JAWAHAR LAL WADHWA Vs. HARIPADA CHAKROBERTY

JUDGEMENT

(1.) THE hearing before us now relates to certain objections filed to the Award made by Shri A. C. Gupta a former Judge of this Court who was appointed the sole arbitrator to adjudicate upon the dispute between the parties pursuant to the Order of this Court dated 18/11/1987 in the circumstances asset out hereinafter. In order to appreciate the objections, it is necessary to refer to certain facts.

(2.) THE Settlement Commissioner, Government of India allotted Plot No. 631 at Chitranjan Park, New Delhi measuring, 160 sq. yds. to the respondent under the Settlement Scheme for the refugees from Pakistan for a total price of Rs. 4,800.00. This allotment was made by the Settlement Commissioner on behalf of the Rehabilitation Department of the Government of India. THE respondent applied for a loan from the Ministry of Defence for construction of the house on the said plot and a loan of Rs. 15,000.00 was sanctioned in his favour. Under the House Construction Rules of the Government, the plans and estimates had to be submitted along with the application and the sanctioned amount was to be paid in four instalments at different stages of construction. THE respondent started the construction of a building on the said land. By the end, of 1973, the respondent had constructed a house on the said plot up to the roof level. By that time he had obtained and used up a sum of Rs. 12,000.00 out of the loan sanctioned to him and only a balance of Rs. 3,000.00 remained to be paid to him under the said loan. According to the respondent, this amount was not sufficient for the final completion of the house and he, therefore, sought the help of Appellant No. 1 who advanced a sum of Rs. 5,000.00 to him. In September 1973 the respondent entered into an agreement dated 6/09/1973 to sell the house and the said plot to the Appellant No. 1. THE aforesaid amount of Rs. 5,000.00 given by way of loan was shown in that agreement as an advance paid towards the sale price. THE respondent also executed a General Power of Attorney in favour of Appellant No. 1 inter alia enabling him to carry on construction work on the said and on behalf of the respondent. According to the respondent, the house was not complete but the Appellants who are husband and wife were occupying the same. Under circumstances, we need not discuss here, on 29/01/1974 another agreement was entered into between appellant No. 1 and the respondent which has been discribed as an agreement for construction. Under that agreement, Rs. 80,000.00 was to be paid by the respondent as the price of the construction to be put up by Appellant No. 1 on the said plot and he was to charge Rs. 20,000.00 as the profits and labour charges. He was to deposit Rs. 15,000.00 with the respondent as a security. After the completion of the house, the respondent was to return the amount of 1,l5,000/- within three years in a lump sum and on such payment, Appellant No. 1 was to hand over the possession of the building and the plot to the respondent. Till the amount was paid, Appellant No. 1 was entitled to possess and occupy and enjoy the same and to receive rents thereof. According to the respondent, this transaction was sham and bogus. Disputes arose between the parties and the respondent filed a suit in August 1977 claiming for the return of the possession of the said plot and the house. A notice of motion under S. 34 of the ARBITRATION AND CONCILIATION ACT, 1940 for stay taken out by the Appellants was dismissed. An appeal was preferred against the said decision. In the appeal which came up for hearing before the Additional District Judge, Delhi, with the consent of the parties, Shri Bakshi Man Singh was appointed as the sole arbitrator to adjudicate upon the disputes in the suit. THE said Shri Bakshi Man Singh died in July 1979 without making any award. On an application by the respondent, the learned Additional District Judge filled up the vacancy by appointing Shri Hari Shanker, Advocate, as the sole arbitrator. Shri Hari Shanker made and published his award which went against the Appellants. According to the Appellants, the said award was made ex parte. THE Appellants challenged the award by filing objections under Ss. 30 and 33 of the Arbitration Act before the learned Additional District Judge and applied for setting aside the said award. This application was dismissed by the learned Additional District Judge. THE Appellants, filed an appeal against this decision on 14/10/1982 before the Delhi High Court but the said appeal was dismissed by the learned single Judge of that High Court on April 30, 1985. This decision of the learned single Judge was challenged before this Court by way of Special Leave Petition under Art. 136 of the Constitution. Leave was granted and the present Appeal came to be numbered as aforesaid. This Appeal came up for hearing before a Division Bench of this Court on 18/11/1987. After hearing learned Counsel for the parties, in order to ensure fair play in the action, this Court set aside the award of the Arbitrator and also the judgment of the Delhi High Court and appointed Shri A. C. Gupta, a former Judge of this Court, as the sole arbitrator to adjudicate upon the disputes between the parties. THE arbitrator was directed to make his award with short reasons within four months front the receipt of the copy of the order. Certain other conditions like payment of compensation and additional expenses were imposed on the Appellants. Pursuant to the said order of this Court the said Shri A. C. Gupta entered upon the reference and made and published his award on 18/03/1988. Under the said award, it was held that the respondent was entitled to a sum of Rs. 58,498.60 p. and interest on this amount at the rate of 18 per cent per annum from the date of the reference to the date of the award which worked out to a sum of Rs. 3,510.00. Taking into account the amount paid by the respondent initially towards the arbitrator's remuneration and other costs and after setting off the dues of appellants against the respondent, it was held that the respondent / claimant was entitled to recover possession of the disputed building from the appellants and that a sum of Rs. 57,753.00 was payable by the appellants to the respondent. It is this award which is challenged before us now.

(3.) IT is a common ground that the sum of Rs. 105.00 per month referred to Cl. 2(b) of the said agreement was paid by the respondent only up to January 1976 and that this payment covered up to 23 instalments and more than 100 instalments were remaining unpaid. Mr. Bhandare pointed out that it was contended by the appellants before the arbitrator that, although the agreement for sale between the parties was not registered and might not convey any interest to Appellant No. 1 in the property, the appellants had been put in possession of the said land and construction pursuant to the said agreement since September 1973, as appears from the agreement of sale, and, in view of this, appellants were entitled to retain possession under the protection afforded by S. 53-A of the Transfer of Property Act, 1882. He drew our attention to the following statements contained in the award of the learned Arbitrator: