PHULCHAND LAXMINARAYAN Vs. INDIA UNITED MILLS LTD

JUDGEMENT

(1.) THIS is an appeal from the judgment of Mr. Justice Shelat refusing to set aside an award made by an umpire in certain arbitration proceedings. The facts relevant for the purpose of the appeal are as follows.

(2.) THE appellants entered into a contract with the respondents on the 30th of April, 1954 for the purchase of 825 bales of dhoties and sarees on terms and conditions contained therein. They paid for and took delivery of all the bales except 175 bales of dhoties. In regard to these bales there was a dispute between, the parties regarding quality. This dispute was referred to arbitration under the rules of the Mill Owner's Association to which the contract was subject. The arbitrators after hearing the parties made an award cancelling the contract with respect to 72 bales and directing the appellants to take delivery of the remaining 103 bales within 15 days of the receipt of the award by them. This award was made on the 5th October, 1955. The appellants, however did not take delivery of these bales even though called upon to do so by the respondents. Eventually, the respondents sold those bales by private treaty on the 9th of November 1955 and claimed as damages the difference between the contract rate and the price realised by them as a result of the re-sale. This amount worked out at Rs. 37. 735-7-6. Since the appellants refused to pay the amount the respondents again invoked the arbitration clause to be found in the rules of the Mill Owners' Association and had the dispute referred to arbitration. The arbitrators, who were eventually appointed by the Mill Owners' Association, however, dismissed the respondents' claim whereupon they filed a petition in this court for setting aside the award. The award was set aside by this Court on the 20th of March 1956. The respondents thereafter again had the matter referred to arbitration under the rules of the Mill Owners' Association. They appointed one Mr. T. V. Baddeley as an arbitrator on their behalf while the appellants appointed one Mr. Gordhandas Vandravan as an arbitrator on their behalf, but they did so under protest.

(3.) MR. Pratap Bhogilal convened a meeting of the parties on the 9th of January, 1958 on which date Vasudeo Lakminarayan, a partner of the appellants and one Marshall, a representative of the Respondents, were present. At that meeting, the umpire wanted certain information to enable him to come to his decision on the point of difference between the two arbitrators. The points on which he wanted information are referred to in the umpire's notes and we will reproduce those notes in the course of our judgment. The umpire could not make his award within 14 days from the date of reference to him and, therefore, the time for making the award was extended with the consent of the parties to the end of January, 1958.