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Shiv Kumar Agrawal v/s Jai Prakash Agrawala

    C.R. 1517 Of 2000

    Decided On, 17 March 2005

    At, High Court of Bihar

    By, THE HONOURABLE MR. JUSTICE S. NAYER HUSSAIN

    For the Appearing Parties: Shiv Nandan Roy, Pravina Kumari, Sidheshwari Pd. Singh, Krishna Kishore Sinha, Sunil Kumar Sharma, Mukesh Kumar Jha, Rama Sinha, Advocates.



Judgment Text

(1.) The petitioner was defendant No. 7 in Title Suit No. 172 of 1993, which was initiated at the instance of opposite party No. 1, who filed a petition on 23-12-1992 in the Court below under Sections 14 and 17 of the Arbitration Act, 1940 (hereinafter referred to as 'the Act' for the sake of brevity) for directing the Arbitrators to submit the award dated 10-12-1992 in the Court and to pass a judgment in terms of that award. The said petition was converted into a suit bearing Title Suit No. 172 of 1993 by the learned Court below on 21-8-1993.

(2.) The short fact of the case is that the properties involved were joint family properties and all the parties referred the matter to two Arbitrators as per their arbitration agreement dated 1-10-1992 for partition of those properties, whereafter the said Arbitrators prepared their award on 10-12-1992. ' After filing of the petition under Sections 14 and 17 of the Act by the Plaintiff on 23-12-1992 the learned Court below sent notices to the Arbitrators on 18-2-1993, whereafter the Arbitrators filed their award with all the papers and documents in the Court on 1-5-1993. After receipt of the award the Court below issued notices to the defendants on 3-7

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-1993, which were received by defendant No. 4 on behalf of all the defendants including defendant No. 7 (petitioner) and the Court vide its order dated 17-7-1993 held that notices have been duly served upon the defendants and thereupon on 21-8-1993 converted the said petition into a suit bearing Title Suit No. 172/1993.

(3.) Defendant Nos. 1, 4, 5, 6, 7, 11, 12, 13 and 14 appeared in the suit on 7-9-1993, whereafter defendant Nos. 2, 3, 8, 9 and 10 also appeared and filed their written statements on 30-9-1993. However, much later on 5-4-1994 defendant No. 7 (petitioner) filed his objection to the award but the said petition was never disposed of and ultimately on 1-7-1995 a compromise petition was filed by 3rd set, namely, defendant Nos. 4, 11, 12 and 14 and 4th set, namely, defendant Nos. 3 and 10 and accordingly by the impugned order dated 11-7-2000 Title suit No,. 172 of 1993 was decreed making the award rule of the Court with modification as per the compromise arrived at between 3rd set and 4th set.

(4.) The said award has been challenged by the petitioner-defendant No. 7 on various grounds. The first ground raised by the learned counsel for the petitioner is that the award cannot be legally made the rule of the Court on compromise only between some of the parties to the suit. His second ground is that Section 41 of the Act specifically states that provision of the Code of Civil Procedure, 1908 (hereinafter referred to as 'the Code' for the sake of brevity) shall apply to all the proceedings under the Act, whereas Section 141 of the Code provides that procedure provided in the Code in regard to suits shall be followed as far as it can be made applicable in all proceedings in any Court of the civil jurisdiction, hence the procedure of the Code including the provisions of Order XXIII, Rule 3 of the Code should have been applied by the learned Court below, according to which such compromise should not have been allowed. The third contention of the learned counsel for the petitioner is that no notice under Section 14(2) of the Act was ever issued to the defendants after filing of the award, hence the specific provision of law having not been complied with, the entire proceeding had become infructuous as mere appearance was not sufficient. On this point he relied upon two decisions of the Hon'ble Apex Court in the cases of Secretary to Govt. of Karnataka v. Harishbabu reported in (1996) 5 SCC 400 : (AIR 1996 SC 3421) and East India Hotels Ltd. v. Agra Development Authority reported in, (2001) 4 SCC 175 : (AIR 2001 SC 1481). In this connection he has also submitted that there is no order of the learned Court below which showed that notices be issued as award has been filed, hence there was clear violation of Section 14(2) of the Act. The last contention of the learned counsel for the petitioner is that the Court ought to have considered the objection to the award already filed by defendant No. 7 (petitioner) who was admittedly not party to the compromise but the learned Court below decided the matter without even realising that there was a clear objection to the award by a necessary party to the suit. He has further submitted that even if there was no objection, the Court below should have applied its mind to the validity of the award as well as of the compromise petition but by the impugned order the learned Court below, without applying its mind, made the award rule of the Court, which according to him was against the specific provisions of law including the decision of the Hon'ble Supreme Court in the case of Union of India v. Manager, M/s. Jain and Associates reported in (2001) 3 SCC 277 : (AIR 2001 SC 809). In the aforesaid circumstances, the learned counsel for the petitioner has submitted that the impugned order of the learned Court below is illegal, arbitrary and perverse.

(5.) On the other hand, learned counsel for the opposite party No. 5 contested the claim of the petitioner on various grounds, which were also adopted by the learned counsel for opposite parties Nos. 3, 4, 9, 10, 11, 12 and 14. The first contention of the learned counsel for the said opposite parties was that by the impugned order the award was not made rule of the Court merely on the basis of compromise between some of the parties, rather by clause 1 l(b) of the award itself 3rd set and 4th set were given the option to get the matter settled among themselves for utilising the properties and managing the business allotted jointly to them inter-se and accordingly when the said 3rd set and 4th set filed their compromise inter-se for the properties/business allotted jointly to them only, the Court had no option but to accept the compromise and make the award rule of the Court accordingly. The second contention of the learned counsel for the opposite parties was that the award was registered and notified and thereafter it was filed in Court, due to which there was a genuine presumption in law that all the parties who had referred the matter for arbitration had full notice and information of the said award. He further claimed that the award was filed by the Arbitrator in the Court on 1-5-1993 and notices were issued to the opposite parties on 3-7-1993, whereafter all of them appeared in September, 1993, hence there was obviously full intimation about the award to the defendants and also full compliance of the provision of Section 14(2) of the Act, as has been held by the Hon'ble Supreme Court in the case of Nilkantha Sidramappa Ningashetti v. Kashinath Somanna Ningashetti reported in AIR 1962 SC 666. The third contention of the learned counsel for the opposite parties was that admittedly the petitioner defendant No. 7 appeared in the suit on 7-9-1993 and filed his objection to the award after seven months on 5-4-1994, although the limitation prescribed in law for the same, according to Section 37 of the Arbitration Act and Article 119(b) of the Limitation Act, is only 30 days from the date of service of notice about filing of the award but the defendant- petitioner did not file any petition for condoning the delay, hence there was no occasion for the learned Court below to consider the said objection of the petitioner as is apparent from the order sheet of the suit. The fourth contention of the learned counsel for the opposite parties was that when objection to the award was not filed by any one within the prescribed time the award became final as per Section 17 of the Act and the Court had no option but to pronounce the judgment as per the award. In this connection he relied upon a decision of the Apex Court in the case of Madan Lal (dead) by his legal representative v. Sunder Lal reported in AIR 1967 SC 1233. The last contention of the learned counsel for the opposite parties was that the suit remained pending for about six years after filing of objection by the petitioner-defendant No. 7, who never pressed his said objection petition and did not raise any objection to the compromise petition dated 1-7-1995 filed by the 3rd set and 4th set, hence there was no occasion for the learned Court below to keep the matter pending for any further period, specially when some of the parties to the suit filed petition dated 7-6-2000 in the Court below praying therein that the suit be decided expeditiously, but even then the petitioner- defendant No. 7 did not wake up from his slumber. Hence the learned counsel for the opposite parties has submitted that the impugned order of the learned Court below is valid, legal and proper and requires no interference,

(6.) Alter hearing the learned counsel for the parties and after perusing the materials on record, it is quite apparent that the case laws cited by the learned counsel for the petitioner, namely, Secretary to Govt. of Karnataka (AIR 1996 SC 3421) (supra) and East India Hotels Ltd. (AIR 2001 SC 1481) (supra) did not at all support his case as by the former it was held that no formal mode for service of notice was required and what was essential was that some notice or intimation of the filing of the award be issued by the Court to the parties, whereas in the latter it was held that even notice under Section 14(2) of the Act need not be in writing. Furthermore, the Court below had sent notices to the defendants after the submission of the award, which fulfilled all the requirements of Section 14(2) of the Act. Hence, I hereby hold that notices issued to the defendants on 3-7-1993, after the award was filed by the Arbitrator on 1-5-1993, was valid notice as per the provision of Section 14(2) of the Act as thereafter all the defendants including the petitioner appeared in the suit and filed their respective petitions.

(7.) It is also apparent from the records that the petitioner-defendant No. 7 filed objection to the award on 5-4-1994 without filing a petition for condoning the delay although the objection was filed after seven months of his appearance, whereas the limitation prescribed is only 30 days. Irrespective of the aforesaid facts, it is clear that the petitioner-defendant No. 7 never pressed his objection petition dated 5-4-1994 all through the pendency of the suit (for six years), which fact is apparent from the order-sheet itself and also did not respond even to the compromise petition dated 1-7-1995 filed by defendant Nos. 3 and 10 and defendant Nos. 4, 11, 12 and 14 as well as to their petition dated 7-6-2000 for early disposal of the suit. Hence in the aforesaid facts the case law relied by the petitioner in the case of Union of India (AIR 2001 SC 809) (supra) was not at all applicable and the learned Court below had no occasion to consider the objection petition filed by the petitioner and it had to pronounce the judgment as per the award, specially in view of the decision of the Apex Court in the case of Madan Lal (AIR 1967 SC 1233) (supra).

(8.) It is an admitted fact that due to family dispute all the parties referred the matter to the two Arbitrators as per their arbitration agreement, whereafter the Arbitrators prepared the award, got it registered and notified and filed the same in the Court below and allotted different pieces of properties and business to different sets of persons. Clause 11(b) of the said award specifically provided that the properties/business jointly allotted to 3rd and 4th sets can be settled inter-se among themselves for managing and utilising the same. Hence the petitioner-defendant No. 7 had no say in the said properties/business allotted to 3rd and 4th set as he was not included in either of the said two sets. In the aforesaid circumstances, the learned Court below rightly made the award rule of the Court with modification as per the compromise between 3rd set and 4th set, which also was in accordance with the clauses of the award itself.

(9.) In the aforesaid circumstances, I do not find any illegality or jurisdictional error in the impugned order, which thus requires no interference. This civil revision is. accordingly, dismissed. Revision dismissed
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