judgement:
ivil Appeal No. 203 of 1975.
From the Judgment and Order dated 12.12.1974 of the Madhya Pradesh High Court in Second Appeal No. 569 of 1970.
U.R. Lalit, Rameshawar Nath, L.G. Kher and Ravinder Nath for the appellant.
P.P. Rao, Dr. N.M. Ghatate, S.V. Deshpande, Ms. Priya Gupta and Ejaz Maqbool for the Respondents.
The Judgment of the Court was delivered by KASLIWAL, J.
This appeal by special leave is directed against 908 the judgment of the High Court of Madhya Pradesh at Jabalpur dated 12th December, 1974.
This litigation has a long chequered history of more than five decades.
The appellant, the Sagar Mahila Vidyalaya is an educational institution founded by a section of the public of District Sagar (M.P.) by giving donations and is duly registered under the Societies Registration Act (Act XXI of 1860).
On 17th November, 1933 one Govind Rao Harshe had mortgaged some agricultural land and house known as ``Harshewada ' ' to Lakshmi Chand and Duli Chand Modi.
The aforesaid mortgages filed a suit and obtained a preliminary decree for sale on 14th July, 1937.
A final decree for sale for the realisation of Rs. 5001/13/6 was passed on 26th March, 1938.
On 29th March 1938 the decree holders applied for execution of the said decree.
The execution of the aforesaid decree was stayed and in the meantime C.P. and Berar Relief of Indebtedness Act, 1939 came into force.
The judgment debtor Govind Harshe alongwith his minor sons namely, Sadashiv Rao and Ram Chander Rao applied for settlement of the debts on 14th September, 1939 in the Debt Relief Court, Sagar.
the execution of the final decree for sale had been stayed by the executing Court as per the provisions of the Relief of Indebtedness Act.
On 11th September, 1940, the Debt Relief Court reduced the amount and granted instalments.
The creditors filed revision applications against the aforesaid order of Debt Relief Court.
The revision filed by Lakshmi Chand and Duli Chand was registered as Civil Revision No. 119 of 1940 while that of another creditor Pandey Shankernath was registered as Civil Revision No. 27 of 1941.
The Additional District Judge disposed of both the revisions by order dated 29th September, is the copy of the order passed in Civil Revision No. 119 of 1940 and its operative part reads as under: ``For the reasons given in paragraph 8 of the order of C.R. No. 27 of 1941, I hold that a condition can be prescribed by the D. R. Court in default of which the order fixing instalments shall cease to have effect and the whole claim shall become recoverable.
I, therefore, order that the debtors shall keep the mortgaged property intact by paying its land revenue in time every year and shall keep the house in good repairs, as a condition precedent to the continuance of their right to pay the claim by instalments fixed by the D.R. Court.
In default of their paying land revenue of the Malik Makbuza land in time, endangering its sale for its recovery, and in case they deliberately fail to keep the mortgaged 910 house in proper repairs or endanger its existence, this order of instalments shall cease to have effect and the applicant creditor shall become entitled to recover the whole amount.
Parties will bear their own costs of this revision. ' ' On November, 1941 the decree holders Lakshmi Chand and Duli Chand Modi applied for the revival of the execution proceedings on the ground that the judgment debtor had defaulted in carrying out the directions of the revisional court and as such the order passed by the Debt Relief Court granting instalments had ceased to exist and the whole amount had become payable in lumpsum.
the decree holders as such prayed for the sale of the house property in dispute.
the judgment debtor Govind Rao Harshe did not appear before the executing court inspite of service of notice and allowed the execution case to proceed ex parte against him.
On 31st March, 1942 the executing court passed a order holding that the non applicant judgment debtor had committed breach of the condition and as such the decree holders were entitled to recover the amount determined by the Debt Relief Court as due to them at once.
It was further held that the decree holders were entitled to execute the decree for recovery of debt amount.
The judgment debtor Govind Rao Harshe submitted an application on 12th August, 1942 for setting aside the ex parte order dated 31st March, 1942.
This application was dismissed on 13th November, 1942.
Civil Appeal filed against the said order was also dismissed on 6th April, 1943 by the Additional District Judge.
In the meantime, the house mortgaged was put to auction and the highest bid of Rs. 5905 was knocked down in favour of one Gopal Rao Mutatkar on 20th August, 1942.
1/4th of the auction amount Rs. 1500 was deposited on the spot and the balance 3/4th amounting to Rs. 4405 was deposited on 4th September, 1942.
The Judgment debtor Govind Rao Submitted an application under Order XXI Rule 90 C.P.C. for setting aside the sale dated 20th August, 1942.
This application was rejected vide order dated 6th February, 1943.
Miscellaneous Appeal filed against the said order was dismissed by the Second Additional District Judge, Sagar vide order dated 19th December, 1943.
It may be noted at this stage that in the meantime the sale was confirmed vide order dated 10th April, 1943.
Sadashiv Rao and Ram Chander Rao, sons of judgment debtor Govind Rao Harshe who had become adult also moved the executing Court on 28th September, 1943 that they were also necessary parties to the execution case as they were also parties in the proceedings before 911 the Debt Relief Court and as they were not made parties in the execution court, the order passed by the executing court dated 31st March, 1942 was void and without jurisdiction.
This application was rejected on 13th December, 1943.
An appeal filed against this order was dismissed by the Additional District Judge, Sagar by order dated 24th April 1944.
The Miscellaneous second appeal filed against the appeal order was also dismissed by the High Court by order dated 15th December, 1947.
In the meantime on 15th January, 1944 an application was submitted by Mahila Vidyalaya, Sagar (appellant before us) through its Secretary, Shri G.R. Wakhle for granting the sale certificate to the applicant Mahila Vidyalaya.
It was stated in the application that the house in question was auctioned by the Court and was purchased by Gopal Rao Mutatkar on 20th August, 1942 for Mahila Vidyalaya, Sagar for Rs. 5905 and the auction sale was confirmed by the Court on 10th April , 1943.
It was prayed that the sale certificate be granted to the applicant purchaser (Mahila Vidyalaya).
Stamps of Rs. 90 were supplied with the application.
A note was also appended with the application as under: ``That when Gopal Rao son of Madho Rao offered bid in public auction he was a member of the above mentioned institution.
But at present he is not a member.
Therefore, the following applicant who is the Secretary of this institution makes this application. ' ' The executing court on 26th February, 1944 passed an order to the following effect: ``The sale certificate will issue in the name of Mahila Vidyalaya, Sagar through Secretary, G.R. Wakhle ' '.
The sale certificate was then actually issued in favour of Mahila Vidyalaya on 8th April, 1944.
It is further important to note that four sons of the judgment debtor Govind Rao, namely, Sadashiv Rao, Ram Chander Rao, Sarad Chand (minor) and Ashok Kumar (minor) filed a Civil suit in the year 1948 (Civil Suit No. 1 A of 1948) for a declaration that the execution sale was not binding on their interest.
It may be noted that initially this suit was filed against Gopal Rao Mutatkar for Mahila Vidyalaya, Sagar as defendant No. 1(a), Shri G.R. Wakhle, Secretary, Mahila Vidyalaya as defendant No. 1(b), Lakshmi Chand and Duli Chand as defendant Nos. 2 and 3 and Govind Rao Harshe (father of the 912 plaintiffs) as defendant No. 4.
In that suit Gopal Rao Mutatkar and G.R. Wakhle filed their written statements and raised an objection that they were unnecessarily made parties as they had ceased to have any connection with the Mahila Vidyalaya.
exhibit P 22 is the copy of the written statement dated 10th March, 1948 filed by Gopal Rao Mutatkar in which he admitted that the house under dispute was auctioned on 20th August, 1942 and the same was purchased by the Sagar Mahila Vidyalaya, Sagar through him and that defendant No. 1 b (G.R. Wakhle) as Secretary of the said Mahila Vidyalaya had made an application for issue of sale certificate and for possession of the house.
The Sagar Mahila Vidyalaya, Sagar was a registered institution and the suit should have been filed against the institution itself and not in the name of its office bearers.
Shri G.R. Wakhle was the Secretary of the Sagar Mahila Vidyalaya, Sagar in 1942 and 1943.
He was no longer its secretary and the present Secretary of the said institution was Mr. Kamlakar Nagarkar.
It was thus prayed that the defendants 1 a and 1 b had been unnecessarily joined as parties to the suit and should be discharged.
Thereafter, the plaintiffs impleaded Mahila Vidyalaya, Sagar as party.
This suit filed by the aforementioned four sons of the judgment debtor was also dismissed on 27th December, 1949 and costs were imposed not only on the plaintiffs but also on defendant No. 4 i.e. Govind Rao Harshe, the judgment debtor.
The defendant No. 4 was also required to pay Rs. 300 to defendants 1, 2 and 3 as compensatory costs.
No further appeal was preferred against this judgment and decree.
The Sagar Mahila Vidyalaya, Sagar in the capacity of auction purchaser then applied for the delivery of possession.
The possession was delivered to Mahila Vidyalaya on 24th March, 1951.
At the time of delivery of possession some portion of the house was in the occupation of Smt.
Radha bai, widowed sister of the judgment debtor, Govind Rao Harshe and other portions were in the occupation of the tenants.
The Secretary of the Mahila Vidyalaya Agreed to the request of the tenants including Smt.
Radha Bai that they will not be ousted as they were willing to execute rent notes.
Thereafter, Mahila Vidyalaya being in need of more occupation moved the Rent Controller for permission to serve notices on the tenants to vacate the premises.
The permission was granted by the Rent Controller on 10th March, 1953 after service of the notices, all the tenants except Mst.
Radha Bai vacated the premises and handed over possession to Mahila Vidyalaya.
The Mahila Vidyalaya then instituted a suit (Civil Suit No. 100 A of 1954) against Mst.
Radha Bai and also Govind Rao Harshe who had started to live with his family in the portion occupied by Mst.
Radha bai as her 913 licensee.
The Trial Court dismissed the suit for ejectment but passed a decree for arrears of rent against Mst.
Radha Bai alone.
The appeal filed by the Mahila Vidyalaya was allowed by the Additional District Judge by judgment dated 27th October, 1957.
Against this decision, Govind Rao Harshe alone preferred an appeal in the High Court and Mst.
Radha Bai was impleaded as respondent No. 2.
The High Court by its judgment dated 29th April, 1960 dismissed the second appeal filed by Govind Rao Harshe.
The Mahila Vadyalaya then filed an execution application for ejectment of the occupants and the same is still pending as a result of stay order passed in a subsequent suit filed by Govind Rao Harshe, which is now the subject matter of the present appeal before us.
In the above background, we would, now state the facts of suit No. 133 of 1960 filed in the Court of Civil Judge, Class I, Sagar on 26th November, 1960 by Govind Rao Harshe, which has culminated in the present appeal.
Govind Rao Harshe filed the suit against Mahila Vidyalaya for a declaration, possession and permanent injunction.
Plaintiff Govind Rao Harshe died on 14th December, 1967 during the pendency of the suit and all the respondents in the present appeal were substituted in his place as his legal representatives.
The suit was dismissed by the Trial Court on 13th December, 1968.
On an appeal the District Judge, Sagar allowed the appeal and decreed the suit in favour of the present respondents granting the declaration, delivery of possession of the house together with a mandatory injunction directing demolition of some new constructions made by the Mahila Vidyalaya.
Aggrieved against the judgment of the First Appellate Court, the defendant Mahila Vidyalaya filed a second appeal before the High Court.
The High Court by order dated 12th December, 1974 dismissed the appeal.
The defendant Mahila Vidyalaya in the above circumstances have come in appeal by the grant of special leave.
The High Court held that as Gopal Rao Mutatkar was the auction purchaser, no sale certificate could be issued by the executing court in favour of the appellant Mahila Vidyalaya.
It was held that the bid in the auction was made by Gopal Rao for himself and not on behalf of Mahila Vidyalaya.
The deposit of auction money was also made in his own name and the order dated 10th April, 1943 confirming the sale was also made in his name.
The High Court affirmed the finding of the First Appellate Court that Gopal Rao Mutatkar did not purchase the property in the auction acting on behalf of the appellant and the First Appellate Court rightly held that Gopal Rao Mutatkar was the auction purchaser ad the sale was confirmed in 914 his name and the deposited full sale amount in his own name.
The High Court also held that Gopal Rao Mutatkar could only transfer his proprietary right by sale or a gift which he did not do.
In the circumstances, there was no transfer of the proprietary rights in favour of the appellant Vidyalaya and if that was so, no certificate could be issued in favour of the Mahila Vidyalaya.
The act of the executing court was clearly without jurisdiction and the sale certificate being void and inoperative conferred no right or title upon the appellant Mahila Vidyalaya over the suit property.
The High Court further held that suit filed on 26th November, 1960 being within 12 years from 24th March, 1951 was within time.
The plaintiff Govind Rao Harshe was never ousted by Gopal Rao Mutatkar who was the auction purchaser.
He was dispossessed by a person who had no title.
There was, therefore, no question of filing a suit for setting aside the sale.
It was further held that the plaintiff in this case was not required to file a suit for getting the sale set aside when he was pleading that the sale itself was void.
A void sale could be ignored by a true owner and it did not affect his title.
The High Court thus took the view that the suit for possession on the basis of title was governed by Article 144 of the Limitation Act, 1908.
In either case, whether Article 142 or 143 of the Limitation Act, 1908 is applied, the suit is within time.
We have heard learned counsel for the parties and have thoroughly perused the records.
In our view the High Court completely misdirected itself and wrongly ignored the earlier decisions between the parties and we are, therefore, inclined to allow this appeal.
The admitted facts of the case are that the house in question was auctioned in the execution of a decree for sale obtained by the mortgagees Lakshmi Chand and Duli Chand Modi.
Gopal Rao Mutatkar took part in the auction bid and it was knocked down in his favour on 20th August, 1942.
The sale was confirmed by an order of the executing court dated 10th April, 1943.
Govind Rao the judgment debtor submitted an application for setting aside the sale under Order XXI Rule 90 C.P.C. but remained unsuccessful.
The steps taken by his adult sons Sadashiv Rao and Ram Chander Rao for impleading them as parties also proved futile.
It is an admitted position that an application was submitted by the Mahila Vidyalaya through its Secretary as early as 5th January, 1944 for issue of a sale certificate in its name as the house was purchased in the auction for the Vidyalaya by Gopal Rao Mutatkar as a member of the institution.
The Court on 26th February, 1944 ordered that the sale certificate be issued to Mahila Vidyalaya.
The necessary stamps for the sale certificate were supplied 915 by the Mahila Vidyalaya and the sale certificate was actually issued in the name of the Mahila Vidyalaya on 8th April, 1944.
It is important to note that no finger was raised nor any steps were taken by the judgment debtor or his sons objecting the issue of sale certificate in favour of Mahila Vidyalaya.
A suit was brought in the year 1948 by the four sons of the judgment debtor Govind Rao Harshe.
The two adult sons were those who had already remained unsuccessful in challenging the order of the Court dated 31st March, 1942 and two sons Sarat Chand and Ashok Kumar were those who were born in the meantime.
This suit filed in 1948 was for a declaration that the execution sale was not binding on their interests.
It is worthwhile to note that this suit was initially filed against Gopal Rao Mutatkar and G.R. Wakhle but subsequently the plaintiffs impleaded the Mahila Vidyalaya in view of an objection raised by Gopal Rao Mutatkar and G.R. Wakhle that the house in question was actually purchased by Mahila Vidyalaya and the sale certificate was also issued in the name of Mahila Vidyalaya.
This suit was dismissed on 27th December, 1949 and had become final as no appeal was preferred against the dismissal of the suit.
It may be further noted that application for delivery of possession to auction purchaser was filed by Mahila Vidyalaya on 22nd September, 1948 and the symbolic possession was also delivered on 24th March, 1951.
As Mahila Vidyalaya was in need of more building, it moved the Rent Controller for permission to serve notices on the tenants.
The said permission was granted on 10th March, 1953 and all the tenants except Mst.
Radha Bai who was the widowed sister of Govind Rao Harshe, handed over the possession to Mahila Vidyalaya.
The Mahila Vidyalaya thereafter instituted Civil Suit No. 100 A of 1954 against Mst.
Radha Bai and Govind Harshe for ejectment and rent.
The Trial Court dismissed the suit for ejectment but passed a decree for arrears or rent against Mst.
Radha Bai alone.
The appeal filed by the Mahila Vidyalaya was allowed by the Additional District Judge, Sagar on 27th October, 1957 and the prayer for ejectment was also allowed.
Against this decision, Govind Rao Harshe alone preferred a second appeal in the High Court and the same was dismissed by order dated 29th April, 1960.
In this litigation Govind Rao Harshe was held to be a licensee of his sister Mst.
Radha Bai.
The above narration of events which remain undisputed go to show that the house in question was sold in the execution of a final decree for sale and the bid was knocked down in the name of Gopal Rao Mutatkar as back as 20th August, 1942.
The entire sale money was deposited and the sale was confirmed under Order XXI Rule 92 C.P.C. by order dated 10th April, 1943.
It is no doubt correct that the 916 final bid in the sale was knocked down in the name of Gopal Rao Mutatkar and the sale was also confirmed in his name but the sale certificate was admittedly issued in the name of the Mahila Vidyalaya.
In this regard an application was filed on behalf of Mahila Vidyalaya on 5th January, 1944 and the executing court had passed an order on 26th February, 1944 that the sale certificate will issue in the name of Mahila Vidyalaya.
In the application filed by Mahila Vidyalaya it was clearly stated that the house in question was auctioned by the Court and was purchased by Gopal Rao Mutatkar on 20th August, 1942 for Mahila Vidyalaya.
This stand taken by Mahila Vidyalaya was accepted and the executing court passed a specific order on 26th February, 1944 for issue of a sale certificate in the name of Mahila Vidyalaya.
The sale certificate was thereafter, actually issued in the name of Mahila Vidyalaya on 8th April, 1944.
Steps for executing the decree and for obtaining actual possession was also taken by the Mahila Vidyalaya.
Govind Rao Harshe was a party to the execution proceedings and till the filing of the present suit on 26th November, 1960, no objection was raised as regards the sale certificate being wrongly issued in favour of Mahila Vidyalaya.
Not only that in a suit for declaration filed in 1948 by the four sons of Govind Rao Harshe, Gopal Rao Mutatkar in his written statement filed on 10th March, 1948 had taken a clear stand that the house in question was actually purchased by Mahila Vidyalaya and as such he was wrongly impleaded as defendant in the suit.
On such stand taken by Gopal Rao Mutatkar, the plaintiffs had subsequently impleaded Mahila Vidyalaya as the defendant.
In this suit also no objection was raised on behalf of the plaintiffs, who were sons of Govind Rao Harshe, that no sale certificate could have been issued in the name of Mahila Vidyalaya nor any title could have passed to Mahila Vidyalaya and as such there was no question of impleading Mahila Vidyalaya as defendant and the suit for declaration should continue against Gopal Rao Mutatkar.
The High Court in the impugned order considered that as Gopal Rao Mutatkar was the auction purchaser, no sale certificate could be issued by the executing court in favour of the appellant Mahila Vidyalaya.
The High Court in arriving at the aforesaid conclusion also took the view that there was nothing on record to show that till the sale was confirmed it was ever made known that Gopal Rao Mutatkar was purchasing the property for and on behalf of the Mahila Vidyalaya.
The order dated 10th April, 1943 relating to confirmation of sale was also made in the name of Gopal Rao Mutatkar.
The High Court further took the view that Gopal Rao Mutatkar could only 917 transfer his proprietary rights by sale or a gift and the same being not done, there was no transfer of the proprietary rights in favour of the appellant Mahila Vidyalaya.
It was thus held that the Act of the executing court was clearly without jurisdiction and the sale certificate being void and inoperative conferred no right or title on the appellant Mahila Vidyalaya over the suit property.
We do not subscribe to the above view taken by the High Court in the facts and circumstances of the present case.
The sale certificate is issued under Order XXI Rule 94 C.P.C. The sale certificate is granted by specifying the property sold and the name of the person who at the time of sale is declared to be the purchaser.
An application was submitted on 5th January, 1944 on behalf of Mahila Vidyalaya that it was the real purchaser and the bid in the auction was made by Gopal Rao Mutatkar on its behalf as he was a member of the institution.
This application was accepted by the executing court by a specific order dated 26th February, 1944 and it was directed that the sale certificate shall be issued in favour of the applicant Mahila Vidyalaya.
The executing court had jurisdiction to allow or reject such application and it cannot be said that the act of the executing court was clearly without jurisdiction and the sale certificate as well as the entire execution proceedings were void and inoperative.
In case Govind Rao Harshe had any grievance he ought to have challenged the order dated 26th February, 1944 in the proper forum and had no right to challenge the same after 16 years by filing the present suit on 26th November, 1960.
We are not going into the propriety of such order but the same cannot be said to be void on account of being without jurisdiction as held by the High Court.
The High Court while dealing with the question of limitation held that the plaintiff in this case was not required to file a suit for getting the sale set aside when he is pleading that the sale itself is void.
A void sale could be ignored by a true owner and it did not affect his title.
The High Court in our view was totally wrong in holding that it was a case of void sale.
It may be noted that Govind Rao Harshe had already taken steps for getting the sale set aside by moving a petition under Order XXI Rule 90 C.P.C. and his sons had filed a suit for declaration but all those proceedings finally terminated against them.
Even if for arguments sake the objection now raised in the present suit is considered, it is only in respect of the sale certificate being wrongly issued in favour of Mahila Vidyalaya.
So far as the sale in favour of Gopal Rao Mutatkar is concerned, there is no illegality and the sale was rightly confirmed in his favour under Order XXI Rule 92 C.P.C. by order dated 10th April, 1943.
It may be noted that once an order was made under Order XXI Rule 92 confirming the sale, the title of 918 the auction purchaser related back to the date of sale as provided under Section 65 C.P.C. The title in the property thereafter vests in the auction purchaser and not in the judgment debtor.
The issue of sale certificate under Order XXI Rule 94 C.P.C. in favour of the auction purchaser though mandatory but the granting of certificate is a ministerial act and not judicial.
Thus looking into the matter from this angle also it is clear that no right or title remained with Govind Rao Harshe after confirmation of sale in favour of Gopal Rao Mutatkar which related back to the date of sale i.e. 20th August, 1942.
Thus there is no question of holding that it was a case of a void sale which could be ignored by a true owner and it did not affect his title.
Govind Rao Harshe and as such the respondents who are his legal representatives were not entitled to take the stand that they were true owner as the sale itself was void and they were not required to file a suit for getting the sale set aside.
With the risk of repetition it is held that it was not a case of the sale being void and in any case so far as issue of sale certificate in favour of Mahila Vidyalaya is concerned, the same was determined by a judicial order dated 26th February, 1944 and the executing court was competent to pass such order cannot be held to be void on the ground of being without jurisdiction as determined by the High Court and it was necessary to challenge the said order within limitation.
Even if the residuary Article 120 of the Limitation Act, 1908 is applied, it should have been challenged within 6 years and as such the present suit filed on 26th November, 1960 was hopelessly barred by time.
The High Court was clearly in error in taking the view that Govind Rao Harshe was the true owner and the appellant Mahila Vidyalaya was a trespasser.
Even if it may be considered for a moment that sale certificate could not have been issued in favour of the appellant Mahila Vidyalaya still in the facts of this case it cannot be held that Mahila Vidyalaya was a trespasser and G.R. Harshe was the true owner at the time of filing of the present suit.
The sale of the property in question was perfectly valid and as soon as the sale was confirmed in favour of Gopal Rao Mutatkar under Order XXI Rule 92 C.P.C., Govind Rao Harshe had no right or title in the property and Gopal Rao Mutatkar became the owner of the property.
The admitted position which is borne out from the records is that Gopal Rao Mutatkar never claimed any right in the property nor took proceedings for obtaining possession by executing the decree.
On the other hand, he took a clear stand in his written statement filed on 10th March, 1948 that he had bit in the auction on behalf of Mahila Vidyalaya and the sale certificate was rightly issued in favour of the Mahila Vidyalaya.
919 The apart, after the issue of sale certificate in favour of Mahila Vidyalaya it alone was entitled to obtain possession under Order XXI 95 C.P.C.
The appellant Mahila Vidyalaya had filed execution application and possession was given to it on 24th March, 1951.
Not only that Mahila Vidyalaya got an order for serving notice of ejectment on the tenants from the Rent Controller and all the tenants except Mst.
Radha Bai surrendered possession in favour of Mahila Vidyalaya.
Not only that a suit for ejectment filed against Mst.
Radha Bai and Govind Rao Harshe was also decreed in favour of the appellant Mahila Vidyalaya.
In execution of the decree for ejectment Mahila Vidyalaya was trying to obtain possession.
Thus by no stretch of imagination can it be said that Mahila Vidyalaya was a trespasser in the facts and circumstances mentioned above.
Th High Court in our view did not consider the case in a proper perspective and took a wholly erroneous view in holding that the appellant was a trespasser and Govind Rao Harshe could have filed a suit for possession.
The plaintiff Govind Rao Harhse himself had come forward with a plea that the execution proceedings and sale was null and void and unless he was able to succeed in this regard, which he did not in the present case, no decree for possession could at all have been passed in his favour.
Thus, we allow the appeal, set aside the judgment and decree of the High Court dated 12th December, 1974 and dismiss the suit with costs.
Y. Lal Appeal allowed.

summary/full:
One Govind Rao Harshe mortgaged some agricultural land and a house to Lakshmi Chand and Duli Chand Modi.
The mortgagees filed a suit and obtained a preliminary decree and later a final decree for sale of the property for realisation of Rs. 5001/13/6 on 26.3.1938, and applied for execution of the said decree, which was stayed ' because the mortgagor applied for relief under the C.P. and Berar Relief of Indebtedness Act, 1939, to save the property from being sold at auction.
Consequent upon his failure to comply with the conditions of the order passed in those proceedings, the decree holders alleging default again applied for the revival of the execution proceedings and prayed for sale of the house property in dispute.
The judgment debtor did not appear before the Executing Court and the said Court held that the decree holders were entitled to execute the decree for the recovery of the debt.
Thereupon the judgment debtor submitted an application for setting aside the ex parte order, which was dismissed and an appeal filed against the said order was also dismissed by the District Judge.
In the meantime the house was put to auction and the highest bid of Rs. 6905 was knocked down in favour of one Gopal Rao Mutatkar on 20.8.1942 and the sale was confirmed vide order dt.
10.4.1943.
Applications filed by the judgment debtor and his adult sons seeking to set aside sale were dismissed and the appeals failed even upto the High Court.
In the meantime the appellant, a registered educational institution, through its Secretary, moved an application for granting a sale certificate stating that the house in question was auctioned by the Court and was purchased by Gopal Rao Mutatkar a member of the appellant institution, on 20.8.1942, for Mahila Vidyalaya, which sale was confirmed on 10.4.43.
The appellant prayed that the certificate be granted in its favour.
A stamp requisite for the purpose was also supplied.
The execution court on 26.2.1944, ordered that the sale certificate will issue in the name of Mahila Vidyalaya, Sagar, through Secretary, G.R. Wakhle and 907 accordingly the sale certificate was issued in favour of the appellant on 8.4.1944.
The four sons of the mortgagor filed a suit impleading the auction purchaser, G.R. Wakhle, Secretary, mortgagees and their father mortgagor, as defendants, praying that the execution sale was not binding on their interest.
The auction purchaser and the former Secretary of the appellant institution objected to their being impleaded as parties to the suit, as according to them they had ceased to be the functionaries of the appellant and the suit should have been filed against the appellant itself and not against its office bearers.
Thereafter the plaintiffs impleaded the appellant as party.
This suit by the sons of the mortgagor was dismissed.
The appellant thereupon as auction purchaser applied for the delivery of possession, which was granted.
Some portion of the property was in occupation of the widowed sister, Radhabai, of the original mortgagor and other portions were in the possession of tenants.
The Secretary of the appellant agreed to the request of the tenants that they will not be ousted as they were willing to execute rent notes.
The appellant later required the premises and moved the Rent Controller for permission to serve notices on the tenants to vacate the premises.
All the tenants except Radhabai and the original mortgagor who had also started living with his sister, vacated the premises.
The appellant then instituted a suit against them.
The trial court dismissed the suit for ejectment but passed a decree for arrears of rent.
The appeal filed by the appellant against that order was allowed by the District Judge.
The original mortgagor 's appeal failed before the High Court whereupon the appellant filed a execution application for ejectment of the occupants which is still pending as a result of stay order passed in a subsequent suit filed by Govind Rao Harshe, original mortgagor, against the appellant for a declaration, possession and permanent injunction.
This suit giving rise to the present appeal was dismissed by the Trial Court.
An appeal preferred against that order by the legal representatives of the deceased plaintiff, was allowed by the District Judge granting the declaration, delivery of possession of the house together with a mandatory injunction directing demolition of some new constructions made by the appellant.
The appellant filed a second appeal before the High Court which was dismissed by the impugned special leave.
The High Court held that as Goapl Rao Mutatkar was the auction purchaser, no sale certificate could be issued by the executing court in favour of the appellant, his bid being in his personal capacity and not one for and on behalf of the appellant.
It was also held by High Court that Gopal Rao Mutatkar could transfer his proprietary right by sale or a gift which he did not do.
According to the High Court the act of the executing court was clearly without jurisdic 908 tion and the sale certificate being void and inoperative, conferred no right or title upon the appellant over the suit property.
Allowing the appeal, this Court HELD: Once an order is made under Order XXI rule 92, confirming the sale, the title of the auction purchaser related back to the date of sale as provided under Section 65, C.P.C. The title in the property thereafter vests in the auction purchaser and not in the judgment debtor.
The issue of sale certificate under order XXI, rule 94, C.P.C. in favour of the auction purchaser though mandatory but the granting of certificate is a ministerial act and not judicial.
[917H 918B] The sale of the property in question was perfectly valid and as soon as the sale was confirmed in favour of Gopal Rao Mutatkar under Order XXI Rule 92, C.P.C. Govind Rao Harshe had no right or title in the property and Gopal Rao Mutatkar became the owner of the property.
[918G] The High Court did not consider the case in a proper perspective and took a wholly erroneous view in holding that the appellant was a trespasser and Govind Rao Harshe could have filed a suit for possession.
The plaintiff Govind Rao Harshe himself had come forward with a plea that the execution proceedings and the sale was null and void and unless he was able to succeed in this regard, which he did not in the present case, no decree for possession could at all have been passed in his favour.
[919C D]


judgement:
ivil Appeal Nos.
338 339 of 1991.
From the Judgment and Order dated 28.12.85 of the Hyderabad High Court in OMA No. 456 of 1984 and CRP No. 2743 of 1984.
WITH Civil Appeal Nos. 2692 930F 1991.
K.R. Choudhary for the Appellant.
K. Madhava Reddy, G. Prabhakar, T.V.S.N. Chari (N.P.) for the Respondents.
J. Leave granted in S.L.P. (C) Nos.
7071 72 of 1986.
These appeals are brought against the common judgment of the 929 Andhra Pradesh High Court in O.M.A. No. 456 of 1984 and C.R.P. No. 2743 of 1984.
The High Court set aside in part the common judgment of the Ist Additional Chief Judge, Civil Court at Hyderabad, in Original Suit No. 174 of 1983 and O.P. No. 49 of 1983 whereby he made the award of the umpire (hereinafter referred to as the `umpire ' or `arbitrator ') a rule of court and passed a decree in terms of the award together with interest on the principal amount awarded at the rate of 12 per cent per annum from the date of the decree.
The High Court set aside the decree in respect of Claim Nos.
III, Vi and IX and affirmed the decree for the other claims.
The main appeal Nos. 338 & 339 of 1991 arising from S.L.P. (C) Nos.
1573 & 1574 of 1986 are by the Associated Engineering Co. (hereinafter referred to as `the Contractor ').
It challenges the judgment of the High Court setting aside the decree of the Civil Court in respect of Claim Nos.
III, VI and IX.
The other appeals arising from S.L.P. (C) Nos.
7071 & 7072 of 1986 are by the Government of Andhra Pradesh and they are against the judgment of the High Court confirming the decree of the Civil Court in respect of Claim Nos.
II, IV and VII(4).
The High Court set aside Claim Nos.
III, VI and IX on the ground that those claims were not supported by the agreement between parties and that the arbitrator travelled outside the contract in awarding those claims.
While that portion of the judgment of the High Court is supported by the Government, the Contractor submits that the High Court exceeded its jurisdiction in interfering with non speaking award.
The Government challenges the judgment of the High Court in so far as it affirmed the findings of the Civil Court in respect of Claim Nos.
II IV and VII(4) on the ground that the arbitrator awarded those claims totally unsupported by the contract.
Mr. A.B. Dewan, appearing for the Contractor, submits that the umpire made a non speaking award.
He did not incorporate any document as a part of the award, notwithstanding his reference to the contract.
In the circumstances, counsel submits, the law does not permit interference by the Court with such an award.
Mr. K. Madhava Reddy, appearing for the Government, on the other hand, submits that the umpire made a speaking award with reference to the claims and he gave reasons for awarding those claims.
It is true, counsel says, that the umpire made only brief reference to the provisions of the contract and his reasons for making the award.
But notwithstanding the brevity of his reasoning, he has spoken sufficiently clearly as a result of which errors of law and fact have become 930 apparent on the face of the award disclosing that the umpire acted contrary to, and unsupported by, contract, thereby exceeding his jurisdiction.
He says that the umpire has referred to the contract not merely for the purpose of reciting or narrating his authority to hear the matter and resolve the dispute, but for incorporating it as a part of the award.
In doing so, he exceeded the contract, not merely by misinterpreting it, but by travelling totally outside it, and by making an award without regard to and independent of the contract.
A number of decision have been cited on either side in support of the respective contentions.
The award was made in respect of disputes which arose between the Government and the Contractor for the cement concrete lining under Agreement dated 20.1.1981 (as supplemented subsequently) in connection with the construction of Nagarjunasagar Dam.
The parties filed their pleadings and documents before the arbitrator/umpire.
There were 15 claims apart from the general claim for cost and interest.
As stated earlier, we are concerned only with Claim Nos.
III, VI and IX which are claims awarded by the umpire and decreed by the Civil Court, but set aside by the High Court, and with Claim Nos.
II, IV and VII(4) which were awarded by the umpire and decreed by the Civil Court as well as by the High Court.
The first set of claims respectively, are: `Escalation on Napa Slabs '; `Payment of Extra Lead for water; and, `Extra Expenditure incurred due to flattening of canal slopes and consequent reduction in top width of banks used as roadway '.
The other set of claims relate respectively to `Labour Escalation '; `Refund of excess Hire Charges of Machinery '; and ' `Stand conveyance '.
The umpire after reciting the background of the dispute which led to his entering upon reference on 16.12.82 to decide the dispute and the relevant agreement between the parties deals with the claims seriatim.
As regards Claim No. III, he says: "I hereby declare and award and direct the respondent to compensate the claimants towards escalation in the cost of napaslabs calculated at Rs.4.25 (Rupees four and paise twenty five) per Sq.
of napa slab lining, under item 11 of schedule A of the agreement for the entire work and make payments accordingly".
The main criticism levelled by the Government against this award is that there was no provision in the contract for escalation of 931 the cost or price of napa slabs.
The escalation provision in the contract related to labour, diesel oil, tyres and tubes, as provided in Item 35 thereof.
There was no escalation provision in the contract as far as napa slabs were concerned.
The price for these slabs had been determined in the contract at Rs. 4.25 Per Sq.
and there was no provision for increase or decrease of that price.
Both the parties to the contract were bound by that price and the arbitrator, therefore, had no jurisdiction to award any escalation in the price of napa slabs.
In the absence of any provision in the contract, the arbitrator had no jurisdiction to make an award for escalation.
This contention of the Government was accepted by the High Court.
Mr. Dewan, appearing for the Contractor, is not in a position to refer to any provision of the contract allowing escalation for napa slabs.
All that he is in a position to refer to is Item 35 of the contract which refers to price adjustment for increase or decrease inthe cost.
That item, as stated earlier, refers to various matters such as, diesel oil, labour, etc., but not to napa slabs.
On the other hand, at the end of that item, it is specifically stated `no claims for price adjustment other than those provided herein, shall be entertained '.
Furthermore, it is specifically provided in the contract `the contractor shall have to make his own arrangements to obtain the napa slabs as per standard specifications.
The Department does not accept any responsibility either in handing over the quarries or procuring the napa slabs or any other facilities.
The contractor will not be entitled for any extra rate due to change in selection of quarries as above '.
There is thus a specific prohibition against price adjustment or award for escalated cost in respect of any matter falling outside Item 35.
Mr. Dewan, however, submits that being a non speaking award, the Court cannot examine the reasons.
Mr. Madhava Reddy, appearing for the Government, submits that the award is not silent on the point.
It speaks eloquently, though briefly.
It is not merely in the recital or narrative portion of the award that the agreement is referred to, but in making the award under Claim No. III the agreement is specifically incorporated by directing payment for escalation on napa slabs under Item 11 of Schedule A of the Agreement at the rate of Rs.4.25.
The agreement is thus bodily incorporated into the award thereby disclosing an error apparent on its face and the total lack of the arbitrator 's jurisdiction by reason of his going totally outside and opposed to the contract.
This, counsel says, is revealed not by a construction of the contractual provisions, but by merely looking at the matters covered by the contract.
932 Claim No. VI Payment of Extra Lead for water.
This is what the arbitrator says: "I hereby declare and award and direct the Respondent to pay extra towards additional lead for water i.e. 3 K. Ms. over the specified lead of 2 K.Ms.
in the agreement for items 4, 5, 6, 10 and 11 of Schedule A".
As regards this claim, Mr. Dewan reiterates his contention that the award is silent as to the reasons and, therefore, the Court should not interfere.
Mr. Madhava Reddy on the other hand submits that the award speaks as to the reasons for allowing the claim for extra amount towards additional lead for water i.e. for 3 K.Ms.
over and above the specified lead of 2 K.Ms.
But counsel says, the agreement provides for no payment at all for any lead and much less for any additional lead.
He refers to the specific provision of the agreement regarding water.
He says that the Contractor had to make its own arrangements for supply of water at work site for all purposes including quarry.
There is no provision in the contract for making any payment to the Contractor for the water brought by it to the site.
In the absence of any such provision, counsel says, it is preposterous that the arbitrator should have awarded extra amount for additional lead for water.
The contract specifically stated that it was the responsibility of the Contractor to make its on arrangements for the supply of water.
The Government gave no assurance to the Contractor regarding the availability of water or the prices payable therefor.
The umpire, therefore, had no jurisdiction to allow Claim No. VI.
The High Court accepting the contention of the State reversed the Civil Court 's decree as regards that claim and held" . .
In view of unequivocal agreement that the contractor should make his own arrangements for supply of water for the purpose of curing, the award of compensation is outside the purview of the agreement and is vitiated".
Claim No. IX Extra expenditure incurred due to flattening of canal slopes and consequent reduction in top width of banks used as roadway.
Referring to this claim, this is what the award says: "I hereby declare and award and direct the respondent to pay the claimant for 50% of the work done on the napa slab lining on the left side slope of Canal at the extra rate of Rs.4.00 per Sq.
Met of lining work".
933 Rejecting the contentions of the Contractor and accepting those of the Government, the High Court held that the contract did not provide for any payment whatever for the maintenance of canal slopes and consequent deduction in top width of banks used as roadway.
The High Court found that it was the responsibility of the Contractor to repair the banks and the contract contained no provision for payment of any amount towards the decrease in the width or otherwise.
The High Court says `. the acceptance of claim on this score is beyond the purview of the agreement and as such vitiated '.
While counsel for the Contractor repeats his contentions regarding the award being silent as to reasons, Mr. Madhava Reddy submits that the contract provides for no payment whatever under Claim No. IX.
On the other hand, it specifically states "8(A) SITE FACILITIES Haul roads from batching plant site to the work site in the first instance will be formed by the Department as per site surveys per each batching plant site.
These haul roads are fair weather roads only with hard passages at stream crossings.
Formation of haul roads within the batching plant area, maintenance of all haul roads including those formed by the Department shall be the responsibility of the contractors.
Existing roads and roads under the control of N.S. Project can be made use of by the Contractor.
Any other haul roads required by the Contractor and not specified in plan shall be carried out by the Contractor at his cost.
8.(A) 1.
WIDENING OF BANKS The canal banks will be widened to 5 meters and 3 meters width respectively by the Department for right and left banks to facilitate transport of materials.
The contractor however has to maintain the haul roads".
In the absence of any provision to pay for extra expenditure and in the light of the specific provision placing the sole responsibility for the maintenance of the haul roads on the Contractor, the arbitrator had no jurisdiction to award 50% at extra rate of Rs. 4 per Sq.
Meter.
The contract contains no provision for payment of any amount outside what is strictly specified under the clause.
In the circumstances, Mr. 934 Madhava Reddy says, the High Court was perfectly justified in coming to the conclusion, which it did, as regards the arbitrator acting outside his jurisdiction.
We shall now deal with the other set of claims, namely, Claim Nos.
II, IV and VII(4) which had been awarded and decreed by both the courts below.
The arbitrator deals with Claim No. II as follows: "The claim is admitted.
I hereby declare and award and direct the Respondents that due to the statutory revision of Minimum rates of wages payable to various categories of workers, the claimant is to be paid compensation as per the following formula: P1 (WSI WSO)0.10+ (WSSI WSSO)0.10 (WUSI WUSO)0.8 V2 X R 100 WSO WSSO WUSO increase in Min.
Wages of labour notified by the Government of A.P. after 22.10.1980 under the Min.
Wages Act., 1948.
Percentage Labour component of each item of Work as per Appendix 9 at page 139 of Agreement.
R Value of work done under each item of work during the period under review.
WSO 11.15 (Daily Minimum wage in force on the date of Tender for skilled labour).
WSSO 8.50 (Daily Minimum wage in force on the date of Tender for semiskilled labour).
WUSO 5.65 (Daily Minimum wage in force on the date of Tender for unskilled labour).
WSI Revised daily Min. wage as fixed by Govt.
A.P. for skilled labour applicable for the period under review.
935 WSSI Revised daily Min. wage as fixed by Govt.
of A.P. for semiskilled labour applicable for the period under review.
WUSI Revised daily Min. wage as fixed by Govt.
of A.P. for semiskilled labour applicable for the period under review.
WUSI Revised daily Min.
Wages as fixed by Government of A.P. for unskilled labour applicable for the period under review.
The above compensation is payable to the claimant for the work done after 23.12.80, the date of publication of G.O. No. 835 dated 18.12.80, till the completion of the work".
It is not seriously disputed that the observation "The claim is admitted" is only a reference to the arbitrator 's decision to allow the claim and not as a concession or admission on the part of the Government.
In fact from the pleadings it is quite clear that the Government had opposed every claim and there was no concession on its part.
Claim No. II had been, as seen above, elaborately dealt with by the arbitrator.
On account of the statutory revision of minimum rates of wages payable to various categories of workers, the arbitrator made the award in respect of labour escalation.
Escalation under this item is in fact, as stated above, provided for under the contract, but in terms thereof.
The grievance of the Government is not because the umpire awarded escalation for labour, but because he allowed escalation otherwise than as provided under the contract.
The contract under Item 35 provides `Increase or decrease in the cost due to labour shall be calculated quarterly in accordance with the following formula: V1 = 0.75 P1 X R(i i) 100 10 V1 = increase or decrease in the cost of work during the quarter under consideration due to changes in rates for labour.
R = the value of the work done in Rupees during the quarter under consideration 936 1 = the average consumer price index for industrial workers (wholesale prices) for the quarter in which tenders were opened (as published in Nalgonda District by the Director of Bureau of Economics and Statistics, Andhra Pradesh).
P1 = Percentage of labour components (specified in schedule in appendix 9 of the item).
i = the average consumer price index for industrial workers (wholesale prices) for the quarter under consideration.
Price adjustment clause shall be applicable only for the work that is carried out within the stipulated time or extensions thereof as are not attributable to the contractor.
No claims for price adjustment other than those provided herein, shall be entertained".
The contention of the Government is that the two formulae are totally different from each other as a result of which the arbitrator awarded very much more than what is warranted under the agreed formula.
Mr. Madhava Reddy submits that it is true that the contractor was bound to pay minimum wages according to the relevant statutory provisions.
In fact the contract contains a provision making it necessary for the Contractor to conform to all laws, regulations, bye laws, ordinances, regulations, etc.
But the fact that the Contractor necessarily had to pay enhanced rates of wages did not entitle it to claim any amount from the Government in excess of what had been strictly provided under the contract.
A specific formula had been prescribed under Item 35, as seen above, and the function of the umpire was to make an award in accordance with that formula.
He had no jurisdiction to alter the formula, which he has done, as seen from the award.
It is not disputed on behalf of the Contractor that the formula followed by the arbitrator, as seen from the award under Claim No. II, is different from the formula prescribed under the contract.
But Mr. K.R. Chowdhury, one of the counsel appearing for the Contractor, points out that the contract provided for payment of all wages according to the current rates and, therefore, the arbitrator was well within his jurisdiction to make an award by adopting a formula in keeping with the enhanced rates of wages, and the High Court, he contends, 937 rightly decreed the amounts under that claim in terms of the award.
We shall deal with Claim Nos.
IV and VII(4) separately.
But as regards Claim Nos.
III, VI and IX, we are of the view that the High Court was right in stating that the arbitrator acted outside the contract in awarding those claims.
For the very same reason we are of the view that the High Court was wrong in coming to the conclusion, which it did, regarding Claim No. II.
We say so because there is no justification whatsoever for the arbitrator to act outside the contract.
These four claims are not payable under the contract.
The contract does not postulate in fact it prohibits payment of any escalation under Claim No. III for napa slabs or Claim No. VI for extra lead of water or Claim No. IX for flattening of canal slopes or Claim No. II for escalation in labour charges otherwise than in terms of the formula prescribed by the contract.
The conclusion is reached not by construction of the contract but by merely looking at the contract.
The umpire travelled totally outside the permissible territory and thus exceeded his jurisdiction in making the award under those claims.
This is an error going to the root of his jurisdiction: See Jivarajbhai Ujamshi Sheth & Ors.
vs Chintamanrao Balaji & Ors., AIR 1965 SC 214.
We are in complete agreement with Mr. Madhava Reddy 's submissions on the point.
As regards Claim Novs.
IV and VII(4), we see no merit in Mr. Madhava Reddy 's contentions.
Claim No. IV relates to `Refund of excess hire charges of machinery and payment towards losses suffered as a result of poor performance of department machinery and also direction for the future '.
This claim, was rightly allowed by the arbitrator and his decision was rightly upheld by High Court.
The Government was, in terms of the contract, bound to compensate the Contractor for the excess higher charges paid as a result of the poor performance of the machinery supplied by the Government.
Claim No. VII(4) is as regards `Sand Conveyance '.
The arbitrator says "The diesel oil requirement shall be taken as 0.35 lit for item No. 5 of statement (A) at page 59 of Agreement as indicated in the original tender and not as 0.035 and price adjustment made accordingly".
The arbitrator was, in our view, right in so stating and the High Court, 938 in our view, rightly upheld this claim.
The arbitrator cannot act arbitrarily, irrationally, capriciously or independently of the contract.
His sole function is to arbitrate in terms of the contract.
He has no power apart from what the parties have given him under the contract.
If he has travelled outside the bounds of the contract, he has acted without jurisdiction.
But if he has remained inside the parameters of the contract and has construed the provisions of the contract; his award cannot be interfered with unless he has given reasons for the award disclosing an error apparent on the face of it.
An arbitrator who acts in manifest disregard of the contract acts without jurisdiction.
His authority is derived from the contract and is governed by the Arbitration Act which embodies principles derived from a specialised branch of the law of agency (see Mustill & Boyd 's Commercial Arbitration, Second Edition, p. 641).
He commits misconduct if by his award he decides matters excluded by the agreement (see Halsbury 's Laws of England, Volume II, Fourth Edition, Para 622).
A deliberate departure from contract amounts to not only manifest disregard of his authority or a misconduct on his part, but it may tantamount to a mala fide action.
A conscious disregard of the law or the provisions of the contract from which he has derived his authority vitiates the award.
A dispute as to the jurisdiction of the arbitrator is not a dispute within the award, but one which has to be decided outside the award.
An umpire or arbitrator cannot widen his jurisdiction by deciding a question not referred to him by the parties or by deciding a question otherwise than in accordance with the contract.
He cannot say that he does not care what the contract says.
He is bound by it.
It must bear his decision.
He cannot travel outside its bounds.
It he exceeded his jurisdiction by so doing, his award would be liable to be set aside.
As stated by Lord Parmoor: ". .It would be impossible to allow an umpire to arrogate to himself jurisdiction over a question which on the true construction of the submission was not referred to him.
An umpire cannot widen the area of his jurisdiction by holding, contrary to the fact, that the matter which he affects to decide is within the submission of the parties . .".
939 Attorney General for Manitoba vs Kelly & Others, , 276.
Evidence of matters not appearing on the face of the award would be admissible to decide whether the arbitrator travelled outside the bounds of the contract and thus exceeded his jurisdiction.
In order to see what the jurisdiction of the arbitrator is, it is open to the Court to see what dispute was submitted to him.
If that is not clear from the award, it is open to the Court to have recourse to outside sources.
The Court can look at the affidavits and pleadings of parties; the Court can look at the agreement itself.
Bunge & Co. vs Dewar & Webb, [1921] 8 L1.
L.Rep.
436(K.B.).
If the arbitrator commits an error in the construction of the contract, that is an error within his jurisdiction.
But if he wanders Outside the contract and deals with matters not allotted to him, he commits a jurisdictional error.
Such error going to his jurisdiction can he established by looking into material outside the award.
Extrinsic evidence is admissible in such cases because the dispute is something which arises under or in relation to the contract or dependent on the construction of the contract or to be determined within the award.
The dispute as to jurisdiction is a matter which is outside the award or outside whatever may be said about it in the award.
The ambiguity of the award can, in such cases, be resolved by admitting extrinsic evidence.
The rationale of this rule is the nature of the dispute is something which has to be determined outside and independent of what appears in the award.
Such jurisdictional error needs to be proved by evidence extrinsic to the award.
See M/s. Alopi Parshad & Sons.
Ltd. vs The Union of India, ; ; Bunge & Co. vs Dewar & Webb.
, [1921] 8 L1.
L. Rep. 436 (K.B.); Christopher Brown Ld.
vs Genossenschaft Oesterreichischer, ; Rex vs Fulham, ; Falkingham vs Victorian Railways Commission, ; Rex vs All Saints, Southampton, [1828] 7 B. & C. 785; Laing.
Son & Ltd. vs Eastcheap Dried Fruit Co., [961] 1 L1.L. Rep. 142, 145 (Q.B.); Dalmia Dairy Industries Ltd. vs National Bank of Pakistan, [1978] 2 L1.
L. Rep. 223 (C.A.); Heyman vs Darwing Ld., Union of India vs kishorilal; , ; Renusager Power Co. Ltd. vs General Electric Company, ; ; Jivarajbhai vs Chintamanrao, AIR 1965 SC 214; Gobardhan Das vs Lachhmi Ram, AIR 1954 SC 689, 692; Thawardas vs Union of India., AIR 1955 SC 468; Omanhene vs Chief Obeng, AIR 1934 P.C. 185, 188; F.R. Absalom.
Ltd. vs Great Western London Garden Village Society.
Limited, and M. Golodetz 940 vs Schrier & Anr., [1947] 80 L1.
L. Rep. 647.
In the instant case, the umpire decided matters strikingly outside his jurisdiction.
He outstepped the confines of the contract.
He wandered far outside the designated area.
He diagressed far away from the allotted task.
His error arose not by misreading or misconstruing or misunderstanding the contract, but by acting in excess of what was agreed.
It was an error going to the root of his jurisdiction because he asked himself the wrong question, disregarded the contract and awarded in excess of his authority.
In many respects, the award flew in the face of provisions of the contract to the contrary.
See the principles state in Anisminic Ltd. vs Foreign Compensation Commission., ; ; Pearlman vs Keepers and Governors of Harrow School, ; ; Lee vs Showmen 's Guild of Great Britain, ; M.L. Sethi vs R.P. Kapur, ; ; The Managing Director.
J. and K. Handicrafts vs M/s. Good Luck Carpets, and State of Andhra Pradesh & Anr.
vs R.V. Rayanim; , See also Mustill & Boyd 's Commercial Arbitration, Second Edition; Halsbury 's Laws of England, Fourth Edition,Vol.
The umpire, in our view, acted unreasonably, irrationally and capriciously in ignoring the limits and th clear provisions of the contract.
In awarding claims which are totally opposed to the provisions of the contract to which he made specific reference in allowing them, he has misdirected and misconducted himself by manifestly disregarding the limits of his jurisdiction and the bounds of the contract from which he derived his authority thereby acting ultra fines compromissi.
In the circumstances, we affirm the judgment of the High Court under appeals except in respect of Claim No. II.
Accordingly, the appeals of the contractor are dismissed; and, the appeals of the Government are allowed in respect of claim No. II.
We do not, however make any order as to costs.
G.N. Appeals dismissed.

dataset_name: IN-Abs

summary/full:
Some disputes arose between the Respondent State and the Contractor in respect of the Cement concrete lining under an agreement in connection with the construction of Nagarjunasagar Dam.
Arbitrator Umpire was appointed and the parties filed their pleading and documents before him.
There were 15 claims apart from the general claim for cost and interest.
The award made by the Umpire was filed before the Civil Court.
The Civil Court made the award a rule of Court and passed a decree in terms of the award together with interest at 12% per annum from the date of the decree.
On appeal, the High Court set aside the decree in respect of three claims on the ground that the claims were not supported by the agreement between the parties and that the arbitrator had gone beyond the contract in awarding the claims, and confirmed the decree in respect of three other claims.
Aggrieved by the High Court 's Judgment, both the Contractor and the State Government preferred appeals by special leave.
On behalf of the Contractor it was contended that since the Umpire made a non speaking award and did not incorporate any document as part of the award except his reference to the contract, law did not permit interference by the Court with the award, and that the High Court exceeded its jurisdiction in interfering with a non speaking award.
On behalf of the State Government it was contended that notwith 925 standing the brevity of his reasoning, the arbitrator had given a speaking award, but with errors of law and fact apparent on the face of it; and that he acted contrary to the contract, thereby exceeding his jurisdiction.
Dismissing the appeal of the Contractor and partly allowing the appeal of the State Government, this Court, HELD: 1.
The arbitrator cannot act arbitrarily, irrationally capriciously or independently of the contract.
His sole function is to arbitrate in terms of the contract.
He has no power apart from what the parties have given him under the contract.
If he has travelled outside the bounds of the contract, he has acted without jurisdiction.
But if he has remained inside the parameters of the contract and has construed the provisions of the contract, his award cannot be interfered with unless he has given reasons for the award disclosing an error apparent on the face of it.
[938A B] 2.
An arbitrator who acts in manifest disregard of the contract acts without jurisdiction.
His authority is derived from the contract and is governed by the Arbitration Act which embodies principles derived from a specialised branch of the law of agency.
He commits misconduct if by his award he decides matters excluded by the agreement.
A deliberate departure from contract amounts to not only manifest disregard of his authority or a misconduct on his part, but it may tantamount to a mala fide action.
A conscious disregard of the law or the provisions of the contract from which he has derived his authority vitiates the award.
[938C E] Mustill & Boyd 's Commercial Arbitration, Second Edition, p. 64; Halsbury 's Laws of England, Volume II, 4th Edn., para 622, referred to.
A dispute as to the jurisdiction of the arbitrator is not a dispute within the award, but one which has to be decided outside the award.
An Umpire or arbitrator cannot widen his jurisdiction by deciding a question not referred to him by the parties or by deciding a question otherwise than in accordance with the contract.
He cannot say that he does not care what the contract says.
He is bound by it.
It must bear his decision.
He cannot travel outside its bounds.
If he exceeded his jurisdiction by doing so, his award would be liable to be set aside.
[938E F] Attorney General for Manitoba vs Kelly & Others, , referred to.
926 4.1 Evidence of matters not appearing on the face of the award would be admissible to decide whether the arbitrator travelled outside the bounds of the contract and thus exceeded his jurisdiction.
In order to see what the jurisdiction of the arbitrator is, it is open to the Court to see what dispute was submitted to him.
If that is not clear from the award, it is open to the Court to have recourse to outside sources.
The Court can look at the affidavits and pleadings of parties; the Court can look at the agreement itself.
[939A B] Bunge & Co. vs Dewar & Webb, [1921] 8 LI.
L.Rep.
436(K.B.), referred to.
If the arbitrator commits an error in the construction of the contract, that is an error within his jurisdiction.
But if he wanders outside the contract and deals with matters not allotted to him, he commits a jurisdictional error.
Such error going to his jurisdiction can be established by looking into material outside the award.
Extrinsic evidence is admissible in such cases because the dispute is not something which arises under to the contract or dependent on the construction of the contract or to be determined within the award.
The dispute as to jurisdiction is a matter which is outside the award or outside whatever may be said about it in the award.
The ambiguity of the award can, in such cases, be resolved by admitting extrinsic evidence.
The nature of the dispute is something which has to be determined outside and independent of what appears in the award.
Such jurisdictional error needs to be proved by evidence extrinsic to the award.
[939C F] M/s. Alopi Parshad & Sons Ltd. vs The Union of India, ; ; Union of India vs Kishori Lal, ; ; Renusagar Power Co. Ltd. vs General Electric Company, ; ; Jivarajbhai vs Chintamanrao, AIR 1965 SC 214; Gobardhan Das vs Lachhmi Ram, AIR 1954 SC 689 and Thawardas vs Union of India, AIR 1955 SC 468, relied on.
Bunge & Co. vs Dewar & Webb, [1921] 8 LI.
L. Rep. 436 (K.B.); Christopher Brown Ltd. vs Genossenschaft Oesterreichischer, ; Rex vs fulham, ; Falkingham vs Victorian Railways Commission, ; Rex vs All Saints, Southampton, [1828] 7 B. & C. 785; Laing, Son & Co. Ltd. vs Eastcheap Dried Fruit Co., [1961] 1 LI.
L. Rep. 142, 145 (Q.B.); Dalmia Dairy Industries Ltd. vs National Bank of Pakistan, [1978] 2 LI.
L. Rep. 223 (C.A.); Heyman vs Darwins Ltd., [1942] A.C. 356; Omanhene vs Chief Obeng, AIR 1934 P.C. 185; F.R. Absalom Ltd. vs Great Western (London) Garden 927 Village Society, Limited, and M. Golodetz vs Schrier & Anr., [1947] 80 LI.
L.Rep.
647, referred to.
In the instant case, the umpire decided matters strikingly outside his jurisdiction.
He outstepped the confines of the contract.
He wandered far outside the designated area.
He diagressed far away from the allotted task.
His error arose not by misreading or misconstruing or misunderstanding the contract, but by acting in excess of what was agreed.
It was an error going to the root of his jurisdiction because he asked himself the wrong question, disregarded the contract and awarded in excess of his authority.
In many respects, the award flew in the face of provisions of the contract to the contrary.
The umpire acted unreasonable, irrationally and capriciously in ignoring the limits and the clear provisions of the contract.
In awarding claims which are totally opposed to the provisions of the contract to which he made specific reference in allowing them, he has misdirected and misconducted himself by manifestly disregarding the limits of his jurisdiction and the bounds of the contract from which he derived his authority thereby acting ultra fines compromissi.
[940A D] M.L. Sethi vs R.P. Kapur, ; ; The managing Director, J. and K. Handicrafts vs M/s. Good Luck Carpets, and State of Andhra Pradesh & Anr.
vs R.V. Rayanim; , , relied on.
Anisminic Ltd. vs Foreign Compensation Commission, ; ; Pearlman vs Keepers and Governors of Harrow School, ; and Lee vs Showmen 's Guild of Great Britain, , referred to.
Mustill & Boyd 's Commercial Arbitration, Second Edition, p. 641 and Halsbury 's Laws of England, 4th Edn., Vol. 2, para 622, referred to.
In the instant case, the contract did not postulate in fact it prohibited payment of any escalation under Claim No. III for napaslabs or Claim No. VI for extra lead of water or Claim No. IC for flattening of canal slopes or Claim No. II for escalation in labour charges otherwise than in terms of the formula prescribed by the contract.
The umpire travelled totally outside the permissible territory and thus exceeded his jurisdiction in making the award under those claims.
This is an error going to the root of his jurisdiction.
As such, the High Court was right in holding that the arbitrator acted outside the contract 928 in awarding the abovesaid claims.
However, the High Court went wrong in confirming the decree in respect of Claim No. II relating to escalation in labour charges since a specific formula had been prescribed under Item 35, and the function of the umpire was to make an award in accordance with the formula; he had no jurisdiction to alter the same.
[937C D; 936F] Jivarajbhai Ujamshi Sheth & Ors.
vs Chintaman rao Balaji & Ors., AIR 1965 SC 214, relied on.
Claim No. IV relating to `Refund of Excess hire charges of machinery and payment towards losses suffered as a result of poor performance of department machinery and also direction for the future ' was rightly allowed by the arbitrator and his decision was rightly upheld by the High Court.
The Government was, in terms of the contract, bound to compensate the contractor for the excess higher charges paid as a result of the poor performance of the machinery supplied by the Government.
[937E F] 6.3.
As regards Claim No. VII(4) relating to `Sand Conveyance ' the arbitrator was right in stating that the diesel oil requirement should be taken as 0.35 lit for item No. 5 of statement (A) at page 59 of Agreement as indicated in the original tender and not as O.035 and price adjustment made accordingly.
The High Court Court rightly upheld this claim.
[937G H; 938A]