Punjab-Haryana High Court
Punjab Small Industries And Export ... vs Sardul Singh And Ors. on 5 August, 1987
Equivalent citations: AIR1989P&H21, AIR 1989 PUNJAB AND HARYANA 21, (1988) 25 REPORTS 51, 1987 REV LR 445, (1989) 1 ARBI LR 239, (1987) 92 PUN LR 497, ILR (1988) 1 P&H 500, (1988) ILR 1 P&H 500
ORDER D.V. Sehgal, J.
1. This revision petition filed by the Punjab Small Industries & Export Corporation Ltd. (for short 'the Corporation') is directed against the judgment and decree dt. 20-9-1985 passed by the learned Additional Senior Sub Judge, Ludhiana.
2. The facts in brief are that Sardul Singh Government Contractor, plaintiff-respon-, dent 1, filed a suit for the recovery of Rs. 2 lacs against the Corporation. During the pendency of the suit, vide his order dt. 23-11-1983, the then learned Sub Judge 1st Class, Ludhiana, before whom the suit was pending, directed the dispute, which was the subject-matter of the suit, to be referred to the Arbitrator on the statements made by the learned counsel for the parties. That order was apparently passed in exercise of power under Section 21 of the Arbitration Act, 1940 (for short 'the Act'). The Arbitrator made his award on 22-8-1985 and filed the same in Court. The learned Trial Court issued a notice regarding the filing of the award in Court to the parties and adjourned the proceedings to 15-9-1985. However, on that date no one appeared on behalf of the Corporation inspite of service of notice. Vide order of the same date the learned Additional Senior Sub Judge proceeded against the Corporation ex parte and ordered the original file to be summoned for further proceedings for 20-9-1985. On that date, through the impugned judgment it was observed that in spite of service of notice no one had appeared on behalf of the Corporation and ex parte proceedings had been taken against it. Therefore, "a well based inference" can be drawn that it had already accepted the award. As a result the award was made a rule of the Court and a decree for Rs. 2 lacs was passed in favour of respondent 1 and against the Corporation along with interest claimed by the said respondentasalso the future interest at the same rate till the entire amount was realised by him. Decree-sheet was accordingly directed to be drawn. A certified copy of the decree-sheet of the same date has been filed along with the revision petition.
3. The grievance made on behalf of the Corporation is that under Section 17 of the Act the award could be made a rule of the Court and a judgment could be pronounced in accordance with it only after the time for making an application to set aside the award had expired. Article 119(b) of the Schedule to the Limitation Act, 1963 prescribes a period of 30 days for filing an application for setting aside an award from the date of service of the notice of the filing of the award. It is contended that the award was made by the Arbitrator on 22-8-1985. After it was filed in the Court, a notice of its filing was issued by the Court. The period of 30 days for filing application for setting aside the award was to commence from the date of service of such notice. The learned trial Court, however, made the award a rule of the Court on 20-9-1985, i.e. within less than 30 days even from the date of the making of the award by the Arbitrator. It is, therefore, contended that the impugned judgment and decree passed by the learned trial Court are without jurisdiction and should, therefore, be set aside.
4. The learned counsel for respondent 1 has, however, raised the following contentions against the plea of the Corporation : --
(1) That the judgment pronouncing the decree in accordance with the award was appealable. No Revision petition against the same can be maintained in this Court.
(2) The award was made by the Arbitrator on a reference made by the trial Court in a pending suit. Therefore, the procedure laid down in Ss. 14 and 17 of the Act regarding giving of the notice of the filing of the award by the Court to the parties and making it a rule of the Court after the time for making an application for setting aside the award has expired is not applicable. Since in spite of service, no one was present on behalf of the Corporation before the trial Court on 13-9-1985, it was rightly proceeded against ex parte and on the adjourned date, i.e. 20-9-1985, a decree in accordance with the award was passed.
(3) The revision petition fifed by the Corporation is not properly presented. There is no resolution passed by its Board of Directors for filing the present revision petition. The same is, therefore, without authority and ought to be dismissed on this solitary ground.
5. I have considered the rival contentions of the learned counsel for the parties. I am of the view that the learned trial Court hasacted in the exercise of its jurisdiction illegally and with material irregularity. The judgment and the decree under revision were passed in flagrant violation of Section 17 of the Act and, therefore, cannot be sustained. Now, I proceed to deal with the submissions made by the learned counsel which would make evident the reasons for the view that I have taken.
6. In support of his first submission, the learned counsel for respondent 1 has relied on Rewa Chand v. K. C. Kapoor, AIR 1954 Ajmer 9(2), and Gopal Das v. S. Kesar Singh, AIR 1966 J and K 133. In my view, however, these authorities do not lay down good law. In Rewa Chand's case, it has been observed by the learned Judicial Commissioner that the decree passed by the Court is in fact an order filing the award from which an appeal lies under Section 39 of the Act. A perusal of Section 39 of the Act, however, shows that an appeal inter alia lies against an order filing or refusing an arbitration agreement. But no appeal is provided against the order filing an award and pronouncing a judgment according to the award. In fact, Section 17 of the Act lays down in clear terms that no appeal shall lie against a decree which follows pronouncement of judgment according to the award. In Gopal Das's case the view taken is that omission of the Court to give notice of the filing of the award amounts to refusal to set aside the award. As such a judgment pronouncing decree in accordance with the award would be appealable under Section 39 of the Act. It is clearly observed in that judgment that there is no direct authority on the point yet reliance was placed on Swastika Scientific Engineering Co. v. Union of India, AIR 1953 Punj 129, wherein it was held that the words of Section 39 are quite clear. An appeal lies against an order setting aside or refusing to set aside an award. Application was made on 7-1-1949 for setting aside the award. Whatever the reason for the Court not setting aside the award, the order still remains an order refusing to set aside the award and an appeal lies under Section 39. With respect, I may point out that the judgment of this Court in Swastika Scientific Engineering Co.'s case (supra) did not take the view which was adopted in Gopal Das's case (supra). In the former case application for setting aside the award had been filed but the award was made a rule of the Court in spite of the said application. This clearly amounted to refusing to set aside the award. I, therefore, do not agree with the ratio of the law laid down in Gopal Das's case (supra).
7. On the other hand, in Koduri Krishnamma v. Koduri Channayya AIR 1949 Mad 276, the facts were almost parallel to those in the presentcase. A decree was passed on the basis of an award before the expiry of limitation for filing objections to the award. There was nothing to show that the aggrieved party had waived its right to object to the award. It was held that the decree so passed ' was in the illegal exercise of jurisdiction and that the remedy of the aggrieved party is by way of a revision. The same view was taken in Ravibhai Kashibhai v. Dahyabhai Zaberbhai Patel, AIR 1921 Bom 32. The provisions which came up for interpretation therein were those of para 16(2) of Schedule 2 of the Code of Civil Procedure, 1908, which before their repeal contained provisions analogous to those of Section 17 of the Act. It was held that where the Court did not allow a party the time which the law allows him to make objections, but proceeded to pass a decree in accordance with the award, the remedy open to the aggrieved party was not by way of appeal as no appeal was maintainable. It was further observed that in such a case the High Court may exercise its discretion under Section 115 of the Civil P.C.
8. In view of the above discussion, I find no force in the first submission made by the learned counsel for respondent 1 and hold that the judgment and the decree of the trial Court are revisable by this Court under Section 115 of the C.P.C.
9. The second submission of the learned counsel for respondent 1 also need not hold me much longer. Chapter IV of the Act makes provision for arbitration in suits. Section 25 which finds place in this chapter lays down that the provisions of the other chapters of the Act shall, so far as they can be made applicable, apply to arbitrations under this Chapter. It is, thus, clear that after the award was filed by the Arbitrator in the trial Court in the pending suit it was obligatory on it to have allowed the prescribed time of 30 days for filing application for setting aside the award to expire before it made it a rule of the Court and pronounced judgment in accordance therewith followed by a decree.
10. In reply to the third submission, the learned counsel for the Petitioner invited my attention to a resolution passed by the Board of Directors of the Corporation authorising its Managing Director to file suits and take other legal proceedings. The learned counsel for respondent 1, however, by getting support from Municipal Committee, Ludhiana v. Surinder Kumar, 1970 Cur LJ 631, and Garib Chand v. Municipal Committee, Budhlada, 1979 Rev. LR 341, contended that before the present revision petition could be filed a specific resolution ought to have been passed by the Board of Directors of the Corporation resolving to file the revision petition against the impugned judgment and the decree and authorising its Managing Director to file the same. A perusal of these judgments shows that these govern the appeals instituted without specific resolutions of a corporate body. It is well known that where conditions of Section 115, C.P.C. are satisfied and interference in any particular case is found necessary, the High Court may on its own motion, call for the record and pass the necessary orders. It is not necessary that a revision petition by a party should be instituted. It is also welt settled that the High Court cannot throw out a revision petition on the ground that it was not properly presented after the same has been admitted, entertained and listed for final hearing. When the illegality in the exercise of jurisdiction by the trial Court has come to its notice, the exercise of revisional jurisdiction by it cannot be hampered by such technicalities as want of a valid resolution by a corporate body supporting the revision petition. If this objection is allowed to prevail, it would amount to perpetuation of the illegal exercise of jurisdiction by the trial Court and allowing respondent 1 to enjoy the fruits of the judgment and the decree passed by the trial Court without jurisdiction. When illegality in the exercise of jurisdiction has once come to the notice of this Court, it has ample power under Section 115, C.P.C. on its own motion to undo the same.
11. In view of the above discussion, I allow this revision petition with costs and set aside the judgment and the decree dt. 20-9-1985 passed by the learned Additional Senior Sub Judge, Ludhiana.
12. The parties through their learned counsel are directed to appear before the learned trial Court on 14-9-1987. The Corporation shall file its objections against the award before the trial Court on that date and further proceedings shall be taken in accordance with law.