Case: U.O.I.,  Vs. Aradhana Trading Llco.

the appellant, namely the Union of India entered into agreements with the respondents for supply of certain items to the Railways viz Chittranjan Locomotives. After the supplies, the Department felt that the bills of exorbitant amount were being raised by the respondents and an enquiry was also set up in that connection. Since however, payments were not being made, the respondents filed writ petitions in Calcutta High Court for direction to the Government to make payment of bills. The High Court passed a common order dated 24.11.1995 in the writ petitions, directing the General Manager to appoint arbitrators to settle the disputes, consequently on December 12, 1995 four Arbitrators were appointed. Parties filed their respective claims before the Arbitrators and put forth their pleas and placed the interim report of the Committee regarding rates of 42 items involved in various purchases made under different agreements. Since the time to make the Award had expired, the High Court on being approached by the parties, extended time with their consent; for a period of two months by order dated 4.2.1997. The Awards were published by Arbitrators on 14.8.1997 sending notices of the same to the parties. The Awards had been filed by the Arbitrators in the Calcutta High Court on 11.11.1997. Notices of the filing of the Award had also been issued by the High Court which were served upon the appellants on 11.12.1997. The appellants did not file any objection against the Award. The case was fixed on 27.1.1998. It appears that nobody appeared on behalf of the Appellants despite notice and since no objections too, were preferred by them against the award, the High Court passed Decree in terms of the Award making the same Rule of the Court4. The Appellant moved an application on 24.2.1998 for recalling the order dated 27.1.1998 passed by the High Court, explaining its absence on the date of hearing and stating that it had moved an application on 29.9.1997 under section 14(2) of the Arbitration Act 1940 before the Assistant District Judge, Asansol, praying for a direction to the Arbitrators to file Awards in the Asansol Courts, therefore awards could not be filed in the High Court5. It may be noted that no appeal was preferred against order and decree dated 27.1.1998 passed by the learned Single Judge. The High Court however, dismissed the application by order dated 23.4.1998, finding that since no objections were filed against the Award, the Court had to pass the Orders making the Award Rule of the Court in accordance with Section 17 of the Arbitration Act. It had also been observed that Decree cannot be said to have been passed ex-parte as it was with due notice to the appellant and that on passing of the order according to Section 17 of the Arbitration Act, the Court had become functus officio. It was also found that Award was rightly filed in High Court. The appellant then filed appeals before the Division Bench against the order dated 23.4.1998 passed by the Single Judge. The Division Bench dismissed the appeals repelling the objections that the High Court could not entertain the matter and also found that the appeal was not maintainable before the Division Bench against the order of Single Judge of the High Court.

Court's reasoning:
the appellant has not come up with the case that there was any inherent lack of jurisdiction in the High Court of Calcutta to entertain such suit or proceedings. As indicated earlier the appellant itself had submitted to the jurisdiction of the High Court while moving application for extension of time under Section 28 of the Arbitration Act. We therefore do not find any fault in the finding of the High Court negating the plea raised by the appellant that Arbitrators should have filed the Award in the Asansol courts and not in the High Court CourtThe counsel for the appellant remained in the Court concerned throughout the day but the matter was not taken up. The next date fixed was January 27, 1998 on which date also the counsel for the appellant was present in Court up to 12 Noon whereafter he got engaged in another Court. Therefore, he could not be present at the time when the case was called out and the order was passed by the Court. The counsel for the appellant made a mention about the matter in the Court on 4.2.1998 and later moved an application in that behalf stating that there was sufficient ground for not being present at the time, the matter was called upon on 27.1.1998 and ex-parte order was passedWe find that prohibition against appeal is provided in two ways one where it is indicated that appeal would lie against given orders and from no other orders and secondly under sub-section (2) of Section 39 that no second appeal shall lie from an order passed in appeal under Section 39 of the Arbitration Act. In the alternate, the Appellantsâ€™ contention is that in any case a Letters Patent Appeal would lie against the original orders of the Single Judge of the High Court to a Division Bench. A number of decisions have been relied upon by the learned counsel for the parties in support of their rival contentionsIn view of what has been held above a Court while exercising power by virtue of Section 41 of the Arbitration Act shall have all other related powers of the ordinary civil court subject to the constraints contained in the special Act itself. Normally, an appeal would be maintainable but there are two constrains as provided under the Special Act, namely, it should not be a second appeal as provided under sub-section (2) of Section 39 of the Act which position is also clear in the case of Mohindra Supply Company (supra) where it was held that the second appeal under Section 100 CPC or under the Letters Patent against an appellate order was barred by virtue of sub-section (2) of Section 39. Here we find that there is yet another constraint as provided under sub-section (1) of Section 39 of the Arbitration Act itself and it is emphatic too when it says that appeal shall lie against the orders indicated in the provision and from no other order. Section 41 of the Arbitration Act makes the provisions of CPC applicable subject to the provisions of the Arbitration Act and the rules framed thereunder. Therefore, the nature of an order against which an appeal may lie must conform to the nature of the order as enumerated under sub-section (1) of Section 39 of the Arbitration Act. If it does not amount to such an order as enumerated under sub-section (1) of Section 39, the prohibition as contained in this sub-section (against no other order) itself, would become operative, subject to which alone provision of CPC apply under Section 41 of the Act. In the facts of the present case we find that an order refusing to recall an order passed by the court will not amount to refusal to set aside the award under clause (vi) of sub-section (1) of Section 39 of the Arbitration Act as no objections to set aside the award have ever been filed with or without application for condonation of delay, challenging the award. Admittedly, the appellant did not file any appeal against the order dated 27.1.1998. In these circumstances and in view of the provisions of the Arbitration Act, the decision in the case of National Sewing Thread Co. Ltd. (supra) shall also not be applicable as in the Trade Marks Act with which the court was dealing, did not have any provision like the one contained in sub-section (1) of Section 39 of the Arbitration Act restricting the right of appeal only in respect of certain nature of orders and prohibiting appeal against any other order whatsoever. Therefore, in the case of National Sewing Thread Co . Ltd. (supra) it was held that where a provision for appeal was made under Section 76(1) of the Trade Marks Act to the High Court, with nothing more, the other provisions relating to exercise of that jurisdiction by the High Court would be applicable. The case of National Sewing Thread Co. Ltd. (supra) is thus based on different provisions and is clearly distinguishable. The case in hand is covered by the decisions in the cases of Neeilkantha (supra) and Mohindra Supply Co. both decided by Bench of four Judges which do not seem to have been noticed in other judgments