U.C. Banerjee, J. - (1.) From time to time plea of misconduct or legal misconduct in an application for setting aside the award has had considerable judicial attention. The long catena of decisions from Jugglilal Kamalapat (AIR 1955 Cal) down to the decision in Indian Iron and Steel Co.'s matter (Award case no. 72 of 1985 : In appeal from original order being no. 233 of 1986), however, echo on the same voice that the arbitrators must act reasonably and in accordance with the principles of natural justice. There exists no contra note and the law is well settled on this score that though the arbitrators have the right to proceed ex parte but that does not clothe the arbitrators to act arbitrarily as otherwise the faith and belief of the people in general will be shaken as regards this chosen forum for adjudication of disputes between the contracting parties. Sabyasachi Mukherjee, J. (as he then was) in the matter of Dipti Bikash Sen and Anr. vs. India Automobiles (1960) Ltd. ( : AIR 1978 Cal 454) while dealing with the issue of Arbitrator's right to proceed ex parte very succinctly laid down five several principles as rules of prudence in regard thereto, Mukherji, J. observed: - The principles governing the arbitrator's right to proceed ex parte were : (1) If a party to an arbitration agreement had failed to appear at one of the sittings , the arbitrator could not or, at least ought not to proceed ex parte against him at that sitting, (2) Where non -appearance was accidental or casual, the arbitrator should ordinarily proceed in the ordinary way, fixing another date of hearing and awaiting the future behaviour of the defaulting party. (3) If, on the other hand, it appears that the defaulting party had absented himself for defending the object of the reference, the arbitrator should issue a notice that he intended at specified time and place to proceed with the reference and that if the party concerned did not attend he would proceed in his absence. (4) But if after making such peremptory appointment issuing such a notice the arbitrator did not in fact proceed ex -parte on the day fixed, but fixed another subsequent date, he could not proceed ex -parte on such subsequent date, unless he issued a similar notice in respect of that date as well. (5) If he issued a similar notice and the party concerned did not appear, an award made ex parte would be in. order. But, if he did not issue such notice on the second occasion but nevertheless recorded ex -parte, the award would be liable to be set aside in spite of a notice of peremptorily hearing having been given in respect of the earlier date, subject, however, to the condition that prejudice was caused tm the party against whom the ex -parte order was made. Mukherji, J however observed that the duty to serve notice, however, cannot be termed to be an absolute one and formality of issuance of such a notice may be dispensed with in the event the party by his conduct makes it clear abundantly that be would not attend the meeting, then and in that event question of complying with required rules of prudence as above would not arise and no exception can be taken for such a non -compliance. Incidentally it is to be noted that in the facts under consideration, before the learned judge, it was held that by reason of non -service of such a notice there was a possibility of miscarriage of justice and prejudice being caused to the applicant before the Court.
(2.) In an earlier decision of this Court Sir Asutosh Mookherjee (AIR 1920, Cal 853) also laid down that service of a further notice prior to proceeding ex -parte was a requirement of prudence, but where a party was determined not to appear before the Arbitrators and he had openly repudiated the reference, the arbitrators are not required to issue a notice defecting an intention to proceed exparte.
(3.) In the latest decision of this Court in the matter of Indian, Iron & Steel Co. Ltd. vs. The Sutna Stone and Limes Co. Ltd. (Award" Case NO. 72 of 1985. In appeal from original order being No. 233 of 1986) Basak -J delivering judgment for the Court observed - In our opinion, it is the duty of the arbitrators to act in a responsible fashion before they proceed to dispose of a matter exparte. The arbitrators have no doubt the authority to pass an award ex parte in the facts and circumstances of a given case. They may have such power in a given case even if there is no prior notice given that the matter would be heard ex parte if there is no appearance. It is the duty of the arbitrator to apply his mind in the facts and circumstances of each case and not proceed ex parte automatically merely because such notice is given. They must act in a proper and reasonable fashion. If on the basis of materials before him, the arbitrator is of the opinion that absence of a party is deliberate with the intention, to avoid or delay the proceedings, the arbitrator is certainly entitled to proceed exparte.;