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1998 DIGILAW 419 (PAT)

LAXMI NARAIN SINHA v. UNION OF INDIA

1998-06-25

RADHA MOHAN PRASAD

body1998
ORDER Radha Mohan Prasad, J 1. In this appeal the appellant is aggrieved and dissatisfied with the quantum of amount awarded vide award dated 20th November, 1980 which has been made rule of the Court vide impugned Judgment and order dated 6-10-1997 passed in Title Suit No. 92 of 1976/184 of 1997 by the Subordinate Judge II, Patna. 2. The plaintiff-appellant entered into an agreement with the defendants-respondents for construction of buildings at Forbesganj. According to the appellant, he had to face difficulties in the construction work, on account of which he had to do extra work involving sufficiently high amount which is claimed to have been done by him under the orders of the authorities concerned. It is alleged that the payments were made to him by the defendants but at a very low percentage of his claim and this led to raising of the disputes by the plaintiff-appellant as per the terms of the agreement by filing the present suit for referring it to the arbitrator. An arbitrator was appointed who submitted his award dated 20th November, 1980 which has been made rule of the Court vide impugned judgment and, accordingly, decree has also been passed. The Union of India (defendant-respondent No. 1) had raised objection against the award and the same was rejected by the learned Subordinate Judge vide impugned judgment, against which they preferred Misc. Appeal No. 48/98 in this Court which has been dismissed vide order dated 10-4-1998. 3. The present appeal has been filed by the plaintiff who value the suit at Rs. 7,56,871/-. The award was allowed for Rs. 4,50,000/- and thus, the present appeal has been valued at Rs. 3,06,871/-. The Stamp Reporter in his report dated 13-1-1998 required the appellant to deposit Court-fee of Rs. 7,179.60 as per the said appeal valuation which has been contested by the appellant. On the request of the Court, learned Government Pleader accepted notice on behalf of the State vide order dated 1-4-1998 and, accordingly, learned Counsel for the appellant and the learned Government Pleader have been heard in the Court-fee matter. 4. Earlier this matter was heard and this Court vide order dated 24-4-1998, while adjourning the Court-fee matter on the request of the learned Government Pleader No. V, directed the Stamp Reporter to re-examine and make further report. 4. Earlier this matter was heard and this Court vide order dated 24-4-1998, while adjourning the Court-fee matter on the request of the learned Government Pleader No. V, directed the Stamp Reporter to re-examine and make further report. The Stamp Reporter on re-examining has reported that the instant first appeal does not appear to be maintainable, rather the miscellaneous appeal under Section 39(1)(vi) of the Arbitration Act, 1940 (hereinafter referred to as 'the Act') appears to be maintainable against the impugned order in which only fixed Court-fee is realised and as such realised of ad valorem Court-fee does not appear to be genuine. 5. Mr. Sinha, learned Counsel appearing for the appellant submitted that in view of the fact that in the present case a decree has been prepared pursuant to the impugned judgment, the present first appeal is maintainable as it is covered by Section 96 of the Code of Civil Procedure (hereinafter referred to as 'the Code') and not Section 39 of the Act, as reported by the Stamp Reporter. 6. According to the learned Government Pleader No. V, in the facts and circumstances of the case, the present appeal is barred under Section 17 of the Act under which no appeal lies if judgment is pronounced according to the award and upon the judgments so pronounced a decree follows except on the ground that it is in excess of, or not otherwise in accordance with, the award. It was submitted that the claim of the appellant in the present appeal is neither that the impugned judgment and decree is in excess of, or not otherwise in accordance with, the award. As such, the present appeal is barred under the aforesaid provision. In support of this he referred to a decision of this Court in the case of Sadhu Singh v. Ramdeo Singh (AIR 1943 Patna 318), which has been followed by a Division Bench decision of the Allahabad High Court in the case of Indian Minorals Co. v. N.I.L.M. Association (AIR 1958 Allahabad 692). 7. In the Patna case the appeal had arisen out of a partition suit in which a decree had been passed by the learned Subordinate Judge on the basis of an award. A question arose as to whether the first appeal against the said decree was maintainable. v. N.I.L.M. Association (AIR 1958 Allahabad 692). 7. In the Patna case the appeal had arisen out of a partition suit in which a decree had been passed by the learned Subordinate Judge on the basis of an award. A question arose as to whether the first appeal against the said decree was maintainable. The Division Bench or this Court, while dealing with the similar provision contained under Schedule 2, para 16 of the Code wherein it was provided that after an application for the setting aside an award had been refused and judgment pronounced according to the award no appeal shall lie from the decree which shall follow except insofar as the decree is in excess of or not in accordance with the award, held the appeal clearly incompetent. 8. The principle laid down in the said decision has been followed by the Division Bench of the Allahabad High Court in the case of Indian Minerals Co. (supra). In the said Allahabad case a question was raised that since the award has been assailed on the ground that it was in excess of the reference, the power of the Court lay within the ambit of Section 15 of the Act to modify or correct the award or within the ambit of Section 16 of the Act to remit the award or any matters referred to arbitration to the arbitrator for reconsideration, and since the Court did not see cause to remit the award or any of the matters referred to arbitration for a consideration or set aside the award and pronounced judgment in accordance with the award and a decree followed upon it, no appeal from such decree lay in view of the provision contained in Section 17 of the Act and consequently it was contended that the appeal was is competent. 9. On the other hand, in the said Allahabad case it was contended that the appeal was made under the express provisions of Section 39(1)(vi) of the Act which provides that an appeal shall lie from an order setting aside or refusing to set aside an award. 9. On the other hand, in the said Allahabad case it was contended that the appeal was made under the express provisions of Section 39(1)(vi) of the Act which provides that an appeal shall lie from an order setting aside or refusing to set aside an award. The Court, finding distinction between an appeal under Section 39 of the Act against an order passed under Section 30 and an appeal against decree passed under Section 17 of the Act, held that Section 39 is a specific provisions which provides for an appeal against certain orders of the Court, one of which is an order refusing to set aside an award. The Court in the said circumstances repelled the argument that a judgment having been pronounced in accordance with Section 17, no appeal lay. Accordingly, it was held that the grounds on which an appeal is allowed against an order refusing to set aside an award are limited, and the merits of the litigation between the parties cannot be raised. 10. According to the learned Counsel forth appellant, the present case is not governed by Section 39 of the Act. He, however, referred to a decision of the Delhi High Court in the case of Mangal Sen v. Union of India (AIR 1970 Delhi 44), and contended that the appeal against the award attracts fixed Court-fee under Article 11 of Schedule II of the Court-fees Act Ad valorem Court-fee on the basis of Section 8 not payable. 11. I am unable to appreciate as to how the said decision is of any help to the appellant. In the said case an award was made by the arbitrator appointed under Section 7 of the Resettlement of Displaced Persons (Land Acquisition) Act, 60 of 1948. The land of the appellant was acquired for the purpose of resettlement of displaced persons. A controversy arose relating to the quantum of compensation. Section 7 of the said Act lays down the method for determining the compensation for the land acquired under the Act under which where the amount of compensation can be fixed by the agreement it is to be paid in accordance with the agreement and where no such agreement can be reached, then the Provincial Government shall appoint as arbitrator a person qualified for appointment as a Judge of a High Court. As there was no agreement, the State Government appointed an arbitrator who made his award whereby he had fixed the compensation at Rs. 908/- as against sum of Rs. 38,530.12 claimed by the appellant. The appeal was preferred for enhancement of compensation under sub-section (3) of Section 7 and the memorandum of appeal was stamped with the fixed Court-fee of Rs. 5.25, to which a preliminary objection was raised by the State that the appeal is deficiently stamped and on this the High Court held that the appeal against the award attracts fixed Court-fee under Article 11 of Schedule II of the Court-fees Act and that ad valorem Court-fee on the basis of Section 8 not payable. In the said case, the question involved was not as to whether the appeal against the judgment itself in terms of the award was maintainable in view of the provisions contained in Section 17 of the Act. 12. Mr. Sinha, learned Counsel for the appellant then referred to a Division Bench judgment of this Court in the case of Union of India v. B.C. Basu (AIR 1983 Patna 25). I fail to appreciate as to how the said decision helps the appellant to maintain the present first appeal. The Division Bench in the said case has only taken note of the difference of opinion of various High Courts as to whether in appeal would lie where the decree has been passed by the Court without allowing the parties the full time (now within 30 days) for filing objection against the award and that the Courts are in unanimous that the an order confirming an award made before the expiry of the period for filing objection is without jurisdiction and revision is maintainable against it. Their Lordships, however, refrained from going into the detail as regards the maintainability of the appeal on such grounds. In the said decision this court only considered the question as to whether the right of appeal conferred by the legislature against the orders of the nature specified in Section 39 can be defeated only because a decree has been passed in terms of Section 17 of the Act. This court held that mere drawing up of a decree will not take away the right of appeal against the order. If the appeal against the order is allowed, the decree will automatically become inoperative. This court held that mere drawing up of a decree will not take away the right of appeal against the order. If the appeal against the order is allowed, the decree will automatically become inoperative. Their Lordships while noticing an instance that there may be cases where the Court passes a composite order which on the one hand dismisses the objections of the defendants to the award and, on the other hand, adopts the award and directs that the decree should be prepared in terms of the decree passed by it, held that such an order should be treated to be an order refusing to set aside an award and an appeal would be maintainable against the order under Section 39(6). 13. In the instant case, admittedly, no objection was filed on behalf of the plaintiff. The objection was only raised on behalf of the respondent-Union of India which has been rejected by the impugned judgment and the award has been made rule of the Court. Under such circumstances, in my opinion, it has rightly been contended by the learned Counsel for the appellant that an appeal under Section 39 is not maintainable. In fact, in the said Division Bench judgment itself the scope of Section 17 of the Act vis-a-vis Section 96 of the Code has been considered and it has held that under Section 96 of the Code all decrees are appealable as such. This section, however, makes a decree passed on the basis of an award, non-appealable unless it is (i) in excess of the award, or (ii) not in accordance with the award. Section 96 of the Code expressly gives a right to appeal from every decree passed by any Court exercising original jurisdiction unless such right is denied by any other law for the time being in force. Section 17 of the Act clearly denies the right to appeal against the decree like the impugned one except on the ground that it is in excess of, or not otherwise in accordance with, the award, or the one covered by Section 39 of the Act. 14. Thus, in my opinion, it has rightly been contended by the learned Government Pleader No. V that the present appeal itself is not maintainable and it is, accordingly dismissed with the liberty, however, to the appellant to avail any other remedy available to him in law. Appeal dismissed.