FAZALALLY JIVAJI RAJA Vs. KHIMJI POONJA AND CO

JUDGEMENT

(1.) The respondents are cotton brokers and members of the East India Cotton Association, Ltd. The petitioner entered into certain forward transactions with them for the sale of Broach cotton April-May delivery, 1933. The petitioner is not a member of the East India Cotton Association, Ltd. In respect of the said dealings the respondents claimed from the petitioner a sum of Rs. 1,35,141. The petitioner denied his liability to pay the said sum, and a dispute arose between the parties. The contracts were subject to the by-laws of the East India Cotton Association, Ltd., and under bye-law No. 38 the dispute was referred to the arbitration of two of the members of the East India Cotton Association, Ltd., Before the arbitrators evidence was led on behalf of the parties, but no record was kept by the arbitrators of the proceedings before them. The arbitrators differed, whereupon the dispute was referred to Mr. Boyagist of Messrs. Langley & Co. as an umpire. Evidence was led before the umpire also, and he put certain questions to the arbitrators. No record, however, was kept by the umpire of the proceedings before him. On November 22, 1932, the umpire made his award in favour of the petitioner. The respondents, thereupon, filed an appeal against the said award to the board of directors of the Association under by-law No. 39, to which the petitioner submitted a rejoinder. The appeal was first heard on February 21, 1933, at which meeting certain members of the board of - directors were present. The parties appeared by counsel, and the arguments of the counsel for the respondents were partly heard on that day. The hearing of the appeal was then adjourned to March 6, 1933. It did not reach a hearing on that day, and was further adjourned to March 15, 1933. At the hearing of the appeal on March 15, some of the directors, who were present at the hearing of February 21, were not present, and some other directors, who were not present at the hearing of February 21, were present. At this hearing counsel for the respondents finished his arguments, and counsel for the petitioner commenced his; but as the same were not finished on that day, further hearing was adjourned to March 17, 1933. At the hearing on March 17, 1933, some of the directors who were present at one or both of the previous hearings were not present, and some directors who were not present at the earlier meetings or either of them were present. The petitioner applied for an adjournment of the hearing of the appeal, but his application was refused. Thereupon, the petitioner withdrew from the appeal, and the directors who were present at the said meeting made an award in favour of the respondents, and set aside the award of the umpire. By this award the board of directors awarded a total sum of Rs. 1,35,141 to the respondents against the petitioner with interest.

(2.) This award was filed in this Court on March 23, 1933, and notice thereof was given by the secretary of the East India Cotton Association, Ltd., to the petitioner on the following day. On March 24, the respondents applied for execution of the said award, and in execution got the petitioner's property attached under a warrant of attachment. It is under these circumstances that the petitioner has filed the present petition, and he contends that the award cannot be filed under Section 15 of the Indian Arbitration Act, and, secondly, that it is illegal, void and of no effect. His contentions briefly are :-(1) that the award of the board of directors in appeal from the award made by the umpire is not within the Indian Arbitration Act and cannot be filed, as it is not the award either by the arbitrators or the umpire, and he prays that it should be taken off the file; and (2) the award is illegal on the ground that it was made by persons some of whom were not present at the earlier hearings, and some who were present at the earlier hearings had not joined in the making of the award, and that the arbitrators did not act together in the making of the award, and the award is against the principles of natural justice. At the hearing one more ground was taken on behalf of the petitioner in support of his first contention, and that is that the award is not signed by all the members of the board of directors who made the award, but only by the chairman of the board.

(3.) Exhibit A is a statement giving the names of the directors present at the various meetings. The statement is admitted to be correct on behalf of the respondents. The statement shows (1) that the three directors who were present at the first meeting of February 21 were not present at the second meeting of March 15; (2) two of the directors who were present at the second meeting of March 15 were not present at the first meeting of February 21; (3) one member present at the first meeting of February 21 was not present at the second meeting of March 15, but was present at the final meeting of March 17; (4) two members present at the second meeting of March 15 were not present at the final meeting of March 17; (5) two members who were present at the first meeting of February 21 were not present at the final meeting of March 17 ; and (6) six members who were present at the first meeting of February 21 were also present at the second as well as the final meeting of March 15 and 17, respectively.