MOHANLAL Vs. STATE OF MADHYA PRADESH

JUDGEMENT

(1.) THIS case has been referred to the Full Bench by the learned single Judge for decision. In the order of reference no specific question has been framed but it appears that the learned single Judge had doubts about the decision of the Division Bench of this Court in Badriprasad v. State of Madh. Pra. Misc. First Appeal No. 156 of 1971, D/- 18-2-1975.

(2.) IN the auctions held on 24-8-1956 the appellant took on lease coupe No. 1 in Tumadabra for Rs. 3100/- and coupe No. 1 in Bundela Kachhar for Rupees 8200/- for extracting timber from these coupes. Both these coupes were in North Bilaspur Forest Division. The amounts of the lease money were payable by instalments and the time of payment of the instalments was the essence of the contract. Regarding the lease of Tumadabra coupe, the appellant deposited the first instalment on 4-10-1956 instead of on 24-8-1956 but the lease deed was executed by the D. F. O. He further defaulted in paying the other instalments. Accordingly, the lease was cancelled. Regarding the lease of Bundela Kachhar coupe, the appellant failed to pay even the first instalment and, therefore, no lease deed was executed and the tender was cancelled and it was re-auctioned for Rs. 5200/-. Since the appellant failed to pay the balance amounts of the lease money, he was served with demand notices calling upon to pay Rs. 2325/-for the first lease and Rs. 2900/- for the second lease. The appellant raised dispute that he was not permitted to work the first lease and so the State is not entitled to recover the balance amounts of the lease money. It appears that thereafter revenue recovery proceedings were started and notices were issued to the appellant on 19-8-1959 but then no further step was taken. Again by notice dated 21-10-1965 the revenue authorities again asked the appellant to deposit the amounts. The appellant, therefore, filed a petition under Section 20 of the Arbitration Act, 1940, on 19-8-1966 contending that in the lease-deed there is an arbitration clause that all disputes and differences should be decided by the Conservator of Forest. Unless the dispute is decided and award is made, the State is not entitled to recover the balance amount of the lease money. The application was opposed by the respondents. They ' denied that the balance amounts of the lease money could not be recovered without referring the disputes to the Arbitrator. They also denied that the appellant was not permitted to work the lease of Tumadabra coupe. Since time of payment of instalments was the essence of the contract, the D. F. O. was justified in cancelling both the leases in default of payment of instalments. IN fact, in respect of Bundela-Kachhar coupe, no lease deed was executed and so there is no question of referring any dispute to Arbitrator.

(3.) IN Badriprasad v. State of Madh. Pra. (supra) it has been held as under:-