantum of the damages to be paid under the said policy and. in response to the said notice, the respondent-company under its letter dated 26.6.1992 informed the appellant-plaintiff that one Mr. BB Dutta was appointed as Arbitrator by the respondent-company. Likewise the plaintiff-appellant also appointed Sri DK Biswas, learned Advocate, as Arbitrator, and both the learned Arbitrators appointed Mr. P. Bhattacharjee. learned Advocate, as Umpire. The appellant-plaintiff submitted his statement of facts and likewise the respondent-company also submitted its counter statements before the Board of Arbitrators. According to the respondent-defendant, the claim of the plaintiff-appellant is not at all maintainable in law and the defendant rather disputed the claim of the plaintiff and denied most of the allegations and statements made by the plaintiff, but the defendant-respondent admitted that the claim was settled at an amount of Rs.80.150/-'on25.9.91. which was refused by the claimant-plaintiff. It is also the case of the respondent-defendant that the claimant-plaintiff cannot be entitled to any amount beyond the amount already offered. In the said counter claim, the defendant contended that the illegal action of the claimant-plaintiff had caused damage to the defendant-company to the extent of Rs. 1 lakh, i.e. loss and damages of reputation and other losses of the time of the officials of the defendant-company. According to the respondent, one Sri PL Bakshi, Chartered Accountant. Jail Road. Silchar, was appointed to review the entire claim and reassess the entire loss and the said Sri PL Bakshi, in pursuance of its. submitted his report dated 18.7.1991 by quantifying the total loss at Rs.57.395/- only, but, the defendant-company upon consideration of the report of Sri PL Bakshi, and other relevant papers settled the claim at Rs.80,150/- only.
Jail Road. Silchar, was appointed to review the entire claim and reassess the entire loss and the said Sri PL Bakshi, in pursuance of its. submitted his report dated 18.7.1991 by quantifying the total loss at Rs.57.395/- only, but, the defendant-company upon consideration of the report of Sri PL Bakshi, and other relevant papers settled the claim at Rs.80,150/- only. After hearing the parties the relevant arbitration proceeding was disposed of with an award dated 8.2.1993 fixing the award/compensation to the tune of Rs.1.34 lacs and such interest as may be found due calculating at the rate of 12% PA for the period from the date of offer of Rs.80.150/- made by the defendant-insurance company till the date of payment. and also the cost of arbitration to the tune of Rs.6,427/- only. Thereafter the plaintiff-appellant filed a petition being case No. TS (Arb) 18 of 1993 to make the said award, which was published by the learned Arbitrators and the Umpire on 8.2.1993. a Rule of the Court, to which an objection petition was filed by the defendant-respondent over the award under section 33 read with section 30 of the Arbitration Act. After hearing the parties the learned Assistant District Judge No. 1, West Tripura. Agartala set aside the award dated 8.2.1993 by his judgment/ order dated 24.5.1994 passed in case No.TS (Arb) 18 of 1993. Being aggrieved by the said judgment/order dated 24.5.1994 passed by the learned Assistant District Judge No. 1. West Tripura, Agartala, the present plaintiff-appellant filed this appeal. 3. At the very outset Sri D. Chakraborty. learned counsel for the appellant, submitted that the impugned judgment/order dated 24.5.1994 is an illegal order inasmuch as there is no material for establishing the alleged biasness of the learned Arbitrators, rather such findings of the learned Court below is based on no evidence. There is no erroneous legal proposition in the award so as to enable the learned Court below to set aside the award, "Sri D. Chakraborty contended.
There is no erroneous legal proposition in the award so as to enable the learned Court below to set aside the award, "Sri D. Chakraborty contended. It is also submitted by Sri Chakraborty that even if the learned Court below found certain errors arising from the accidental slip or omission or whether the award contains any obvious error, the learned Court below ought to have amended the award without effecting such decision as required under section 15 of the Arbitration Act, but the learned trial Court below without considering the existing facts and circumstances of the case as well as the important materials available on record abruptly passed the impugned judgment/order. At the hearing Sri S. Roy. learned counsel for the defendant-respondent, argued that if the award is suffering from patent errors, the party can raise objection under section 30 of the Arbitration Act for setting aside the award, and as such the respondent-defendant raised objection under section 30 of the Act. Sri Roy. further, submitted that the plaintiff-appellant claimed Rs.5,800/- for loss of furniture due to fire accident but the learned arbitrators considered the said claim of the plaintiff and awarded Rs.6,000. Therefore, it is a misconduct of the Arbitrators; and as such the said award suffers from patent errors. That being the position the learned Court below rightly set aside the award Sri Roy contended. In support of his contention Sri Roy drew my attention to the decision of the Apex Court rendered in M/s Chahal Engineering and Construction Co vs. Irrigation Department, Punjab, Sirsa reported in AIR 1993 SC 2541 . 4. Now this Court is to examine as to whether the learned Court below rightly passed the impugned judgment/order dated 24.5.1994 in accordance with law or not and that, whether the impugned judgment/order suffers from any illegality or irregularity and whether the said award suffers from patent errors or not. 5. On perusal of the available materials on record it has been revealed that the plaintiff appellant submitted his claim for Rs.5.800.10 for the loss and damage of furniture, but the Arbitrators' awarded a sum of Rs.6,0007- as compensation for loss of 'FFF' (Furniture, fixture and fittings). From the survey report of Sri AK Upadhaya.
5. On perusal of the available materials on record it has been revealed that the plaintiff appellant submitted his claim for Rs.5.800.10 for the loss and damage of furniture, but the Arbitrators' awarded a sum of Rs.6,0007- as compensation for loss of 'FFF' (Furniture, fixture and fittings). From the survey report of Sri AK Upadhaya. Surveyor, and the Loss Assessor engaged by the .defendant-respondent to survey and assess the loss caused to the plaintiff-appellant it has been pointed out by the said Surveyor that the following are the 'FFF' stated to have been at the premises of the plaintiff-appellant which were gutted as per list which were purchased in 1985 with its cost without any depreciation and the salvages; 1. Wodden Racks 4 Nos Rs.4,000.00 2. Wodden Chowki 2 Nos Rs. 600.00 3. Wodden Show case 1 No Rs. 1,40(5.00 4 ***** 5 ***** 6. Wodden stools sunmica fitting 5 Nos Rs. 600.00 7. Wodden bench 1 Nos Rs. 1,400.00 Total Rs.8,000.00 6. It is an admitted and undisputed fact that the plaintiff-appellant was a bona fide insured and his stock of garments in the damaged premises along with furniture were under a valid policy of insurance, assured sum of which was Rs.1.5 lakhs; and that Amtali Market was gutted by fire in the small hours of 14.10.1990 in which the plaintiff's shop was also involved; and that the plaintiff sustained loss due to the fire accident for which he is entitled to be compensated by the defendant-respondent subject to the limits of the policy. On careful perusal of the relevant policy it has been revealed that the property insured are as follows : (1) Rs. 1,44.000/- (on goods or merchandise of all kinds of cloths and readymade garments). (2) Rs.6.000/- on business furniture. There is clear indication that the insured property, namely furniture, was for a value of Rs.6.000/- and from the report of the said Surveyor Sri AK Upadhaya. appointed by the defendant-respondent, it is established that the wooden furniture for valued Rs.8.000/- were gutted by fire at the relevant accident. However, from the award dated 8.2.1993 it is seen that the Arbitrators has come to the conclusion that the claimants/plaintiff/appellant is entitled to and the insurance company namely the New India Assurance Co Ltd (defendant/respondent herein) is liable to make payment to the extent of Rs.6.000/- for FFF (furniture, fixtures and fittings).
However, from the award dated 8.2.1993 it is seen that the Arbitrators has come to the conclusion that the claimants/plaintiff/appellant is entitled to and the insurance company namely the New India Assurance Co Ltd (defendant/respondent herein) is liable to make payment to the extent of Rs.6.000/- for FFF (furniture, fixtures and fittings). The main contention of the defendant-respondent is that the claim of the plaintiff/appellant for the loss and damages caused to furniture was valued at Rs.5,800.10. but the Arbitrators allowed the plaintiff/appellant for an entitlement of Rs.6.000/- which is meant for furniture, which is not permissible within the purview of the related policy as the policy speaks about only Rs.6.000/- on business furniture. For these reasons, in otherwords the omission and commission with certain irregularities, so to say. the learned Court below had opined that the learned Arbitrators illegally awarded Rs.6.000/- as compensation for FFF despite the existence of the factum of the claim of the plaintiff/appellant to the tune of Rs.5.800.10. After examining all these aspects I am of the view that the present award contains some obvious error which could be amended without affecting such decision of the Arbitrators and Umpire concerned inasmuch as that may be either clerical mistake or an error arising from an accidental slip or omission. Mention may be made that the related insurance policy speaks about the property insured which this Court indicated more in detail in above paragraphs. In otherwords the plaintiff-appellant is entitled to the extent of Rs.6.000/- on business furniture under the relevant policy. Mere mentioning of the figure, namely. FFF does not mean that the plaintiff-appellant shall be debarred from getting the benefit under the said insurance policy. At this stage I hereby recall the decision of the Apex Court rendered in Naraindas Lilaram Adnani vs. Narsingdas Naraindas Adnani & others reported in AIR 1995 SC 763 , wherein the-Apex Court held thus : "9. Under section 15 (b) of the Arbitration Act, 1940. the Court may, by order, modify or correct an award inter alia where the award is imperfect in form or contains any obvious error which can be amended without affecting such decision. Obviously the Court cannot substitute its own order for the award of the Arbitrator.
Under section 15 (b) of the Arbitration Act, 1940. the Court may, by order, modify or correct an award inter alia where the award is imperfect in form or contains any obvious error which can be amended without affecting such decision. Obviously the Court cannot substitute its own order for the award of the Arbitrator. But any obvious error in the award can be corrected by the Court provided it does not affect the decision given by the Arbitrator/' It is also well settled that an award cannot be amended on the ground of error on' the face unless some legal proposition is stated, which is the basis of the award and which one can then say is erroneous. The Court can either set aside the award or sustain the award or it can remit the award or act on the principle of severability, but it cannot amend the award and substitute its own decision in lieu of Arbitrator's decision. 7. From these principles of law laid down by the Apex Court, as discussed above, it is well established that if the mistake of the Arbitrator is allowed to stand as it is. it would clearly lead to further litigations amongst the parties, although their rights, inter se, are clearly decided by the Arbitrator. Therefore, such a mistake can be corrected under section 15 of the Arbitration Act. 1940. Be that as it may. in my opinion the learned Court below ought to have invoked the provisions of law laid down under section 15 of the Arbitration Act, 1940 and passed a reasoned order, thereby rectifying or amending a clerical mistake or an obvious error without affecting the decision arrived at by the Arbitrators after a protracted proceedings relating to the dispute amongst the parties concerned. Mere mentioning of the term or word/figure namely FFF under the award will not affect the merits of the case. There are ample evidence and materials on record for awarding a sum of Rs.6.000/- for the damages caused to the plaintiff-appellant in respect of his furnitures, as indicated above, and. rather, there is no bar on the part of the Arbitrators to enhance the claim-money made by the plaintiff-claimant in respect of the damages and loss to his furnitures even though he may claim a certain lower compensation of it.
rather, there is no bar on the part of the Arbitrators to enhance the claim-money made by the plaintiff-claimant in respect of the damages and loss to his furnitures even though he may claim a certain lower compensation of it. For the reasons and discussions made above, I am of the view that the learned Court below had completely misappreciated the entire evidence on record as well as the provisions of law as contemplated under section 15 of the Arbitration Act, 1940 while passing the impugned judgment/order. In the result the impugned judgment/order dated 24.5.1994 passed by the learned Assistant District Judge No. 1, West Tripura, Agartala, in case No.TS (Arb) 18 of 1993 is set aside, and make the award dated 8.2.1993 a rule of the Court. Considering the facts and circumstances of the case, this Court award a cost of Rs.5,000/- (Rs. five thousand) only which shall be paid by the defendant-respondent to the plaintiff-appellant within a period of one month from today. In the result this appeal is allowed.