Judgment : 1. The Petitioners have challenged Award dated 20 February 2010/6 October 2010 passed by Respondent No.2’s Sub-Committee being an Arbitral Tribunal, thereby ordered in the following terms against the Petitioners: “M/s. Empire Estate (M/s. Rumanek Estate Pvt. Ltd.) A/c. New Empire Cinema, Mumbai should pay a sum of Rs.16,66,964.86 to M/s. Pushpam Enterprises, Mumbai, being the balance dues within 15 days on intimation failing which M/s. Empire Estate (M/s. Rumanek Estate Pvt. Ltd. ) A/c. New Empire Cinema, Mumbai shall be declared as Defaulter.” 2. Some time in the year 1997, one Roosi K. Modi advanced a loan of Rs.20,00,000/(Rupees twenty lacs) on interest to Respondent No. 1 for renovation of New Empire Cinema. On 11 January 2002, a request was made to waive the interest. The same was acceded to. It was not paid. On 9 February 2006 letter was sent to Respondent No.1 to repay the amount. There was no response. Therefore, a complaint was filed with Respondent No.2 for a sum of Rs.16,86,837/on 17 August 2006. Respondent No.2 is an Association having object to promote, aid, help and encourage and develop in all possible ways the trade of exhibiting motion pictures. Respondent No.2 therefore called upon the Petitioners to settle the dispute within 15 days failing which they would refer the mater to the Dispute Committee for adjudication, based upon their dispute resolution Sub-Committee rules. Petitioner No.2 pointed out to Respondent No.2 that an amount of Rs.19,872.80 pertaining to distributor’s dues against the exhibition which was payable to Respondent No.1 and the same had been finally settled on 28 August 2006. It was also pointed out that other claims of Respondent No.1 did not pertain to distributor’s share of money. Respondent No.1, though accepted the same, still insisted that the other claims need to be settled through the arbitration as it was never disputed by Petitioner No.2. Respondent No.2 therefore issued a notice called upon the Petitioners to settle the matter and for that a meeting was held on 13 December 2006. Petitioner No.2’ Advocate, in view of above notice dated 5 December 2006, asserted that they have no jurisdiction or authority to try such complaint under the Rules. As the Advocate was not permitted, Respondent No.2 intimated to Petitioner No.2 that the said letter would be placed before the Committee. Petitioner No.2’ Advocate, in view of above notice dated 5 December 2006, asserted that they have no jurisdiction or authority to try such complaint under the Rules. As the Advocate was not permitted, Respondent No.2 intimated to Petitioner No.2 that the said letter would be placed before the Committee. By a letter dated 11 December 2006, by Roosi K. Modi to Respondent No.2, informed about an outstanding amount of Rs. 20 lacs due from Respondent No.1. 3. It was insisted that Respondent No.2 is empowered to decide the complaint by further stating that Petitioners 1 and 2 were one and the same. A request was made by letter dated 6 August 2007 to Respondent No.2 to hear both the complaints together. On 7 August 2007, a meeting of Sub Committee was held. By letter dated 29 August 2007, it was recorded that the amount would be paid directly to Roosi K. Modi by Petitioners 1 and 2. Respondent No.1 also addressed a letter to Respondent No.2 to withdraw the complaint against the Petitioners. The similar letter was sent also by Roosi Modi to Respondent No.2. On 19 April. 2008 Mr. Burjor Cooper admitted to the partnership of Petitioner No.1 and Roosi K. Modi retired as a partner. On 18 August 2008, a request letter by Respondent No.1 to Respondent No.2 to restore the complaint dated 17 August 2006 and a reference was made about a Summary Suit No.2281 of 2008 filed by the said Roosi K. Modi in Bombay High Court. 4. Respondent No.2 called upon the parties to submit the relevant papers. Roosi K. Modi addressed a letter directly to Respondent No.2 objecting to the adjudicating of the amount. The intimation was sent on 16 October 2008, by the Sub Committee’s meeting on 7 November 2008. 5. On 1 December 2008, a meeting took place and the Sub Committee refused to reopen the complaint by further recording that a transaction between Respondent No.1 and Petitioner No.1 was a loan transaction and not connected with the distributor’s dues and/or film dues and further that Petitioner No.1 did not have any film distribution agreement with Respondent No.1. Again Respondent No. 1 issued letters on 31 July 2009 to settle the matter amicably. 6. Respondent No.2 on 10 August 2009, called upon the Petitioners to attend the Sub Committee meeting. Another meeting was fixed by letter dated 10 September 2009. Again Respondent No. 1 issued letters on 31 July 2009 to settle the matter amicably. 6. Respondent No.2 on 10 August 2009, called upon the Petitioners to attend the Sub Committee meeting. Another meeting was fixed by letter dated 10 September 2009. Roosi Modi submitted not to adjudicate the dispute between Respondent No.1 as the matter was pending in the High Court. Respondent No.1 again pointed out by letter dated 13 September 2009 that the complaints once withdrawn could not be entertained again. However, Respondent No.1 addressed a letter to Respondent No.2 dated 23 November 2009, contending that once dispute has been referred to arbitration before Sub Committee, the parties are precluded from agitating from such dispute before any other form. The Sub Committee by letter dated 5 January 2010 called upon the parties to appear by reopening the matter. The meeting was held on 13 January 2010. Petitioner No.1 requested Respondent No.2 to provide reasons for reopening of the complaint. By letter dated 23 January 2010 and also asked for contents of Respondent Nos.1’s letter dated 23 November 2009. The correspondences were exchange for details of the documents. Respondent No.2 by letter dated 29 January 2010 directed the Petitioners to get the copies of civil matters from the Court but insisted to appear before the Committee on 9 February 2010. The Petitioners requested to postpone the matter. The same was opposed. The meeting of Sub Committee was held on 9 February 2010. The Petitioners again objected for want of jurisdiction, authority to adjudicate the complaint. 7. The Sub Committee (The Arbitral Tribunal) by impugned Award without assigning reasons and even without taking note of above facts and objections, passed the Award against the Petitioners by accepting the case of Respondent No.1. 8. Mr. Cooper also placed on record a letter dated 9 February 2010 objecting to the jurisdiction in view of the bye/laws/articles of association itself specifically Article 33 read with Article 22 and he also requested to examine the matter in detail concerning the statements of all the parties. 8. Mr. Cooper also placed on record a letter dated 9 February 2010 objecting to the jurisdiction in view of the bye/laws/articles of association itself specifically Article 33 read with Article 22 and he also requested to examine the matter in detail concerning the statements of all the parties. The Arbitrator read those letters, but without assigning detailed reasons based upon the letter dated 24 July 1990 held that they have power to adjudicate the matter of the complaint from its members and relying on the letter dated 5 February 2010 placed by Respondent No.1 to expedite the matter passed the Award as recorded above only by observing “After hearing both the parties at length discussed the Committee passes the following order”. No reason whatsoever is given by the Arbitrator to the objection so raised by the parties basically with regard to the jurisdiction and authority. The reference was made both to the letter dated 24 July 1990 but there was no justification and/or contents of the same letters were recorded before passing the Award. 9 The Arbitral Tribunal as recorded Sahyadri Earthmovers vs. L & T Finance Limited & anr. 2011 (4) Mh. L.J. 200, in my judgment are bound to follow the basic procedure of laws: Equal and fair treatment (xvii)The Arbitrator must give equal opportunity to both the parties and, therefore, bound to follow the principles of natural justice, fair play and equity. CPC & Evidence Act (xviii) Though Code of Civil Procedure and the Evidence Act are not applicable strictly, (Section 19), but the settled principles do apply. The power of Arbitral Tribunal to determine the admissibility, relevance, materiality and weight of any evidence just cannot be over looked. To decide jurisdiction: (xix)The Arbitrator is empowered to decide his own jurisdiction if objected and even the issue of existence of arbitration agreement (S/16). It should be decided as early as possible by passing reasoned order, as this could be additional ground of challenge u/Section 34 of the Arbitration Act. Substantial laws-customs-commercial usages and practice (xx)The Arbitrator is bound by the substantive laws of the land as well as procedural laws and practice and principle apart from the custom and usage of the trade referring the business and commerce between the parties, in all respects. Substantial laws-customs-commercial usages and practice (xx)The Arbitrator is bound by the substantive laws of the land as well as procedural laws and practice and principle apart from the custom and usage of the trade referring the business and commerce between the parties, in all respects. To Analyse the evidence and the record (xxi)The Arbitrator is required to consider all the material and evidence/documents placed by the parties on record read with the evidence led by the parties. The Arbitrator is, therefore, bound to analyse and appreciate the same by giving proper and correct interpretation of terms of the contract subject to provisions of law, before passing reasoned interim or final award. The Arbitrator to pass reasoned interim and/or final award, unless agreed otherwise. To award interest-pre-post-future-interest-as agreed if not as per the law (xxii)The Arbitrator is required to consider/grant pre/post, pending and future interest as contemplated under Section 31 of the Arbitration Act. The Doctrines to be followed (xxiii)The Arbitrator cannot disregard the substantive and procedural law. The Arbitrator is therefore bound to take note of law; of interpretation, precedent, obiter dicta, ratio decidendi, Estoppel, acquiescence, waiver and res judicata, public policy, natural justice, fair play and equity. The communication/service of the award/interim or final. (xxiv)The Arbitrator, if other side is absent, needs to send/serve a copy of the signed arbitral award as per the law so that the aggrieved party may take appropriate steps to challenge the same within limitation and as it is also enforceable, executable like decree. (xxv) The Arbitrator, if application is moved, may correct an error or clarify the award, as contemplated under Section 33 of the Arbitration Act.” 10. In the present case, there is nothing pointed out that the parties have agreed that the Award can be passed by the Arbitrator without assigning any reason. Therefore, in the absence of any such agreement, the Arbitrator, Sub Committee ought to have given reasons before passing and communicating the Award to the Petitioner. The issue of jurisdiction ought to have been adjudicated first before proceeding with the merits of the matter. The Sub Committee has not even discussed the same before passing the Award. The pendency of the matter in the High Court was just overlooked specifically when the contentions were raised in this regard. The issue of jurisdiction ought to have been adjudicated first before proceeding with the merits of the matter. The Sub Committee has not even discussed the same before passing the Award. The pendency of the matter in the High Court was just overlooked specifically when the contentions were raised in this regard. There are no reasons why the Petitioners are liable to pay the said payment in view of the above background and facts. The Sub Committee ought to have given reasons of reopening of the matter once it was withdrawn. It was a case of claim or counter claim, the direction only against the Petitioners by overlooking its case and the background so referred above, in my view, also shows non-application of mind. The Sub Committee ought to have assigned the reason, in view of the specific objection with regard to the jurisdiction and authority to settle such disputes but he same is also missing in the present case. 11. Strikingly, in the present case, the communication dated 20 December 2010 (Exhibit A) was issued by the Secretary of Respondent No.2 intimating the operative part of the Award. The Petitioners, accordingly, lodged and filed Section 34 Petition treating the same as Award dated 20 February 2010. Since there was no actual copy of the Award received on 5 March 2010, this Court, in view of the nature of the Award itself, admitted the matter and made returnable on 5 April 2010 and passed the reasoned order to protect and stay further execution of the same. 12. The learned senior counsel appearing for the Petitioners pointed out and placed on record a letter dated 6 October 2010 received by the Petitioners whereby copy of the Award was forwarded by Respondent No.2. The same is placed on record. The said communication/Award is taken on record and marked “X”. The Award is signed by four members. The basic reasons, as recorded in the Award to grant the amount so claimed is reproduced as under: “B) From the documents submitted by the Complainant along with the complaint in support of his claim it is clear that the amount of Rs.16,86,837.66 was payable by the Respondents to the Complainant. It is no where denied by the Respondents that the said amount was payable by them to the Complainant. It is no where denied by the Respondents that the said amount was payable by them to the Complainant. After filing of the complaint an amount of Rs.19,872.80 was paid by the Respondents leaving a balance sum of Rs.16,66,964.86 as payable to the Complainant.” It is further clear that the procedure adopted by Respondent No.2 in dealing with arbitration proceeding is apparently illegal and unacceptable. The detailed Award as received by letter dated 6 October 2010 was passed after the High Court Order dated 5 March 2010 but again without assigning the reasons in view of the objections so raised by holding that there is no denial by the Respondents about the sum due and payable to the complainant. The Arbitrators even by this order, no where dealt with the objections that there was no valid and binding arbitration between the Petitioners and Respondent No.1 and, therefore, Respondent No.2 Sub Committee had no jurisdiction to pass such Award. Any undisclosed letter of Executive Committee dated 24 July 1990 cannot create an agreement between the parties. In the absence of any arbitration agreement the initiation of arbitration proceeding and so also the Award itself is without jurisdiction and it is nullity. 13. It is relevant to note that Award is signed by four members only. The requirement under the Arbitration Act is of an even number of Arbitrators. In the present case, as referred, it ought to have been one or three or between five to thirteen in number. 14. The Executive Committee, based upon the Resolution and/or byelaws ought to have been given the reasons that such loan transaction falls within the ambit of “in respect of the execution and/or distribution or any related nature of disputes”. The Award so passed and the procedure which the Arbitral Tribunal has followed is totally against the principles of natural justice and also against the expected fair and due trial. 15. The principle of law of limitation, in the present facts and circumstances ought to have been recorded by the Tribunal before Awarding such claim against the Petitioners on the basis of complaint dated 17 August 2006, which was apparently time barred. 16. The Arbitrator ought to have considered the pendency of the dispute between Roosi Modi and Respondent No.1 in respect of Rs. 20 lacs. All these disputes were interlinked and a request was made to combine and give joint hearing. 16. The Arbitrator ought to have considered the pendency of the dispute between Roosi Modi and Respondent No.1 in respect of Rs. 20 lacs. All these disputes were interlinked and a request was made to combine and give joint hearing. The Tribunal committed further illegality by overlooking the totality of the matter and by holding that there was no denial to the liability by the Petitioners, specifically when Roosi Modi was not a party to the dispute and/or arbitration agreement even if any. 17. It is apparent that the operative part of the Award to pay the amount within 15 days of intimation is contrary to the provisions of Section 34(3) of the Arbitration Act. The mandate of Section 34(3) of Arbitration Act just cannot be overlooked by any Arbitral Tribunal. The aggrieved person/party has statutory right to challenge the Award within the given period. Such Award, therefore, unless attained finality as contemplated under Section 36 of the Arbitration Act is unenforceable. Therefore, the direction and threat so issued to comply with the order within 15 days was apparently contrary to the law. The Petitioner has no choice but to file present Petition on the receipt of such conditional operative part of the Award. 18. Resultantly, the Award dated 9 February 2010 communicated firstly by letter dated 20 February 2010 and subsequently signed order by letter dated 6 October 2010, by Respondent No.2 is quashed and set aside. The Petition is accordingly allowed. There shall be no order as to costs.