ivil Appeal No 2647 of 1980
From the Judgment and Order dated 2441980 of the Patna High Court in Original Decree No 289 of 1979R
Shankar Ghosh S P Lal and HK Puri for the Appellant
LN Sinha RN Sachthey and A Sachthey for the Respond ents
The Judgment of the Court was delivered by K JAGANNATHA SHETTY J
This appeal by certificate under article 1331 of the Constitution is from a decision of the Patna High Court which reversed the decree in the suit filed by the appellant for declaration of title and confir mation of possession
In the court of the Subordinate Judge the First Court at Dhanbad the plaintiffappellants instituted a suit in respect of Schedule B of the plaint for a declaration of their homestead right thereto and for confirmation of pos session or in the alternative recovery of possession
The suit property consists of 30 bighas 18 kattar and 11 chha taks being part of plot nos
59 and 70 in village Dhansar
The plaintiff s claim was based on a registered indenture of lease dated December 9 1949 by which it is said that the possession in the Zamindari right of Kali Prasad was settled to Ruplal Aggarwal father of plaintiff No 1 and grand father of plaintiff Nos 2 and 3
The plaintiffs  claim that they have become the owners of the lease hold land and are in possession of the same by exercising diverse acts of possession mutating their name and by payments of stipulat ed rents to the State of Bihar who recognised the said lease
The defendant is a Government company called Messrs Bharat Coking Coal Limited The Company
The Company re sisted the suit on three main grounds firstly that the disputed land formed part of North Bhuggatdih Colliery which had vested in the Central Government and thereafter in the company under the provisions of the Coal Mines Nationalisa tion Act 1973 secondly that the interest claimed by the plaintiffs automatically stood extinguished with the vesting of the estate of the plaintiffs  lessor by reason of the vesting notification 286 issued under sec
3 of the Bihar Land Reforms Act 1950
Lastly that actual lease of the land was taken much earlier expressly for the purposes of the mines and that the instru ment of 1949 is contaminated with flaw and obtained with a view to certifying the vesting of the estates in the State of Bihar and even that on a misapprehension that the so called homestead land would
not vest
The trial court negatived all the defences and decreed the suit
Upon appeal by the company the Patna High Court re versed the decree of the trial court and dismissed the suit
There are two main findings recorded by the High Court to allow the appeal
As to the scope and effect of the provi sions of the Bihar Land Reforms Act 1950 in respect of the suit property the High Court held For the reasons indicated above I am of the view that a lease granted to the plaintiffs in the instant case was an encum brance and it was annihilated with the issu ance of the notification under sec
3 of the Act
The submission urged on behalf of the appellants therefore in this behalf must be accepted
The lease of the plaintiffs having come to an end consequent upon the issuance of notification under sec
3 of the Act the plaintiffs have no title to be declared and the decree of the trial court is liable to be set aside
 As to the nature of the suit property and the scope and effect of the Coal Mines Na tionalisation Act 1973 the High Court on an appraisal of the oral and documentary evidence led by both the parties said I would therefore prefer their positive evidence referring to the defend antsrespondents evidence than to the nega tive evidence adduced on behalf of the plain tiffs
It will however be seen that the suit lands are adjacent to a coal mine namely North Bhuggatdih Colliery and were being used for the purposes of the said mine namely stacking of coal and effecting local sales thereof
The conclusion is therefore ines capable that the suit lands are more within the meaning of the Nationalisation Act
What vests under the Nationalisation Act is the mine and not merely the interest of the owner of the mine
 287 Having regard to these findings the High Court did not find it necessary to examine whether the instrument of 1949 was a genuine transaction
In this appeal on the submission of counsel for both sides two questions arise for our consideration i wheth er the suit lands had vested free from encumbrance in the
State consequent upon the issuance of Notification under sec
3 of the Bihar Land Reforms Act and ii whether the suit land is mines within the meaning of the  In our opinion it is unnecessary to consider the first question and indeed it is not proper also to consider the question in the absence of the State which is a necessary party for adjudication of that dispute
The State of Bihar is not impleaded as a party to the suit and we therefore refrain from expressing any opinion on the first question
On the second question the relevant provisions of the The Act may now be noted
Section 2h defines mines to mean any excavation where any operation for the purpose of searching for or obtaining minerals has been or is being carried on and includes XXX XXX XXX XXX XXX iv all open cast workings XXX XXX XXX XXX XXX vi all lands buildings works adits levels planes machinery and equip ments instruments stores vehicles railways tramways and sidings in or adjacent to a mine and used for the purposes of the mine XXX XXX XXX XXX XXX x all lands buildings and equip ments belonging to the owners of the mine and in adjacent to or situated on the surface of the mine where the washing of coal obtained from the mine or manufacture therefrom of coke is carried on
XXX XXX XXX XXX XXX XXX 288 Section 3 so far it is relevant reads
1 On the appointed day the right title and interest of the owners in relation to the coal mines specified in the Schedule shall stand transferred to and shall vest absolutely in the Central Government free from all incumbrances    Section 51 reads as under 1 Notwithstanding anything con tained in secs
3 and 4 the Central Govern ment may if it is satisfied that a Government company is willing to comply or has complied with such terms and conditions as that Govern ment may think fit to impose direct by an order in writing that the right title and interest of an owner in relation to a coal mine referred to in sec
3 shall instead of continuing to vest in the Central Government vest in the Government Company either on the date of publication of the direction or on such earlier or later date not being a date earlier than the appointed day as may be specified in the direction
 Section 61 provides as under 1 All property which vests in the Central Government or in a Government company under this Chapter shall by force of such vesting be freed and discharged from any trust obligation mortgage charge lien and all other incumbrances affecting it and any attachment injunction or decree or order of any court restricting the use of such property in any manner shall be deemed to have been withdrawn
 Sections 8 to 10 in chapter III provide for payment of compensation to owners of coal mines
Provisions under Chapter IV of the Act deal with claims to be made for compensation and for disbursing the amounts payable to the Owners of coal mines by Commissioner of Payments
On behalf of the plaintiffs 11 witnesses were examined including plaintiff No 1 himself
Most of the witnesses have not made any relevant statement on the question of location or user of the suit land
289 However Kanhaiya Lal Agarwal witness No 6 for the plain tiff stated The land is full of collieries on all the four sides Likewise Ram Briksha Viswakarma witness No 8 for the plaintiffs has stated that the suit land is a fallow land and no crop is grown on it and there is nothing except the road in between the suit land and the North Bhagatdih Colliery
The 9th witness of the plaintiffs BK Mukherjee who surveyed the locality and submitted a report stated At the time of my inspection the defendants were removing the over burdened surface and then taking out coal and this is called open cast working  
I do not see the quarry by Southern side of the leased coal land but do not remember whose quarry was there
There were coal all over the land but it was after the burden of earth was removed  
The coal was being cut at the depth of 25 from the surface
Adjoining the quarry the land was not for homestead pur poses
 The witnesses for the defendant company have specifical ly stated that the land in dispute constitutes the upper layer of the coal lying beneath and above the surface
The working of the mines is by open cast working system
When the mining operations are carried on in the other parts of the Seam the land is being used for the various purposes connected with the mining operations
In the light of this evidence the location of the suit land and the uses to which it is put to are beyond doubt
The land is being used for carrying on the mining operations and it is adjacent to a mine
It is used for the purposes of the mine for carrying on the mining operations in respect of the part of the Seam lying immediately below the surface
Apparently there cannot be any working mine without the surface being included in that concept
If the surface does not form part of the concept of mine it is not possible to have any excavation
Section 2hiv includes open cast working within the definition of mine
Secondly the suit land is also adjacent to a coal mine namely North Bhagatdih Colliery and is being used for the purposes of the said mine namely stacking of the coal and effecting local sale thereof
It is therefore a mine as defined under sec
2hvi of the Act
Under sec
3 of the Act the right title and interest of the owners in relation to the coal mines stand trans ferred to and shall vest abso 290 lutely in the Central Government free from encumbrances
For the purpose of acquisition and vesting it is immaterial whether the mine belongs to the State or to the plaintiffs
In either case the Act extinguishes the title
A Constitu tion Bench of this Court in State of West Bengal vs Union of India 1964 1 SCR 371 has held that under Entry 44 of List 3 of the Seventh Schedule to the Constitution Parliament is competent to make a law for acquisition of property owned by the State
It was however urged for the appellants that there is no proper pleading or issue for determination of the afore said question and the evidence let in should not be looked into
It is too late to raise this contention
The parties went to trial knowing fully well what they were required to prove
They have adduced evidence of theft choice in support of the respective claims
That evidence has been considered by both courts below
They cannot now turn round and say that the evidence should not be looked into
This is a well accepted principle
In Kunju Kesavan vs MM Philip  Others   this Court has stated as summarised in the headnote at p 637 The parties went to trial fully understanding the central fact whether the succession as laid down in the Ezhava Act applied to Bhagavathi Valli or not
The ab sence of an issue therefore did not lead to a material sufficient to vitiate the decision
The plea was hardly needed in view of the fact that the plaintiff stated in his replication that the suit property was obtained as makka thayam property by Bhagavathi Valli under the Ezhava Act
The subject of exemption from Part IV of the Ezhava Act was properly raised in the trial court and was rightly considered by the High Court
 On the facts and circumstances of the case we cannot therefore accept the contention urged for the appellant in this regard
In the result and for the reasons stated above the appeal fails and is dismissed
In the circumstances howev er
we make no order as to costs
PSS Appeal dis missed


Summary:
The appellant a Corporation was created under the Jammu functions was to undertake the removal and disposal of trees and exploitation of the forest resources entrusted to it by the Government
The Corporation took a decision for the extraction of timber of a total volume of 1008 lakh c ft which included the work of felling and removal of trees
The respondent an approved contractor submitted his tender and was granted the works contract initially with reference to 4 lakh c ft and subsequently he was entrusted with an additional work for a further quantity of 2 lakh c ft
The respondent completed the entire work under the contract
Thereafter he claimed that he was entitled to the remaining volume of the work namely 408 lakh cft
as per the procedure prac tice custom and usage extended to him
The appellant denied any such practice custom or assurance and said that a decision had been taken not to work the area further till the entire timber already extracted was removed to its destination
There was therefore no question of entrusting the remaining work to anybody
Paragraph 15 of the Tender Notice stipulated that Extension for the additional volume in the coupe will not be claimed as a matter of right but may be considered by the Management where the achievement 381 is 100 per cent
 The agreement provided for arbitration which was contained in clause 42 and which stipulated that any dispute differences or question that may arise was to be referred for arbitration to the Managing Director of the Jammu  Kashmir Forest Corporation
 The respondent filed an application under sections 8 11 and 20 of the Jammu and Kashmir Arbitration Act 2002 Smvt in the High Court for a direction to the Corporation to file the agreement and to refer the dispute to an arbitrator
The High Court deprecated the attitude of the Corpora tion in not awarding the remaining work to the respondent
It held that the trees in question had already been marked and had therefore to be felled one day or the other  and as the contractor s achievement was 300 per cent he had all the right to claim the remaining work as provided in para graph 15 of the Tender Notice
The High Court also found that as there existed a dispute touching the contracts executed between the parties it referred the matter under clause 42 of the agreement to the named arbitrator namely the Managing Director of the State Forest Corporation
The High Court went further and by an interim order directed that the contractor be permitted to do the remain ing work of extraction of timber of standing marked trees and the rates be determined by the arbitrator after hearing both the parties pursuant to the said interim order
Aggrieved by the aforesaid orders of the High Court the appellant appealed to this Court by special leave
On the questions i whether there was any subsisting arbitration agreement in respect of the matters sought to be referred and ii whether the interim order of the High Court directing the respondent to do the remaining work was without jurisdiction and whether the respondent was enti tled to any compensation for the work done
Allowing the appeal the Court HELD RS Pathak
CJ and LM Sharma J Majority Per LM Sharma
J 1
The claim raised by the respondent in his application before the High Court is not covered by the arbitration clause and cannot be 382 referred for a decision of the arbitrator
The order of reference passed by the High Court has therefore to be set aside
390F 2
If the foundation of the claim of the respondent be any alleged assurance or custom or practice it cannot be said that such claim arises out of the written agreement between the parties and so the prayer for reference has to be rejected
If the case pleaded is true the appropriate forum for the respondent will be a Court of Law directly granting the relief in an appropriate legal proceeding 388A B 3
The language of the term contained in para 15 of the tender notice is explicit in declaring that the contractor would not be allowed to claim as a matter of right the additional volume of work
His right extends only to a consideration of his case by the management when the ques tion of allotment of additional work is taken up
But by the application filed before the High Court the respondent did not ask for reference of a dispute as to whether he is entitled to consideration or not the prayer is for refer ence of a higher claim of immediately getting the additional work and this prayer has been allowed
This issue cannot be said to have any connection with the 15th term of the tender notice or any other provision thereof or of the agreement
388D E 4
In the absence of a repudiation by the Corporation of the respondent s right to be considered if and when occa sion arises no dispute can be said to have arisen which may be referred for arbitration
390B 5
In order that there may be a reference to arbitra tion existence of a dispute is essential and the dispute to be referred must arise under the arbitration agreement
390C Seth Thawardas Pherumal vs The Union of India relied on
There was no justification for the High Court in deprecating the Corporation for not awarding the remaining work 10 the contractor when it was leaving the matter to be decided by the arbitrator 387G 7
A Court while considering the question whether an alleged dispute between the parties has to be referred for arbitration or not should refrain from expressing its opinion on the merits of the dispute which may embarrass the arbitrator
387G H 383 8
Section 18 deals with the power of the Court to pass interim orders after award is actually filed in Court
So far as clause a of Section 41 is concerned it makes only the procedural rules of the Civil Procedure Code applicable
The source of power to grant interim relief cannot be traced to clause a otherwise clause b would become otiose
So far as clause b is concerned it circumscribes the Court s power within the limits indicating in the second Schedule and further qualifies it by declaring in the Proviso that it cannot be used to the prejudice of any of the powers of the arbitrator
391 D E HM Kamaluddin vs Union of India relied on
Interim directions can be issued only for the pur pose of  arbitration proceedings and not to frustrate the same
391E 10
The High Court in the instant case by granting the interim relief not in the shape of an injunction in the negative form but by a mandatory direction clothing the respondent plaintiff with the right to do something which he could have been entitled to only after a final decision on the merits of the case in his favour committed a serious error
391G H Per Sabyasachi Mukharji J partly dissenting 1
There was a dispute in the instant case whether the contractor was entitled to the grant of the additional volume of work
Such dispute was a dispute between the parties in respect of the works to be executed by the contractor 
In that view of the matter and in the light of clause 15 read with clause 17 of the Agreement the dispute was clearly referable to the arbitration of the Managing Director Jammu  Kashmir State Forest Corporation
397F G 2
Endeavour should always be to find out the intention of the parties and that intention has to be found out by read ing the terms broadly clearly without being circumscribed
398B C 3
An arbitration agreement is one which is defined in section 2a of the as a written agreement to submit present or future differences to arbi tration
There was in the instant case an arbitration agreement that is to say the parties had been ad idem
The agreement was in writing
It was not a contingent or a future contract
It was a contract at present time to refer the dispute arising out of the present contract entered into by the parties as a result of which the 384 contractor got a right or privilege to ask for consideration of grant of the further work
It was not a mere right to get the additional work
The amplitude of the arbitration clause was wide enough and should be so read
397H 398A B C D Seth Thawardas Pherumal vs The Union of India distinguished
AM Mair  Co vs Gordhandass Sagarmull  at 798 and Heyman vs Darwins Ltd 1942 Appeal Cases 356 at 368 referred to
Though under section 41b the Court has power to pass an interim order or injunction or appointment of re ceiver the Section does not empower the Court to direct execution of the contract the extent of which is in dispute and is a matter referable to be adjudicated by the arbitra tor
If the Court does so then the decision of the dispute becomes academic because the contract is executed
399D E 5
Where the question is whether the contract was to be executed by the respondent if the contract is in fact executed by the respondent by virtue of the order of the Court then nothing remains of the dispute
There is nothing arbitrable any more land proceedings before the arbitrator cannot be forestalled by interim order by ordering execution of the contract before it is decided whether the contractor had any right to the contract for additional work in the grab of preservation of the property
399E F 6
The interim directions given by the High Court that the contractor be allowed to do the remaining work of ex traction of timber of standing marked trees was beyond the competence of the Court
399F G 7
It would be unjust to deprive any party of its dues simply because the work has been done in view of a wrong order or incorrect order of the Court of justice when there was no stay 400B