Delhi District Court
Sh. Ramesh C. Sharma vs Sh. Rajender Pershad Sharma on 17 April, 2007
IN THE COURT OF SH. MANOJ JAIN: ADDL. DISTRICT JUDGE:
DELHI
RCA No. 1/07
IN RE:
Sh. Ramesh C. Sharma,
s/o late Sh. R.P. Sharma,
r/o 6596/9-B, Dev Nagar,
New Delhi .....Appellant/plaintiff No.1
Versus
Sh. Rajender Pershad Sharma,
s/o late Sh. R.P. Sharma,
r/o 60/15, Ramjas Road, Karol Bagh,
New Delhi. ............Respondent/defendant
Date of Filing : 02.01.2007
Date of Decision : 17.04.2007
JUDGMENT
1 This appeal takes exception to the judgment dated 25.11.2006 passed by Sh. Raj Kumar, learned Civil Judge whereby suit of the plaintiff No.1/appellant had been dismissed. Let me give brief facts germane for the purpose of disposal of the present appeal. For the sake of convenience, I would be referring to the parties as per their nomenclature in the suit. 2 Plaintiffs had filed a suit against the defendant on 16.08.1996 and sought declaration to the effect that defendant had no lawful or legal right to raise construction or to create any third party interest with respect to jointly owned property bearing no. 60/15, Ramjas Road, Karol Bagh, New Delhi (hereinafter referred to as 'suit property') and also prayed for 1 necessary injunction.
3 Defendant resisted the suit and filed written statement and he took various legal preliminary objections as well. According to him, suit was barred under Section 32 of Indian Arbitration Act, 1940 as well. It was also claimed that suit was barred by principles of res judicata. Facts on merit were also disputed.
4 Issues were framed.
5 It is worthwhile to mention here that defence of the defendant had been struck off vide order dated 07.07.2005. 6 Learned Trial Court decided issue no. 2, 3, & 5 in favour of the plaintiff and against defendant but plaintiff has been non-suited on the basis of decision given with respect to issue no. 1. Issue no. 1 reads as under:
''Whether the suit is barred under section 32 of the Arbitration Act? OPD''
7 Appellant is an advocate and he has argued his case all by himself and has contended that learned Trial Court has erred in holding that suit was barred under Section 32 of Indian Arbitration Act, 1940 (hereinafter referred to as 'said Act'). It has been argued that such issue, even otherwise, was not a pure legal issue and since onus was on defendant to prove such issue and since defence of the defendant had already been 2 struck off, issue could not have been decided against the plaintiff. It has also been argued that even otherwise facts mentioned by the plaintiff have been misread and there was no admission as such and, therefore, issue could not have been decided against the plaintiff. It has also been argued that suit is liable to be decided as per law in force at the time of the filing of the suit and since suit was instituted on 16.08.1996 and since such Act had already been repealed in 1996, learned Trial Court could not have relied upon a repealed statute.
8 Counsel for defendant has, on the other hand, refuted all the aforesaid contentions and has argued that aforesaid issue was a pure legal issue and learned Trial Court was fully justified in adjudicating the same against the plaintiff.
9 Plaintiff and defendant happen to be real brothers. Suit property was owned by Sh. Raghunandan Prasad Sharma (their father) who expired on 22.06.1987. He had, however, left behind a Will dated 05.11.1986 and as per the Will, plaintiff and defendant were given equal share of twenty five per cent each. According to the plaintiff, defendant colluded and conspired with one Sh. Madan Lal Ahuja and clandestinely obtained false, fraudulent and illegal award dated 17.03.1988. According to plaintiff, such award has no legal sanctity and, therefore, defendant has no lawful right to make any structural changes or to make any construction in the suit property. 3 10 As I have already noted above, as per the Will left behind by Sh. Raghunandan Prasad Sharma, plaintiff had been given share of twenty five per cent. Copy of award is on record and as per the award dated 17.03.1988, the suit property was agreed to be divided in the following manner:
SHARE OF RAMESH CHANDER SHARMA AND MUNISH KUMAR SHARMA (Plaintiff no. 1 & plaintiff no. 3 respectively in the suit).
They are also given the right to construct, whenever they like, one complete story of building upon the roofs of 60/15, Ramjas Road, Karol Bagh, New Delhi by legal procedure, and for this their relatives (brothers and uncles) residing there at the Ground floor will help them by all the possible means (except financial). There is one grage on the Road Side which is let out to M/S. KIRANK DRY CLEANER, which will be the property of Shri Ashok Kumar Sharma, but there is one room on the grage, which will belong to Shri Munish Kumar Sharma.
SHARE OF RAJINDER PARSHAD SHARMA (Defendant in the suit) Shri RAJINDER PARSHAD SHARMA is given half of the ground floor of Building No. 60/15, Ramjas Road, Karol Bagh, Newe Delhi consisting of One Big Hall, (used as D. Dinning) a bed room on its back (already with Shri Rajinder Parshad Sharma) and adjoining Bath Room, Round Room, both the varandas one covered with glasses, and the other before the Big Hall. The lawn in front is also given to Shri Rajinder Parshad Sharma with the clear understanding that the lawn can be used by all the family members on some family functions etc. 4 SHARE OF SH. ASHOK KUMAR SHARMA (Plaintiff No. 2 in the suit though his name was deleted vide order dated 19.08.96) Shri ASHOK KUMAR SHARMA is given the balance half portion of the ground floor of 60/15, Ramjas Road, Karol Bagh, New Delhi, both the garages as mentioned above in this building.'' 11 Admittedly, suit no. 786A/88 is pending adjudication before the Hon'ble High Court of Delhi for making said award rule of the Court. Such suit is at the stage of recording of evidence and even plaintiff/appellant does not dispute the aforesaid fact.
12 Section 31 (2) & Section 32 of said Act read as under:
Section 31 (2) Jurisdiction-(2) Notwithstanding anything contained in any other law for the time being in force and save as otherwise provided in this Act, all questions regarding the validity, effect or existence of an award or an arbitration agreement between the parties to the agreement or persons claiming under them shall be decided by the Court in which the award under the agreement has been, or may be, filed, any by no other Court.
Section 32 Bar to suits contesting arbitration agreement or award- Notwithstanding any law for the time being in force, no suit shall lie on any ground whatsoever for a decision upon the existence, effect or validity of an arbitration agreement or award, nor shall any arbitration agreement or award be [enforced], set aside, amended, modified or in any way affected than as provided in this Act.'' 5
13 Appellant has contended that by filing the instant suit for declaration and injunction, plaintiff has not prayed for any amendment or modification in the aforesaid award. He has also argued that bar as contained under Section 32 of said Act does not stand attracted at all. 14 Admittedly, defence of the defendant had been struck off but the question of applicability of Section 32 of said Act cannot be said to be a mixed question of fact and law. It rather, obviously, is a pure question of law. Even if the defendant is proceeded against ex parte or defence of defendant is struck off, plaintiff is still duty bound to show that suit is not barred by any specific provision of law or by implication. 15 I have already extracted above the various clauses of the award and as per award, plaintiffs no. 1 & 3 had been given roof rights and plaintiff no. 2 Sh. Ashok Kumar Sharma and defendant Rajender Prasad Sharma were given ground floor portion equally. Plaintiff has, in the suit, prayed that it be declared that defendant had no lawful right to make any structural changes or to make any construction and by seeking such declaration, he is naturally and evidently praying for modification and amendment in the award.
16 Award is, in fact, a final adjudication and suit cannot be filed on any ground whatsoever seeking modification or amendment in such arbitral award. Words ''on any ground'' are pertinent and wide enough to cover any possible situation effecting award. By virtue of award, plaintiffs no. 1 & 3 6 had been given roof rights only and ground floor portion was given to defendant and plaintiff no. 2 in equal. Plaintiffs, by filing a suit, want to seek declaration that defendant Rajdender Prasad Sharma had no lawful right to raise construction or to make any structural changes whereas as per the award, he had been given half portion of the ground floor. In case declaration, as prayed, is granted to the plaintiff then it would certainly be amending and altering the award.
17 Learned Trial Court was, therefore, fully justified in applying the bar contained under Section 32 of said Act. 18 Section 85 of Arbitration & Conciliation Act, 1996 reads as under:
'Repeal and saving -(1) The arbitration (Protocol and Convention) Act, 1937 (6 of 1937), the Arbitration Act, 1940 (10 of 1940) and the Foreign Awards (Recognition and Enforcement Act, 1961 (45 of 1961) are hereby repealed.
(2) Notwithstanding such repeal,-
(a) the provisions of the said enactments shall apply in relation to arbitral proceedings which commenced before this Act came into force unless otherwise agreed by the parties but this Act shall in relation to arbitral proceedings which commenced on or after this Act comes into force;
(b) all rules made and notifications published, under the said enactments shall, to the extent to which they are not repugnant to this Act, be deemed respectively to have been made or issued under this Act.7
19 Counsel for appellant has contended that at the time when the suit was filed, the old Act had already been repealed and, therefore, learned Trial Court could not have applied the bar as provided under Section 32 of old Act. However, bare perusal of aforesaid provision clearly reveals that any accrued right under the old Act is preserved from being affected. In the case of THYSSEN STAHLUNION GMBH V. STEEL AUTHORITY OF INDIA LTD. AIR 1999 SUPREME COURT 3923 it has been observed in Paras 39, 40 and 41 as under: -
''....................Enforcement of the award, which is made under old Act i.e. Arbitration Act, 1940 though after coming into force of new Act i.e. Arbitration and Conciliation Act, 1996 which repealed old Act of 1940, has to be examined on the touchstone of the proceedings held under the old Act.
.....................The question as to what is right accrued or acquired has to be examined with reference to the provisions of S. 6 of the General Clauses Act if it could be said that when the arbitral proceedings have commenced under the old Act, a party has acquired a right to have the award given thereafter enforced under the old Act. The question that arises for consideration is if a right has accrued to the party or it is merely an inchoate right. .................
.................
Principles enunciated in the judgments show as to when a right accrues to a party under the repealed Act. It is not necessary that for the right to accrue that legal proceedings must be pending when the new Act comes into force. To have the award enforced when arbitral proceedings commenced under the old Act under that very Act is certainly an accrued right. Consequences for the parties against whom award is given after arbitral proceedings have been held under the old Act though given after the coming into force of the new Act, 8 would be quite grave if it is debarred from challenging the award under the provisions of the old Act. Structure of both the Acts is different. When arbitral proceedings commenced under the old Act it would be in the mind of everybody, i.e., arbitrators and the parties that the award given should not fall foul of Ss. 30 and 32 of the old Act. Nobody at that time could have thought that S. 30 of the old Act could be substituted by S. 34 of the new Act. As a matter of fact appellant Thyssen in Civil Appeal No. 6036/98 itself understood that the old Act would apply when it approached the High Court under Ss. 14 and 17 of the old Act for making the award rule of the Court. It was only later on that it changed the stand and now took the position that new Act would apply and for that purpose filed an application for execution of the award. By that time limitation to set aside the award under the new Act had elapsed. Appellant itself led the respondent SAIL in believing that the old Act would apply. SAIL had filed objections to the award under S. 30 of the old Act after notice for filing of the award was received by it on the application filed by the Thyssen under Ss. 14 and 17 of the old Act. We have been informed that numerous such matters are pending all over the country where the award in similar circumstances is sought to be enforced or set aside under the provisions of the old Act. We, therefore, cannot adopt a construction which would lead to such anomalous situations where the party seeking to have the award set aside finds himself without any remedy. We are, therefore, of the opinion that it would be the provisions of the old Act that would apply to the enforcement of the award in the case of Civil Appeal No. 6036 of 1998. Any other construction on the S. 85(2)(a) would only lead to the confusion and hardship.
This construction put by us is consistent with the wording of S. 85(2)(a) using the terms "provision" and "in relation to arbitral proceedings" which would mean that once the arbitral proceedings commenced under the old Act it would be the old Act which would apply for enforcing the award as well.'' 9 20 I, therefore, do not find any error in the findings returned by learned court below. Appeal is accordingly dismissed. No order as to costs. Decree-sheet be prepared accordingly. A copy of this order be sent to learned Trial Court along with trial court record. 21 Appeal file be consigned to record room.
Announced in the open Court on this 17th day of April, 2007.
(MANOJ JAIN) ADDL. DISTRICT JUDGE: DELHI 10