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TMI Blog1974 (11) TMI 92X X X X Extracts X X X X X X X X Extracts X X X X ..... rom challenging the jurisdiction of the umpire. As it was contended for the Board that point 2(a) of the reference related only to the sum still payable for the work done under the second contract and therefore the return of the security amount would not be covered by point 2(a). And, as regards point 2(d), the contention of the, Board was that it related to the claims of the Board against the respondent in respect of or under the agreement. The Board, therefore, contended that the matter was not referred to the arbitrators either under point 2(a) or 2(d). The High Court did not express any final opinion on this question - Allow the appeal and set aside the judgment of the High Court - C.A. 682 OF 1974 - - - Dated:- 21-11-1974 - KUTTYIL KURIEN MATHEW, A.N. RAY AND N.L. UNTWALIA, JJ. For the Appellant : B. Sen, C. Krishnan Nair and K. N. Bhat For the Respondents.V, M. Tarkunde and A. G. Pudissery JUDGMENT This is an appeal, by special leave, from the judgment of the Kerala High Court reversing an order passed by the District Judge making an award passed by the umpire a rule of the court after dismissing an application to set aside the award. By a contract da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1972 for extension of time for passing the award by the. arbitrators. This was disposed of by an order dated 22-6-1972 stating that since O.P. 11 of the 1972 bad been allowed, it had become unnecessary to extend the period. The umpire entered on reference in his capacity as umpire on 30-6-1972. Both the appellant and the Board participated in the proceedings before the umpire without demur and the umpire made the award in favour of the appellant for nearly Rs. 30 lakhs on 15-2-1973. The umpire field the award in court on 30--2-1973 and prayed by O.P. 21 of 1973 that notice of the filing of the award be issued to the parties and that the award be made a rule of the court. Notice was ordered on the application on 21-2-1973. The Board filed an application on 22-3-1973 [I.A. 895(a)] challenging the award under sections 16, 30 and 33 of the Arbitration Act and praying to set aside the award. On 24-3 1973, the appellant filed an application to pass a decree in terms of the award for interest at 15 per cent from the, date of the decree. The appellant filed his objection on 26-3-1973 to the Board' application to set aside the award. The case was posted for hearing on 4-4-1973. On that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aph 5 of that order, the court has stated : "When the, matter came up for enquiry, it was represented by both sides, that since the petitioner (appellant) has expressed in so many words his want of confidence in the arbitrators and since the arbitrators themselves have expressed their willingness to be relieved of their duties as 'arbitrators, they, may be dispensed with. In view of this agreement, it has become necessary to revoke the authority of respondents 2 and 3 (arbitrators) and to appoint the 4th respondent as umpire and to direct him to make the award". We find it difficult to accept the, reasoning of the High Court that the umpire had no jurisdiction to enter upon the reference. In the first place, the orders in O.P. 11 of 1972 was an order passed on consent of the appellant and the Board. Quite apart from this, rule 4 in the first schedule to the, Arbitration Act authorises an umpire to enter upon the reference in case, the arbitrators fail to make the award within the time specified. Whatever be the reason, since the arbitrators did not make, the award within the extended time, the umpire, by virtue of the provision of rule could have entered upon the reference and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rence either agree before hand to the method of appointment, or afterwards acquiesce in the appointment made, with full knowledge of all the circumstances, they will be precluded from objecting to such appointment as invalidating subsequent proceedings. Attending and taking part in the proceedings with full knowledge of the revelant fact will amount to such acquiesence" (see Rusesell on Arbitration", 17th ed., p. 215). In Chowdhri Murtaza Hossin v. Mussumat Bibi Bachunnissa( 3 I.A. 209 at 220) the Privy Council said : On the whole, therefore, their Lordships think that that appellant, having a clear knowledge of the circumstances on which he might have founded an objection to the arbitrators proceeding to make their award, did submit to the arbitration going on; that he allowed the arbitrators to deal with the case as it stood before them, taking his chance of the decision being more or less favourable to himself; and that it is too late for. him, after the award has been made, and on the application to file the award, to insist on this objection to the filing of the award." The High Court said that acquiescence of the Board by participating in the proceeding before the umpir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce in this case so that the court should have allowed. the Board to adduce other evidence (see s. 33 of the Arbitration Act). The next question for consideration is whether the High Court was right in its view that the claim of the appellant in respect of the two matters dealt with by it was validly allowed by the umpire. The terms of the agreement for reference to arbitration be between the appellant and the Board provided : "It is agreed that the Contract Agreement No. 15/CEC/67/68 stands terminated by letter No. C2F.359/66, dated 15-11-1968 of the Chief Engineer, Civil. The Contractor agrees to withdraw the Suit No. O.S. 38/1970 filed in the Badagara Sub-Court by him. It is agreed that there is no other question of dispute or difference arising for settlement except those specifically detailed below in respect of the above contract. All other questions or claims of contractor, if any, whether existing, now or if arising from findings in the award under this reference or during arbitration proceedings or otherwise are hereby withdrawn and are deemed to be abandoned. Points of Reference 1. Regarding the first contract, i.e. Agreement No. CEC/4/64-65. Whether the claim to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... live by any acknowledgement by the Board, or in any other manner known to law and in so far as the umpire did not address himself at all to the plea of limitation, the award was vitiated by an error of, law apparent on the face of the record. The High Court did not make any pronouncement upon this question in view of the fact that it remitted the whole case to the arbitrators for passing a fresh award by its order. We do not think that there is any substance in the contention of the Board. In the award, the umpire has referred to the claims under this head and the arguments of the Board for disallowing the claim and then awarded the amount without expressly adverting to or deciding the question of limitation. From the findings of the umpire under this head it is not seen that these claims were barred by limitation. No mistake of law appears on the face of the award. The umpire as sole arbitrator was not bound to give a reasoned award and if in passing the award he makes a mistake of law or of fact, that is no ground for challenging the validity of the award. It is only when a proposition of law is stated in the award and which is the basis of the award, and that is erroneous, ca ..... X X X X Extracts X X X X X X X X Extracts X X X X
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