UNION OF INDIA Vs. FIRM J P SHARMA AND SONS
LAWS(RAJ)-1967-5-2
HIGH COURT OF RAJASTHAN
Decided on May 12,1967

UNION OF INDIA Appellant
VERSUS
FIRM J P SHARMA Respondents

JUDGEMENT

KAN SINGH, J - (1.) THIS is an appeal under sec. 39 of the Arbitration Act and is directed against the judgment and decree of the learned District Judge, Bikaner, dated 28-10-63, whereby the learned Judge awarded a decree of Rs. 4,26,528. 90 paise in favour of the respondent and against the appellant on the basis of an award given by Shri S. P. Lal, Deputy General Manager, Northern Railway on 12-2-63 consequent to the dismissal of the objections filed by the appellant against the validity of the award. The respondent has also filed a cross-objection and has prayed that interest be awarded on the amount decreed by the District Judge from the date of the decree till the realisation of the decretal amount. The main question that arises for consideration is about the validity of the award and we may briefly state the relevant facts as follows.
(2.) THE respondent firm was engaged as contractor by the Northern Railway for the purpose of performing all the work of porterage of goods at the various railway stations and goods-sheds falling in Zone No. 2 of the Bikaner Division of the Northern Railway. THE terms and conditions of the contract were contained in an indenture dated 3-4-57. THE agreement came into force from 1-4-57 and was terminable on 31-3-60. THEre were two schedules A and B appended in the agreement which provided for the rates payable to the plaintiff-respondent for the various jobs to be done by it. According to the schedules the remuneration of the contractor was to be on the basis of per thousand maunds of goods handled or per vehicle or per man hour according to the nature of the work. It was also agreed between the parties that all other handling work not specified in the agreement was to be performed by the contractor at the rates to be mutually agreed upon by the railway administration and the contractor. THE procedure for payment to the contractor was that he was to prepare and submit monthly bills on the basis of the goods handled during the previous month and the actual job done was to be certified by the Station Masters concerned on submission of the bills to the Divisional Superintendent. THE Accounts Office was to certify the bills after a checking and payment was ordinarily to be made within six weeks of the submission of the bills. It was, however, laid down that pending final check from the several station-returns the contractor was; to be provisionally paid to the extent of 90 per cent of the amount claimed in the bills: THE grievance of the contractor was that in disregard of the terms of the contract it was not paid an amount of Rs. 36,870. 38 paise for the period from April, 1957 to August, 1958. It also felt aggrieved of certain unauthorised deductions made by the railway administration for the period from January, 1958 to September, 1958 to the tune of Rs. 1,24,715. 44 paise. THEn, according to it for the period from May, 1957 to December, 1958, certain bills for repacking stations and road-side stations aggregating to Rs. 1,01,222. 03 paise were not paid to it. THEn it had a further grievance that the Station Masters had not submitted about 125 bills for the period from March, 1958 to January, 1959 to the tune of Rs. 40,000/ -. THE plaintiff-respondent, according to it made several demands to the railway administration for settlement of his claims, but it was not heard. Consequently after serving a notice under sec. 80 of the Code of Civil Procedure the firm filed a suit against the Union of India for a sum of Rs. 3,17,728 81 paise in the court of the District Judge, Bikaner on 21. 9-59. However the defendant-appellant applied under section 34 of the Arbitration Act for staying the suit as, according to the Union of India, clause 33 of the agreement provided for arbitration in the matter of all disputes between the Union of India and the contractor. We will have occasion to refer to the arbitral clause a little later. To continue the narration, the District Judge accepted this application and stayed the suit leaving the parties free to get the matter adjudicated upon by the arbitrator provided in the agreement. Against this decision the respondent came in appeal to this Court but eventually it withdrew the appeal and agreed to go in for arbitration. THE General Manager, Northern Railway by his order dated 21-9-62 appointed Shri S. P. Lal, Senior Deputy General Manager, Northern Railway to act as Arbitrator in the dispute between the railway administration and the contractor as owing to his previous heavy engagements' and pressure of official work it was not possible for him to act as an arbitrator. THE order of the General Manager is available at page 411 of the paper book. Accordingly by his letter dated 29-8-62 ( available at page 420 of the paper book ) Shri S. P. Lal called upon both the parties to submit their respective claim petitions giving full details of the claim together with all relevant documents. He also directed that the respondent should submit a copy of the claim petition directly to the Chief Commercial Superintendent who was then to reply to the claim petition para-by-para. Accordingly the respondent filed the claim petition on 10-9-62 ( available at page 423 of the paper book ). THE railway administration submitted its reply and also made a counter claim. By his order dated 21-8-62 ( available at page 521 of the paper book) after hearing both the parties, the arbitrator settled the procedure to be followed by him. THE arbitrator directed that the railway administration would frame its reply to the points raised in the petition filed by the respondent and then after the reply of the railway was received, a date shall be fixed on which the parties would argue the different issues raised point-by-point so that the issues may be clear. THE arbitrator was to either announce his judgment or reserve it as the circumstances on each point might demand. THE copy of the order was served on both the parties. On 5-12-62 it was contended by the respondent before the arbitrator that he should take up the counter claim put in by the railway administration first after listening the arguments of both the parties. THE arbitrator recorded the following minutes: "the issue raised by the applicant is that the Railway should make out a complete claim, deduct from it all the amounts they have already received and give a net balance of the amount due from the contractors to the Railway. THE Railway's contention is that the calculations of the amount would be done after some primary decisions are taken on the various issues involved and, therefore, they appear to maintain that first of all those issues should be decided, After those issues are decided, then they will work out the actual amounts on the basis of the decisions given on the various issues and the balance sheets will be struck on that basis, Considering the arguments of both the parties it has been decided to take up the issues involved in this case before arriving at the amounts payable in respect of each claim. Parties have been informed accordingly. Parties are allowed to strikeout the issues jointly and they should meet me again after lunch in case they agree on the same. " It appears that the parties came forward with a list of issues and then the arbitrator incorporated the 10 issues in the following extract of the proceedings: "the parties have come forward with a list of issues which they have referred for decision by the Court. THE said issues are reproduced below- (1) Whether the rate in respect of handling of TR/cr Vans under item 18 of the Rate Schedule 'a' is applicable at all the stations, if not, at what stations? (2) Whether the petitioner is entitied to payment for handling of TR/cr Vans, both on inward as well as outward basis, at Repacking Stations as per item 18 of the Rate Schedule, if not, on what basis? (3) Whether the petitioner is entitled to special goods rate as per items 5 of the Rate Schedule 'a' in respect of TR/cr of Vans containing special goods. If not, what rate is applicable? (4) Whether loose wool and loose cotton in boras can be classified as special goods? (5) Whether the rate in items 3 and 4 of Schedule Al in respect of F. P. Cotton bales is applicable to F. P. wool bales. If not, what rate is applicable. (6) Who is responsible for submission and preparation of bills in respect of the handling work at the stations? (7) Whether the contract has been wrongly terminated by the Railway Administration and if so, is the petitioner entitled to renewal of the contract? (8) Whether the petitioner is entitled to the interest as claimed? (9) To what amount, if any, the Railway Administration is entitled to recover from the petitioner? (10) Relief. " THEn the arbitrator took up issue No. 1 for consideration and he passed the following order after hearing both the parties: "my orders, therefore, are that handling of goods is known to all people dealing with in the railway in the form of handling of goods either the Officer Incharge of the operations or Contractors and the mode of payment for such operations is that which is given in the Railway's interpretation. I, therefore, order that for dealing with the payment of CR/tr Vans, if at a station goods are unloaded or loaded, in such vans, the payment should be made on the maundage basis as given in items 1 to 5 of the Schedule 'a', while if the contents of CR/ TR Vans are sorted out at any station and reloaded after sorting into one or more CR/tr Vans so that consignments for one destination or direction are put together, they should be paid for at the van rates i. e. item 18 of the Schedule 'a'. " Earlier to this, while recording the arguments he noted that the parties had accep-ted the interpretation that the arbitrator had given. THEn the arbitrator noted the arguments of the parties regarding each issue and he also noted in the proceedings whatever concessions had been made by the parties but he did not give his decision on any issue. THE observations that the arbitrator had made from time to time are also contained in the proceedings. After arguments had be heard issue-wise, the arbitrator by his order dated 19-1-63 (available at page 661 of the paper book ) called upon both the parties to furnish factual information in detail after carrying out a joint check of the actual work done during the period of the contract on the Bikaner Division. The information was to be given month-by-month and broken up under certain major heads indicated in the letter. In pursuance of this letter both the parties submitted a joint statement which is available at page 668 of the paper book. Against the several entries the parties gave their own remarks where they differed. On the basis of the joint statement furnished by the parties the arbitrator prepared a summary of the joint statement and found that the net amount claimed by the contractor was Rs. 5,99,886. 49 paise and the arbitrator allowed Rs. 4,26,828. 90 paise disallowing the remaining amount. On 12-2-63 the arbitrator pronounced his award which is available at page 673 of the paper book and is in the following terms: "in the matter of Arbitration between M/s J. P. Sharma & Sons, Handling Contractors, Sri Ganganagar and the Union of India represented through Northern Railway, regarding Handling Contract on Bikaner Division in respect of contract executed by the parties in respect thereof on 3rd April, 1957. Whereas the said disputes and differences were referred to me, S. P. Lal, Senior Deputy General Manager, Northern Railway, Baroda House, New Delhi and whereas, the said disputes and differences were contained in the statements of facts and counter-statements produced before me during the hearing, I, S. P. Lal, having entered into the reference and having duly considered the said statements of facts before me and having heard in my office on 21-9-62, 5-12-62, 21-12-62, 22-12-62 and 8-1-63 and duly considered all the arguments and having gone through all the material and papers, I hereby give my award as under: I award that the claimant be paid a total amount of Rs. 4,26,828. 90 paise (rupees four lacs twenty six thousand eight hundred and ninety paise only) by the Railway Administration in full and final settlement of all the claims of the parties including claim for parcel traffic, miscellaneous services and all other types of services rendered to each other. The parties will bear their respective costs The stamp charges amounting to Rs. 75/-shall be borne by claimant. Honorarium for arbitration, amounting to Rs 135/- for 4 days (of more than 2 hours duration ) and 1 day (of less than 2 hours) shall be payable by the Railway Administration to me and clerkage due to the Stenographer amounting to Rs, 45/- shall be paid by the claimant. New Delhi, Dated 12-2-1963 Sd/- S. P. Lal, 12-2-62. Arbitrator. This award was filed in the court of the learned District Judge, Bikaner by the arbitrator on 25-2-63. The Union of India filed objections against this award under sec. 30 of the Arbitration Act on 28-3-65. It was contended that the award was bad as the arbitrator had committed misconduct in deciding the case. It was urged that the arbitrator did not apply his mind in examining the counterclaim of the railway administration that he did not decide the matter on each issue, that the award was very vague as it did not show what the dispute was and what was the judgment of the arbitrator about the dispute, that no evidence had been taken by the arbitrator,, that the arbitrator had gone beyond the terms of reference by including claims for parcel and other miscellaneous services, that the arbitrator had no jurisdiction to award an amount of Rs. 4,26,828. 90 paise when in the suit the plaintiff had claimed only Rs. 3,17,728. 81 paise, that the arbitrator had not taken into account the sums already paid to the contractor, that the amount awarded by the arbitrator was not correct, and that the claim filed by the respondent contained extraneous matters which had not been referred to the arbitrator. The objections were contested by the respondent. The District Judge framed the following issues on 12-7-63: - " (1) Whether the award is vague and is liable to be set aside? Burden on the defendant, (2) Whether the arbitrator has gone beyond the term of reference and has otherwise misconducted the proceedings? If so, what shall be its effect? Burden on the defendant. (3) Whether the arbitrator had no juris diction to give award for the amount exceeding the amount of the suit filed by the plaintiff and if so, what will be its effect? Burden on the defendant. (4) Relief. " We may now proceed to summarise the conclusions reached by the learned District Judge regarding the above issues. Regarding issue No. 1 it was contended by the Union of India that the award did not give any reason as to how and in what manner the arbitrator had reached his conclusion. It was pointed out that there was no mention in the award about the counter-claim and no reason had been given as to why the counter claim was disallowed. It was also urged that the award did not show as to what claims of the plaintiff-respondent were allowed and what claims were rejected. The learned District Judge observed that as no particular form of the award was prescribed by the statute, the award could be in such form as the arbitrator thought fit. The learned District Judge, however, added that all that was required in the award was that its language should be clear and the finding be precise. The learned District Judge further noticed that the arbitrator was not bound by the technical rules of procedure like a court and, therefore, he need not record separate findings on the various points on which the parties were at issue. Nor was the arbitrator required to write a reasoned judgment. In support of his observations the learned Judge placed reliance on Raminder Singh vs. Mohinder Singh (1) which was affirmed by the Privy Council vide 1944 PC. 83. The learned District Judge felt that the language of the award was quite clear and the amount awarded was precise and there was no ambiguity or vagueness about it. He also repelled the contention of the Union of India that the arbitrator did not consider the claims of both the parties. In this connection he referred to what was mentioned in the award and observed that it has been clearly stated therein that the arbitrator arrived at the finding after considering the statements and counter-statements produced before him and the amount was awarded in full and final settlement not only of the claim of the plaintiffs, but of all the claims of the parties. The learned District Judge also observed that the arbitrator had not left out any disputed point, but had determined all the differences which the parties had submitted before him and this was also clearly mentioned in the award. The learned Judge, therefore, reached the conclusion that the award could not be said to be vague and accordingly he decided the issue against the Union of India. The learned District Judge then proceeded to consider issue No. 2. He analised it and noticed that it comprised of two objections: (1) that the arbitrator had gone beyond the terms of the reference; and (2) that he misconducted the proceedings. Regarding the first objection the learned District Judge referred to clause 33 of the agreement which was the arbitral clause and found that it authorised the arbitrator to decide all disputes and differences between the parties including the construction and interpretation of any of the terms and conditions of the agreement. The learned Judge accordingly held that the mere fact that a certain item was not mentioned in the schedule to the agreement did not mean that the arbitrator was not empowered to deal with that matter. In his view, the arbitrator was entitled to give his finding regarding the application of the conditions and terms of the agreement. Then he considered at length the second objection whether the arbitrator had misconducted the proceedings. He noticed at the outset that it was apparent from the reply of the Union of India that the objection was not regarding the (misconduct of the arbitrator himself, In other words, there was no allegation that the action of the arbitrator amounted to moral lapse. He then applied himself to the question whether there was any legal misconduct. The connotation of the term 'legal misconduct' according to the learned District Judge was that it was misconduct not amounting to moral turpitude and in that sense it had a very wide meaning, though it was difficult to give an exhaustive definition of what amounted to legal misconduct. The learned District Judge referred to the Indian Minerals Co. vs. The Northern India Lime Marketing Association (2) and observed that legal misconduct means misconduct in the judicial sense arising from some honest, though erroneous breach and neglect of duty and responsibility on the part of the arbitrator causing miscarriage of justice. " Then the learned Judge noticed several instances of 'legal mis-conduct: It included, according to him, failure to perform the essential duties which are cast on an arbitrator as such. It also included any irregularity of action which is not consonant with general principles of equity and good conscience which ought to govern the conduct of an arbitrator. Having stated the principles the learned District Judge then proceeded to consider their applicability to the facts and circumstances of the case. The learned District Judge observed that to start with the arbitrator had taken down detailed notes of his proceedings and all the notes of the proceedings had been tendered in evidence on behalf of the one or the other parties and their genuineness was not disputed. Having referred to the several order-sheets in detail he noted that the arbitrator by his letter dated 19-1-63 required both the parties to submit a joint statement containing factual information and the details of the actual work done during the period of the contract. Regarding this the arbitrator gave detailed directions. Accordingly both the parties submitted the joint statement under their signatures on 11-2-63. On the basis of this joint statement the arbitrator prepared the summary containing a comparative table of the amount due according to the plaintiffs and that due according to the defendant and it was then that he gave his award on 12-2 63. On the basis of his examination of the proceedings of the arbitrator the learned District Judge reached the following conclusion: - "a perusal of the above mentioned proceedings taken by the arbitrator clearly shows that he did not anywhere fail to perform the essential duties which were cast on him as an arbitrator. He conducted the proceedings in consonance with general principles of equity and good conscience giving full opportunity to the parties to place their respective cases before him point by point. " Then the learned District Judge considered the various other pleas advanced by the defendant. As regards the arbitrator's failure to take evidence, the learned District Judge observed that it did not appear from the proceedings that at any time the defendant wanted to lead evidence regarding any matter. It could not, therefore, be said that the arbitrator had not given any opportunity to produce evidence. Then, as regards the contention that the arbitrator did not take into account the sums already paid to the contractor by the Railway, the learned District Judge observed that the learned counsel for the defendant did not press this point as well in his argument and rightly so. The learned District Judge referred to the joint statement prepared by both the parties which showed in column No. 3 (c) that an amount of Rs. 3,14,116. 04 paise had been admittedly paid to the contractor by the Railway and there was no dispute regarding this amount. He also observed that the summary of the account prepared by the arbitrator showed that this item had been credited to the Railway administration. It was therefore, wrong to say that the arbitrator did not take into account the sums already paid to the contractor. Then the learned District Judge considered at length the contention that the arbitrator had not given any finding on the several issues except issue No. l and he also considered the question about the consideration of the counterclaim made by the Railway. The learned District Judge observed that an arbitrator was not bound to give his finding separately for the issues raised before him. Apart from this, according to the learned District Judge, the procedure had already been settled and it did not require the arbitrator to decide each issue first. The learned Judge also referred to cl 33 of the agreement and observed that that clause also did not direct the arbitrator to give detailed findings point by point. Consequently the learned Judge reached the conclusion that there was no misconduct of the proceedings even if the arbitrator had abstained from giving detailed findings on the several issues. As regards the counter-claim, the learned District Judge observed that in the joint statement admittedly filed by the parties for the several claims month-by-month under all the major heads it appeared that the amount that had been paid to the plaintiffs had been shown and according to this statement itself, on the defendant's own showing, the plaintiffs were entitled to get some amount from the defendant. The learned District Judge, therefore, held that there was no scope for any counter-claim in the circumstances and it had not been mentioned in the joint statement either. The learned District Judge also repelled the contention that issue No. 1 had been decided in favour of the defendant in toto. The finding on issue No. 1 only laid down certain principles on which the rates were to be applied and there was thus no question of deciding any item of claim contained in the joint statement. The learned District Judge then noticed that the arbitrator in the case was next senior-most officer of the Northern Railway who was fully conversant with the rules governing the loading and unloading of goods by the contractors. He had heard arguments at great length and the proceedings revealed that he had taken sufficient pains in trying to understand the point of view of each party. In the opinion of the learned District Judge it was open to the court to enter into the merits of the claim and there was no allegation of any improper motive to the arbitrator. In the result the learned District Judge decided issue No. 2 against the defendant.
(3.) LASTLY we may turn to issue No. 3. It was argued by the defendant that although the suit before the District Judge was for a smaller amount, the award had been given for a much larger amount. In repelling this plea the learned District Judge observed that some claims were specifically reserved in the plaint and the claim put forth before the arbitrator covered the entire period of the contract and all kinds of claims. In the circumstances, according to him, it could not be said that the arbitrator had acted without jurisdiction. Consequently he decided this issue also against the defendant. In the result the District Judge accepted the award and passed a decree against the defendant-appellant as noticed at the outset. In assailing the judgment of the learned District Judge, Shri Magraj, appearing for the Union of India, has taken 4 grounds namely; (1) the award was vague, (2) the award was not valid as the arbitrator had failed to decide all the points of dispute, (3) that the arbitrator had gone beyond the terms of the reference and has otherwise mis-conducted himself, and (4) the award was given for an amount far exceeding the amount claimed by the plaintiff in the suit. In elaboration of his arguments Shri Magraj submitted that Article 33 of the agreement between the parties governed the matter and it envisaged arbitration on all the points in the agreement including dispute, if any, regarding the terms of the agreement. According to the learned counsel, as in the present case the reference to the arbitrator was not made through the court, but by the parties themselves and they put in their respective claims before him, the points of difference emerging therefrom namely, the issues, should be taken to be the several disputes between the parties, It was, therefore, the duty of the arbitrator, Shri Magraj maintains, to decide all the issues separately. Shri Magraj. however accepts the position that the arbitrator need not give any reasons for his conclusion, but he was bound to decide each issue or dispute between the parties. Shri Magraj maintains that the arbitrator had himself laid down a certain procedure and had framed issues, but even then he has failed to give finding on each issue with the result that the award was rendered vague and unintelligible. This was, according to Shri Magraj, a patent error of law apparent on the face of the award. Shri Magraj then submitted that the award appeared to be arbitrary and capricious inasmuch as no principle was indicated therein as to how the figures regarding the claims were arrived at. According to him, it was not clear whether any interest as claimed by the plaintiffs to the tune of Rs. 84,000/- on the sum clue was allowed or disallowed by the arbitrator. It was also not clear whether the claim of the plaintiff for the refund of the security, which was also subject-matter of arbitration, was allowed or disallowed. The award, according to him, on the face of it appeared to be most arbitrary. In other words, Shri Magraj submitted that it was not clear how the arbitrator had arrived at the figure of Rs. 4,26,828. 90 paise and what were the items covered by it. Shri Magraj also submitted that the arbitrator had allowed himself to be influenced by extraneous considerations. Finally, he urged that as the award was vague it was the duty of the plaintiff-respondent to have examined the arbitrator in court as a witness. In support of his contention Shri Magraj placed reliance on Mt. Ishwar Dei vs. Chhedu (3), Caja Sinhva Rao vs. Sujat Ali (4), The Indian Minerals Co. vs. The Northern India Lime Marketing Association (2), and Lingam Dasaradharamayya vs. Kanuri Raja Rao (5 ). Shri Magraj also referred to us certain passages in Russell on Arbitration (17th edition) pages 158 and 243 and the form of awards contained in pages 431 and 432 ibid. He also read to us certain passages from Halsbury's Laws of England (Vol. 11) page 13, and some passages from Articles 341 and 342 of Corpus Juris (Vol. V ). We propose to deal with the salient features of these citations in the course of the discussion. Shri M. M. Vyas, on the other hand, stoutly contested the stand taken by Shri Magraj. He referred to sec. 30 of the Arbitration Act and submitted that the award of an arbitrator could be set aside only on the grounds mentioned in that section and no others and, according to the learned counsel the appellant had failed to make out such grounds. Shri Vyas submitted that the arbitrator was a very senior officer of the Railway itself and he was next to the General Manager and as such he knew the rules and procedure regarding the contracts of porterage and handling. Therefore, when no malice had been imputed to the arbitrator the award cannot be set aside. Shri Vyas submitted that the real dispute between the parties was the claim for money which had first been put forth by the plaintiff in its suit and then in greater detail after including the claims left out in the plaint before the railway administration. Shri Vyas thus maintains that what was referred to the arbitrator by the General Manager was the dispute about the claim of the money put forth by the defendant appellant. The issues, according to Shri Vyas, which came at a later stage after the arbitrator had entered upon the arbitration proceedings, could not be said to be the points referred to him. Shri Vyas took us through the old Civil Procedure Code and referred us to the form of award contained therein. He submitted that the award has to be in this form, though in the subsequent legislative changes the form of the award has not been adhered to as by long usage the form was already well-known and also crystallised. According to Shri Vyas the award is not like a judgement of a court but in the nature of a decree and it should contain only the sum that is awarded. He, however, concedes that the award has to be certain or in clear terms. Shri Vyas disputes that the award is bad on the ground that it did not indicate what reasons weighed with the arbitrator in giving the award, nor was it necessary, according to him, to decide all the issues separately and even if there were several points of dispute a lump sum could be awarded in respect of all of them taken together. Shri Vyas also contested the position that there was any error of law disclosed in the award. According to Shri Vyas, it is not open to the court to travel beyond the award itself to discover any error of law. Error, according to him, should be in the operative part of the award. Shri Vyas placed reliance on a number of cases such as Sreelal Mangtulal vs. J. F. Madan (6), Jivraj Ballo Spinning and Weaving Company Ltd. vs. Champsey Bhara and Com-pany (7), Champasey Bhara and Company vs. Jivraj Balloo Spinning and Weaving Company Ltd (8) which affirmed the last mentioned Bombay case, Raminder Singh vs. Mohinder Singh (l), Mohinder Singh vs. Ramindar Singh (9), Jivarajbhai Ujamshi Sheth vs. Chintamanrao Balaji (10) and Bungo Steel Furniture (pvt) Ltd. vs. Union of India (l 1 ). The recent decision of the Supreme Court appearing in the blue prints namely, Firm Madanlal Roshanlal Mahajan vs. The Hukumchand Mills Ltd. Indore (Civil Appeal No. 878 of 1964 ) decided on 19-8-66 and the Union of India vs. Bungo Steel Furniture Private Ltd. , (Civil Appeals Nos. 373 and 543) decided on 14-9-66 were also brought to our notice. Shri Vyas also placed reliance on Smt. Santa Sila Devi vs. Dhirendra Nath Sen (12) Narpat Rai vs. Devi Das (13), Nanjappa vs. Nanja Rao (14), Jupiter Insurance Co. vs. Calcutta Corporation (15 ). Rustomjee Dorabsha vs. Manmal Prabhudayal (16), The Union of India vs. Mangaldas N. Varma, Bombay (17), Asadullah Makhdoomi vs. Lassa Baba (18), Pannalal Paul vs. Smt. Padmabati Paul (19) and extracts from Duke of Buccleuch vs. Metropolitan Board of Works (20) reproduced in Ward vs. Shell-Mex and B. P. , Ltd. (21 ). Shri Vyas also referred us to some passages from Russell on Arbitration (17th edition) page 242, Corpus Juris Secundum (Vol. 6) pages 116, 123, 185 and 213, and to some passages from Halsbury's Laws of England (Vol. II) paga 57. 14. Before we proceed to deal with the merits of the present case we find it convenient to refer, in brief, to the principles elucidated in the above citations. In our view, the difficulty does not lie so much in gathering or enunciating the principles, but in applying them to a particular situation in hand. The grounds on which an award can be challenged are contained in sec. 30 of the Arbitration Act, which reads as under: Sec. 30. Grounds for setting aside award.- An award shall not be set aside except on one or more of the following grounds, namely: - (a) that an arbitrator or umpire has misconducted himself or the proceedings; (b) that an award has been made after the issue of an order by the Court superseding the arbitration or after arbitration proceedings have become invalid under sec. 35; (c) that an award has been improperly procured or is otherwise invalid. " This section, therefore, clearly enjoins that the award shall not be set aside except on one or more of the grounds mentioned therein. Glauses (b) and (c) are clearly inapplicable in the present case and we are, therefore, left to consider only the applicability of clause (a) of the section. It was conceded before the learned District Judge that there was no such misconduct on the part of the arbitrator as implied any malice, dishonesty or fraud on the part of the arbitrator. In other words, it was not a case of any misconduct from the moral point of view. The contention was only confined to a case of legal misconduct on the part of the arbitrator in the conduct of the proceedings. The learned District Judge has, in our view, correctly pointed out that legal misconduct means any neglect of the duty and responsibility of the arbitrator. In Halsbury's Laws of England 3rd Edition (Vol. 11), it has been pointed out under Art. 126 that the expression 'misconduct' is of wide import and it includes on the one hand bribery and corruption and on the other a mere mistake as to the scope of the authority conferred by the agreement of reference or a mere error of law appearing on the face of the award. According to the statement of law contained in this Article, misconduct, occurs if the arbitrator or umpire fails to decide all the matters which are referred to him; if by his award he purports to decide matters which have not in fact been included in the agreement of reference or if the award is inconsistent, or is uncertain or ambiguous, or is on its face erroneous in matter of law, or even if there has been irregularity in the proceedings. Several other instances of legal misconduct have been given and we need not notice them all. Shri Magraj's contention, as we have already noticed, mainly centres round the one ground that the arbitrator has failed to decide all the issues or points in dispute before him and his award was, therefore, incomplete. He also submitted in this connection that the award was arbitrary and capricious and no principle was indicated therein showing how the amount awarded had been arrived at and what items of claim were accepted or refused. In Mt. Ishwar Dei vs. Chhedu (3), cited by Shri Magraj, the learned Judge observed as follows: "it is not necessary for the arbitrator to exhaustively give reasons for the conclusions arrived at by him or to give his findings on the issues raised in the case. His award would be a perfectly valid and good award provided he has given a clear decision of the case. Where on she face of it the award is very vague and it is difficult to know what his findings actually were the award is not a decision of the case at all. Further if the award does the very thing which the parties wished to avoid, namely going to a Court of law and bearing the expenses of protracted litigation the purported award defeats the very purpose of arbitration by throwing the parties back to the very position from which they wanted to escape, The defect in the award is a vital one and goes to the root of the award given by him and the award must, therefore, be treated as 'otherwise invalid'. " In this case a wife sued her husband for dissolution of the marriage on the ground of ill-treatment, adultery and immorality. The defendant denied the allegations. After the issues were framed in the suit, the whole case was, with the agreement of the parties, referred to arbitration of a pleader. The arbitrator in his award stated that the best thing was not to dissolve the marriage forthwith but to give sometime to the parties to reconsider the whole situation and their interests. For that end in view he, therefore, directed that the defendant should bring a suit for restitution of conjugal rights against the plaintiff within a year. In case the defendant was to succeed in his suit] the marriage shall remain intact, but if he was unsuccessful then the marriage will stand dissolved thereafter. It was in this context that the above observations were made and they are hardly applicable to the case in hand. ;


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