LACHHMAN DASS v. RAM LAL & ANR

Citation: [1989] 2 S.C.R. 250

Court: Supreme Court of India

Bench: SABYASACHI MUKHERJI, S. RANGANATHAN

Case summary

Both the parties appointed one Shri Ajit Singh as the Arbitrator on 7th March, 1974 for settlement of the dispute about 2'h Killas of land situated near Chandni Bagh, Panipat in the State of Haryana....

Judgment text

The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J. Special leave granted. This appeal is from the judgment and order of the High Court of Punjab and Haryana dated 22nd April, 1988. The dispute was between the two brothers. Both the parties appointed one Shri Ajit Singh as the Arbitrator on 7th March, 1974 for settlement of the dispute about 2'h Killas of land situated near Chandni Bagh, Panipat in the State of Haryana. The said land stood in the name of the appellant. According --.... - to the respondent, Ram Lal, it was benami in the name of the appel- "·( lant. That was the dispute. The arbitrator gave his award on 22nd May, ~-. 1974 and moved an application on 23rd September, 1974 before the ·court of Sub-Judge Ilnd Class, Panipat, for making the award the rule of the Court. The application was registered in the said Court and notice was issued to the appellant hereiq on 7th November, 1974. Objections were filed by the appellant taking various grounds.

It was contended that the appellant had informed the sole arbitr;;tor through "\ registered notice and by a telegraphic notice that he had no faith in the said arbitrator and had thus repudiated his authority to proceed with the arbitration proceedings. It was also contended that the award was lop-sided, perverse, and totally unjust and against all cannons of justice and fair play. It was alleged that the arbitrator had acted in a partisan manner. He never heard the claim of the appellant and never called upon him to substantiate his claim and had acted as an agent of ~ the respondent. It was, therefore, prayed by the appellant that the award be set aside. It may be mentioned that no point was raised that the award was bad and unforceable because it was not properly stamped nor any plea was taken that the award was an unregistered one as such could not be made the rule of the court. Several issues were framed.

No issue was, however, framed on t the ground that the award was bad because it was not properly . ,. t stamped or that it was not registered. The appellant, who was respondent No. 2 in the said proceedings before the learned Trial Judge, gave his version about the repudiation of the authority. The learned Trial Judge had, however, held that the appellant had failed to prove that he had repudiated the authority of the arbitrator to enter upon the arbitration through registered notice or otherwise before the arbitrator ---\. announced his award. It was further hdd that the award of the arbitrator was not liable to be set aside on the grounds taken. The objections were treated as objections under section 33 of the Arbitration Act, 1940 and it was filed within the limitation period.

In that view of the matter, the learned Sub-Judge Ilnd Class, Panipat by his order dated 28th July, 1977 dismissed the objections under Section 14 of the Arbitration Act, 1940 and made the said award the rule of the court. Aggrieved thereby, the appellant went up in first appeal before the Additional District Judge, Karna!. The learned Additional District Judge, while dealing with the contentions of the appellant, held that the application was properly filed. A point was taken before the first Appellate Court that the award was on an unstamped paper and as such could not be made the rule of the court. The learned District Judge held that the award has not been r properly stamped and as such could not be made the rule of the court. It was also contended before the learned District Judge that the award was unregistered and as such it could not be made the rule of the court as it affected immovable property of more than Rs. 100.

The learned District Judge after analysing the provisions of section 17 of the Registration Act, 1908 (hereinafter referred as to 'the Act') came to the conclusion that the award declared right in immovable property and since it was unregistered, it could not be made the rule of the court. The learned District Judge, however, also came to the conclusion that the authority of the arbitrator had been repudiated. This ground no longer survives. In the aforesaid view of the matter, the learned District Judge allowed the appeal on the ground that the . }award was unregistered and unstamped and as such could not be made the rule of the court and set aside the order of the learned Trial Judge. There was a second appeal to the High Court. The High Court upheld the award. The High Court noted that the necessary stamp was puJchased on 8th August, 1974 before the award was filed on the 9th Septemb_er, 1974. And that being so, it could not be argued success- \ fully that the award was unstamped.

In that view of the matter, the '! , High Court held that the learned District Judge was in error in allowing the stamp objection to be taken. As regards the registration, it was held by the High Court that the award did not create any right as such in immovable property; it only admitted the already existing rights between the parties and hence it did not require any registration. In that view of the matter, the ,f- High Court was of the opinion that the first appellate Court was wrong. The High Court was further of the view that no right was created in favour of Shri Ram Lal, the respondent herein when he was declared the owner. Both Lachhman Das, the appellant and Ram Lal, the respondent, had claimed their ownership and, according to the High Court, they had the existing rights. The award only made, according to the High Court, it clear that the ownership would vest in one of the brothers, Ram Lal.

In the aforesaid view of the matter, the ~· High Court was of the view that it did not require registration. The High Court allowed the appeal and directed the restoration of the order of the learned trial court and the award be made the rule of the court. Aggrieve. ct thereby, the appellant has come up to this Court. The question ls-Was the High Court right in the view it took? ~ \' ~ Mr. A. K. Sen, learned counsel for the appellant contended that . the High Court was clearly in error in the facts and circumstances of this case to have made this award the rule of the court and to have looked upon this award which at all relevant and material time was unregistered. It may be mentioned that when this matter came up before this Court on the 5th December, 1988, the matter was >. ; adjourned for two months and it was recotded "In the meantime, the parties may take steps".

Thereafter, it ~ppears that the award was filed for registration on 19th December, 1988 before the Sub-Registrar, Panipat and was registered actually on 3rd February, 1989. Mr. Sen, contended that the registration of the award subsequently made in the manner indicated hereinbefore did not validate it retrospectively in view of the relevant provisions of the Act. The award being an unregistered one could not have,. been looked into by the High Court. Mr. Sen tried to urge before us ·thatthe award was got registered by misrepresentation of the order of this Court dated 5th December, 1988. This Court did not, on 5th December, 1988, direct that the registration could be made. All that this Court observed was that the parties might take steps. It may be mentioned that on or about 18th December, 1988, it appears at page 75 of the present paper book that an application was made for registration of award which was said to have been applied by Shri Ajit Singh, S/o Shri Beer Singh.

In the said Jetter, it was mentioned that Mr. 1ustice J. V. Gupta of the Hon'ble High Court of Punjab and Haryana had held in favour of the said writer and it was further stated that on the 5th December, 1988, this Court dismissed the case of Lachhman Singh, the appellant herein, copy whereof was enclosed. The award was filed for registration on 18th December, 1988. The statements contained in the letter were incorrect and misleading inasmuch as this Court did not dismiss the case of the appellant on 5th December, 1988. On the other hand, this Court, as mentioned hereinbefore on the 5th December, 1988, merely observed that the appellant would be at liberty to do what was needful. Mr. Ashri, learned counsel for the respondent, submitted that the registration was done in view of provisions of sections 23 and 25 of the Act. Mr.

Sen, on the other hand, submitted before us that this was wholly irregular to have obtained registration by misleading the Sub-Registrar and this was of no effect. Furthermore, in any event, according to Mr. Sen, the registration having been beyond the period of four n:tonths as enjoined by the relevant provisions was wholly bad. r The first question that requires consideration in the instant case is whether the Court could have l oked into the award for the purpose of pronouncing judgment upon the . award. In order to deal with this question, it is necessary to refer to 'section 17 of the Act. Section 17 deals with documents of which registration is compulsory. Section 17 of the said Act mentions the documents which must be registered.

Section 17(1)(e), interalia, provides: "non-testamentary instruments transferring or ass1gnmg any decree or order of a Court or any order of a Court or any award when such decree or order or award purports or operates to create, declare, assign, limit or extinguish, whether in present or in future, any right, Utle or interest, LACHHMAN DASS v. RAM LAL IMUKHARJI, J.! 257 whether in present or in future, any right, title or interest, whether vested or contingent, of the value of one hundred rupees and upwards, to or in immovable property.

" Section 23 of the said _Act provides as under: "Subject to the provisions contained in sections 24, 25 and 26, no document other than will shall be accepted for registration unless presented for that purpose to the proper officer within four months from the date of its execution: Provided that a copy of a decree or order may be presented within four months from the day on which the decree or order was made, or, where it is appealable, 'f within four months from the day on which it becomes fmal.

" Section 25 of the said Act provides as under: "If, owing to urgent necessity or unavoidable accident, any document executed, or copy of a decree or order made, in India is not presented for registration till after the expiration of the time hereinbefore presented in that behalf, the 1 Registrar, in cases where the delay in presentation does not exceed four months, may direct that, on payment of a fine not exceeding ten times the amount of the proper registration-fee, such document shall be accepted for registration. " Section 49 of the said Act provides as under: "No document required by section 17 or by any provision ~ of the Transfer of Property Act, 1882, to be registered shall (a) affect any immovable property comprised therein, or (b) confer any power to adopt, or ~ (c) be received as evidence of any transaction affecting such property or conferring such power, unless it has been registered. "