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1998 DIGILAW 1165 (MAD)

K. v. V. V. ELANCHEZHIAN VS K. V. V. CHOCKALINGAM

1998-08-31

K.GOVINDARAJAN

body1998
ORDER K. Govindarajan, J. - The second petitioner and the respondents are brothers. The first petitioner is the son of one K. V. Veeranan Ambalam, who is the another brother of the petitioner No. 2 and respondents 1 and 2. A dispute had arisen between them in respect of division of the properties. Arbitrators were appointed and the parties executed a Muchalika separately and handed over the same to the Arbitrators. On the basis of the same, the arbitrators also inspected the properties and after ascertaining the information from the third parties and considering the representations made by the parties, passed the award on 23-8-1995. The Arbitrators sent the copy of the award to the concerned parties by Registered Post with Acknowledgement Due. After receipt of the true copy of the award, the petitioners 1 and 2 filed the Arbitration O.P. in Ar. O.P. No. 42 of 1995 on the file of the Principal Sub-Court, Madurai. According to the petitioners since the opposite parties did not agree for the proposals suggested by the petitioners in accordance with the terms of the award, they were constrained to file the said Ar. O.P. The said Ar. O.P. was filed on 31-8-1995. Along with the said O.P., the petitioners filed an application in I.A. No. 453 of 1995 seeking an order of injunction. Notice in the said O.P. was ordered to the Arbitrators and to the respondents on 31-8-1995. According to the petitioners, the respondents entered appearance through their advocate Mr. T. R. Jeyapalan in the said I.A. on 8-9-1995. When the said O.P. was called on 20-9-1995 the advocate appearing on behalf of the respondents was on record, time was granted of file counter in the Ar. O.P., by 27-10-1995. Thereafter it was adjourned to various dates, namely, 15-12-1995, 4-1-1996 and 2-2-1996 for filing counter. On 2-2-1996 the respondents filed counter. Meanwhile, on 4-1-1996 the advocate for the Arbitrators filed the original award. The court granted time till 2-2-1996 for filing objections if any, and, it is stated that notice was taken by the other side. On 2-2-1996 the respondents filed a petition in Ar. O.P. No. 9 of 1996 to set aside the award. The petitioners filed I.A. Nos. 504 and 505 of 1997, requesting the court to decide the maintainability of the petition in Ar. On 2-2-1996 the respondents filed a petition in Ar. O.P. No. 9 of 1996 to set aside the award. The petitioners filed I.A. Nos. 504 and 505 of 1997, requesting the court to decide the maintainability of the petition in Ar. O.P. No. 9 of 1996, and to pass an order that the filing of objections by the respondents in Ar. O.P. No. 4 of 1995 is barred by Limitation, as the same has been filed, according to the petitioners, beyond the period of limitation as prescribed under Art. 119(b) of the Limitation Act. The said petitions were contested by the respondents. The court below in the order dated 23-7-1998 rejected the case of the petitioners and held that both the objections filed in Ar. O.P. No. 42 of 1995 and the petition in Ar. O.P. No. 9 of 1996 are well within the time, having been filed on 2-2-1996, in view of the fact that the original award was filed on behalf of the Arbitrators only on 4-1-1996. Aggrieved against the said common order, passed by the court below, the petitioners have filed the above revisions. 2. In the above revisions, the issue to be decided is whether the objections filed in Ar. O.P. No. 42 of 1995 and the petition filed to set aside the award, by the respondents are well within the period of limitation, as prescribed under Art. 119 of the Limitation Act. 3. According to the petitioners, the limitation starts at least from 20-9-1995 when the appearance of the counsel on behalf of the respondents was recorded by the court below in the O.P. On the other hand, according to the respondents, the limitation would start only from the date of filing of the original award by the Arbitrators, i.e., 4-1-1996. The learned senior counsel appearing for the petitioners has submitted that the notice in Ar. O.P. No. 42 of 1995 was given to the respondents through their counsel, and the copy of the petition was also served on the counsel, in which it is specifically stated that copy of the award has been filed along with the O.P. In spite of the same, the respondents did not avail of the opportunity for filing the objections to the award or the petition to set aside the award within the time stipulated. The learned senior counsel, to sustain his arguments that the copy of the award filed along with the O.P. has to be taken as the award was filed into court as contemplated under Section 14(2) of the Arbitration Act, has referred the clause in the award, to the effect that the petitioners were authorised to file such award. The said clause in the award runs as follows : .............. .............. .............. .............. Relying on this clause, the learned senior counsel has submitted that the petitioners are authorised to file the award into court for the purpose of getting a decree. Accordingly, the petitioners filed the said award along with the Ar. O.P. No. 42 of 1995, and the respondents had knowledge about the filing of the said award, at least on 20-9-1995. So, the petition filed by the respondents in Ar. O.P. No. 9 of 1996, to set aside the award was beyond 30 days and the same cannot be sustained. 4. Before appreciating the said argument, it is necessary to appreciate the scope of Section 14 of the Arbitration Act, which read as follows : "Award to be signed and filed sub-section : (1) When the arbitrators or umpire have made their award, they shall sign it and shall given notice in writing to the parties of the making and signing thereof and of the amount of fees and charges payable in respect of the arbitration and award. (2) The arbitrators or umpire shall, at the request of any party to the arbitration agreement or any person claiming under such party or if so directed by the court and upon payment of the fees and charges due in respect of the arbitration and award and of the costs and charges of filing the award, cause the award or a signed copy of it, together with any depositions and documents which may have been taken and proved before them, to be filed in court, and the court shall thereupon given notice to the parties of the filing of the award. (3) Where the arbitrators or umpire state a special case under Clause (b) of Section 13, the court, after giving notice to the parties and hearing them, shall pronounce its opinion thereon and such opinion shall be added to, and shall form part of the award." According to the said provisions, (1) the arbitrators are required to sign the award after the award is ready, and to give notice of the same to the parties; (2) the said notice should be in writing and should state that the award has been made and signed and the amount of fees and charges payable in respect of the arbitration of the award; (3) The arbitrators or the umpire are bound to file the said award itself or a signed copy of the same in the court along with the depositions if any which may have been reduced to writing by them and all the documents produced and proved before them; (4) Such a filing of the award and the documents by the arbitrators or umpire may be at the request of either party or any person claiming under such party or at the direction of the Court, and when the same is filed, notices, of the same shall be given to the parties by the court. 5. While dealing with this provision, the Apex Court has held in Kumbha Manji v. Dominion of India ( AIR 1953 SC 313 ), to the effect that under Section 14(2) of the Arbitration Act the actual filing of the award of the Umpire or the arbitrators is not necessary, and, it implies that where the award or a signed copy thereof is filed into court by a party have the authority of the umpire for doing so. That means party who has been empowered to file such an award into court by the arbitrators or umpire, the same can be filed into court. While holding so, the Apex Court in the decision cited supra has further held as follows : "Where, as in this case, the originals are said to have been handed over to both the parties, it cannot be assumed that the mere handing over of the awards to the parties necessarily implies the authority of the umpire to file the same into court on his behalf. The authority has to be specifically alleged and proved. The authority has to be specifically alleged and proved. In the present case the statement in the affidavit relied on by learned counsel before us is no more than an assertion that the umpire handed over the original awards to the appellant for filing, but there is no allegation that they were so handed over to him for filing on behalf of the umpire. The umpire may not have been aware that the awards should be filed into court only by himself or under his authority." 6. When similar issue came up for consideration from the Kerala High Court, the Apex Court in another decision in Food Corporation of India v. E. Kuttappan ( AIR 1993 SC 2629 = 1993(2) Arb. LR 266), has held as follows : "Assimilating the legal thoughts afore-expressed and applied to the facts afore stated, it becomes manifest that when the Arbitrator had sent the award and other papers to the respondent through his counsel; unless he had authorised the respondent for his counsel on his behalf to the filing of it in court, it cannot be assumed that when the respondent or his counsel filed the award and other connected papers in court it was not (sic) done for and on behalf of the arbitrator. Instantly it was the respondent who by his letter had requested the arbitrator to send to his lawyer the award for filing in into court and to whom the arbitrator obliged on such request. In our view, when the arbitrator chose to accede to the request of the respondent in specific terms, he by necessary implication authorised the respondent's counsel to file the award and the connected papers in court on his behalf. The law enjoined on the arbitrator to file the award in court for which purpose he could even be directed by the court. The obligation of filing the award in court is a legal imperative on the arbitrator. The agency of the party of its lawyer employed by the arbitrator for the purpose normally need be specific, but can otherwise be deduced, inferred or implied from the facts and circumstances of a given case. It needs, however, shading the impression that when a lawyer files the award in court when given to him by the arbitrator his implied authority to do so, shall not be presumed to exist. It needs, however, shading the impression that when a lawyer files the award in court when given to him by the arbitrator his implied authority to do so, shall not be presumed to exist. In the instant case, no one raised the plea that the filing of the award in court by the respondent's lawyer was without the authority of the arbitrator and the courts below were not engaged on that question. The matter was agitated on the basis of knowledge of award from the fact." 7. Even in the recent decision of the Apex Court in Secretary to Government of Karnataka v. Harishbabu ( AIR 1996 SC 3421 = 1996(2) Arb. LR 276), similar issue has been dealt with, which is as follows : "The issuance of a notice under Section 14(2) of the Act of the court is a mandatory requirement though the section does not prescribe any formal mode for the service of the notice. What is essential under the said provision is that there must be service of notice or intimation or communication of the filing of the award by the court to the parties, the mode of service of such a notice being immaterial. It is the substance and not the form of the notice which is relevant and once it is established that a notice or communication or information of the filing of the award has been issued by the court and served on the party concerned, the statutory requirements of Section 14(2) of the Act would stand satisfied. Keeping in view the difference in the phraseology of Sections 14(1) and 14(2) of the Act, it follows that the notice from the court under Section 14(2) of the need not be in writing. It can be oral also but what is necessary is that a notice, communication or information to the effect that an award has been filed in the court must be given by the court to the parties concerned Notice to the pleaders of the parties, who are representing the parties, before the court, would of course be sufficient compliance with the requirements of sub-section (2) of Section 14 of the Act. A notice by the arbitrator under sub-section (1) of the Act is not a substitute for the notice which the court is enjoined upon to issue under sub-section (2) of Section 14 of the Act. A notice by the arbitrator under sub-section (1) of the Act is not a substitute for the notice which the court is enjoined upon to issue under sub-section (2) of Section 14 of the Act. Where the arbitrator, himself files an award in the court, the court is bound to give notice to the parties that the award has been filed and the court cannot pass a decree in terms of the award, unless such notice has been served on the party concerned and till after the expiry of a period of 30 days from the date of service of such a notice as contemplated by Art. 119(b) of the Limitation Act, 1963. In a case where a party has knowledge aliunde of the filing of the award and seeks time to file objections to the award, absence of a normal notice from the court would be rendered immaterial and in such the date when the party enters its appearance and either through an application in writing or orally seeks time to file objections to the award, shall be deemed to be the date of service of the notice within the meaning of sub-section (b) of Section 119 of the Limitation Act read with Section 14(2) of the Act. However, where the order of the court merely records the presence of the parties or their counsel, after an award is filed by the arbitrator in the court, but does not indicate that the notice of the filing of the award has been given to the parties, no service of notice can be presumed from the order. No formality in the act of filing of the award in the court is required but what is required is that the filing of the award must be by or on behalf of the arbitrator and after the same has been filed the notice of the filing of the award must follow from the court under sub-section (2) of Section 14 of the Act. If an award is filed by one of the parties the authority of the arbitrator to the party concerned to file the award must be established that he had been so authorised by the arbitrator to file the award in the court. A plea to that effect must be found in the application which accompanies the award. If an award is filed by one of the parties the authority of the arbitrator to the party concerned to file the award must be established that he had been so authorised by the arbitrator to file the award in the court. A plea to that effect must be found in the application which accompanies the award. Such an authority has to be specifically alleged and positively proved otherwise the filing of the award in the court cannot be said to be by or under the authority of the arbitrator or the umpire as the case may be." From the abovesaid decisions it will be clear that the award can be filed either by arbitrator or by a party specifically authorised by the arbitrators or umpire. But the said authorisation should be pleaded and proved by the party concerned. 8. In the present case, to sustain the case of the petitioners that the award was filed in the court on behalf of the arbitrators, the learned senior counsel appearing for the petitioners, as stated above, has relied on the clause in the award which had been extracted above, but, there is no plea in the O.P. regarding the authorisation for filing the award. 9. While dealing with similar issue, as to whether such an authorisation is enough to file the award into court on behalf of arbitrator, without making any specific pleading regarding the authorisation on R. Balasubramanian, J., in the decision in Union of India v. M/s. Balaji Brothers ( (1998) 2 CTC 137 = 1998 (Suppl.) Arb. LR ....), has held as follows : "Though the arbitrator authorised the parties to the award to take appropriate steps for filing the award into court, yet I do not find, as submitted by the learned counsel for the revision petitioner, that such authority given by the arbitrator was not even pleaded in the plaint and proved in a manner known to law before the court." In view of the abovesaid decided cases, though such authorisation was given, in the present case, no pleading has been made to the effect that they have been authorised to file the award into the court for the purpose of passing the decree. So, in this case, it cannot be said that the filing of the award into court by the petitioners along with Ar. So, in this case, it cannot be said that the filing of the award into court by the petitioners along with Ar. O.P. No. 42 of 1995 is on behalf of the arbitrators and in accordance with Section 14(2) of the Act. Filing of the award by the petitioners, if it is not on behalf of the arbitrators on their authorisation, even if there is any knowledge of the respondents regarding such filing, it cannot be taken into consideration for the purpose of limitation under Art. 119 of the Limitation Act. 10. The learned senior counsel appearing for the petitioners has relied on the appearance of the learned counsel for the respondents on 20-9-1995 in the Ar. O.P. No. 42 of 1995 and submitted that the respondents took notice in the petitioner on 20-9-1995 and so the limitation starts from the date. According to the learned senior counsel, Section 14(2) of the Arbitration Act does not prescribe the specific form of notice, and even oral notice is enough. But, as discussed earlier, such a notice and knowledge cannot be construed as the knowledge and notice as contemplated under Section 14(2) of the said Act. The knowledge and notice can be referable only to the petition filed by the petitioners and not with respect to the award filed into the court by the arbitrators. Admittedly, the award was filed by the arbitrators. Admittedly, the award was filled by the arbitrators on 4-1-1996 only. 11. While construing the scope of notice under Section 14 of the Arbitration Act, the Apex Court in the decision in Secretary to Government of Karnataka v. Karishbabu (supra), has held that notice to the parties and pleaders who are representing the parties before the court would of course be sufficient compliance with the requirements of sub-section (2) of Section 14 of the Act. Relying on the said decision, the learned Senior Counsel for has submitted that the counsel for the respondents toom notice on 20-9-1995 and so the limitation starts from that date. But, while dealing with the scope of the notice, the Apex Court has held as follows : "The respondent also filed along with the petition a copy of the award dated 22-4-1993 but there is no averment in the petition that the arbitrator had authorised the respondent to file the copy of the award in the court. But, while dealing with the scope of the notice, the Apex Court has held as follows : "The respondent also filed along with the petition a copy of the award dated 22-4-1993 but there is no averment in the petition that the arbitrator had authorised the respondent to file the copy of the award in the court. Notice of the petition filed by the respondent was issued by the court to the appellant and other respondents on 24-4-1993 returnable by 22-6-1993. A perusal of the notice shows that let alone attaching a copy of the award there is not even an indicating therein that a copy of the award had also been filed with the petition. No. objections were invited by the court in the said notice to the award as such. On 23-6-1993 the Additional Government Pleader appeared for the appellant in response to the above notice. Since respondent 3, the sole arbitrator to the petition, had not been served the case was adjourned to 13-7-1993 without any further proceedings after record the presence of the parties present before the court." From the abovesaid decision it is clear that notice contemplated under Section 14(2) of the Arbitration Act is a notice in which the objection should be invited by the court to the award as such and not with respect to the petition filed by the petitioner. From the records available, I am able to see that the notice, as such, given to the counsel appeared for the respondents is not with respect to the award, but with respect to the petition filed by the petitioners. Merely because it is stated in the petition that the award also has been filed along with the petition, it cannot be said that the notice issue in the said petition is the notice as contemplated under Section 14(2) of the Arbitration Act. It is not in dispute that after the filing of the award by the arbitrators on 4-1-1996, the respondents took notice. 12. It is not in dispute that after the filing of the award by the arbitrators on 4-1-1996, the respondents took notice. 12. In view of the abovesaid discussions, the petitioners cannot take advantage of the filing of the singed copy of the award, along with the petition and contend that the award has been filed into court in accordance with the provisions of Section 14(2) of the Arbitration Act, when there is no pleading that they are duly authorised by the arbitrators to file such award into the court, so as to enable them to pass a decree. So, any notice with respect to the said proceedings cannot construed as the notice issued under Section 14(2) of the Arbitration Act. 13. In view of the above, the court below is correct in coming to the conclusion that the objections filed in the Ar. O.P. No. 42 of 1995 and the petition filed by the respondents in Ar. O.P. No. 9 of 1996 are well within the time. I do not find any merits in these revisions. Accordingly, they are dismissed. No costs. Consequently, C.M.P. No. 11279 of 1998 is also dismissed. Petition dismissed.