Gokal Chand Gian Chand vs Ishar Dass Durga Dass

Kapur, J.—This order will dispose of two Petitioners, for leave to appeal to the S.C. filed by M/s. Gokal Chand-Gian Chand against two parties and directed against two orders of this Court.

The facts are given in our order dated 28-12-1949. It may perhaps be necessary briefly to state them here again. On 16-1-1947 the Respondents entered into a contract with M/s. Gokal Chand-Gian Chand of Amritsar for the purchase of some goods. There was in this contract a clause providing for arbitration in the following terms:

Any dispute or claim of whatever nature relating to or arising out of this contract, shall be referred to arbitration of two European merchants engafed in the piece goods trade at Karachi, one to be appointed by each party and in accordance with the provisions of the Arbitration Act X [10] of 1940.

In pursuance of this agreement, M/s. Gokal Chand-Gian Chand served a notice on the Respondent on various dates informing them that as a breach of contract had occurred because of their default, they, the Petitioners had appointed an arbitrator in Karachi and called upon the buyers to nominate their arbitra for. The Respondents on 26-10-1948 filed an Appellant. u/s 33, Arbitration Act praying that the arbitration agreement should be declared ineffectual and menforeable and be set aside and that the Respondents be ordered to refrain from acting thereon or be restrained from acting on arbitration proceedings. Their plea, in other words was that there was an implied agreement in the contract that the arbitration will only be carried out if the same circumstances as existed at the date of the contract continued to exist at the date of the arbitration, and as Karachi had now become part of Pakistan Dominion the contract with regard to arbitration had been frustrated. The original peters, failed in the Subordinate Judge''s Court, but in this Court it was held that there was such an implied condition. It is against this order that the firm Gokal Chand-Gian Chand have asked for leave to appeal to the S.C.

Several objections were taken to the grant of such leave by Mr. Mahajan, on behalf of M/s. Ishar Das Durga Das and by Mr. Grover on behalf of M/s. Rama Nand Vijay Parkash. It was submitted that the present case was one for leave to appeal to the S.C. under u/s 109(e) CPC and leave should be given sparingly under that section. Reliance was placed on several cases which I have discussed in Batala Engineering Co. Ltd. v. Castodian of Evacuee Property Civil Misc. No. 31.C of 1950 and for reasons given there I agree with this contention.

The second contention waa that a matter must be of importance to both parties. This also I have discussed in the other case mentioned above and I need not repeat what I have said there.

The next contention was that the order under appeal does not prejudice the rights of either of the parties, and reliance was again placed on Govind Das v. Indrawati ILR 1940 ALL. 11 at p. 17 and on Binoy Krishnav v. Satish Chandra 31 C.W.N. 540 at p. 549, and also on Mahomed Musaji v. Ahmed Musaji 10 I.C. 439 (cal). The contention raised was that as a result of an order of this Court all that has happened is that instead of the matter being decided by some arbitrator in Karachi the matter will now be decided by the Court in Amritsar, and this contention of Mr. Mahajan seems to be right that the order of this Court does not in any manner prejudice the right of M/s. Gokal Chand Gian Chand to recovor on the contract. Reliauce was further sought to be placed on Radhakrishna Ayyar v. Swaminatha Ayyar 44 Mad. 293 and on Annamalai Chettiar Vs. S. Rm. Ar. Ramanathan Chettiar and Others, where it was held that whore substantial rights are in no way affected by an order there is prima facie no reason for issuing a certificate that tho caso is a fit one for appoal to His Mujesty in Council. I am therefore of the opinion that in this case tho mere fact the seller will be deprived of the right of having his dispute decided by an arbitrator doos not prejudice any substantial right, and this objection of Mr. Mahajan is well founded and must be given effect to.

In the case of M/s. Rama Nand Vijiy Parkash (C. Misc. No. 45-C of 1950), there is a further point that the claim is only of Rs. 1708-11-0, and Mr. Grover strongly contended that there is no reason why he should be forced to go to the S.C. and spend such a large amount of money on fighting out a litigation mercy because the Petitioner thinks that his right to get the matter referred to arbitration has not been accepted in this Court. He relied on Raja of Ramnad v. Tiruneelakantam Servai A.I.B. 1923 Mad. 232. That is an additional factor which must be taken into consideration in his case.

Mr. Bhagirath Das replied by referring to a judgment of the Court of Appeal in re Comptcir Commercial Anversois and Power, Son and Co.''s Arbitration, (1920) 1 K.B. 868 where it was held that whether a term can be implied to dissolve a contract is a question of law. But even if it was a question of law, it will still have to be shown that it is a question of law which is far-reaching and is a matter of "dominant public importance". I do not think that this a case of that kind. The responsible in these petitions also submitted that the question was one of great importance to the whole of the commercial community whether the principle of frustration in implied in contracts of this kind. There are two objections to this submission one, there are not likely to be many cases of this kind and, secondly, the doctrine of frustration has been applied in India see Hurnandrai Fulchand v. Pragdas Dudhsen 47 Bom. 344. I am therefore of the opinion that neither of these two cases are fit cases for leave to appeal to the S.C. and I would dismiss the Petitioner with costs.

Khosla, J.

I agree.