RAM DHARI SAHU Vs. RAM CHARITAR SAHU

JUDGEMENT

(1.) The plaintiff and the defendant who are the appellant and the respondent respectively in the present appeal, are two brothers and after the death of their father, they seem to have quarrelled and to have made two or three ineffectual attempts to divide between them the property left by their father. Having failed, they on the 12 March 1907, jointly executed and registered an ekrarnamah, or deed of agreement, by which they agreed to refer their dispute to five persons as arbitrators who were also to effect a partition between them of the property On the 15 April 1907, the award was delivered and on the 6 July 1907, the plaintiff- appellant applied to the Court under Section 525 of the old Civil P. C. to have the award filed in Court and a decree passed in accordance therewith. The written award appears to have been kept in the custody of one of the arbitrators and in the application, there was a prayer that that arbitrator should be directed to produce the award in Court. This order was afterwards carried out. The application having been made on the 6 July 1907, several adjournments were taken by the defendant and, on the 23 January 1908, he for the first time filed his petition of objection. In substance, his objections amounted to this that the award was bad by reason of misconduct on the part of the arbitrators and, therefore, it was illegal and could not be enforced. He further stated, apparently as an instance of misconduct on the part of the arbitrators, that the valuation of the properties had not been correctly made and that, in consequence, he had been prejudiced. The case was then adjourned on several occasions till the 13 July 1908 and a year after the first application had been made, an application was made by the defendant to the Court to appoint a Commissioner to value the properties in dispute. The plaintiff did not object to the application and a Commissioner was appointed and, on the 10 August 1908, the Commissioner submitted his report. After that, the Court examined the defendant and three witnesses on his behalf in order to support the allegation of misconduct against the arbitrators, and, in answer to that evidence, he examined, on behalf of the plaintiff, two of the gentlemen who had acted as arbitrators. On that evidence, the learned Subordinate Judge arrived at the conclusion that the award was bad by reason of misconduct on the part of the arbitrators and on the ground that the award was prepared after the arbitrators had been served by the defendant with a notice not to proceed with the arbitration. The Subordinate Judge, therefore, dismissed the application and refused to allow the award to be filed. Against that decision, the plaintiff has appealed. A preliminary objection has been taken that no appeal lies. In our opinion, this objection cannot be sustained. In the case of Sheo Sahai Mahton V/s. Kirtarth Bhagat 7 C.L.J. 486, which follows other decisions of this Court to the same effect, it has been distinctly held that an appeal lies against an order refusing to grant an application to file an award under Section 525 of the old Civil P. C.. It is true that a different view has been taken by the learned Judges of the Allahabad High Court in the case of Basant Lal V/s. Kunji Lal 28 A. 21 : 2 A.L.J. 450 : A.W.N. (1905) 150, but we are not prepared to differ from the view which has all along been taken by this Court and which, in fact, has been introduced in the new Civil P. C. as Clause (f) of Section 104. The preliminary objection, therefore, in our opinion, fails.

(2.) The learned Subordinate Judge, in arriving at his conclusion that the arbitrators had been guilty of misconduct or partiality as alleged by the defendant, relies entirely on the fact that certain statements made by the parties or statements made by the witnesses which were either filed before the arbitrators or were taken down by them in writing were not filed with the award in the Court and were not produced. The plaintiff when he made the application filed with it the award only and, so far as we can interpret the provisions of the law that was all what was necessary under Section 525 of the old Code. We are not aware of any provision of the law which requires persons, to whom matters have been referred for decision by private arbitration, to adopt any special procedure or which compels them to keep any record or to produce any record of the proceedings taken before them. The proceedings contemplated by Section 525 are proceedings of a private nature to which the rules of evidence cannot be strictly applied. It is not very clear from the evidence of the arbitrators themselves whether any formal record of the statements of the parties or of the witnesses was made but the arbitrators appear to have questioned the parties and the persons who were produced before them in order to enable them to decide the questions which had been referred to them for determination. The learned Subordinate Judge, in dealing with this question of misconduct, appears to us to have travelled beyond that question and to have really taken into consideration the merits of the award and to have attempted to decide whether the decision of the arbitrators was one which, in his opinion, appeared to be correct. We think that it is no part of the duty of the Court acting under Section 525, Civil Procedure Code, to enter into the merits of the award. All that Section 526 contemplates is that the Court shall determine whether the defendant has made out against the award any objection which he is entitled to take under the provisions of Section 520 or Section 521 of the old Code. Thus the learned Subordinate Judge, in dealing with this question of misconduct, has attempted to decide whether the valuation made by the arbitrators of the properties was correct or not. We are not aware under what provision of law the learned Subordinate Judge appointed a Commissioner in order to test the merits of the award or to determine whether the valuation was correct or not. But even if the report of the Commissioner on that matter be accepted, we think that a perusal of the whole report is sufficient to convince any body looking into the matter impartially that, even supposing that, in the few cases where the Commissioner has differed from the valuation of the arbitrators, the arbitrators are in the wrong, there is no ground whatever for supposing that their mistake was not a bona fide mistake, but was a mistake due to collusion or misconduct. We may observe that so far as the valuation of the Gola house and of the orchard is concerned, we should certainly, in the position of the Subordinate Judge, have felt considerable hesitation in accepting the valuation of a learned member of the legal profession acting as Commissioner on these two matters, in preference to the valuation arrived at by the arbitrators in the case of the Gola house, on the opinion of a mason and, in respect of the orchard, on their own knowledge as persons living in the locality and holding orchards similar to the orchard which was the subject of consideration. In our opinion, the learned Subordinate Judge has not given in his judgment sufficient reasons to support the finding that the arbitrators were guilty of misconduct or partiality in preparing the award. He has next arrived at the conclusion that the arbitrators have shown partiality in the way they have divided the assets due to the joint family. It appears that the account books of the joint family were kept by the plaintiff and that he produced them before the arbitrators. It seems from the evidence of the arbitrators themselves that certain objections were taken by the defendant to some of the items in the accounts but that, when he was asked to substantiate his objections, he failed to adduce any evidence whatever on the subject. The learned Subordinate Judge deals with one item in particular which is a mortgage bond shown to be executed by one Biju Goala in favour of the joint family. That bond is shown in the accounts as still outstanding and the bond itself appears to have been produced before the arbitrators by the plaintiff. It was admitted, however, that the joint family was in possession of the bond covered by the mortgage but it was explained that the bond which was a simple mortgage bond having been treated as an usufructuary mortgage bond, the members of the joint family were allowed to remain in possession and to appropriate the profits in lieu of interest. The case of the defendant was that Biju Goala had executed a kobala by which he had sold the mortgaged land to the family and so paid off the mortgage; but both the arbitrators in their evidence deposed that the defendant never made any such statement before them. The Subordinate Judge, however has come to the conclusion that the defendant's story is correct as the joint family of the plaintiff and the defendant was in possession of the mortgaged property. In our opinion, that conclusion is not warranted by the evidence or by the facts and the circumstance that the bond was produced by the plaintiff certainly is inconsistent with the view that Biju Goala had paid off the mortgage-debt by transferring the property to the joint family or to the plaintiff. The arbitrators in their evidence have stated that the defendant failed to adduce any evidence in support of his allegation that the accounts produced by the plaintiff were not correct and, though the arbitrators stated that there were some differences between the day book and the ledger produced by the plaintiff, they appear to have found that the accounts were substantially correct and that the assets which they divided among the parties were those due to the family.

(3.) Before the arbitrators, an objection was taken to another item, namely, a bond executed by Sheo Mistry on the ground that the sum due under the bond was not recoverable. The arbitrators, however, found that this objection was not well-founded as the value of the property mortgaged was more than sufficient to cover the mortgage-debt. The learned Subordinate Judge in his judgment has not referred to this bond. The learned Judge has further held that from the award it appears that the defendant took objections on several other points but that the arbitrators decided those points against him without giving him any opportunity to substantiate them. On these grounds also the learned Subordinate Judge held that the arbitrators had been guilty of partiality and misconduct. The learned pleader, who has appeared to support the decision of the lower Court, has contended that the learned Subordinate Judge was right in the view which he took with regard to the misconduct of the arbitrators on the ground that they failed to give to the defendant a reasonable opportunity for the examination of his witnesses and because they arrived at no definite decision with regard to the objections raised, first, as to the jewellery ; secondly, as to the accounts, thirdly, as to the landed property and, fourthly, as regards the debts. He has also contended that the award was bad for misconduct of the arbitrators because they did not value the lands themselves and because they did not go into the question whether the plaintiff had named, as creditors to the estate, persons who were really fictitious creditors with the object of causing loss to the defendant. Four persons are referred to who are entered in the award as creditors to the estate. They are Bunwari Lal, Lalji Sahu, Ram Lal Mali and Gobinda Sahu. It appears, however, that the debts due from the joint family have not been divided between the parties by the arbitrators but have been left to be recovered from the members of the family jointly. It was not, therefore, necessary for the arbitrators to go into detail into these matters as any decision with regard to these debts would certainly not bind the parties in any subsequent litigation. Furthermore, we can hardly regard this omission as sufficient to make out a case of misconduct on the part of the arbitrators.