Dad Khan Khudad Khan vs Abdul Samad Peeru Bakhsh

G.P. Bhutt, C.J.

This revision is by the plaintiff whose plaint in the suit to enforce an award, filed in the Court of Small Causes, has been returned for presentation to the proper Court.

The suit was filed in the Court of First Civil Judge, Jabalpur, empowered u/s 18 of the C. P. Courts Act, for recovery of Rs. 250/-in terms of an award which is said to have been given by the arbitrators who were appointed by both the parties to decide their dispute. The lower Court has held that the matter relating to arbitration now falls to be decided under the Arbitration Act, 1940, and as the Court of Small Causes is excluded from the definition of the word ''Court'' in Section 2 (e) of the said Act, except for the purpose of arbitration proceedings u/s 21, the suit has to be tried by a regular Court. This view was not consistent with a decision of this Court by Pollock J. in AIR 1944 24 (Nagpur) . Accordingly, the case was placed before a Division Bench for decision.

There is no doubt that neither Article 15, which relates to a suit for specific performance or rescision of a contract, nor Article 24, which relates to a suit to contest an award, of the Provincial Small Cause Courts Act, 1887, bar the jurisdiction of a Civil Court to enforce an award. The question, however, is whether the jurisdiction of the Small Cause Court has been taken away in such suits under the Arbitration Act.

As has been held by their Lordships of the Supreme Court in Kumbha Mawji Vs. Union of India (UOI), , section 14, as also Sub-section (1) of Section 31, of the Arbitration Act, deal with cases where the parties had referred the matter to arbitration out of Court. It appears that Sub-section (1) of Section 31 is a corollary of Section 14 and defines the Court where an award made in such cases may be filed. The question is whether the remedy of a party to enforce an award lies only u/s 14 or whether he can also file a suit for the purpose.

In this connection, Section 32 of the Arbitration Act is pertinent and is reproduced below :

"32. Notwithstanding any law for the time being in force, no suit shall lie on any ground whatsoever for a decision upon the existence, effect or validity of an arbitration agreement or award, nor shall any arbitration agreement or award be set aside, amended, modified or in any way affected otherwise than as provided in this Act." In AIR 1944 24 (Nagpur) , it was held by Pollock J. that the words ''existence, effect or validity of an arbitration agreement or an award'' only imply a challenge to the award and do not apply to a case where the award is sought to be enforced. Upon that interpretation, it was held in that case that a party in whose favour an award was made was entitled to a decree in lerms thereof by filing a suit and Section 14 of the Arbitration Act was not a bar to such a course. A contrary view was taken by the Madras High Court in Moolchand Jothajee Vs. Rashid Jamshed Sons and Co., , where it was held that a suit to enforce an award necessarily raised the question with regard to the existence and validity of the award and accordingly was expressly barred by Section 32 of the Arbitration Act. The same conclusion was reached in Ramchander Singh and Others Vs. Munshi Mian, , although on different grounds. In our opinion, a suit to enforce an award necessarily raises the question as regards the existence, effect or validity of the award within the meaning of Section 32. This is so because when a decree on the basis of an award is sought, the plaintiff has to prove that there was a valid reference to arbitration, that an award was made and that it was valid. In such a case, the liability sought to be enforced against a defendant necessarily implies a determination of the question as regards the existence, effect or validity of the award. With the utmost respect, therefore, we find ourselves unable to concur with the view taken in AIR 1944 24 (Nagpur) .

The suit filed by the petitioner, therefore, can only succeed if it is treated as an application, u/s 14 of the Arbitration Act. We, however, find that instead of asking for intervention of the Court to direct the arbitrators to file the award as required by Section 14, he has directly filed it along with the plaint. This may raise the question whether the award has been properly filed within the meaning of Section 31, read with Section 14, of the Arbitration Act. This would depend upon, as held by their Lordships of the Supreme Court in Kumbha Mawji Vs. Union of India (UOI), , whether the petitioner was authorised by the arbitrators or by the umpire to file it in Court. If the necessary authority was given to him, his remedy would be to apply for amendment of the plaint, to the Court where the suit may now be filed, having regard to its jurisdiction u/s 31 of the Arbitration Act.

Since the matter, as observed above, falls u/s 14, read with Section 31, of the Arbitration Act, the jurisdiction of the Small Cause Court is barred u/s 40, read with Section 2(c), ibid.

The result, therefore, is that the order of the lower Court returning the plaint for presentation to the proper Court is correct. The revision is accordingly dismissed. In the circumstances of the case, however, there shall be no order as to costs.