UNION OF INDIA Vs. AMERICAN STORES
LAWS(P&H)-1957-2-2
HIGH COURT OF PUNJAB AND HARYANA
Decided on February 12,1957

UNION OF INDIA (UOI) Appellant
VERSUS
AMERICAN STORES Respondents

JUDGEMENT

Bishan Narain - (1.) IN November 1947 the Government of INdia invited tenders for the purchase of certain American surplus foodstuffs which were lying at three depots viz. Northbrook Depot, Lybion Depot and Gangalbuoy Depot. The American Stores, a partnership firm, offered Rs. 4,17,000/15/3 for the entire stock on the basis of certain valuations and calculations and this tender was accepted by the Government on the 22nd of December, 1047. Possession of the stock was delivered to the firm in due course. The firm removed certain quantities of these goods, but then the Medical Authorities. Calcutta, intervened and declared certain stores to be unfit for human consumption. Thereupon disputes arose between the purchasers and 'the Government and the parties by document dated the 6th of July, 1950 entered into an arbitration agreement. Under the agreement the Government appointed Bakhshi Shiv Singh and the firm appoint' ed Raizada Narsingh Das Bali as arbitrators. The latter, however, refused to act and INdar Singh was appointed an arbitrator in his place by the firm. Proceedings were taken by the arbitrators and the firm claimed Rs. 6,13,817 as damages. The arbitrators failed to agree and the case was forwarded on the 24th of September, 1951 to Diwan Hukam Chand a retired Magistrate, who had been previously appointed as an umpire by the arbitrators. Thereafter the Government counter-claimed rent for godowns and for this claim Diwan HuKam Chand was appointed as the sole arbitrator by the parties. The umpire entered into reference on both the matters and decided the disputes by separate awards given on the 28th of August 1952. The umpire awarded Rs. 6,05,215 to the American Stores and rejected the counter-claim of the Government. The umpire sent an intimation of the awards to the counsel for both parties. It is not necessary to refer to the proceedings relating to the Government's counter-claim as it is not before me and the Government has not filed an appeal against the order of the trial Court making that award a rule of the Court which allowed costs to the firm.
(2.) ON the 14th of October, 1952, the American Stores made an application in Court under Section 14 of the Arbitration Act for a direction to the umpire to file the award in Court with all the documents and record of proceedings and thereafter to make it a rule of the Court. After the award etc. had been filed in Court, the Government filed objections to the award inter alia on the grounds that (1) the umpire was guilty of misconduct as he had been approached by the claimants, (2) the umpire had not produced the real award in Court which he had already sent to the Government, and (3) in any case the award is against law on the face of it. The other objections raised by the Government before the trial Court were not pressed and were also ignored in this Court. The trial Court" overruled all these objections and ordered the award to be made a rule of the Court. The Government has filed' this appeal in this Court to, get the award set aside. The learned counsel for the Government frankly conceded before me that there is no 'evi- dence in support of issue No. 2 which relates to the misconduct of the umpire. The Government had only questioned the umpire on this matter who denied that he had been approached by the respondent firm or its partners. This issue was therefore rightly decided against the Government by the trial Court. The learned counsel for the Government strenuously urged before me that the umpire had not produced the real award in Court and that another document had been produced in Court which was not the real award. This objection arises in the following circumstances. The umpire has filed a short award bearing a stamp of Rs. 75/-(Exhibit Order 2). It is dated the 28th of August, 1952. It is proved on the record that on the 2nd of September, 1952, the umpire sent a letter (Exhibit Order3) to the Government which was signed on the 28th of August, 1952, and therewith was enclosed a document dated the 28th August, 1952 (Exhibit Order 1) which runs into 82 typed pages and discusses the merits of the case in detail. The argument is that Exhibit Order l is the real award and that after the umpire had signed it he had become functus officio and could not give another award (Exhibit Order 2) which he has filed in Court. It is, therefore, necessary to determine whether the umpire's real award was the document Exhibit Order 1 or the document, Exhibit Order 2.
(3.) NOW, the covering letter recites the fact that he had been appointed an umpire in one " case and the sole arbitrator in Government's counter-claim and gives the amounts that he had awarded to the firm. The letter then proceeds to say. "These awards were formal and short. Besides I am sending informally my findings in each of the two cases, covering 82 pages and four pages respectively. I know I was not bound to write these lengthy findings, but still I have done it, as I felt I was duty bound to bring to the notice of the authorities the misconduct of some of the Disposal Officers who made these awards inevitable against the Union of India, so that if you think fit you might make enquiries into the whole affairs." It is clear that this letter was signed by the umpire on the 28th of August, 1952, i.e., on the date that the stamped award was given and on that date the umpire had written that the formal award was a short one and that the accompanying document was being sent to enable the Government to hold an inquiry into the conduct of the Disposal Officers. Therefore, as far as this letter is concerned, it is clear that the umpire intended the short award to be the real and formal award. Moreover, it is admitted in the parties' pleadings that on making the award the umpire had informed their counsel that the award had been made in accordance with Section 14 (1) of the Act. It is not suggested that in this intimation there was any reference that the award was being or was intended to be forwarded to the Government for necessary action, It has, however, been urged on behalf of the Government that there is intrinsic evidence in Exhibit Order 1 which shows that It was the real award. I have carefully gone through this document. It is headed as "order". It deals with the present claim and discusses the pleadings of the parties, the issues and evidence in this case. Separate findings are given on the 23 issues which had been framed by the arbitrators and also reasons for his conclusions on these issues. The document then say - "Thus the claimant is entitled to Rs. 5,14,4707-on account of North Brook Depot and Rs. 90.745/-on account of Lybian Depot; total Rs. 6,05,215/-as compensation and I give award of this amount." It is signed as an umpire and is dated 28th August, 1952. If this was all and the document stood by itself without any collateral document, then it could be said with justification that it was the umpire's award. There are, however, other circumstances which militate against this conclusion. At page 5 of this document (Exhibit Order 1) occurs a paragraph which reads - "The claimant has laid his entire case in his petition and the respondent in the written statement. I have separately given my award as an Umpire. At the same time I consider it my duty to briefly discuss the entire case of both the parties and give my own finding on it for the consideration of the Government for any action they deem fit to take in it and send the file to the Director of Administration and Coordination for the purpose." It is not the Government's case that this paragraph was a subsequent interpolation in the document, nor does it so appear to the naked eye. This paragraph is in complete harmony with the covering letter and is in consonance with the umpire's conduct in not stamping it as an award and also in sending it to the Government alone. The umpire has stated in Court that he had purchased the stamp paper on the 27th of August, 1952, and that by that time the document, Exhibit Order 1, was completed, but he is definite in his cross-examination that he had signed the award, Exhibit Order 2. (the stamped document) before he had signed Exhibit Order 1, and there is no reason to disbelieve him on this point. He is a retired Magistrate and is aware of the formalities of law. He has complied with the provisions of Section 14 to the letter. It is further clear that he did and purported to sign the award, Exhibit Order 2, as a formal award, although he signed many other documents at that time. Besides the two awards he signed two notes which were forwarded to the Government as also two letters intimating the parties' counsel that the awards had been made and signed. In these circumstances I agree with the trial Court that the document, Exhibit Order 2, is the real award and the document. Exhibit Order 1, was intended by the umpire to be detailed resume of the case with his findings to enable the Government to take any action that it considers fit and proper. This contention of the Government therefore fails and is rejected.;


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