UMADUTT NEMANI Vs. CHANDRAO GKADAM

JUDGEMENT

(1.) This is an application for judgment in terms of an award made under Section 17, Arbitration Act, 1940. The award was made on 25 March last and it was filed in this Court on 1 May and on 7 June notice was given by this Court to the respondent to the effect that the award had been filed under Sub-section (2) of Section 14 of that Act. The present application is made pursuant to a notice dated 24 July for 10 August of this year, and between 7 June and 24 July the present respondent has, so far as is material to this application, done nothing Art. 158, Limitation Act, as amended by the Indian Arbitration Act of 1940, provides a period of thirty days from the date of the service of the notice of the filing of the award for an application to set aside an award or to get the award remitted for reconsideration. Thirty days from 7 June would expire on 7 July well before the present notice of motion was taken out. Nonetheless, the respondent has attended the hearing of the motion and alleged in affidavits several grounds which, if they happened to be true (as to which, for the moment, I express, of course, no opinion), are to the general effect that the award was as bad as any award could be, for it is alleged, amongst other things, that there was no reference to arbitration; that as there was no reference there was no arbitration, and consequently, no award; and that which purports to be an award and has been filed as an award is, in reality, no award at all. He says that though he has no right to apply to the Court to set the award aside or remit it for reconsideration, he has a right to bring these matters, which he alleges to be facts, to the notice of the Court in the hope that the Court, under Section 17 of the Act, will see cause to set aside the award, Section 17 does not say what the Court has to do if it sees cause to set aside the award, but merely what it has to do if it sees no cause to set aside an award. But, presumably, what the Legislature meant was that if the Court does see cause to set aside an award, it shall set the award aside. So that, in substance, the respondent's application is an application to set the award aside and is out of time. The only difficulty I feel about coming to that conclusion is this, namely, that the word "award" prima facie means a genuine award and not a bogus award, which, for purposes of considering this point, I assume, without deciding, the so-called award now in question to be. However in considering the material sections, I am entitled to take into account what the law before 1940 was, what were its defects which the Legislature has attempted to remedy by the Arbitration Act of 1940, and if, and so far as the language used permits, I may and should then consider the Act in such a way as to make the proposed remedy effective. One of the defects in the old law was that the remedies to a party aggrieved, or posing as aggrieved, by an award were all too numerous, and the machinery for enforcement of awards was inadequate, slow, ineffective and uncertain, with the result that all too often arbitration, which is resorted to by the parties as a cheap substitute for litigation, was the high road from India, in some cases, to Downing Street, and always into expensive litigation-the very thing which parties who go to arbitration seek to avoid.

(2.) Now, how did the Legislature set about trying to amend that state of affairs? First of all, I must quote some sections which do not greatly differ in substance from their predecessors, Section 14 provides: (1) When the arbitrators or umpire have made their award, they shall sign it and shall give notice in writing to the parties of the making and signing thereof and of the amount of fees and charges payable in respect of the arbitration and award. The alleged absence of that notice is one of the things the respondent complains of in this case. Then Sub-section (2) says: The arbitrators or umpire shall, at the request of any party to the arbitration agreement or any person claiming under such party or if so directed by the Court and upon payment of the fees and charges due in respect of the arbitration and award and of the costs and charges of filing the award, cause the award or a signed copy of it, together with any depositions and documents which may have been taken and proved before them, to be filed in Court, and the Court shall thereupon give notice to the parties of the filing of the award.

(3.) It is not disputed that the word "Court" means, for present purposes, this Court. That notice the respondent in this case admittedly, has had I need not bother with the third subsection of that section. Then Section 15 empowers the Court, in certain cases, to order to modify or correct an award. Those cases are where there is a severable part of the award in respect of which the arbitrators have exceeded their powers; where there is an imperfection in form, or an obvious error, which can be amended without affecting the decision, or where an award contains a clerical mistake or an error arising from an accidental slip or omission. Then Section 16 empowers the Court to remit awards for reconsideration in three cases, the last of which, curiously enough, is where an objection to the legality of the award is apparent upon the face of it. It is difficult to see how such an illegality can be cured by sending the offending award back to the offending arbitrators, but the direction to the Court to send back an award under Sec. 16 is not imperative but permissive, and Section 30 to which I now turn, sets out the grounds on which the Court may set aside an award. They are where an arbitrator or umpire has misconducted himself or the proceedings where an award has been made after the issue of an order by the Court superseding the arbitration or after arbitration proceedings have become invalid; and thirdly, (which is the widest clause) where an award has been improperly procured or is otherwise invalid; and I suppose, if the Court could see, on the face of the award, that it is obviously and totally invalid it would, of its own motion, set it aside under Section 30 rather than remit it under Section 16. An example would be an award reciting the fact of a dacoity and a reference to the arbitrators, the arbitrators then taking upon themselves the burden of deciding the matter and making a partition of the spoils between the dacoits; no doubt in such a case an award might be set aside, and direct action taken against the arbitrators.