Consensual arbitration in a pending partition suit remains valid before final decree, and an award may note admitted foreign property rights.

In a pending partition dispute, a consensual arbitration reference was held valid even after a preliminary decree, because appellate proceedings are a continuation of the suit and section 21 of the Indian Arbitration Act, 1940 permits reference while matters remain in difference. The award was also upheld because it did not adjudicate title to immovable properties in Burma; it only recorded admitted positions and made practical arrangements for partition. The High Court stay order barred only the drawing up of the final decree and did not prohibit arbitration proceedings, so the award did not violate that restraint.

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Issues: (i) Whether the reference to arbitration and the award were invalid because they were said to include immovable properties situated in Burma and thus matters beyond the court's jurisdiction; (ii) Whether the award was vitiated as contrary to the High Court's stay order; (iii) Whether the trial court had jurisdiction under section 21 of the Indian Arbitration Act, 1940 to make the reference after a preliminary decree had been passed and appeals were pending.

Issue (i): Whether the reference to arbitration and the award were invalid because they were said to include immovable properties situated in Burma and thus matters beyond the court's jurisdiction.

Analysis: The reference was made in the context of pending appeals in which the dispute actually alive between the parties did not include any surviving claim to a share in the Burma immovable properties. The pleadings, the preliminary decree, and the appeal papers showed that the claim to those properties had not remained in controversy. The award, read as a whole, did not adjudicate title to foreign immovable property; it only stated the admitted position and made practical arrangements for future partition in accordance with law.

Conclusion: The reference and the award were not invalid on the ground that they dealt with immovable properties in Burma.

Issue (ii): Whether the award was vitiated as contrary to the High Court's stay order.

Analysis: The stay order only prevented the drawing up of the final decree and did not stay the proceedings before the Commissioner or prevent the parties from resorting to arbitration. The arbitration proceedings did not amount to a final decree and did not transgress the limited restraint imposed by the High Court.

Conclusion: The award did not contravene the stay order and was not invalid on that account.

Issue (iii): Whether the trial court had jurisdiction under section 21 of the Indian Arbitration Act, 1940 to make the reference after a preliminary decree had been passed and appeals were pending.

Analysis: Section 21 permits a reference where all parties agree to refer matters in difference before final judgment is pronounced. In a partition suit a preliminary decree does not finally terminate the suit, and appellate proceedings are a continuation of the suit. Where proceedings are pending both before the trial court and the appellate court, either court may make the reference in respect of the matters in dispute, particularly when an effective single reference is desirable.

Conclusion: The trial court was competent to make the reference under section 21 of the Indian Arbitration Act, 1940.

Final Conclusion: The objections to the reference and the award failed, and the decree in terms of the award was upheld.

Ratio Decidendi: In a pending partition dispute, a consensual arbitration reference may validly be made before final judgment, and appellate proceedings are part of the suit for this purpose; an award will not be invalid merely because it records admitted rights in foreign immovable property without adjudicating title thereto.

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