B UPENDRA NATH BASU Vs. BHET LAL

JUDGEMENT

(1.) This is a defendant's appeal arising out of an order passed by the Subordinate Judge of Benares under para. 21, Schedule 2, Civil P.C. ordering an award to be filed and pronouncing judgment according to the award. The appellant Babu Upendra Nath Basu was defendant 1 in the suit. In the year 1908 he purchased certain zamindari property in the village called Raitar in the District of Patna which is in the province of Bihar and Orissa. In 1902, the appellant borrowed a sum of Rs. 61,000 from Ishwari Prasad and in 1914 Ishwari Prasad and the appellant agreed that Ishwari Prasad should have a half share in. the Raitar property in lieu of his loan. No conveyance was executed in Ishwari Prasad's favour but the appellant continued to manage the Raitar property both for Ishwari Prasad and for himself and to pay a half share of its profits to Ishwari Prasad. After Ishwari Prasad's death his sons and grandson entered into an agreement with the appellant on 25 April 1925 in respect of the Raitar property. It was-agreed that the appellant should execute a conveyance to the heirs of Ishwari Prasad in respect of one-half of the property and that he should continue to manage it on behalf of both parties. It was further agreed that ins case of dispute , the dispute should be referred to arbitration. Dispute arose, and on 3 April 1928 the appellant and the heirs of Ishwari Prasad referred their disputes to arbitrators. The terms of reference required the arbitrators to go into the accounts and the transfer of the Raitar property. On 1 August 1930 the arbitrators delivered their award. The appellant was to pay Rs. 61,400 to the heirs of Ishwari Prasad, i. e., he was to pay Rs. 15,350 to each of the four heirs to buy out their interests in the Raitar property. It was further provided that until the heirs had been paid, they would remain owners in one-half of the Raitar property. Provision was also made for payment of interest on the sums awarded.

(2.) Het Lal, who is one of the sons and heirs of Ishwari Prasad applied to the Subordinate Judge of Benares under para. 20, Schedule 2, for an order that the award be filed in Court and that a decree be passed accordingly. The appellant resisted the application on several grounds, one of which was that the Subordinate Judge of Benares had no jurisdiction over the subject matter of the award. The Court below remarked that the award related to two matters, namely, to accounts and to transfer of Raitar property. So far as the accounting and the award of money to the plaintiff and defendants. 2 to 4 were concerned^ it was admitted that the Court had jurisdiction. It may be here observed that the parties are. residents of Benares. In so far as. the award related to the transfer of Raitar property the Court below came to the conclusion that in reality the heirs of Ishwari Prasad were not legally owners of a half share and that the clause in the award, which declared the ownership of those persons in the Raitar property, was a mere nullity. The learned Subordinate Judge therefore treated the award as granting merely certain sums of money to the heirs of Ishwari Prasad and treated the clause in the award relating to ownership in the Raitar property as a mere nullity which could be ignored without affecting the rest of the award. The result was that the Court below passed an order that the award be made a rule of the Court, excepting the portion which deals with the ownership of the Raitar property. The appellant challenges the order of the Court below on several grounds, but for the purpose of disposing of this appeal it is only necessary for us to consider the objection that the Court below had no jurisdiction to pass the order that the award be made a rule of the Court subject to a certain modification. The question raised depends upon the interpretation of Schedule 2, para. 20, Clause (1) which lays down that: where any matter has been referred to arbitration without the intervention of a Court, and an award has been made thereon, any person interested in the award may apply to any Court having jurisdiction over the subject-matter of the award, that the award be filed in Court.

(3.) The question is whether the Subordinate Judge of Benares had jurisdiction over the subject-matter of the award. The award, as we have already stated, dealt with two principal points, one was the sum of money due from the appellant to the heirs of Ishwari Prasad in respect of the profits of Raitar property; the other point related to the transfer of Raitar property, i.e. the question whether the appellant should execute a conveyance in respect of a half share of the Raitar property in favour of the heirs of Ishwari Prasad or whether he should buy out their interests in the property. It is argued for the appellant that the Court must have jurisdiction over the whole of the subject-matter of the award and that as the Raitar property, which forms the subject-matter of the award, is outside the territorial jurisdiction of the Court, the-Court has no jurisdiction under para. 20. Several authorities have been cited for the proposition that the Court must have jurisdiction over the whole of the subject-matter. In V.N. Krishna lyar V/s. V.N. Sabbarama Iyar A.I.R. 1932 Mad 462 it was held that the expression "the subject-matter of the award" in para. 20, Schedule 2, Civil P.C. means the whole, and not the whole or a portion of the subject-matter of the award and that a Court within whose jurisdiction a portion of the immovable properties forming the subject-matter of an award is not situated, has no jurisdiction to entertain an application to file the award. That case related to the partition of joint family property which was situated partly in British India and partly outside British India. It was argued that the decree might be conned to the subject-matter of the award in so far as it was within the jurisdiction of the British Indian Courts. The learned judges held that it was not open to the Court to direct the award to be filed in part and to pass a decree in terms of portions only of the award under para. 20, Schedule 2. In the present case the Court below has only been able to assume jurisdiction by treating the award as merely an award of money and by disregarding the portion relating to the ownership of Raitar property. On the strength of the Madras ruling, the Court below was not justified in passing a decree in terms of a. portion only of the award and we think the Court took an erroneous view in treating the portion relating to the ownership of Raitar property as a mere nullity.