PREM NATH Vs. UNION OF INDIA

JUDGEMENT

(1.) ON 27-1-1949 Prem Nath, the sole proprietor of Messrs Prem Nath Prannath of 10, Double Phatak Road, Kishan Ganj, Delhi, agreed to supply Dal Moong to the Government of India. After partly performing the contract he informed the Government that he was not in a position to supply the remaining portion of Dal Moong. Thereupon the Government withheld Rs. 16,585/-on account of damages from the sums due to the contractor on the basis of other contracts. Prem Nath disputed his liability to pay the damages and wrote to the Government on 15-12-1951 that he had appointed Shri Girdhari Lal to act as his arbitrator and called upon the Government to appoint their arbitrator. This action was taken by Prem Nath under Clause 21 of the General Condition of the Contract. The Government by letter dated 19-12-1951 informed the Contractor that Clause 21 was not applicable to the case but that Clause 11 of the contract applied under which the Secretary, Ministry of Food, or his nominee could act as an arbitrator and nobody else and accordingly the Government refused to appoint an arbitrator under Clause 21 of the General Conditions given in the pamphlet, W. B. B. 133. evertheless Girdhari Lal constituted him-self as sole arbitrator and issued notice to the parties to appear before him. Nobody appeared before him for the Government and after aking ex parte proceedings, the arbitrator pass-ed a decree for Rs. 16,585/- with interest and costs in favour of Prem Nath by his award dated 15-11952. The contractor applied under Section 14 of the Act to get this award made a rule of the Court, and then the Government filed objections on 26-5-1952 on the ground that Clause 21 was not applicable to the case and that the arbitrator had no jurisdiction to decide the dispute arising out of the contract between the parties. This objection has been upheld by the trial Court as well as by a learned Single Judge of the Court. Prem Nath being dissatisfied with these judgments has come to this Court under Clause 10 of the Letters Patent.

(2.) THE learned counsel for the appellant has argued only two points before us, namely that under the circumstances of this case arbitration Clause 21 of the General Conditions applies, and (2) that in any case the arbitrator having decided this disputed point of jurisdiction, it is not open to the Courts to interfere with that decision.

(3.) IT is true that the arbitrator has held that Clause 21 applies to the dispute, but I have already held this conclusion to be erroneous and therefore the arbitrator has no jurisdiction to act as an arbitrator to decide this particular dispute. This matter was previously argued before me when I was sitting alone and I held that an arbitrator cannot give himself jurisdiction by a wrong decision as to the facts upon which the limit of his jurisdiction depends and that the final decision on the question of j urisdiction rests with law Courts and not with the arbitrator: vide Prince and Co. v. Governor General' in Council. AIR 1955 Punj 240 (A). The learned counsel for the appellant has relied upon A. M. Mair and Co v. Gordhandas Sagarmull AIR 1951 SC 9 (B), but I have already held in Prince and Co's case (A) that this Supreme Court judgment is of no assistance in the matter. Today the learned counsel for the respondent has brought to our notice an English judgment Christopher Brown Ltd. v. Genessenschaft Oseterreichischer Waldbesizer Holzwirts 1953 W. R. 689 (C) Devlin J. in that judgment has observed at page 693: