- (1.) THE appellant Seth Ramrichhpal Sirya, on behalf of himself and as manager and karta of the joint Hindu family known as Tilokchand Dilsukhrai, resident of AJmer, has filed this appeal under Section 39 of the Arbitration Act (hereinafter referred to as the Act) against the order of the Senior Civil Judge, Ajmer, dated 16-2-1960, overruling the appellant's objections to the validity of the award and making award a rule of the Court and directing a decree In terms oj the award.
(2.) THE facts giving rise to the appeal are briefly these the respondent M/s. Ajmer Traders, a registered partnership firm, Naya bazar, Ajmer, through its partner Birdhichand of Ajmer put in an application in the Court of the Senior Civil Judge, Ajmer, on 18th March, 1958, against Seth Ramrichpal Sirya of Ajmer, praying for a judgment and decree on the basis of an award. The respondent-applicant's case was that the respondent and the appellant having had some dispute in regard to certain shon situated outside Railway Goods-shed, Ajmer, known as "sirya Market Ajmer" referred their dispute for arbitration to shrl Krishna Gopal Garg under an agreement dated 25-7-1956. The arbitrator Shri Krishna Gopal Garg gave his award on 25-10-1956. The respondent produced the award with the application and, as stated earlier, prayed for a judgment and decree on its basis. It appears that without notice to the appellant the court began ex parte proceedings. On 19-11-1958, the appellant appeared before the court and applied for setting aside the ex parte proceedings. The court by its order dated 17-111959 set aside the ex parte proceedings and the appellant was granted time to file his objections on or before 21st December, 1959. The appellant actually filed his objections on 18-12-1959 urging various grounds against the validity of the award and prayed for either setting aside of the award or for remitting it for reconsideration. Apart from these objections the appellant also raised a legal objection that the award having not been filed by the arbitrator or by anybody else acting under the authority of the arbitrator, there was no proper filing ot the award in court and, therefore, the court could not entertain an application for making the award a rule of the court and passing a decree in terms of the award. The respondent in its turn pleaded that the appellant having failed to file a proper application for setting aside the award within the period of 30 days from 19-111958,. these objections were barred by limitation. The trial Judge formulated the following three points for its determination-- (1) Whether the application of the applicant for getting the decree according to the terms of the award is valid under Section 14 of the arbitration. Act or under any other section of the Act? (2) Whether that application is within limitation? (3) Whether the objections filed by the opposite party are time-barred? On the first point, the trial Judge substantially held that the respondent's application could not be treated as an application under Section 14 of the Act. However, on the basis of a few cases, namely, Jai Kishen v. Ram Lal Gupta, AIR 1944 Lah 398, Radha Kishen v. Madho Krishna, AIR 1952 All 856 and Gangaram v. Radha Kishan, (S) AIR' 1955 Punj 145, he held that Section 14 (2) of the Act is not exhaustive and that independently of that an application can be made by a party to the arbitration for making the award rule of the court if the award can be produced and that Section 14 of the Act would not come into play in such a case. Such an application, according to him, was maintainable under Section 17 of the act. On the second point, he held that Article 178 of the Limitation Act applies only to applications under Section 14 of the Act and cannot govern an application which does not request for the filing of an award but which merely prays for a judgment and decree in terms of an award and which is accompanied by the award itself. Such a case, according to the trial Judge, would be governed by three years rule prescribed by Article 181 of the Limitation Act. With regard to the third point, the trial Judge held that the Act contemplates only one application to get the award set aside and that such an application must be filed within 30 days of the date of the service-of the notice of filing of the award under Article 158 of the Limitation Act. Purporting to hold that the parties received notice of the filing of the award on 17th November, 1959, the respondent's objections having been filed on 18th December, 1959, i. e. , one day after the expiry of 30 days, he treated the objections as time-barred. In the result, he made the award a rule of the court and passed a decree in terms thereof. The appellant has challenged this judgment and decree of the trial Judge in this appeal. Mr. jindal, appearing for the appellant, contended that it is not open to a party to obtain a judgment and. decree on the basis of an award without causing the award to be filed under the provisions of Section 14 of the Act by merely putting an application along with an award and praying for judgment and decree in terms thereof. The view of the law taken by the trial Judge, according to him is clearly erroneous. He mainly relied upon Amod Kumar Verma v. Hari Prasad Burman, AIR 1958 All 720, and, Kumbha Mawji v. Dominion of India, AIR 1953 SC 313. In the alternative, he contended that if an application for making the award the rule of the court and praying for a judgment and decree on the basis of the award be treated as maintainable, the opposite party should be held entitled to raise all objections to the validity of the award in its written statement irrespective of the period of 30 days prescribed by Article 158 of the Limitation Act. Article 158 of the limitation Act is applicable to a case where an award is properly filed under section 14 of the Act and notice of filing the award had been served on the parties. Where filing of the award Is not relied upon as in the present case, Article 158 of the Limitation Act cannot be attracted. Mr. Chand Mal supported the judgment of the trial Judge and relied upon the authorities referred to in the judgment of the trial Judge as also on Vissanna v. Viswabrahmam, AIR 1957 Andh Pra 25 and some observations in M. Gulamali abdulhussein and Co. v. Vishwambharlal Ruiya, AIR 1949 Bom 158. The first and the principal question emerging for determination is: Whether an application for making an award the rule of the court and praying for a judgment and decree on its basis is maintainable without causing the filing of the award under the provisions of Section 14 of the Act? There is some conflict of judicial opinion on this point; the absence of exhaustiveness of the Act providing materials for the said conflict, for a proper determination of the question it will be useful and convenient to refer to Sections 14 to 17 and 30 of the Act and Article 158 of the Limitation Act as, they, In our opinion, disclose a proper scheme for securing an enforcement of an award or getting it set aside or remitted for reconsideration and that under this scheme alt proceedings, whether by way of enforcing the award or for getting it set aside or remitted should commence with the filing of the award under Section 14 of the Act. Section 14, the commencing section in connection with proceedings in court consequent on an award, purports to regulate the procedure after the making of the award. Sub-section (1) enjoins upon the arbitrators or umpire to sign the award and give notice in writing to the parties of the making and signing thereof. Sub-section (2) requires that at the request of any party to the arbitration agreement or any person claiming under such party the arbitrators or the umpire shall cause the award or a signed copy thereof together with certain specified documents to be filed in court. This sub-section also contemplates a move by a party to secure the help of court for securing the filing of the award if an award is not filed at his request and provides for a direction by the court to the arbitrators or umpire to cause the filing of the award. Reference may also be made at this stage to Article 178 of the Limitation Act as amended by the Arbitration Act providing limitation for the applications for the filing in court of an award. These two provisions taken together provide the machinery for securing the filing of the award in court. Lastly, the sub-section also requires the court to give notice of the filing of the award to the parties. The scheme and the provisions of Section 14, namely, (1) creating an obligation on the part of the arbitrator or umpire to file the award, (2) recognition of a right of a party to secure the help of court in getting an award filed and the prescription of a period of limitation in this behalf, and (3) requirement that the court shall give notice of the filing of the award to the parties; appear to suggest that the filing of the award has been intended to bring it within the jurisdiction of the court for appropriate action contemplated on the subsequent sections of the Act, and that this (i. e. , filing of an award) should be the commencement of all proceedings in court and no steps either for enforcing the award or for getting it set aside or remitted can be contemplated without the filing of the award. This suggestion is not negatived by the subsequent provisions but stands re-enforced by them. Section 15, enumerates the grounds on which the court may modify or correct an award. Section 16 then provides the grounds on which the court may remit it for reconsideration. Section 30 specifies the ground on which the court may set aside the award. Article 158 of the Limitation Act, which prescribes the period of limitation for applications for purposes of Sections 16 and 30, reads as follows-Description Period of Time from limitation which period begins to run 158. Under the Thirty The date arbitration Act, days of service 1940, to set aside an of notice award or to get an of filing of award remitted for the reconsideration. awards. It is clear from the language of the Article that three things are necessary for starting of the period of limitation, namely, (1) The award must be filed (evidently under Section 14); (2) It must be filed in court. (3) Notice of the filing of the award must be given to the parties. We may now indicate two conclusions appearing to follow from the above review: (1) A move for setting aside the award or getting It remitted or for its correction and modification contemplates a prior filing of the award and the law fixes date of service of notice of filing of the award as the date on which the right accrues to a party to put in an application for these purposes. (2) In the light of the order of the various provisions of (the Act ) the term "the court" referred to in Sections 15, 16 and 30 which can pass appropriate orders should be understood with reference to the court as used in Section 14 as the court where the award has been filed. The final conclusion to be arrived at is that an application for setting aside the award cannot be made unless the award is filed. There is abundant authority for the above proposition, namely, Ratanji Virpal and Co. v. Dhirajlal Manilal, AIR 1942 Bom 101, Bengal Jute Mills v. Jewraj heeralal, Air 1944 Cal 304, Janardhanprasad v. Chandrasekhar, AIR 1951 Nag 198 and lastly, Firm Shriram Harachandas, Khamgaon v. President, Cotton Seed Forward Delivery. Managing Association Ltd. Khamgaon, AIR 1954 Nag 236. In the last mentioned case after a reference to the earlier three cases it was observed that the law on the point was settled. If the filing of the award is necessary even for getting it set aside, there is all the greater need for the filing of the award for its enforcement by judgment and decree.
(3.) NEXT comes section 17, which provides for the pronouncement of a judgment in accordance with the award to be followed by a decree. An analysis of Section 17 will show that the following conditions must be complied before a Court can pronounce a judgment on the basis ot an award - (1) A notice of the filing of the award must be given to the parties. (2) A period of 30 days prescribed under Article 158 of the Limitation Act must be allowed to expire after the date of the service of the notice of the filing of the award. (These two conditions are deducible from the following words of the section --"the Court shall, after the time for making art application to set aside the award ex parte has expired ). (3 ). In case of an application having been made for setting aside an award the application must be disposed of and disallowed. The necessary implication of the position stated above is that a judgment and decree on the basis of an award is not permissible without the proper filing of the award under Section 14 of the Act. In fact, the idea of an application accompanied by an award containing a mere prayer for judgment and decree on the basis of an award without causing the award (to be?) filed under Section 14 is foreign and repugnant to the language of Section 17 because such an application does not contemplate the filing of an award and giving notice thereof to the parties. In such a case, there can be no commencement of the period of limitation for an application under Article 158 of the Limitation Act to get the award set aside or remitted. It follows that a period of limitation, therefore, would never expire with the result that on giving proper effect to the language of Section 17 a Judgment and decree cart never be passed on such an application. On a consideration of the various provisions in conjunction we have no hesitation in coming to the conclusion that an application for judgment and decree in terms of the award without causing the filing of the award is not contemplated by Section 17 and is unmaintainable. It is, however, necessary in all fairness to the trial Judge and the learned Advocate appearing for the respondent to notice and discuss the cases which have taken the contrary view. The first case relied upon is AIR 1944 Lah 398. The facts in that case were "an award was made by the arbitrator in the presence of the parties to the application on 30th July, 1940. They were accordingly asked by the arbitrator to sign the award and did so. The award was then handed over to the petitioner in whose favour it was made while a copy of the same was given to the other party i. e. respondent. As the respondent did not carry out the terms of the award, the petitioner applied on 8th November, 1941 (i. e. after the expiry of 90 days), for making it a rule of the Court. Since, the original award was filed by him along with his application, the petitioner did not ask for an order for the filing of it but only asked for it to be made a rule of the Court, The award baving been obviously filed after 90 days, the trial Court dismissed the application under Article 178 of the limitation Act. On revision, Abdur Rehman J. found it difficult to treat the petitioner producing the award with the application as an agent of the arbitrator and filing the award as an agent". He observed, "it is impossible to suggest that when, he made the application for the award to be made a rule of the Court, he did so as an agent on behalf of the arbitrators or in any capacity other than his individual one in which, he was entitled to enforce the award and to have for that purpose a decree passed in accordance with the award. If he did not make that application as an agent, how could he-be deemed to have attached the award to the application or filed the award in Court as an agent of the arbitrators?" In his judgment, the application of the petitioner could not be taken as one for filing the award. He thus overruled the applicability of Article 178 of the Limitation act in the facts of that case. In answer to an argument that if that application was not under Section 14 of the Act, it could not be competent at all and was liable to be dismissed as not being provided by the Actr the- learned Judge observed, "but, the Arbitration Act is not in my opinion exhaustive in the sense that an application like this could be thrown out as incompetent in the absence of a clear provision in the Act. Moreover, 1 cannot forget that the petitioner had asked for the award to be made a rule of the Court or in other words for a judgment and a decree to be passed in accordance with the award and this is distinctly provided in Section 17, Arbitration act. " With great respect, we are unable to agree with the above observations of the learned Judge. In the earlier part of judgment we have discussed the scheme disclosed by the relevant provisions of law and have recorded a conclusion that section 17 does not contemplate a judgment or a decree on the basis of an award without a proper filing of the award under Section 14 of the Act, and we do not feel persuaded to modify our conclusion. The other case referred to in the judgment of the trial Judge, namely, AIR 1952 All 856 has merely followed the case AIR 1944 Lah 398 cited earlier and does not at all advance the respondent's case. ;