Arbitration award upheld where contractual valuation, limitation objections, and monetary equalisation supported impracticable partition in specie.

An arbitral tribunal's construction of a valuation agreement was upheld where the parties had agreed to market-value assessment by an appointed expert, received the draft report, and were given an opportunity to respond; a section 34 court will not disturb a plausible contractual interpretation or the resulting refusal of cross-examination and further expert evidence. The limitation objection also failed because it was not effectively pressed before the tribunal and the dispute was not treated as a simple accounts claim. Monetary equalisation and possession-based adjustments were likewise sustained because exact partition in specie was impracticable, and owelty was treated as a legitimate means of implementing the parties' and tribunal's mandate.

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Issues: (i) Whether the arbitrator validly treated the parties' agreement on market-value valuation as excluding further challenge to the expert's final report and thereby declined cross-examination and additional expert evidence; (ii) whether the claim in arbitration was barred by limitation; (iii) whether the award, while directing distribution in specie, could validly provide monetary equalisation and ancillary possession-based adjustments.

Issue (i): Whether the arbitrator validly treated the parties' agreement on market-value valuation as excluding further challenge to the expert's final report and thereby declined cross-examination and additional expert evidence.

Analysis: The agreement of 20 March 2007 substituted market value for book value and provided for valuation by an agreed expert chosen through the arbitrator. The parties were heard by the valuer, were given access to the draft report, and were afforded an opportunity to make further submissions before the final report. The arbitrator construed the agreement as one where the valuation report was to bind the parties, and such construction was a possible view of the contract. In proceedings under section 34, the Court would not interfere with a plausible contractual interpretation adopted by the arbitrator.

Conclusion: The objection failed and the arbitrator's refusal to permit cross-examination or further expert evidence was upheld.

Issue (ii): Whether the claim in arbitration was barred by limitation.

Analysis: The plea of limitation had not been properly urged before the arbitral tribunal by the Mumbai group, while the Kanpur group had raised it. The earlier Supreme Court decision concerned limitation of the application under section 20 of the Arbitration Act, 1940 and also emphasised the family-settlement context and continuing negotiations between the parties. The claim before the arbitrator was not a simple suit for accounts and share of profits of a dissolved partnership, and the Court found no basis to fault the tribunal for not dealing with a submission that was not effectively advanced. The challenge on limitation therefore could not succeed.

Conclusion: The limitation objection was rejected.

Issue (iii): Whether the award was invalid because it provided monetary equalisation and ancillary possession-based adjustments despite the requirement of distribution in specie.

Analysis: The deed contemplated distribution in specie, but exact physical division of the immovable properties was not practicable. The Supreme Court in the earlier round had envisaged equalisation if necessary, and the award merely implemented that approach by distributing properties as far as possible and balancing values through money payments. The award also reconciled the possession and encumbrance position of certain properties with the parties' agreed understanding. The Court held that this was not a transgression of the contract and that owelty was a legitimate device where exact division in specie was impossible.

Conclusion: The award was not vitiated on this ground.

Final Conclusion: The arbitral award disclosed no jurisdictional error or legal infirmity warranting interference under section 34, and the appeals failed.

Ratio Decidendi: Where an arbitrator adopts one of the possible constructions of the parties' agreement, and where exact partition in specie is impracticable, the Court will not interfere under section 34 merely because another view is possible; monetary equalisation may validly accompany distribution in specie if it implements the contractual and arbitral mandate.

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