Sudhir Kishan Gupta vs Prem Chand Gupta & Ors
2010 Latest Caselaw 734 Del

               *IN THE HIGH COURT OF DELHI AT NEW DELHI

+                                       CM(M) No.234/2009

 %                                              Date of decision: 9th February, 2010

RAJENDER KISHAN GUPTA                        .... Petitioner
                 Through: Mr. Kamal Sawhney, Advocate

                                             Versus

PREM CHAND GUPTA & ORS.                  .... Respondents
                Through: Mr. B.S. Maan & Mr. H. Singh,
                        Advocates
                                            AND
+                                       CM(M) No.235/2009

SUDHIR KISHAN GUPTA                        ..... Petitioner
                 Through: Mr. Kamal Sawhney, Advocate.

                                             versus

PREM CHAND GUPTA & ORS                    ..... Respondents
                 Through: Mr. B.S. Maan & Mr. H. Singh,
                         Advocates
CORAM :-
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
1.        Whether reporters of Local papers may               Yes
          be allowed to see the judgment?

2.        To be referred to the reporter or not?              Yes

3.        Whether the judgment should be reported             Yes
          in the Digest?




CM(M) No.234/2000 & CM(M) No.235/2000                                         Page 1 of 20
 RAJIV SAHAI ENDLAW, J.

1. These two petitions under Article 227 of the Constitution of India,

though preferred by different petitioners, are with respect to similar /

identical orders of the same Additional District Judge on the similar

objections preferred by each of the petitioners to the execution petition filed

for execution of a decree pursuant to an arbitration award under the

Arbitration Act, 1940, made rule of the Court. The counsel appearing for

both the petitioners has addressed same arguments in both the matters.

Whatsoever, the objections before the executing court may have been and

which have been dismissed, the arguments before this court were confined

only to the contention that the decree sought to be executed is a nullity,

being in violation of Section 185 of the Delhi Land Reforms Act (hereinafter

called the DLR Act).

2. The arbitration award dated 31st March, 1973 records that the parties

to the arbitration were members of a joint Hindu family owning immovable

and movable properties and carrying on businesses of brick kiln, nursery and

florists; that lands and other immovable properties at various places were

owned by the members of the aforesaid family either in the name of any of

the member or more members or even in the name of their relations, friends

and other persons as benami; that disputes had arisen between the aforesaid

members of the joint Hindu family and with a view to settle the same

amicably they had entered into an arbitration agreement dated 13th April,

1971 and referred all their disputes and differences to the arbitration of Mr.

L.R. Gupta, advocate and Dr. M.L. Sharma. The award, after recitals and

listing the points for determination, divides the properties of the family

amongst the five branches of the family.

3. Mr. L.R. Gupta, advocate being one of the arbitrators filed the award

aforesaid in the Court for being made rule of the Court. It appears that

objections to the award were preferred by only one branch of the family (not

the petitioners herein). However, subsequently the parties arrived at a

compromise, terms whereof were recorded in Ex.CA. As per the

compromise, the award dated 31st March, 1975 was to be made rule of the

Court, subject to amendments detailed in Ex.CA. This court recorded the

statements of the parties in support of the compromise application and made

the award as amended through Ex.CA, a rule of the court and passed the

decree in terms thereof on 1st September, 1975.

4. Execution proceedings from which these petitions have arisen, was

filed by one branch of the family i.e. who had preferred objections to the

award. By way of execution, possession of several properties which were

stated to have been awarded to the party applying for execution was sought.

Though the execution was filed in or about August, 1987 but objections

thereto were filed by the petitioners in or about the year 2003. It was inter

alia stated in the said objections that the decree if implemented / executed

will violate DLR Act.

5. The said objections have been dismissed vide the order impugned in

these petitions. The counsel for the petitioners has besides addressing oral

arguments also filed written submissions. It is his contention that the

arbitration award supra forming the basis of the decree under execution

resulted in partition of agricultural land; that the DLR Act which is a

complete code in itself provides a detailed mechanism for partition of

agricultural properties; Section 185 of the said Act prohibits the courts other

than the court mentioned in Column 7 in schedule I of the said Act from

taking cognizance of any suit, application or proceeding mentioned in

Column 3 thereof; that a suit for partition is mentioned in column 3 of

Schedule I. It is further his contention that the decree holder has admitted in

the pleadings that the award would result in partition of agricultural land.

He contends that the exclusive jurisdiction for partitioning agricultural land

being with the Revenue Court, the decree resulting from the award being

made rule of the court is a nullity and un-enforceable.

6. The learned Additional District Judge has on this aspect, relying on

Morgan Securities and Credits Pvt. Ltd. Vs. Morepen Laboratories Ltd.

132 (2006) DLT 588 held that the executing court cannot go behind the

decree and cannot entertain any objections that the decree is incorrect in law

or facts; it has further been held that the objections, if any, with respect to

the arbitral award, under Section 34 of the 1996 Act are required to be

preferred within the time mentioned therein; that the petitioners/objectors

having not preferred any objections to the award, the executing court cannot

entertain such objections as it would amount to setting at naught the

limitation provided in Section 34(3) of the 1996 Act for objecting to the

award. It was further held that since the executing court was not dealing with

a suit for partition of agricultural land, the bar provided in Section 185 of the

DLR Act did not come into play.

7. The counsel for the petitioners has urged that the learned Additional

District Judge has erred in holding that the objections to a decree consequent

to the award being made rule of the court cannot be preferred. Reliance in

this regard is placed on Union of India Vs. Jagat Ram Trehan 61 (1996)

DLT 779 (DB) where it was held that Section 47 of the CPC applies to

execution proceedings taken pursuant to a decree making the award a rule of

the Court; it is open to the executing court under Section 47 to declare that

the award was without jurisdiction and therefore the decree passed there

upon is also null and void and not executable. The counsel for the petitioner

also distinguishes the judgment in Morgan Securities (supra)by contending

that in that case, the counsel for the petitioner had conceded that he would

not raise any question regarding inherent lack of jurisdiction. It is contended

that in the present case, there was inherent lack of jurisdiction in the

arbitrator partitioning properties governed by the provisions of the DLR Act.

8. This Court is of the opinion that first it has to be determined whether

there is any bar on the arbitrator from exercising powers in respect of

matters of which jurisdiction of the "court" is barred under Section 185 of

the DLR Act. Only if such bar is found, would the next question arise i.e.

whether such objections could have been taken only at the stage of objecting

to the award or could they also be taken in the execution of the ensuing

decree.

9. Section 185 of the DLR Act is as under:-

"185. Cognizance of suits, etc., under this Act. - (1) Except as provided by or under this Act no court other than a court mentioned in column 7 of Schedule I shall, notwithstanding anything contained in the Code of Civil Procedure, 1908 (5 of 1908), take cognizance of any suit, application, or proceedings mentioned in column 3 thereof.

(2) Except as hereinafter provided no appeal shall lie from an order passed under any of the proceedings mentioned in column 3 of the Schedule aforesaid.

(3) An appeal shall lie from the final order passed by a court mentioned in column 3 to the court or authority mentioned in column 8 thereof.

(4) A second appeal shall lie from the final order passed in an appeal under sub-section (3) to the authority, if any, mentioned against it in column 9 of the Schedule aforesaid."

Serial 11 in Schedule 1 to the DLR Act prescribes that a suit for partition

of holding of a Bhumidhar shall lie before the court of the Revenue

Assistant with First Appeal there-against before the court of the Deputy

Commissioner and Second Appeal there-against before the court of the

Chief Commissioner.

10. Thus, if the suit is for partition of holding by a Bhumidhar of land

governed by the provisions of the DLR Act, Section 185 bars the jurisdiction

of any other "court" with respect to such a suit. The question which thus

arises is whether the arbitrator is a "court".

11. The aforesaid question was posed to the counsel for the petitioner also

at the very outset. He had then not cited any judgment on this aspect.

Subsequently, however, he sought another opportunity of hearing and placed

reliance on Indian Trade Promotions Organization Vs. International

Amusement Ltd 142(2007) DLT 342. His argument is that the DLR Act,

which is like the Public Premises (Eviction of Unauthorized Occupants) Act

(hereinafter called the PP Act) in consideration in the said judgment, is a

complete code in itself. On this aspect reliance is placed on Hatti Vs.

Sunder Singh AIR 1971 SC 2320 and Gaon Sabha Vs. Nathi (2004) 12

SCC 555. He also seeks to place reliance on Jai Singh Vs. Mangtoo AIR

1962 HP 10 where the Judicial Commissioner held that where the subject

matter of a private award was exclusively within the jurisdiction of a

revenue court, the award cannot be filed in a civil court and it cannot also be

filed in a revenue court, it being not a civil court within the meaning of the

Arbitration Act.

12. The bar in Section 185 of the DLR Act is only to the jurisdiction of a

"Court". The bar is not to the jurisdiction of the arbitrator. The Arbitration

Act, 1940 was in existence since prior to the coming into force of the DLR

Act, 1954. The legislature still did not deem it appropriate to bar the

jurisdiction of the arbitrator. The Supreme Court in Manohar Lal Vs.

Vinesh Anand AIR 2001 SC 1820 after noticing that as far back as in

Thawardas Pherumal Vs. Union of India MANU/SC/0070/1955 it had

been held that the arbitrator is not a Court within the meaning of CPC, but in

view of the sea change since then i.e. the repeal of the 1940 Act and the

introduction of the 1996 Act, reconsidered the question whether the

arbitrator could be said to be a Court and again held that an arbitrator is not a

court, though the examination in that case was vis-à-vis Section 195 of the

Cr.P.C.

13. The Supreme Court in Olympus Superstructures Pvt. Ltd. Vs. Meena

Vijay Khetan AIR 1999 SC 2102 was faced with the question whether

specific performance, jurisdiction whereof under the Specific Relief Act has

been conferred on the civil court only, can be arbitrable. There was a

difference of opinion among the High Courts in that regard. It was held by

the Supreme Court that there being no prohibition in the Specific Relief Act

that issues relating to specific performance of contract relating to immovable

property cannot be referred to arbitration and there being also no prohibition

in the Arbitration Act in this regard, no such prohibition could be carved out

by the Court. Reliance was placed on Halsburys' Laws of England stating

that disputes or differences which the parties to an arbitration agreement

agree to refer must consist of a justiciable issue triable civilly. A fair test of

this is whether the differences can be compromised lawfully by way of

accord and satisfaction.

14. Applying the aforesaid dicta, I am of the opinion that there being no

bar neither in the DLR Act nor in the Arbitration Act to arbitration of

disputes qua partitioning of property even if governed by the provisions of

the DLR Act, the arbitration award or the decree in terms thereof cannot be

set aside on this ground.

15. That brings me to the judgment in International Amusement Ltd.

(supra). In that case, the agreement between the parties though providing for

arbitration of disputes also provided that the premises subject matter of the

agreement would be governed by the PP Act. It was in that context that the

Division Bench of this Court held that the two clauses of the agreement have

to be read harmoniously. It was held that the arbitration clause could not

make the other clause regarding applicability of the provisions of the PP Act

redundant. Reading the two clauses harmoniously, it was held that

arbitration could not be of the disputes covered by the PP Act. The Division

Bench however further held that the PP Act being a special Act prescribing

the complete procedure for adjudication of proceedings and being a

complete code in itself, the matters required to be adjudicated thereunder

could not be made subject matter of arbitration. It was further held that the

jurisdiction conferred by the statue on the Estate Officer, could not by

contract be conferred on an arbitrator. Proceeding further, it was held that

the bar in the PP Act to jurisdiction of courts would apply to the arbitrator

also. The counsel for the petitioners would contend that what has been held

by the Division Bench qua the PP Act, applies to the DLR Act also.

16. I have already noticed above that the arbitrator has not been held to be

a court by the Supreme Court. The bar of Section 69(2) of the Partnership

Act applicable to courts has also been held not applicable to proceedings

before an arbitrator, by the Supreme Court in Kamal Pushp Enterprises Vs

D.R. Construction Co. AIR 2000 SC 2676. Similarly, in Paramjeet Singh

Patheja Vs ICDS Ltd AIR 2007 SC 168 an arbitration award was not held to

be a decree within the meaning of Section 9(2) of the Presidency Towns

Insolvency Act, 1909 inter alia because it is not rendered in a suit

commenced by institution of a plaint. Yet again in M.D. Army Welfare

Housing Organisation Vs Sumangal Services Pvt Ltd AIR 2004 SC 1344 it

was held in the context of the Arbitration Act, 1940, whereunder arbitration

proceedings in the present case also were held, that an arbitral tribunal is not

a court of law and its functions are not judicial in nature and it functions in

the confines of the four corners of the agreement. Section 34 of the CPC

was also not held applicable to arbitration proceedings, in Bhagwati Oxygen

Ltd Vs Hindustan Copper Ltd. AIR 2005 SC 207, for the reason of the

arbitrator not being a court.

17. I may also notice that in Galib Bin Awaj Vs Mohd. Abdul Khader

AIR 1987 SC 1565, the Supreme Court held that the bar in Section 99 of the

Andhra Pradesh (Telangana Area) Tenancy and Agricultural Lands Act,

1950 to the jurisdiction of the Civil Court was not against the arbitrator.

18. The question therefore which arises is, whether, what the Division

Bench has observed in International Amusement Ltd. (Supra) qua the PP

Act, applies to the DLR Act. The PP Act, without exception, applies to all

public premises. The DLR Act is not such an Act. In fact, the provisions

thereof do not even extend to the entire city of Delhi or even to all

agricultural lands in Delhi. This Court in Ram Lubhaya Kapoor Vs J.R.

Chawla 1986 RLR 432, Narain Singh Vs Financial Commissioner

MANU/DE/1008/2008, N.B. Singh (HUF) Vs Perfexa Solutions Pvt Ltd.

MANU/DE/0743/2009 and recently in Nilima Gupta Vs Yogesh Saroha

156 (2009) DLT 129 has held that the DLR Act ceases to apply when the

land ceases to be agricultural and is built upon, as is the case with most of

the agricultural land in Delhi. The arbitration award in the present case,

though describes some of the properties of the family as agricultural land,

does not show that any agricultural activity was being carried on by

members of the family; rather they are described as carrying on other

business. Also Single Judges of this court in Trikha Ram Vs Sahib Ram 69

(1997) DLT 749 and Sis Ram Vs Lallu Singh MANU/DE/8613/2006 have

held that upon issuance of notification of urbanization of the village, the

provisions of the DLR Act cease to apply. Thus, it would be seen that the

DLR Act cannot be equated to the Rent Act or to the PP Act.

19. I may also notice that the bar under the DLR Act is only to a suit for

partition of holding of a Bhumidhar. From a reading of the award, the

claims therein do not appear to be for partition of the holding of a

Bhumidhar. The claims therein were with respect to properties admittedly

belonging to all the members of the family being held in the name of some

of the members only or even in the names of others. All that the parties have

done is to divide the said property between themselves. The said division

appears to be amicable and with the consent of the parties. The parties

appear to have involved the arbitrator only with a view to formalize their

family settlement. The DLR Act does not prohibit such family settlement.

Only when a suit for partition is required to be filed, is the fora of the courts

created there-under provided. What appears to have happened in the facts of

the present case, is more akin to a voluntary agreement/family settlement

between the parties and with respect whereto in any case, the bar of the DLR

Act does not arise. The Supreme Court in Kale Vs Deputy Director of

Consolidation (1976) 3 SCC 119 has held that a very liberal and broad view

of the validity of such family settlement has to be taken and they are to be

enforced and upheld by the courts and technicalities of law should not be

permitted to be an impediment in implementation thereof.

20. I also do not see any practical difficulty in following the aforesaid

course. Under Section 54 read with Order XX Rule 18 of the CPC, where

the decree is for partition of an undivided estate assessed to the payment of

revenue to the Government, or for the separate possession of a share of such

an estate, the partition of the estate or the separation of the share shall be

made by the collector or any gazetted subordinate to that collector deputed

by him in this behalf in accordance with law for the time being in force

relating to partition, or the separate possession, shares, of such an estate.

The civil court before which the decree is filed for partition is then required

to direct such partition or separation to be made by the collector or his

subordinate in accordance with the declaration as to shares. It thus cannot

be said that the execution poses any problem.

21. The claim of the petitioners in the present case is found to be

dishonest. The arbitration award made rule of the court and to execution

whereof objections have been filed has admittedly been implemented to a

large extent and the petitioners have also availed benefits thereunder and are

objecting only to implementation qua one branch of the family. The

Supreme Court in Puran Chand Nangia Vs National Fertilizers Ltd (2003)

8 SCC 245 has held objections to the award to be not maintainable after a

party has submitted to the award. To the same effect is the judgment of this

court in Anand Kumar Jain Vs UOI MANU/DE/0191/1987. The principle

is found to apply to the facts of the present case and the reliance by the

petitioners on Harshad Chimanlal Modi Vs. DLF Universal Ltd. (2005) 7

SCC 591 is misconceived.

22. I may also notice that the petitions have been preferred under Article

227 of the Constitution of India. The exercise of jurisdiction there under is

discretionary, though of course, in accordance with the established

parameters. The said jurisdiction has been conferred primarily to ensure that

any of the orders of the subordinate court / tribunal does not result in

injustice to any of the parties in the present case. The Supreme Court in

State Vs Navjot Sandhu (2003) 6 SCC 641 and Surya Dev Rai Vs Ram

Chander Rai (2003) 6 SCC 675 has held that the powers thereunder are to

be exercised to meet the ends of justice and where the orders impugned have

occasioned grave injustice or failure of justice. The equities are loaded

against the petitioners and are in favour of the decree holders. It is perhaps

for this reason only that the counsel for the petitioner chose to confine

himself to the aforesaid legal issues only. Else as aforesaid, not only did the

petitioner not prefer any objection to the arbitration award of 1973 but the

same was made rule of the court with modifications in terms of the

compromise arrived at between the parties, as far back as in 1975. It is the

case of the decree holder that the petitioners cannot wriggle out of the

compromise; that the petitioner along with their other family members have

been enjoying the immovable properties which under the award had fallen to

the exclusive share of their branch of the family since 1975 and have also

been selling off some of the properties claiming themselves to be the

exclusive owners thereof by virtue of the award made rule of the court, as

aforesaid. The decree holder has taken the plea that the petitioners having

availed of the benefits of the decree are now estopped from challenging the

same. It is also pleaded that the petitioners, in other legal proceedings, have

been relying on the aforesaid award and decree and are precluded from

challenging the same. Not only so, it is further pleaded by the decree

holders that the petitioners themselves had applied for execution of the

aforesaid award made rule of the court and decreed and taken possession of

the properties which had fallen to their share under the aforesaid award. It is

contended by the decree holders that after having taken possession and

having sold off some of the properties which had fallen to their shares, the

petitioners are now creating obstructions to the decree holders getting their

share of the properties as per the said award. It is further contended that the

award has been acted upon and remains only qua the decree holder. In the

circumstances no case for exercise of discretion in favour of the petitioners

is found. The petitioners by preferring objections are purporting to

perpetuate injustice and which cannot be permitted under Article 227 of

Constitution of India. The Supreme Court in Ravinder Kaur Vs Ashok

Kumar (2003) 8 SCC 289 has held that courts of law should be careful

enough to see through diabolical plans of judgment debtors to deny the

decree holders the fruits of the decree obtained by them.

23. The learned Additional District Judge however, erred in applying the

provisions of the Arbitration Act 1996 to the matter in controversy when not

only the award but also the proceedings for making the same rule of the

court and decree in terms thereof were long prior to the coming into force of

the 1996 Act. There is a material difference between the 1996 Act and the

1940 Act. While under the 1996 Act, the award after the expiry of the

period prescribed for preferring objections is a decree without being required

to be made rule of the Court, under the 1940 Act, the court was required to

apply itself to the correctness of the award before making the award a rule of

the court. A duty was cast on the court to satisfy itself that the award was in

accordance with law before making the same rule of the court even if any

objections had been preferred there against. In the present case, not only did

the court make the award the rule of the court but the petitioners expressly

agreed to the same being made rule of the court. The question of estoppel

would certainly arise against the petitioners. The petitioners cannot be

permitted to indulge in re-litigation.

24. That brings me to the judgment of the Division Bench of this Court in

Jagat Ram Trehan (supra); in that case the arbitration was to cease upon the

arbitrator being transferred or vacating his office. The objection was that the

arbitrator had vacated his office on the date when the award was

pronounced. It was on these facts that the Court held that the objection qua

the award could be taken even in execution. That case did not concern

exclusive jurisdiction of any other Court.

25. Thus looked at from any perspective, I am unable to find any merits in

favour of the petitioners. The petitions are mala fide and vexatious and are

dismissed with costs of Rs.25,000/- each, payable to the respondents.

RAJIV SAHAI ENDLAW (JUDGE) February 9, 2010 gsr