Delhi High Court
International Security And ... vs Municipal Corporation Of Delhi And Ors. on 5 March, 2002
Equivalent citations: AIR2002DELHI347, 2002(2)ARBLR7(DELHI), 2002(63)DRJ38, AIR 2002 DELHI 347, (2002) 2 ARBILR 7 (2002) 63 DRJ 38, (2002) 63 DRJ 38
Author: J.D. Kapoor
Bench: J.D. Kapoor
JUDGMENT J.D. Kapoor, J.
1. Award was made by Justice Jagdish Chandra on 14.3.1997. Objections were filed by the respondent-Judgment Debtor before this court. Vide order dated 17.1.2001, objections were dismissed and the award was made rule of the court, and the decree sheet was ordered to be drawn up accordingly. Pursuant to the decree, instant execution petition was filed. Respondent-Judgment Debtor preferred an appeal and sought stay of the execution of the decree. However, subsequently the application of stay was withdrawn being not pressed as the Judgment Debtor failed to deposit the decretal amount as ordered by the Division bench. In this regard, the order of the Division Bench needs to be reproduced and is as under :-
"C.M.1135/2001 The appeal is not within the period of limitation. Pending consideration in the application for condensation of delay, there was a request for staying the execution of the decree passed pursuant to the award of the arbitrator. It was stated that execution petition is pending. Therefore, we had called upon the appellant to first deposit the amount becoming due and payable under the decree in the registry within four weeks.
Admittedly, till date, the amount has not been deposited.
Learned counsel for the appellant was asked whether the appellant wants more time to deposit the amount. He states that since amount has not been deposited, therefore, he is not pressing the application for stay of execution of decree. The application is accordingly dismissed with liberty to the respondent to seek execution of the decree passed pursuant to the award."
2. At first instance the Judgment Debtor had pointed out legal defect of absence of 'verification' at the foot of the exaction petition. Vide order dated 4.2.2002, the Decree Holder was directed to remove the defects by way of incorporating 'verification'. By way of removal of defect, the 'verification' has been appended at the foot of the petition.
3. Again vide EA 97/2002 the Judgment Debtor has resisted the execution of the decree on multifarious grounds. At the threshold, the respondent-J.D. has questioned the validity of the verification appearing at the foot of the amended application inasmuch as that it is still not as per requirement of law as the person verifying it has not specified as to which particular paragraph of the application he verifies of his own knowledge and which paragraph he verifies upon information received from the records and believed to be true.
4. It is forcefully contended by Dr. K.S. Sidhu, learned senior counsel appearing for respondent-J.D. that the aforesaid requirement of verification is applicable to the execution petition also and is mandatory under the provisions of Order 21 Rule 11(2) CPC. It reads as under :-
"(2). Save as otherwise provided by Sub-rule (1), every application for the execution of a decree shall be in writing, signed and verified by the applicant or by some other person proved to the satisfaction of the Court to the acquainted with the facts of the case and shall contain in a tabular form the following particulars, namely :-
(a). the number of the suit ;
(b). the name of the parties ;
(c). the date of the decree ;
(d). whether any appeal has been preferred from the decree.
xxxxx"
5. Similarly Dr. Sidhu has also relied upon the provisions of Order VI Rule 15 which are like this :-
15.(1). Save as otherwise provided by any law for the time being in force, every pleading shall be verified at the foot by the party or by one of the parties pleading or by some other person proved to the satisfaction of the Court to be acquainted with the facts of the case.
(2). The person verifying shall specify, by reference tot he numbered paragraphs of the pleading, what he verifies of his own knowledge and what he verifies upon information received and believed to be true.
(3). The verification shall be singed by the person making it and shall state the date on which and the place at which it was signed.
6. According to Dr. Sidhu information provided by the Decree Holder is not based upon record and is from his personal knowledge and from the information received by him and the information is wanting inasmuch as application is not verified as to whether the bank accounts mentioned in the application were as a result of personal knowledge or otherwise. In view of the aforesaid defects of the verification, Dr. Sidhu seeks rejection of the application under Sub-rule 1(A) of Rule 17 of Order 21 CPC which is as under :-
If the defect is not so remedied, the Court shall reject the application:
Provided that where, in the opinion of the Court, there is some inaccuracy as to the amount referred to in Clauses (g) and (h) of Sub-rule (2) of Rule 11, the Court shall, instead of rejecting the application, decide provisionally (without prejudice to the right of the parties to have the amount finally decided in the course of the proceedings) the amount and make an order for the execution of the decree for the amount so provisionally decided."
7. I am afraid an execution petition cannot be placed on the same pedestal as the pleadings of the suit viz. the plaint, the written statement, replication which have to be necessarily in the form of paragraphs. The facts of pleadings are put in such a mode that may require verification as contemplated by the aforesaid Order. On the other hand, there is a prescribed proforma having more than 11 columns for execution petition in respect of which information is to be provided by the applicant.
8. Though the information as to the name of the parties, date of the decree in tabular form cannot be provided the status of "paragraph" of pleadings in a suit yet such columns have to be referred as "paras" in the 'verification' appearing at the foot of the execution petition. In common parlace and as per dictionary meaning the word "paragraph" is defined as 'a distinct section of a piece of writing, a symbol used to mark a new paragraph and also a reference mark'. This is why requirement of Order 21 Rule 11(2) CPC are deemed to be fulfillled if the verification is to the satisfaction of the Court. It is the satisfaction of the court which is material for the purpose of accepting or rejecting verification. In the pleadings of the aforesaid nature, party may be required to verify as to which of the paragraphs are verified to be true out of his knowledge and which of the paragraphs are verified to be true upon information and believed to be true. Thus, it is the satisfaction of the court with regard to the sufficiency and correctness of the information provided by the petitioner that is paramount.
9. The verification signed by the Managing Director of the company is as under :-
"I. S.S. Dhindsa, Managing Director/ Principal Officer of the Decreeholder above named do hereby verify that the contents of this Execution Petition from para No. 1 to 10 are true and correct as per record and nothing material has been concealed there from. Last para is prayer to this Hon'ble Court.
Verified at New Delhi on this 8th day of February, 2002."
10. As is apparent from the above, contents of the execution petition from paras 1 to 10 have been sufficiently verified as true and correct as per record and nothing material has been concealed thereform. Respondent-Judgment Debtor has failed to point out as to in which respect the information given in the execution petition is wanting. Verification in question fully satisfies the requirement of Sub-rule (2) of Rule 15 of Order VI CPC. Objection in this regard is wholly groundless and tenuous.
11. Next objection is that certified copy of the decree accompanying the application for execution is not in accordance with the judgment of the court inasmuch as the only application dismissed by the court was IA 9207/97 (i.e. one under Section 30 of Arbitration Act, 1940) and not the IA 818/2000 (application under Section 33 of the Arbitration Act, 1940). Application under Section 33 of the Arbitration Act, 1940 was an independent application challenging the very existence of the arbitration clause resulting in rendering the decree as null and void.
12. Dr. Sidhu contends that this a home drawn decree and therefore in contravention of the requirement of Order 20 Rule 6 which requires that the decree shall agree with the judgment; it shall contain the number of the suit, the names and descriptions of the parties, their registered addresses and particulars of the claim and shall specify clearly the relief granted or other determination of the suit and it shall also state the amount of costs incurred in the suit and by whom or out of what property and in what proportions such costs are to be paid.
13. The argument that decree is not in agreement with the judgment is based on the premise that only IA 9207/97 under Section 30 of the Indian Arbitration Act was decided by judgment dated 17.1.2002 whereas the crucial IA bearing No. 818/2000 preferred under Section 33 of the Indian Arbitration Act remained undecided but the decree shows that both the applications were decided by the said order.
14. Dr. Sidhu contends that provisions of Section 33 of the Act were invoked for declaring that there was no arbitration agreement between the parties whereas learned Single Judge vide order dated 17.1.2002 has not returned any finding in this regard.
15. Dr. Sidhu has referred to the opening part of the judgment whereby learned Single Judge proposed to decide S.No. 569A/1997 and IA bearing No. 9207/1999 filed under Section 30 of the Arbitration Act only. The order shows that the learned Judge did not propose to decide I.A.No. 818/2000 moved under Section 33 of the Act. The relevant extracts of the judgment are as under :-
Suit No. 569-A of 1997 has been filed for making the Award relating to case No. ARB/JC/1 dated 14th March, 1997, passed by Justice Jagdish Chandra (Retd.) as Rule of the Court and for passing of a decree in terms thereof. The Respondent, the Municipal Corporation of Delhi (MC) has filed objections to this Award on 27th May, 1997, in terms of their application numbered as IA 9207/97. Both these actions shall be disposed off by this judgment."
16. The decree drawn by the registry is as under :-
"This suit coming on this day for final disposal before this Court in the presence of the counsel for the parties as aforesaid, it is ordered that the objections (I.A. No. 9207/97) filed by the respondent and (I.A. No. 818/2000) filed by the respondent to declare the Award dated 14.3.1997, given by Shri Jagdish Chandra Arbitrator, as null and void, be and the same are hereby dismissed and the said award appended hereto as annexure 'A' is taken on record and made a rule of the Court and a decree is hereby passed in terms of the said Award which shall form part of the decree."
17. In support of the contention that the executing court can refer to the pleadings of the parties in order to understand the judgment of the court. Dr. Sidhu has placed reliance upon following judgments:
i) Bhagwati Prasad v. Babu Lal bathwal wherein it was held that "Where the terms of the decree are uncertain, although it is not permissible for the executing Court to refer to other evidence in order to understand the judgment of the Court, the executing Court can certainly refer to the Court's judgment and to the pleadings of the parties in order to find out its precise meaning.
ii) A.T.N.A.T. Chockalingam Chettiar v. Ko Maung Gyi and Ors. AIR 1938 Rangoon 372 wherein it was held that "No doubt the executing Court has got to take a decree and execute it as it stands, but the executing Court is not precluded from finding out whether any decree had ever been passed at all; and merely because something has been written in a decree form, it does not necessarily make it a decree."
18. On the point that the executing court has inherent power under Section 151 CPC to correct or amend the clerical or arithmetical mistakes in the judgment or errors arising therein, Dr. Sidhu placed reliance on Rajkishore Das Nilamani Das wherein it was held that any order amending the execution is in exercise of its inherent jurisdiction under Section 151 CPC.
19. There is no gainsaying the fact that any order or decree passed by any Court which lacks inherent jurisdiction is not only void ab initio but is a nullity and is rendered non-existent. The executing Court is neither required nor can it be called upon to execute a decree which is a nullity and, therefore, is vested with the powers to go into the question whether the decree is a nullity on account of lack of inherent jurisdiction and if it holds in the affirmative it can and should decline to execute it.
20. The Full Bench of this Court in KC Manchanda v. Murree Brewery Co. Rawalpindi held that the executing Court is competent to consider the validity of the decree in the sense of its being within or outside the jurisdiction of the court that has passed the decree.
21. Developing this concept Dr. Sidhu has assailed the decree being nullity on the premise that the application IA 818/2000 preferred under Section 33 of the Indian Arbitration Act through which the existence of the arbitration agreement itself was questioned has remained undecided as mere mention in the title and not in the text does not amount to deciding the application and it militates against the principles of natural justice. In this regard, Dr. Sidhu has placed reliance upon the following observations made by Full Bench of Punjab and Haryana High Court in Ram Singh v. The Gandhar Agricultural Co-operative Service Society, Gandhar . These are:-
"It would thus be seen that there is preponderance of authorities in support of the proposition that if the determination by a tribunal depends upon following the principles of natural justice the decision given by it would be treated as a nullity in case it had failed to follow these principles. An aggrieved party would in that be not under an obligation to have the decision set aside in appeal. It would be open to it to challenge its validity at the stage of execution and even in collateral proceedings, as held by their Lordships of the Supreme Court in Kiran Singh's case (supra). The Courts when "they talk of error of jurisdiction", they do not deal with absolutes but with the opinions of human beings. Laws are framed for the common man and they should be so interpreted as to foster the faith and respect of the common man in the laws of the land. I have no doubt in my mind that the denial of right to a litigant to question the validity of an order, given in contravention of the principles of natural justice, in collateral proceedings like execution would be viewed with serious apprehensions even by a man in the street."
22. There is no doubt that denial of hearing either consciously or inadvertently hits at the fount of principles of natural justice and entitles the aggrieved party to get the order or judgment or decree set aside even in execution proceedings.
23. According to Dr. Sidhu if it is held in the said. application that the arbitration agreement did not exist at all the whole case of the decree holder will fall like a pack of cards as it will rend the award from its foundation of cornice.
24. Section 33 of the Act can be invoked in three eventualities viz. (i) if any party to arbitration agreement or any person claiming under him desires to challenge the existence of the arbitration agreement ;
(ii) if it desires to challenge the validity of the arbitration agreement; (iii) if it desires to challenge the existence of an award or its validity or if it desires to have the effect of both determined. Needless to say that if it is held that the arbitration clause does not exist, the award or the decree based on the award are rendered null and void as any award or decree has no existence if it is passed by a person or the court who lakcs jurisdiction itself. Every judicial or quasi judicial authority claims its existence from its jurisdiction. No such authority can traverse beyond its arena. If it does so it amounts to trespassing or wandering into the territory legally occupied by another person.
25. However without traversing further on this aspect of the matter I place reliance upon and refer to the observations made by the Full Bench of this Court in Prem Sagar Chawla v. Security and Finance (P) Limited which are quoteworthy and are as under :-
"If the arbitration agreement is non-existent, so must be the award with the result that there would be nothing to set aside. I am unable to reconcile myself to the view that in cases where the arbitrator makes an award without any arbitration agreement, then a party cannot go to Court under Section 33 and ask for a declaration that there was agreement and consequently, no award. In such cases, the challenge to the agreement is independent. There appears to be no justification for limiting the words "challenge the existence..... of an arbitration agreement in Section 33 to the pre-award stage. The arbitration agreement provides the source of authority to the arbitrator and is the very foundation of his jurisdiction. If there is no arbitration agreement, there is no arbitrator and consequently there is no award requiring to be set aside."
26. However the ratio of the aforesaid judgment is based upon the minority view of the Calcutta High Court in Shaba and Co.'s case which is as under :-
"I am therefore of the opinion that under the Arbitration Act, 1940 (a) an award on an arbitration without the intervention of Court presupposes an arbitration agreement; (b) There can be no arbitration award without the intervention of Court if the alleged arbitration does not exist or is invalid; (c) Non-existence or invalidity of the alleged arbitration agreement is not a ground for setting aside an award without the intervention of Court under Section 30; (d) An application may be made under Section 33 asking for a decision that the arbitration agreement does not exist or is invalid and that consequently the award is a nullity and does not exist; (e) Proceedings for summary enforcement of an award without the intervention of Court may be defended on the ground that the arbitration agreement does not exist or is invalid and that consequently the award does not legally exist even though no substantive application challenging the award has been made."
27. On the point whether or not the averments/objections made in the application under Section 33 of the Act were considered and decided by the learned Single Judge through judgment dated 17th January, 2001, answer lies in making copious reference to and reproduction of observation. Some of the excerpts are as follows :-
"That the objections of the respondent to the effect that the disputes raised by the claimant were beyond the scope of the arbitration agreement and that there was no agreement between the parties as it did not pertain to the period stipulated in the agreement and that there was no agreement between the parties for the subsequent period in question appear to have been agitated before either at the stage of the disposal of the suit 578-A/95 in terms of the decision of S.K. Mahajan, J. dated 22.2.1996 when the present parties were referred to the sole arbitration of Mr. Justice Jagdish Chandra (Retd).
After perusal of the pleadings it was found that the reply to the letter dated 26.9.94 citing out the six disputes to be arbitered upon by the sole Arbitrator reply was filed by the respondent/applicant namely the Director (Administration) but nowhere it was assailed that no arbitration agreement prevailed between the parties or that the six claims referred to Arbitrator are beyond the arbitration clause between them. The entire reply was reproduced in the judgment. The other relevant observations of the learned Single Judge in this regard are as under :-
28. However while coming to the conclusion that the plea raised by the respondent by way of application under Section 33 of the Arbitration Act is an after though the learned Single Judge provided the following reasons:-
"Firstly, it is the Respondents who have themselves referred all six Claims to the Sole Arbitration of Shri R.K. Yadav, even after referring to both the Agreements. No demur to the effect that no consensus to arbitrate existed had been recorded even at that stage. Secondly, the Respondents appear to have accepted the transition and metamorphosis of the sole Proprietary concern with the Limited Company, and Clauses 16 and 18 respectively contained the Arbitration Clause. This is not a case of a total absence of an agreement to arbitrate. Contrary to the previous conduct between the parties a convoluted and intricate skein, of the absence of agreement to refer to six Claims to arbitral resolution, has been spun by the Respondents in their Counter-Statement before the Sole Arbitrator, but apparently not pressed any further. Thirdly, the understanding given by the Respondents to the Order allowing the petition under Section 20 in Suit No. 578-A/95, by reference to the opening words, that it was only the 7.6.1989 Agreement which was in the Court's contemplation, must be rejected as sophisticated sophistry. There was no doubt, nor any controversy between the parties at that stage, that it was the six Claims that were to be referred/were referred to Arbitration. This debate has been started only since the Award is against the Municipal Corporation of Delhi. It has been held in a plethora of precedents that the Court ought not to countenance an Objection that has been raised after a party has participated in the proceedings. Fourthly, the proper stage for raising the demurer of nonreferability of disputes to arbitration is in the proceedings under Section 20 of the Arbitration Act. If not so raised, the principles of constructive res judicata would preclude the Court from entering into this debate."
29. Aforesaid observations of the learned single Judge amply demonstrate that each and every contention as to the non-existence of the arbitration agreement was not only dealt with but also considered in extenso.
30. So much so the learned Single Judge had duly considered Prem Sagar Chawla's case which has been strongly relied upon by the learned counsel for the respondent. Contention of the learned counsel for the respondent is on very slippery ground even as to factual matrix.
31. Even if it is assumed for the sake of argument as contended by Dr. Sidhu that the order dated 17.1.2002 is not in the correct prospective as it has failed to distinguish between the scope of Sections 30 and 33 still the fact remains that the objections contained in both the applications were dismissed and disposed off by the said order. Moreover the Judgment Debtor/applicant has challenged the said order by way of appeal on the same grounds as are being agitated in these proceedings for terming the decree as a nullity and not being a agreement with the judgment for the self-same reasons.
32. The Arbitrator is an instrument of an arbitration agreement. In other words he is a creature of the agreement and if it is found that the arbitration agreement did not exist at all not only the existence of the arbitration is rendered non-existent but the act done by the Arbitrator is rendered nugatory and tutalogus also.
33. Section 33 pre-supposes an arbitration agreement whereas Section 33 pre-supposes non-existence or invalidity of the arbitration agreement or award. The award cannot be set aside under Section 30 on the ground of non-existence or invalidity of the arbitration agreement. The reasons for setting aside or rejection of the award under Section 30 are independent of Section 33. If any of the ingredients of Section 33 exists the award itself becomes a casualty and is rendered a nullity. Distinction between Sections 30 and 33 of the Act is that the former applies to violable award while the latter is applicable to void award.
34. To fortify this view, the observations made in Basant Lal v. Surendra Prasad and Ors. may be quoted. These are as under :-
"Section 30 speaks only of invalidity, in making the award, and the grounds set forth in Section 30 indicate that these grounds have reference only to proceedings before the arbitrator alone and not the anterior proceedings of the Court. The words "or is otherwise invalid" must, therefore, refer to the invalidity of the award based on any ground unconnected with the proceedings of the Court. Non-existence, or invalidity, of an arbitration agreement, or reference, are not contemplated by, and, included in the words "or is otherwise invalid" in Section 30(c), and are, as such, not grounds, contemplated by, and, within the meaning of Section 30, on which an award can be set aside, under it even if the award is based on any invalid and non-existent arbitration agreement, or reference, without the intervention of the Court. These words consequently should not be read ejusdem generis, with the other cases mentioned in Clauses (a) and (b), or in the proceedings words in Clause
(c) of Section 30. They should be restricted to cases where an award is bad on one or more of the grounds mentioned in Section, or on grounds other than those specifically mentioned in Clauses
(a), (b) and (c) of Section 30, relating to the invalidity of the award."
35. Let us assume for the sake of argument that vide order dated 17.1.2001 application under Section 33 of the Act remained undecided. To show that there was no agreement for arbitration, Dr. Sidhu has pointed out the following facts :-
(i) That in an application under Section 20 of the Arbitration Act, 1940 failed by the petitioner for appointment of the Arbitrator, the relief of the declaration of the arbitration agreement being non-existent was out of question.
(ii) The award has been made by the Arbitrator on the assumption that the reference had been made to him on the basis of the arbitration clause in the agreement dated 24.1.92 whereas inf act it was in agreement dated 7.1.89 that the arbitration clause existed.
36. The main thrust of the contention of Dr. Sidhu for declaring the decree as a nullity is that the arbitration agreement dated 7.6.89 which was ordered to be filed by this Court through its order dated 22.2.96 was not the agreement between the parties or for that matter before the Arbitrator and, therefore, the award made by the Arbitrator against the petitioner on the basis of the agreement dated 7.6.89 is null and void as the learned Arbitrator proceeded on the presumption that the reference has been made to him on the basis of the agreement dated 24.1.92 whereas in actuality the reference made by the Court was based on or stemmed from the agreement dated 7.6.89. Since the arbitration agreement did not figure in the agreement dated 7.6.89 the award by the Arbitrator is without jurisdiction and is no award in the eyes of law. It is further contended that this objection was also raised before the Arbitrator but he ignored the same and proceeded with the arbitration proceedings on the plea that the reference has been made by the Court and, therefore, he was duty bound to deliver the award.
37. There are several courses which the parties may chose to adopt if there is a challenge as to the existence of the arbitration agreement. The course adopted by the petitioner is that he has waited and watched and taken a chance in the hope that the decision may come in his favor but has challenged the validity of the award when it has been sought to be made a decree of the Court on the ground that there was in fact no valid or existing contract of arbitration.
38. The Bombay High Court had the occasion to deal with the courses the parties can adopt if there is a challenge to the existence of arbitration agreement. In Shri Vallabh Pitte v. Narsingdas Govindram Kalani , Bombay High Court has agreed in principle that any of the courses contemplated under Section 33 of the Act is available to the party. It has held as under :-
"Whenever there is a dispute as to the existence of a contract of arbitration, the parties may choose to adopt one or the other of the following courses; (1) The party affirming the existence of the contract of arbitration may approach the Court to have it determined either under Sections 31 & 32 read together, or approach the Court under Section 20 and request that the agreement be filed and that the matter be referred to arbitration. (2) He may not necessarily follow the same course. He may follow the procedure of Chap. II and refer the matter to arbitration according to the contract calling upon the party denying the existence of the contract of arbitration to appoint his own arbitrator who may if he so chooses deny the jurisdiction of the arbitrator and appear under protest or he may, if he so chooses refuse to appear before the arbitrator at his own risk. (3) He may if he so chooses approach the Court under Section 33 and have it declared that there is in fact no arbitration agreement in existence and obtain stay of the proceedings of the arbitrators. (4) He may not even adopt that procedure but may wait and take a chance of a decision in his favor and when an application is made to make a decree in terms of the award, challenge the validity of the award on the ground that there was in fact no valid and existing contract of arbitration."
39. It is settled law and has been laid down by the Supreme Court in Vasudev Dhanjibhai Mod v. Rajabhai Abdul Rehman and Ors. that a court executing a decree cannot go behind the decree between the parties or their representatives; it must take the decree according to its tenor, and cannot entertain any objection that the decree was incorrect in law or on facts. Until it is set aside by an appropriate proceeding in appeal or revision, a decree even if it be erroneous is still binding between the parties.
40. It is beyond the purview of the executing court to scan or review the reasoning provided by the court in decreeing the suit. Reasons may be tenuous or even such which when examined by the competent court i.e. appellate court may be found unsound. But the hands of executing court in testing or examining the reasons of judgment leading to the decree are tied. Executing court is the creature of a decree. It cannot be allowed to be above it. It can set aside the decree if it has been passed by the court that had no jurisdiction at all. Otherwise right or wrong it is bound by it. However when the decree is made by a Court which lacks inherent jurisdiction, objection as to its validity can be raised in execution proceedings if the objection appears true on the face of the record and requires examination of the questions raised and decided at the trail.
41. To reopen issue or contention and to say that some part of the arguments were not considered or that the application was dealt with on the peripheral pedestal is neither factually nor legally permissible. Unless and until there is a compete absence of any reference or arguments or decision on the application or objections, the decree cannot be rendered as a nullity. Executing court cannot scan or scrutinize strength or weaknesses of the contentions of the parties and reasons provided by the court for accepting or rejecting them. It is not the function of the executing court to review the judgment of the court of competent jurisdiction.
42. To find fault with the reasoning of the judgment is not a ground for declaring the decree as a nullity. Main ground for declaring the award or decree as a nullity is that it should either suffer from the vice of non-jurisdiction or should be beyond the scope of the agreement.
43. Let us take the arguments of Dr. Sidhu in extremity. He says that award has been made on the assumption that reference was made in respect of agreement dated 24.1.1992 whereas it was with regard to agreement dated 7.6.1989 in which arbitration clause did not exist. Admittedly there were two agreements. The first agreement was made on 7.6.89 between Slum Wing DDA, Vikas Bhawan through its Director Administration and M/s International Security and Intelligence Agency through Shri S.S. Dhindsa, the proprietor of the said firm. The relevant clause in this regard read as under :-
Clauses 16: Any other matter not incorporated specifically in this agreement shall be mutually settled between both the parties. In case of any dispute regarding interpretation of above terms and conditions of contract and their non-implementation or any other matter incidental thereto covered in this agreement, the matter will be referred to the sole arbitration of Commissioner (S&JJR), D.D.A. or person nominated by him whose decision shall be final and binding on both the parties."
44. The second agreement was made on 24.1.92 between Slum Wing DDA and M/s. International Security and Intelligence through its Director Mr. S.S. Dhindsa. The relevant clause in this regard is as under :-
Clause 18. Any other matters not incorporated specifically in the agreement shall be mutually settled between both the parties. In case of any dispute regarding interpretation of the above terms and conditions of contract and their non-implementation or any other matter incidental thereto not covered in this Agreement, the matter will be referred to the sole arbitration of Commissioner (S&JJ) I, D.D.A., or a person nominated by him whose decision shall be final and binding on both the parties.
45. The dispute arose out of the first agreement dated 7.6.89. The decree holder gave a notice to the Judgment-Debtor for appointment of the Arbitrator by invoking Clause 16 of the agreement dated 7.6.89. On failure of the respondent to settle the disputes in terms of he said clause the decree holder approached the Court by moving the application under Section 20 of the Arbitration Act, 1940. However during the pendency of the petition the JD appointed one Mr. R.S. Yadav, Superintending Engineer as the Arbitrator. The decree holder challenged the appointment of Mr. R.S. Yadav before the Court. The learned Single Judge vide order dated 22.2.96 revoked the appointment of Mr. Yadav and appointed Mr. Justice Jagdish Chandra as the sole Arbitrator. The respondent/JD contested the application under Section 20 and filed the reply wherein no plea was raised that the arbitration agreement did not exist between the parties.
46. Neither was any appeal filed by the respondent-Judgment Debtor against the said order of appointment of the Arbitrator and reference of the disputes for adjudication. Both the parties appeared and submitted before the Arbitrator. So much so the respondent also filed the counter claims before the Arbitrator whereas the petitioner/DH filed as many as six claims.
47. The perusal of the judgment shows that the learned Single Judge dealt with the plea of the respondent as to the non-existence of the arbitration agreement from every possible aspect namely on factual matrix as well as legal matrix. The rake up the issue again at the stage when the decree is being sought to be execute that the arguments were not actually heard on the application under Section 33 but were only heard in relation to the application under Section 30 is highly far fetched, unacceptable and without any basis. The learned Single Judge ha dealt with this aspect in extenso. The relevant and significant portions of which have been extracted above. The reasons provided by the learned Single Judge in this regard run from pages 23 to 26 which I deem needless to reproduce them as substantial portions have been reproduced above.
48. So much so the findings of the learned Single Judge on the point whether or not there existed the arbitration agreement between the parties have since been challenged by way of appeal FAO(OS) 471.01. All those points which are now being agitated have been raised before the Appellant Court.
49. Moreover the respondent/JD did not raise the objection at first instance when the opportunity arose in the proceedings under Section 20 of the Arbitration Act. All this leads to the most ineluctable conclusion that the decree in question is not only in agreement with the judgment pronounced by the learned Single Judge but the objections raised in the application under Section 33 of the Act squarely and fairly dealt with in all possible and extensive perspective. Thus, there is not other option left for the respondent/JD than to wait for the decision of the appellate Court. Respondent/Judgment Debtor appears to be clutching a weakest legal straw like a drowning person as the appellate Court has also directed the Judgment Debtor to deposit the decretal amount first before it could be heard in appeal.
50. Last but not the least the contention of Dr. Sidhu that the agreement dated 7.6.89 was between the Decree Holder and Shri S.S. Dhindsa in his capacity as proprietor of M/s. International Security and Intelligence Agency whereas the second agreement was between Slum Wing of DDA and a Public Limited Company though by the same name i.e. International Security and Intelligence Agency which was represented through its Director Rupinder Kaur and not Shri S.S. Dhindsa and the instant decree has been passed pursuant to the award stemming from the agreement dated 7.6.89. This has to relevance as at no stage this objection was taken before the Court who had appointed the Arbitrator or before the Arbitrator or even in the application under Section 33 of the Act. However this objection was taken only in the application under Section 30 of the Arbitration Act which was duly dealt with and disposed off by the learned Single Judge in the following manner:-
"I have perused the Counter Statement of facts and Reply to Claims filed before the Sole Arbitrator, and find that although Objections to this effect were raised peripherally and in passing, specific challenge should have been prominently and vociferously raised by the Respondents at the very threshold. But this is not so. Obviously the oral arguments raised before me are an after-thought. The only inference that I can draw is that the arguments was not raised before the learned Sole Arbitrator and hence he did not return a finding on the issue. This issue is now being contended as being pivotal and vital."
51. More so this objection is not available to the Judgment Debtor by way of application under Section 33 of the Act. Even if it is assumed that the first agreement was between the sole proprietor of the concern and second agreement was with a company, the fact remains that Shri S.S. Dhindsa, the proprietor happens to be the Managing Director of the company and is placed in similar situation as he was when he was sole proprietor.
52. Having held the matter in all its possible aspects, I find the objections highly flimsy, frivolous and fraught with feeble attempts to stultify and scuttle the decree and deprive the Holder thereof of its fruits. In the result, objections prove damp squip and are dismissed. The order dated 31.1.2002 stands restored.