Madras High Court
Tiruchirapalli District Football ... vs Tamil Nadu Football Association on 23 July, 2016
1
IN THE HIGH COURT OF JUDICATURE AT MADRAS
Reserved on : 16.04.2019
Delivered on : 30.04.2019
CORAM
THE HON'BLE MR.JUSTICE M.SUNDAR
O.P.No.663 of 2016
Tiruchirapalli District Football Association
Rep. by its Honorary Secretary
53, Second Street (Near Divine School)
Sir Raja Ganapathy Nagar
Tiruchirapalli District ..Petitioner
Vs.
Tamil Nadu Football Association
Rep. By its President
No.73, Jawaharlal Nehru Stadium
Chennai – 600 003 .. Respondent
Original Petition filed under Section 34 of Arbitration and
Conciliation Act, 1996 (Act 26 of 1996) to set aside the award dated
23.07.2016 passed by the learned Arbitrator.
For Petitioner : Mr.J.Sivanandaraaj
for Mr.S.Mahesh Kumar
For Respondent : Mr.P.V.Balasubramaniam
ORDER
Instant 'Original Petition' (hereinafter 'OP' for brevity) has been presented in this Court on 29.08.2016 under Section 34 of 'The Arbitration http://www.judis.nic.in 2 and Conciliation Act, 1996' ('A & C Act' for brevity) assailing an arbitral award dated 23.07.2016 (hereinafter 'impugned arbitral award' for brevity) made by an 'AT' ('AT' for brevity) constituted by a sole arbitrator, who is former Hon'ble Judge of this Court.
2. Before the AT there was a sole claimant and a lone respondent. Sole claimant's plea was dismissed with costs by the AT vide impugned arbitral award. Sole claimant is the sole petitioner before me in the instant OP and obviously the lone respondent before AT is the only respondent in the instant OP before me also.
3.Though the caption to the petition in the instant OP reads that it has been filed under Section 34 of A&C Act, learned counsel for petitioner before me, in the hearing made it clear that instant OP is predicated on two specific grounds under Section 34, namely conflict with public policy of India and patent illegality, i.e., Section 34(2)(b)(ii) read with Clause (ii) and
(iii) of Explanation 1 and Section 34(2A). In other words, instant OP is predicted on the grounds that the impugned arbitral award is in conflict with public policy of India, that it is vitiated by patent illegality on the face of the impugned arbitral award and is therefore liable to be set aside on these two grounds.
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4.To be noted, in the instant case, an application prior to commencement of arbitral proceedings under section 9 of A & C Act was filed being O.A.No.1252 of 2015 on 08.12.2015. Ultimately, the sole arbitrator who constituted AT was appointed in these proceedings. Impugned award came to be passed on 23.7.2016 and the instant O.P had been presented in this Court on 29.8.2016.
5.Therefore, the date of commencement of arbitral proceedings within the meaning of section 21 of A & C Act is not available in the instant case. However, as sole arbitrator was appointed by consent in aforesaid O.A.No.1252 of 2015, admittedly before commencement of arbitral proceedings and as this application was filed on 08.12.2015, it can be safely inferred that arbitral proceedings in the impugned award are post 23.10.2015 and therefore, instant O.P will be tested as one under section 34 of A & C Act as it exists in the statute book post amendment on and with effect from 23.10.2015 brought in initially by an Ordinance and subsequently by amending Act No.3 of 2016.
6.Before I proceed further, it is necessary to set out the factual matrix of this case in a nutshell. To be noted, instant OP being one under Section 34 of A & C Act, it is neither an appeal nor a revision. It is not even a full fledged review. It is only a challenge to impugned arbitral award on the limited and specific grounds adumbrated under Section 34 of A & C Act. Therefore, factual matrix will be in a nutshell, it will contain only bare http://www.judis.nic.in 4 minimum facts that are imperative for understanding / appreciating this order. To put in differently it will be a thumbnail sketch of facts and the narrative will include the trajectory of the proceedings before AT.
7. FACTUAL MATRIX AND TRAJECTORY OF PROCEEDINGS BEFORE AT:
7(i) It unfurls from the submissions made before me that there is no specific statute dealing with conduct of various sports in the country. It is submitted that there is a National Sports Code governing National Sports Federations.
7(ii) The instant case pertains to one particular sport, namely the game of Football.
7(iii) 'All India Football Federation' ('AIFF' for brevity), this Court is informed is a society registered under the Societies Registration Act, 1860 (Central Act). This Court is further informed that respondent before this Court, namely 'Tamil Nadu Football Association' ('TNFA' for brevity) is a member of AIFF. It is also submitted that TNFA is also registered as a Society, but it is registered as a Society under the Tamil Nadu Societies Registration Act, 1975 (State Act). In other words, while AIFF is registered as a Society under the Central Act, TNFA is registered as a Society under the Tamil Nadu State Act. Under TNFA, there are various District bodies and http://www.judis.nic.in 5 these district bodies, in turn, are made up of several clubs. One such District body under TNFA is the petitioner before me, namely 'Tiruchirapalli District Football Association' (hereinafter 'Trichy DFA' for brevity.
7(iv) It is submitted that Trichy DFA is not registered as an entity under any statute. Therefore, this Court will have to necessarily construe Trichy DFA as an Unincorporated Association of Persons (Unincorporated AOP).
7(v) As mentioned supra, claimant being a District body is in turn made up of several clubs and this Court is informed that Trichy DFA is made up of 47 clubs. This Court is informed that there are various District bodies under the respondent TNFA. While the Madras District body is the largest body with 96 clubs, Trichy DFA is the second largest body with 46 clubs is another factual detail that is brought to the notice of this Court.
7 (vi) It is not in dispute that the primary object of TNFA is to improve the game of football constantly, promote, regulate and control it throughout the territory of State with further objectives of unifying, educational, cultural and humanitarian values, particularly through youth and developmental programmes. It is submitted that TNFA is the only association in the State of Tamil Nadu to promote the sport of football and http://www.judis.nic.in 6 has to actively participate in national championships and encourage players from the State of Tamil Nadu. It is not in dispute before me that there is a set of bylaws for the TNFA, which shall hereinafter be referred to as 'said bylaws' for the sake of brevity and clarity. Alleging that Trichy DFA has not performed its obligations, which was superseded under said bylaws by TNFA, Trichy DFA assailed such Supercession on the grounds that it is illegal, tainted and malafide. Trichy DFA also alleged that it is TNFA, which is not performing its obligations and that in the junior girls under 18 played in the month of October 2015 at Goa when all the States in India participated, Tamil Nadu was the only exception. According to Trichy DFA, TNFA is responsible for such state of affairs and such non-participation in a national championship is clearly not in tune with the objectives with which TNFA was formed.
7(vii) Be that as it may, aggrieved by the aforesaid Supercession, Trichy DFA filed a writ petition on 24.08.2015 in the Madurai Bench of the Madras High Court. This is vide W.P. No.15369 of 2015 and an interim order of status-quo was passed. Ultimately, the writ petition came to be dismissed after which an application under Section 9 being O.A.No.1252 of 2015 came to be filed on 08.12.2015. In this application, both the parties before me i.e, Trichy DFA and TNFA agreed for appointment of a Hon'ble retired Judge of this Court as sole Arbitrator and this resulted in constitution of the AT.
http://www.judis.nic.in 7 7(viii) AT entered upon reference and Arbitration was conducted. Both parties i.e., Trichy DFA and TNFA participated in the arbitration, both were represented by learned counsel. Trichy DFA as claimant filed Claim Statement dated 21.05.2016 and additional Claim Statement dated 30.06.2016. TNFA, as sole respondent, filed counter statement dated 12.07.2016 and Trichy DFA filed a rejoinder dated 19.06.2016. Pleadings were thus completed.
7(ix) There was no oral evidence or marking of documents as exhibits, but documents were referred to, pressed into service, placed before the AT and arguments were advanced inter-alia by relying on the same. In other words, there was oral hearing where the adversaries were represented by their respective learned counsel.
7(x) From the narrative thus far, it will be clear that the pivotal issue before the AT, which is the fulcrum of the arbitrable dispute in instant OP is Supercession of Trichy DFA by TNFA, which was communicated to Trichy DFA by TNFA vide letter dated 18.08.2015. Before the AT, three issues were framed and they are as follows:
'1.Whether the Tribunal has jurisdiction to decide this dispute?
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2.Is the letter of Supercession dated 18.08.2015 valid?
3.What are the consequential reliefs that the parties are entitled to?' 7(xi) After detailed oral hearing, while Issue No.1 was answered in the affirmative, with regard to Issue No.2, AT returned a finding that the Supercession is valid and as a consequence, directed the Trichy DFA to hand over all records, properties, bank account, cheque book and cash balance with the audited statement within two weeks from the date of impugned arbitral award and imposed costs.
7(xii) In other words, the claim made by claimants (Trichy DFA) before the AT was dismissed with costs vide impugned arbitral award.
7(xiii) As mentioned supra, this impugned arbitral award is called in question inter alia on two grounds. As mentioned supra elsewhere in this order, one ground is that it is in conflict with public policy of India and the other ground is that it is vitiated by patent illegality appearing on the face of the award.
8. I now proceed to consider the challenge to the impugned arbitral award under the caption 'Discussion and Dispositive Reasoning' infra.
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9. DISCUSSION AND DISPOSITIVE REASONING:
9(i) Mr.J.Sivanandaraaj, learned counsel representing the counsel on record for the petitioner (Trichy DFA) and Mr.P.V.Balasubramaniam, learned counsel on record for the respondent (TNFA) were before this Court and both learned counsel advanced submissions.
9(ii) Two specific grounds on which challenge to the impugned arbitral award are predicated (in the instant OP) have already been alluded to supra. One ground is that the impugned arbitral award is in conflict with public policy of India and the other ground is that it is vitiated by patent illegality appearing on the face of the award.
9(iii) In support of his submission qua both these grounds, learned counsel for petitioner made submissions and his sheet anchor submission is that the AT interpreted the bylaws of TNFA correctly, but arrived at conclusions based on such interpretation incorrectly owing to which AT returned fallible findings which are liable to be set aside under Section 34 of A & C Act. Elaborating on this sheet anchor submission, Mr.Sivanandaraaj, learned counsel submitted that Supercession of any District Association, which is a member of TNFA, can only be under Article 16 of said bylaws. http://www.judis.nic.in 10 Taking me through Article 16, it was submitted that only when a District Football Association does not do three things conjunctively, there can be Supercession. It was submitted that a District Football Association should not have conducted annual league for their member clubs, it should not have conducted School Tournament for the schools in their jurisdiction and should not have participated in the State Championship organized for men by TNFA. Only if a District Association does not do all these three functions conjunctively can there be supercession under Article 16, is learned counsel's say.
9(iv) Learned counsel adverting to Article 9 of said bylaws submitted that under Article 9, though there are three categories of members, with regard to District Associations, like Trichy DFA, there are only two categories, those two categories being 'active members' and 'ordinary members'.
9(v) Further adverting to Article 9, particularly 9.2 and 9.3 of said bylaws, learned counsel submitted that if a District Association does not conduct annual leagues for its member clubs with a minimum of 7 matches in the league or if the Annual School Tournament in its jurisdiction is not conducted and does not participate in a State championship for men, it could at best only be http://www.judis.nic.in 11 placed in the category of ordinary member (as opposed to active member) and that also will be temporary or transitory i.e., upto such concerned District Association rectifies and qualifies as an active member, but not supercession.
9(vi) In the light of this being the sheet anchor submission and considering the nature of the submission, I deem it appropriate to extract Articles 16 and 9 of said bylaws. I do so. Article 16 of said bylaws reads as follows:
'Article 16 SUPERCESSION
16.1 Members who do not conduct the Annual League for
their Member Clubs and a Schools Tournament for the Schools in their jurisdiction and also do not participate in the State Championships organized for Men by TFA shall be superceded and an Adhoc Committee appointed to take over the administration and revive its activities on the directions of the Executive Board.
16.2 The Executive Board by two third majority of the votes taken may supercede a District Association for its failure to implement the Statutes, Rules and Regulations of the Association and also for failure to discharge its obligations cast upon it by these Statutes and appoint an Adhoc Committee to take over its administration subject to confirmation at the next Congress.' Article 9 of said bylaws reads as follows:
'Article 9 MEMBERS
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9.1 There shall be three categories of Members in TFA.
a) Active Members (DFAs)
b) Ordinary Members (DFAs)
c) Tamilnadu Women's Football Committee (TWFC) as Associate Member.
9.2 The DFAs that
1. have sixteen (16) Active Clubs or more
2. conducts the district annual leagues for all its members providing each of them with a minimum of seven (7) matches in the league
3. conducts an Annual Schools Tournament for schools in its jurisdiction
4. participates in all the State Championships for Men
5. holds its General and Executive Committee Meetings in accordance with the articles of the Statutes every year.
6. and are not otherwise disqualified either by TFA or DFA shall be in the category of “ACTIVE DFAs” 9.3 The Member DFAs other than those in the category of Active DFAs shall be placed in the category of “Ordinary DFAs” till such time they fully comply with the criteria and obligations set of Active DFAs in the immediate preceding two years consecutively.
9.4 Tamilnadu Women's Football Committee appointed by TFA or elected and assigned specific responsibilities to promote and develop Women's Football in the State shall be an Associate Member.
9.5 An “Active Club” referred to in Article 9.2, shall mean a http://www.judis.nic.in 13 Member Club of a DFA who fulfills all its engagements/matches scheduled for it in the Annual League of its DFA in the immediate preceding two years consecutively and is not otherwise disqualified by TFA or DFA.
Note: A “Screening Committee” shall be appointed with three (3) members to observe and monitor the activities of both “Active” and “Ordinary” DFAs and on the basis of its report, categorization of DFAs as “Active” and “Ordinary” DFAs shall be made.
9.6 All the Football Clubs affiliated to the member DFAs shall be “Indirect Members” of TFA through their respective DFAs. 9(vii) Responding to the aforesaid submissions made by learned counsel for petitioner (Trichy DFA), learned counsel for respondent (TNFA) submitted that AT certainly noticed the said bylaws, noticed that the decision to supersede Trichy DFA is unanimous and has rightly returned a verdict negativing the prayers of Trichy DFA.
9(viii) This takes us to examination and analysis of impugned arbitral award. To be noted, examination and analysis of impugned arbitral award is within the contours of Section 34 of A & C Act. When I say that it is within the contours of Section 34 of A & C Act, it is to be noted that A & C Act essentially provides for 8 specific grounds on which an arbitral award can be set aside. While these http://www.judis.nic.in 14 five grounds are adumbrated under Section 34(2)(a), two others are adumbrated under Section 34(2)(b). The eighth ground is contained in Section 34(2A). With regard to the two grounds adumbrated in Section 34(2)(b), the term 'public policy' is no more res integra and the same has been explained by way of two explanations, namely Explanation 1 and 2. Likewise, grounds under Section 34(2A) is also with a rider which is in the form of a proviso to Section 34(2A).
9(ix) Be that as it may, suffice to say that challenge to an arbitral award within the contours of Section 34 of A & C Act necessarily means that a petitioner, to successfully take recourse against an arbitral award under Section 34 of A & C, should be able to demonstrate that the grounds of challenge can be neatly packaged in one of the aforesaid 8 slots, which can be described as pigeon holes.
9(x) A perusal of the scheme of A & C Act and more particularly Section 34 of A & C Act, in my considered view, buttresses the description that the grounds for challenge to an arbitral award adumbrated in Section 34 can be aptly described as pigeon holes as the scope to flap one's wings are so limited that the figurative usage of describing each of the grounds as a pigeon hole is literal and legal too. To put it differently, it is a pigeon hole in every sense of the term. This is more so in the light of salutary principle and sublime philosophy underlying A & C Act and 'Alternate http://www.judis.nic.in 15 Dispute Resolution Mechanism' ('ADR mechanism'). Salutary principle and sublime philosophy underlying A & C Act and ADR mechanism is 'minimum judicial intervention'.
9(xi) This Court is referring to all these aspects of the matter to highlight the scope of 8 grounds adumbrated in Section 34 and what impelled this Court to describe them as pigeon holes.
9(xii) I now revert to an examination and analysis of the impugned arbitral award. A careful perusal, examination and analysis of the impugned arbitral award reveals that the AT has proceeded on the basis that the entire matter pertains to internal affairs of a Society and the scope of intervention in internal affairs of a society is clearly limited. With regard to the first issue pertaining to jurisdiction of the AT, the very fact that the sole arbitrator who constituted the AT was agreed upon in proceedings under Section 9 of the A & C Act before this Court as alluded to supra puts an end to this ground. To be noted, learned counsel on both sides fairly submitted that this issue stands doused.
9(xiii) To be noted, an AT is a creature of a contract and it is in the nature of a private Tribunal. As mentioned supra, the sheet anchor submission of the petitioner is based on Articles 16 and 9 of said bylaws. http://www.judis.nic.in 16 This sheet anchor submission has already been set out supra. The AT has gone into this submission, has considered the same and has given a finding and this finding is set out by the AT in Paragraph 5.15 of the impugned arbitral award A reading of Paragraph 5.15 of the impugned arbitral award reveals that the same argument, which is now being advanced before this Court, has been advanced before the AT by the Trichy DFA i.e., the argument based on Articles 16 and 9 and that has been dealt with by the AT. AT has dealt with the petitioner's submission that the Trichy DFA could have merely been relegated temporarily to the status of an ordinary member from the status of active member, rather than stringent action of Supercession under Article 16 and held that it is possible that the TNFA could have resorted to that option, but the question is whether the AT can interfere with the decision. After noticing that the decision is unanimous, AT has come to the conclusion that all these being in the realm of internal disputes of an Association, the same need not be interfered with. I deem it appropriate to extract Paragraphs 5.15 and 5.16 of the impugned arbitral award, which read as follows:
'' 5.15 The Learned Counsel for the Claimant had submitted that even assuming that there was an lapse on the part of the Claimant only with regard to the inability to complete the league match, the Respondent could have converted the status of the Claimant to an ordinary member removing the status of active member and this stringent action of supersession is not warranted. It is possible that the http://www.judis.nic.in 17 Respondent could have taken that option, but the question is whether the Tribunal can interfere with the decision taken.
5.16 It appears that the issue is not only the non-
completion of the league match, there appears to be internal squabble that prevent the smooth working of the Association. The letter that we have referred to above dated 10.2.2015, 27.7.2015, 3.6.2015 all indicate that there are persons who are preventing the smooth functioning of the Claimant Association. I find that of the 6 members who have been appointed to the ad hoc Committee, three have been nominated by the Claimant themselves to encourage the football activities in para 10(2) at the urgent executive committee meeting held on 5.10.2014. It is possible that the present members are not to be blamed but obviously the game suffers and it is the interest of the game that is paramount. Further it is difficult for this Tribunal to interfere when this decision is a unanimous decision of the executive as recorded in the Minutes of the Meeting dated 9.8.2015. It is possible that the Agenda might have mentioned “matters relating to Trichy DFA” instead of just DFA. But on such slight lapses I cannot interfere with what is said to be an unanimous decision of the Executive Board.
9(xiv) A close reading of the aforesaid sub-paragraphs reveal that the AT has noticed that the agenda has not been set out with clarity and the argument that the decision would not have been unanimous if the agenda had been set out with clarity and specificity. In other words, the argument of Trichy DFA that if the agenda had been set out with specificity that it is relating to Trichy DFA instead of just saying DFA, the decision would not http://www.judis.nic.in 18 have been unanimous has been noticed by AT and it has even been observed by AT that it would have well been possible for TNFA to mention with specificity that matters relating to Trichy DFA instead of just DFA, but the argument of Trichy DFA has been negatived.
9(xv) This takes us to the question as to whether the aforesaid findings, which have been returned by AT will be hit by the vice of being in conflict with public policy of India and being vitiated on the ground that it is patent illegality appearing on the face of the impugned arbitral award.
9(xvi) A careful perusal of the grounds on which challenge to impugned arbitral award are predicated in the instant OP before me and as articulated by learned counsel for petitioner before me read in the light of Paragraphs 5.15 and 5.16 of the impugned arbitral award (extracted and reproduced supra) leaves this Court with the considered opinion that the view taken by AT does not qualify as a possible view, much less a plausible view.
9(xvii) Moreover, as mentioned supra, what is public policy of India is no more res integra as the same has been explained in Explanation 1 to Section 34(2)(b)(ii) of A & C Act. It is the specific case of the learned counsel for petitioner that instant OP will qualify under Clauses (ii) and (iii) http://www.judis.nic.in 19 of Explanation 1 to Section 34(2)(b)(ii). A perusal of Clauses (ii) and (iii) of Explanation 1 reveals that it is the contention of the petitioner that the impugned arbitral award is in conflict with public policy of India as it is in contravention with the fundamental policy of Indian law and it is in conflict with most basic notions of justice. With regard to conflict with public policy of India, the same has again been elucidatively explained by the Hon'ble Supreme Court in Associate Builders Case by placing reliance on the celebrated ONGC Ltd. v. Western Geco International Ltd., reported in 2014 (9) SCC 263. Based on the Western Geco International Case, in Associate Builders case, Hon'ble Supreme Court reiterated the position that three distinct juristic principles can be culled out with regard to fundamental policy of India. Those three distinct juristic principles are
(a)judicial approach, (b)natural justice principles and (c) irrationality/perversity. With regard to judicial approach, Hon'ble Supreme Court placing reliance on celebrated Western Geco International case held that fidelity in judicial approach is the test, with regard to natural justice principles, it was held that the time honoured audi alteram partem principle and whether the arbitral award gives reasons for the verdict/findings are the tests. With regard to irrationality/perversity being third juristic principle constituting fundamental policy of Indian law, Hon'ble Surpeme Court based on Western Geco International Case held that the test for the third juristic principle is the famous Wednesbury principle http://www.judis.nic.in 20 of reasonableness. In other words, the test for the third juristic principle of irrationality/perversity is whether an arbitral award passes the muster of Wednesbury principle of reasonableness. To put it differently, if an arbitral award passes the muster of Wednesbury principle of reasonableness, it cannot be held to be irrational or perverse, whereas it can be held to be perverse/irrational if does not pass the muster of Wednesbury principle of reasonableness. While on this, it is to be noted that Explanation 2 of Section 34(2)(b)(ii) controls Explanation 1. Explanation 2 makes it clear that the test as to whether an award is in contravention with fundamental policy of Indian law should be such that it is not a review of the impugned arbitral award on merits of the dispute.
9(xviii) With regard to patent illegality on the face of the award, it should be an error, which is incorporated in a document or note appended to the impugned arbitral award. It should be such that no process of interference needs to be applied to find the error. In other words, without any inferential process, it should come out clearly that there is illegality in the impugned arbitral award or in any document appended to the same. To put it differently in the considered view of this Court, an illegality which is so obvious and conspicuous that it need not be detected much less detected by taking recourse to an inferential process. This Court also bears in mind proviso to Section 34(2A). The proviso makes it clear that mere erroneous http://www.judis.nic.in 21 application of law cannot attract patent illegality within the meaning of Section 34(2A) of A & C Act. Likewise, proviso also makes it clear that patent illegality appearing on the face of the award as a ground under Section 34(2A) cannot be tested by re-appreciation of evidence.
9(xix) To be noted, instant case turns heavily on section 28(3) of A & C Act.
9(xx) With regard to by-laws of a registered society, no elucidation or elaboration is required for the principle that by-laws of a society operates as a contract between the members of the society. Therefore, in the instant case, we are concerned with Articles 9 and 16 of by-laws which have already been extracted and reproduced supra. As these clauses 9 and 16 are effectively covenants between members, they are clearly terms of contract within the meaning of section 28(3) of A & C Act.
9(xxi) With regard to the question as to whether contravention of section 28(3) of A & C Act can become a ground for setting aside an arbitral award, Hon'ble Supreme Court in Associate Builders Vs. Delhi Development Authority reported in (2015) 3 SCC 49 had held that contravention of section 28(3) of A & C Act is clearly one of the facets of patent illegality which in turn is a ground for setting aside an arbitral award. The only caveat which Hon'ble Supreme Court had laid down in this regard is that construction of the term of contract is primarily for an arbitrator to decide. http://www.judis.nic.in 22 Furthering on this caveat, Hon'ble Supreme Court held that if the arbitrator construes the term/s of a contract in a reasonable manner, it cannot be a ground for setting aside an arbitral award and construing of the term of contract should be such that no fair minded or reasonable person would construe the term in that particular manner.
9(xxii) Therefore, the legal position that emerges clearly from the celebrated Associate Builders case is that contravention of section 28(3) is certainly a facet of patent illegality and therefore, it qualifies as a ground for assailing an arbitral award, but with a caveat as laid down by Hon'ble Supreme Court which has been alluded to supra. This Court reminded itself that patent illegality which was added to section 34 as a ground by ONGC Ltd. Vs. Saw Pipes Ltd. reported in (2003) 5 SCC 705 prior to 23.10.2015, has now found statutory expression by way of sub-section (2A) of section 34 of A & C Act. While patent illegality has found statutory expression in sub-section (2A) of section 34, a caveat in this regard which this court bears in mind is the proviso to sub-section (2A) of section 34. Vide proviso, the statute makes it clear that patent illegality cannot become a ground for setting aside the arbiral award when it is merely on a ground of erroneous application of law. The other limb of the proviso is that while testing the award for patent illegality, reappreciation of evidence is impermissible.
9(xxiii) However, in the instant case, this court does not even intend to examine how AT has construed Articles 9 and 16 of by-laws. This court http://www.judis.nic.in 23 will proceed on the very basis of construction on such Articles placed by AT. In other words, the outcome qua impugned award will be tested by applying that very construction placed on Articles 9 and 16 by AT. In other words, the exercise which this court would embark upon is to see whether the ultimate conclusion returned by the AT is in tune with the manner in which AT has construed the terms of contract, i.e., Articles 9 and 16. If AT has construed the terms of contract in a particular manner and if the conclusion is completely contrary to such construction, that will also tantamount to contravention of section 28(3) mandate. The spirit and objective behind section 28(3) is that AT should take into account the term of contract as well as trade usage applicable to transaction while deciding and making award. After taking into account the term of contract and after construing the same in a particular manner, if the decision making of the award is completely contrary to the manner in which the terms have been construed, in the considered opinion of this Court, that will also be contravention of section 28(3) of A & C Act.
9(xxiv) As already mentioned supra, Section 28(3) contravention is one of the facets of patent illegality and is therefore a ground for assailing the arbitral award. The manner in which AT construed Articles 9 and 16 is articulated in paragraph 5.15 of impugned award, which has already been extracted and reproduced supra. A perusal of paragraph 5.15 will reveal that AT has come to the conclusion that the argument that even if it is http://www.judis.nic.in 24 assumed that there was lapse, that is only with regard to inability to complete league matches and this could have only converted the status of Trichy DFA as that of an ordinary member or in other words, removing the status of Trichy DFA from that of an active member has not been repelled. After saying so, AT has also held that stringent action of supercession is not warranted, as even on a demurrer, lapse if at all, can only be with regard to one of the three requirements for supercession. In other words, it is clear that AT has construed Article 16 to mean that supercession is possible only when three lapses adumbrated therein, namely non conduct of annual league for their member clubs, non conduct of school tournament for the schools in its jurisdiction and non participation in State championships organised for men by TFA happening conjunctively can result in supercession. Having made it clear that in the instant case, even on demurrer, only one of the three determinants / parameters can be put against Trichy DFA, AT was clearly in error in not interfering with supercession and this is so obvious on the face of the impugned award that it is patent illegality.
9(xxv) This takes us to reasons as to why AT has not interfered with supercession and not declared the same as invalid.
9(xxvi) This is articulated in paragraphs 5.16 and 5.17 of impugned award. To be noted, paragraph 5.16 has already been extracted and reproduced supra. Therefore, this court deems it appropriate to extract http://www.judis.nic.in 25 paragraph 5.17, which reads as follows :
“5.17 It is clear from the pleadings and the records that the league matches were not completed on time, that there were internal disputes in the Claimant Association that could not be resolved in spite of attempts made by the Respondent, that the power of supersession is found in the Statute and there is no apparent malafide in the action. When the Minutes record that efforts have been taken to unite the members of the Claimant Association and they went in vain and Claimant's President himself mentions there are bound to be disputes from minority clubs, it is clear that they were aware what the problem was and what the Respondent was attempting to address. In these circumstances I do not find the action is tainted by unfairness or arbitrariness. Issue (2) is answered accordingly.” 9(xxvii)A perusal of the aforesaid portion of impugned award reveals that AT has proceeded on the basis that it is internal affairs of a society. With regard to internal affairs of a society, the contractual origin of the rule of expulsion has its corollary in the cognate rule that in expelling a member, conditions laid down in the rules must be strictly complied with. This can be traced to what Lord Morton wrote in Bonsor Vs. Musicians' Union case [LR 1956 AC 104]. In this regard, T.P.Daver Vs. Lodge Victoria case reported in (1964) 1 SCR 1 : AIR 1963 SC 1144 was pressed into service and attention of this Court was drawn to paragraph 8, which reads as follows :
http://www.judis.nic.in 26 “8.The following principles may be gathered from the above discussion. (1) A member of a masonic lodge is bound to abide by the rules of the lodge; and if the rules provide for expulsion, he shall be expelled only in the manner provided by the rules. (2) The lodge is bound to act strictly according to the rules whether a particular rule is mandatory or directory falls to be decided in each case, having regard to the well settled rules of construction in that regard. (3) The jurisdiction of a civil court is rather limited; it cannot obviously sit as a court of appeal from decisions of such a body; it can set aside the order of such a body, if the said body acts without jurisdiction or does not act in good faith or acts in violation of the principles of natural justice as explained in the decisions cited supra. “ 9(xxviii) Though this was pressed into service by the petitioner, this Court is of the considered view that Trichy DFA, TNFA and AIFF are not societies which are comparable with Masonic lodge or any other club.
9(xxix) As already alluded to supra, there is no codified law with regard to how the national team for sport of Football is ultimately selected. AIFF has several State bodies, as its members, TNFA is one such member. TNFA in turn has several district bodies as its members and the district body in turn has several clubs as its members. Trichy DFA is one such District body with 46 clubs as mentioned supra. The effective functioning of these entities is imperative to ensure that best available sporting talent in any discipline represents the Country and it is a matter of national pride. http://www.judis.nic.in 27 Axiomatically best available talent in the Country should also get due recognition. Therefore, entities like AIFF, TNFA or Trichy DFA are not comparable with other societies and clubs and therefore, the principle of not interfering with internal affairs of society is clearly inapplicable.
9(xxx) All these are in the nature of a national sports code and therefore, cannot be treated as mere internal affairs of society. This court has already alluded to supra the Bonsor principle laid down by Lord Marton. Indian courts have also adopted this view and when a rule provides for expulsion and when it also lays down that conditions have to be fulfilled, then these conditions may have to be strictly complied with as the very power of expulsion itself is depending on the term of rule. In other words, in the instant case, all three non compliances conjunctively as laid down in Article 16 ought to have occurred for Trichy DFA to be superseded.
9(xxxi) It is made clear that this court is not re-examining the impugned award and views expressed therein on merits.
9(xxxii) This court has already opined that the very construction of Articles 9 and 16 not having been repelled by AT, the conclusion is contrary to such construction. This by itself is sufficient to invalidate the impugned award. However, only with the intention of making the discussion as http://www.judis.nic.in 28 comprehensive as possible, this court has embarked upon the exercise of examining as to why AT has not chosen to return a verdict on the basis of construction placed on terms of contract, namely Articles 9 and 16 not having been repelled. It is in this regard that this court has observed that the principle of not interfering with the internal affairs of a society will not apply to entities like AIFF, TNFA and Trichy DFA, as they are all entities which are part of what can aptly be described as a national sports code (this court is informed that there is no codified law in this regard.
9(xxxii) On research it is found that the word supercession does not find place in a Puritan's English as per Oxford Publications. It is also noticed that there are two words, namely 'Supercede' and 'Supersede'. While 'Supercede' is described as a fancy word, 'Supersede' appears to be more appropriate in the instant case, as it relates to supplement or replace one body with another. The source is Oxford Publications.
10. This brings us to the end of discussion and dispositive reasoning and it takes us to the conclusion.
11 Conclusion :
From the factual matrix set out supra followed by discussion and dispositive reasoning, this court has no doubt in its mind that impugned award is vitiated by patent illegality inter alia owing to contravention of section 28(3) of A & C Act besides being in conflict with public policy owing http://www.judis.nic.in 29 to being contrary to fundamental policy of Indian law and is therefore, liable to be set aside.
12 Decision :
Owing to all that have been set out supra, instant O.P is allowed. Impugned award dated 23.07.2016 is set aside and it follows as a natural sequittur that prayer of the petitioner in the claim petition before AT for declaring the communication dated 18.8.2015 superseding the executive committee of Trichy DFA and appointing an adhoc committee as invalid stands answered in the affirmative. In other words, instant O.P being allowed and impugned award being set aside leaves the prayer of the petitioner before AT acceded to as it is axiomatic besides being a sequitur and a corollary.
Considering the nature of the matter and trajectory of the hearing, this court deems it appropriate to leave the parties to bear their respective costs.
30.04.2019 Speaking order Index: Yes gpa http://www.judis.nic.in 30 M.SUNDAR.J., gpa order in O.P.No.663 of 2016 30.04.2019 .
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