H.R.Sodhi, J. - (1.) THIS first appeal from order has come before us on a reference made by my Lord the Chief Justice. The two question? of law which require decision, are as follows: (1) When the parties in an arbitration case continue without objection participating in proceedings before the arbitrator, who gives the award after the time fixed for making the award, are they estopped from raising an objection subsequently as to the validity of the award on the ground that it had been made after the prescribed time? (2) If an objection as to the invalidity of the award on the ground of its having been made after the expiry of the period fixed for the same is taken before the Civil Court in order to get the award set aside under Section 30 of the Arbitration Act, 1940, and the objection is not accepted by the Court, can it be said that the Court must be deemed to have enlarged the time for making the award?
(2.) THE facts which led to the reference are not in dispute and may be stated in a narrow compass. Hardyal Appellant entered on 4th January, 1958 into a contract with the State of Punjab, Public Works Department, Buildings and Roads Branch, for the construction of some bridges and culverts on the Mukerian -Naushehra road. In the written agreement between the parties there was an arbitration clause which provided that the disputes, if any, would be referred for arbitration to the Superintending Engineer, Public Works Department, (Buildings and Roads), Jullundur Circle, who would be the sole arbitrator. Some disputes did arise as a result whereof the Appellant sent a notice, Exhibit C 2, on 7th January, 1960, to the Superintending Engineering calling upon him to accept his claim to the tune of Rs. 7,568 and give his award accordingly. It is not necessary to make a mention of the details of his claim and suffice to state that the Appellant claimed this amount as compensation because of the Sub -Divisional Officer having not demolished certain bridge which according to the Appellant had been constructed in accordance with the terms of the agreement. Since the Appellant had also been directed to stop his work the total claim for compensation, including that for demolition of the bridge, as made by him was for the said amount. The proceedings commenced before the arbitrator and the first date of hearing was 20th February, 1961. It is not disputed that both the parties continued taking part in the proceedings which ultimately ended in the impugned award dated 28th April, 1961. The claim of the Appellant was rejected in toto by the arbitrator. The Appellant then presented an application on 1st June, 1961, in the court of Senior Subordinate Judge, Hoshiarpur, raising certain objections under Section 30 of the Arbitration Act, 1940 (hereinafter called the Act), and prayed that the award made by the Superintending Engineer on 28th April, 1961, be set aside. The objections raised were: (i) that the arbitrator had misconducted himself and not allowed the claim of the objector even in regard to the items admitted by the department; (ii) that reasonable opportunity was not afforded to the objector to adduce evidence: (iii) that the award was against natural justice ; and (iv) that the award was given after inordinate delay and was otherwise also invalid. The Senior Subordinate Judge, Hoshiarpur. dismissed the objections by his order dated the 18th April, 1962, thereby upholding the award. The objection regarding delay in making the award was repelled on the short ground that the Appellant had participated in the proceedings throughout upto the announcement of the award and was not able to convince the Court as to how delay in such circumstances could by itself be enough for setting aside the award. It is not necessary to state the reasons for rejecting other objections since the same are not relevant for the purposes of the present reference. The objector Hardyal then preferred an appeal in this Court which came up for hearing, before my Lord the Chief Justice who. because of the importance of the questions involved and the conflict of judicial opinion in regard to question No. (1). referred the case for decision by a Division Bench. In order to answer the questions referred to us it is necessary first to determine what is the time within which an award must be given and if the award is not made within such a time, who has the power to extend it. The relevant provisions in this connection are contained in Sections 3 and 28 of the Act read with para 3 of the First Schedule appended thereto. These provisions are -reproduced below in extenso for facility of reference: 3. An arbitration agreement, unless a different intention is expressed therein, shall be deemed to include the provisions set out in the First Schedule in so far as they are applicable to the reference. 28. (1) The Court may, if it thinks fit, /whether the time for making the award has expired or not and whether the award has been made or not enlarge from time to time the time for making the award. (2) Any provision in an arbitration agreement whereby the arbitrators or umpire may, except with the consent of all the parties to the agreement, enlarge the time for making the award, shall be void and of no effect." The First Schedule. (3) The arbitrators shall make their award within four months after entering on the reference or after having been called upon to act by notice in writing from any party to the arbitration agreement or within such extended time as the Court may allow. A perusal of the above -mentioned provisions of law leaves no manner of doubt that it is open to the parties to an arbitration agreement to fix a time within which the arbitrator must give an award but it has to be so stated in the arbitration agreement itself. If no such time has been specified by the parties in the arbitration agreement then by virtue of the operation of Section 3 read with para 3 of the First Schedule, the award must be given within four months of the arbitrator entering on the reference or after having been called upon to act by notice in writing from any party to the arbitration agreement or within such extended time as the Court may allow. The power to extend time has been given to the Court by virtue of Section 28(1) and this power can be exercised even after the award has been made. Marginal note to this section is in the following terms: Power to Court only to enlarge time for making award. I have made reference to the marginal note to dispel any doubt about the intention of the Legislature which obviously is that it is the Court alone which can extend time whether the award has been made or not. There is only one contingency envisaged in Section 28(2) when an arbitrator or umpire can also extend the time but that is when a provision to that effect has been made in the arbitration agreement itself, and it specifically provides that the arbitrator or umpire may enlarge time for making the award with the consent of all the parties to the agreement. Except in such a contingency it is the Court and Court alone that can extend time for making an award.
(3.) THE policy of law has always been that awards are given as expeditiously as possible and in furtherance of this policy it is provided, by the Act that time cannot be extended by the parties or ever, by the arbitrators and it is the Court which must apply its mind and agree to the extension of time. If a Court finds that the making of the award is being unnecessarily delayed whether for any fault of the arbitrators or the parties, it can exercise its discretion and supersede the arbitration altogether thereby leaving it to the parties to have recourse to proceedings by way of a regular suit. It is not correct to say that the parties, by mutual consent whether expressed in writing or given orally, when the arbitrators are seized of the proceedings can have the time enlarged without the intervention of the Court. There is one and only one eventuality as referred to in Sub -section (2) of Section 28, which is in the nature of a proviso to that section when the arbitrators or umpire can enlarge the time with the consent of the parties to the agreement and that is where a provision to that effect appears in the arbitration agreement.;