JIVRAJ BHAI Vs. CHINTAMAN RAO

JUDGEMENT

(1.) THE applicants seek to revise an order dated 11 September 1958 which the First Additional District Judge, Saugar, passed in certain proceedings initiated under the provisions of the Arbitration Act.

(2.) BY a deed dated 16 February 1956, the applicants and the non -applicants constituted a partnership called 'Vrajlal Manilal and Co., Saugar and Delhi'. On or about 13 April 1958, the applicants 1 to 3 offered to retire from the partnership. The parties appointed three arbitrators, Chaturbhuj Jasani, Ambalalbhai and Becharbhai, to determine inter -alia the amount due to the outgoing partners The agreement of reference was, it appears, signed by the parties on 16 April 1958. After the arbitrators entered on the refernce, the non - applicant No 1 made an application date 21 June 1958 requesting the arbitrators to treat the retirement of the applicants as elective from 15 April 1958. The arbitaters stated in their order dated 22 June 1958 that they would give their decision on the question of retirement in the award itself.

(3.) THE question for consideration is whether, on an application under Section 11 (2) of the Arbitration Act, the lower Court was competent to adjudicate upon any question relating to the merits of the dispute or to give a direction in relation thereto. Section 11 (2) empowers the Court to remove an arbitrator who has misconducted himself or the proceedings. In my opinion, it gives no power to the Court to give any direction regarding the scope of the reference. This is in keeping with the well established principle that, subject to any limitation contained in the instrument of his appointment and to any statutory provisions as to the manner in which he is to discharge his duties, an arbitrator may act as he thinks fit so long as he does so in accordance with the principles of equity, justice and good conscience. If the arbitrators were going beyond, the terms of reference from corrupt motives, they could have been removed. But that did not give to Court at that stage jurisdiction to define the limits of the reference or to direct the remaining arbitrator to adhere to the limits so defined.