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Civil Petitions Nos. 238 and 239 of 1980, decided on 1st August, 1983.
(From the judgment dated 11th November, 1979, of the Lahore High Court, passed in Second Appeal Order No. 146 of 1975 and Civil Revision No. 263 of 1975).
‑‑ Art. 185(3)‑Civil Procedure Code (V of 1908), O. XXIII, r. 3 Leave to appeal granted to examine question whether an award made out of Court during pendency of litigation can be considered as an agreement or compromise for adjustment of suit even in absence of consent of all parties.
Subharaju v. Venkatramaraju A I R 1928 Mad. 1025 ; Arumuga v. Balasubramania A I R 1945 Mad. 294 ; Salima Bibi v. Muhammad Ibrahim A I R 1962 Andh. Pra. 123 ; Rameshwar Lal v. Mangi Lal A I R 1964 Pat. 374 ; Hari Prashad v. Mst. Soogni Devi A 1 R 1921. Lah. 232 ; Moradhwaj v. Bhudar Das A I R 1955 All. 353 ; Asmatennessa Bibi v. Arju P L D 1967 Dacca 603 and Muhammad Saleem v. Muhammad Akram P L D 1971 S C 516 ref.
Raja Mahmood Akhtar, Advocate Supreme Court instructed by Muhammad Aslam Chaudhry, Advocate‑on‑Record for Petitioner.
Ch. Muhammad Ashraf, Senior Advocate Supreme Court instructed by S. Wajid Hussain,
Advocate‑on‑Record for Respondents.
Date of hearing :1st August, 1983.
The common question arising in these two petitions is whether an award made out of Court during the pendency of litigation can be considered as an agreement or compromise for adjustment of the suit A under Order XXIII, rule 3, C. P. C. even in the absence of consent of all the parties. The view taken by the Madras High Court in Subharaju v. Venkatramaraju (A I R 1928 Mad. 1025) and Arumuga v. Balasubramania (A I R 1945 Mad. 294) was that it could be which view has been followed by some other Indian Courts vide Salima Bibi v. Muhammad Ibrahim (A I R 1962 Andh. Pra. 123) and Ramesh war Lal v. Mangi Lal (A I R 1963 Pat. 374 ). But a contrary view was taken in Hari Prashad v. Mst. Soogni Devi (A I R 1921 Lah. 232), Moradhwaj v. Bhadar Das (A I R 1955 All. 353) and Asmatennessa Bibi v. Arju (P L D 1967 Dacca 603). The High Court has in the present case followed the contrary view and held that . . . . . consent should be accorded after the award and not when the award did not even come into existence".
2. In Muhammad Saleem v. Muhammad Akram (P L D 1971 S C 516) this Court had held "But if the award has been made in an arbitration out of Court and the award has neither been filed nor made a rule of Court then the parties will be entitled to sue or defend on the basis of that award if it has been accepted and acted upon by the parties by mutual consent". However, the provision of Order XXII, rule 3, C. P. C. had not specifically come up there for con sideration. It is, therefore, considered necessary to examine the point in controversy so as to lay down an authoritative pronouncement by this Court.
3. Leave to appeal is accordingly granted in both the petitions. Security amount shall be Rs. 2,500 in each case.
S. Q. Leave granted.
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