Case Note & Summary
The dispute arose during consolidation proceedings in village Dharaki-Garhi under the Uttar Pradesh Consolidation of Holdings Act, 1954. A question of title was referred by the Consolidation Officer under Section 12(4) of the Act to the Civil Judge, Aligarh, who in turn referred it to an arbitrator appointed under Section 37 of the Act. The arbitrator, Shri Vikram Singh, submitted an award dated May 14, 1956 to the Civil Court for final decision. The appellants, Charan Singh and others, filed objections before the Civil Judge under Section 15 of the Arbitration Act, 1940, and on September 8, 1956, the Civil Judge modified the award. The respondents, Babu Lal and others, appealed to the District Judge, contending that the Civil Judge had erred in modifying the award and also raising a preliminary objection that no appeal lay. The District Judge overruled the preliminary objection, and on merits held that the Civil Judge was not justified under Section 15 of the Arbitration Act in modifying the award merely because he disagreed with the finding. The District Judge allowed the appeal, set aside the Civil Judge's modification, and accepted the arbitrator's original award. The appellants then filed a revision petition under Section 115 of the Code of Civil Procedure before the Allahabad High Court. Dhavan, J. dismissed the revision, following Sarju Prasad v. Civil Judge, Farrukhabad and Sayeed Ullah Khan v. The Temporary Civil Judge, Sultanpur, holding that an order of the Court on an objection against an award under Section 12(4) of the U.P. Act was appealable under Section 39 of the Arbitration Act. The Supreme Court granted special leave to appeal. The core legal issue was whether an order of the Civil Judge modifying an award under Section 12(4) of the U.P. Consolidation of Holdings Act is appealable under Section 39 of the Arbitration Act, 1940. The appellants argued that Section 37 of the U.P. Act applied the provisions of the Arbitration Act only as far as procedure was concerned, and that Section 39, which provides for appeals, did not apply to arbitrations under Section 37. They relied heavily on Section 12(6) of the U.P. Act, which provides that the decision of the arbitrator under sub-section (4) shall be final, and on the observations in Attar Singh v. State of U.P. that Section 37 made the Arbitration Act applicable to proceedings before the arbitrator in the matter of procedure only. The respondents maintained that the appeal was maintainable under Section 39. The Supreme Court held that Section 12(4) of the U.P. Act provides for statutory arbitration, and Section 37 provides for the appointment of an arbitrator by the State Government. Apart from the question of appointment, all other respects of the matter, including the question of title referred under Section 12(4), were to be determined in accordance with the provisions of the Arbitration Act. Section 37 made no distinction between provisions like Section 39 and Section 15. The effect of Sections 46 and 47 of the Arbitration Act was that all provisions of the Arbitration Act except sub-section (1) of section 6, sections 7, 12, 36 and 37 applied to arbitrations under the Consolidation of Holdings Act. Section 37 could not be held as providing anything inconsistent with this. Therefore Sections 15 and 39 of the Arbitration Act applied to the proceedings. Regarding Section 12(6) of the U.P. Act, the Court held that it must be read with Section 37, and what was made final was the decision of the arbitrator as it emerged after appropriate proceedings under the Arbitration Act. The Court distinguished Attar Singh, stating that the observations there were made in the context of examining the Act's validity under Article 14 of the Constitution and did not decide the question of appealability under Section 39. Accordingly, the Supreme Court upheld the High Court's conclusion that the decision of the Civil Judge modifying the award was appealable under Section 39 of the Arbitration Act. The appeal was dismissed with costs.
Headnote
A) Arbitration Law - Appealability - Order Modifying Award - Arbitration Act, 1940, Sections 15 and 39; Uttar Pradesh Consolidation of Holdings Act, 1954, Sections 12(4) and 37 - The Civil Judge modified an arbitrator's award under Section 15 of the Arbitration Act after objections. The District Court held the appeal maintainable and the High Court dismissed the revision holding that an appeal lay under Section 39 of the Arbitration Act. Held that the Civil Judge's order modifying the award under Section 12(4) of the U.P. Act was appealable under Section 39 of the Arbitration Act, 1940. (Paras not mentioned) B) Statutory Interpretation - Applicability of Arbitration Act Provisions - Sections 46 and 47 - Arbitration Act, 1940, Sections 46, 47, 15 and 39; Uttar Pradesh Consolidation of Holdings Act, 1954, Section 37 - The Court rejected the contention that Section 37 of the U.P. Act applied only procedural provisions of the Arbitration Act. Section 37, read with Sections 46 and 47 of the Arbitration Act, applied all provisions of the Arbitration Act except sub-section (1) of section 6, sections 7, 12, 36 and 37 to arbitrations under the U.P. Act. Therefore Sections 15 and 39 of the Arbitration Act applied. Held that Section 37 did not contain anything inconsistent with this application. (Paras not mentioned) C) Arbitration Law - Finality of Award - Section 12(6) - Uttar Pradesh Consolidation of Holdings Act, 1954, Section 12(6) and 37; Arbitration Act, 1940, Section 15 - The appellant relied on Section 12(6) making the arbitrator's decision final. The Court held that Section 12(6) must be read with Section 37, and what is made final is the decision of the arbitrator as it emerges after appropriate proceedings, if any, have been taken under the provisions of the Arbitration Act. Thus the finality clause did not bar the appeal against the Civil Judge's order modifying the award. Held that finality under Section 12(6) is subject to modifications under the Arbitration Act. (Paras not mentioned) D) Precedent - Distinguishing Attar Singh - Applicability of Prior Decision - Constitution of India, Article 14; Uttar Pradesh Consolidation of Holdings Act, 1954, Section 37 - The appellant relied on Attar Singh v. State of U.P., where the Court observed that Section 37 made the Arbitration Act applicable to proceedings before the arbitrator in the matter of procedure only. The Supreme Court held that this observation was made in the context of examining the validity of the Act under Article 14 and did not decide whether Section 39 of the Arbitration Act applied to arbitrations under Section 12(4). In Attar Singh, the Court was not considering the effect of Sections 46 and 47 of the Arbitration Act. Held that Attar Singh was not applicable to the present question of appealability. (Paras not mentioned)
Issue of Consideration
Whether an order of the Civil Judge on objections against an award made under Section 12(4) of the Uttar Pradesh Consolidation of Holdings Act, 1954 is appealable under Section 39 of the Arbitration Act, 1940
Final Decision
The Supreme Court dismissed the appeal with costs, holding that the decision of the Civil Judge modifying the award was appealable under Section 39 of the Arbitration Act, 1940. The High Court's order dismissing the revision petition was upheld, and the District Judge's decision accepting the original arbitrator's award remained in effect.
Law Points
- Legal points not extracted
- Section 37 of Uttar Pradesh Consolidation of Holdings Act
- 1954 read with Sections 46 and 47 of Arbitration Act
- 1940 applies all provisions of the Arbitration Act (except sub-section (1) of section 6
- sections 7
- 12
- 36 and 37) to statutory arbitration under Section 12(4) of the U.P. Act
- Section 39 of Arbitration Act
- 1940 applies to appeals against orders modifying awards
- Section 12(6) of U.P. Act makes final only the arbitrator's decision as it emerges after appropriate proceedings under the Arbitration Act
- the Civil Judge's order modifying an award under Section 15 of Arbitration Act is appealable under Section 39 of Arbitration Act
- observations in Attar Singh v. State of U.P. about Section 37 applying only procedural provisions were made in a different context and do not decide appealability
