1988 (10) TMI 282 - SC - Indian Laws

Summary

Issues Involved:
1. Validity of the Award by Shri A.C. Gupta.
2. Error of Law on the Face of the Award.
3. Applicability of Section 53A of the Transfer of Property Act.
4. Alleged Non-Consideration of Material Documents by the Arbitrator.

Detailed Analysis:

1. Validity of the Award by Shri A.C. Gupta:
The judgment revolves around objections filed against the Award made by Shri A.C. Gupta, a former Judge of the Supreme Court, who was appointed as the sole arbitrator by the Supreme Court to adjudicate the dispute. The arbitrator awarded the Respondent a sum of Rs. 58,498.60 with interest at 18% per annum and ruled that the Respondent was entitled to recover possession of the disputed property from the Appellants. The Appellants challenged this award, claiming it was bad in law and disclosed an error on the face of the award.

2. Error of Law on the Face of the Award:
The primary argument presented by the Appellants was that there was an error of law apparent on the face of the award. The Appellants contended that the arbitrator misapplied the legal principles regarding the repudiation of the contract by the Respondent and the obligations under Section 53A of the Transfer of Property Act. The Supreme Court, however, held that there was no error in the legal propositions set out by the arbitrator. The Court noted that while the arbitrator might have erred in applying these principles, this did not constitute an error of law on the face of the award.

3. Applicability of Section 53A of the Transfer of Property Act:
The Appellants argued that they were entitled to retain possession of the property under Section 53A of the Transfer of Property Act, which protects the possession of a transferee who has performed or is willing to perform their part of the contract. The arbitrator found that the Respondent had not performed his obligations under the contract, specifically the payment of Rs. 105 per month, and thus was not entitled to retain possession beyond January 1976. The Supreme Court upheld the arbitrator's interpretation, stating that the Respondent's repudiation of the contract did not absolve the Appellants from their obligation to show readiness and willingness to perform the contract for claiming specific performance.

4. Alleged Non-Consideration of Material Documents by the Arbitrator:
The Appellants also contended that the award was flawed because the arbitrator did not refer to or discuss certain important documents. The Supreme Court dismissed this argument, noting that there was no evidence that any essential documents were not considered by the arbitrator. The Court emphasized that an error of law on the face of the award must be evident from the award itself or a document incorporated into it, and mere non-reference to documents does not constitute such an error.

Conclusion:
The Supreme Court dismissed the objections to the Award of Shri A.C. Gupta, concluding that there was no error of law on the face of the award and that the arbitrator had not committed any legal misconduct. The judgment in terms of the Award was upheld, and no order as to costs was made.