AI Drafter 
TaxTMI 
TaxTMI 
1956 (3) TMI 52
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....evidence of the respondent's representative. 3. No other objection has been urged before me. 4. Before discussing these objections and determining them; the facts of the dispute between the parties and the history of the Arbitration in this matter have to be briefly stated. On 10-4-1953 the applicant agreed to purchase a certain quantity of jute to be delivered in April-May, 1953. It is the applicant's case that the respondent delivered only a part of that jute and failed to deliver the balance and that even those goods which were delivered were not of the contracted quality. The applicant thereupon claimed Rs. 7,300/- as damages for inferior quality and Rs. 29.52Q/- as damages for non-delivery. The respondent claimed Rs. 37,272/- being the price of the goods delivered. Their dispute and differences were referred to the Bengal Chamber of Commerce. On 22-2-1954; an Award was made by the Bengal Chamber of Commerce directing the applicant to pay to the respondent Rs. 37,245/-and the respondent to pay to the petitioner Rs. 18,450/-. An application was then made by the present applicant on 24-5-1954 to set aside that Award. On 33-7-1954, by consent of parties the follow....
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.... the rules and regulations of the Bengal Chamber of Commerce. 7. I am afraid this objection has no substance whatever & can be dismissed on three broad grounds. It is true that there was a consent order remitting the Award to the Arbitrators. But an order remitting an Award is made always under Section 16 of the Arbitration Act which says expressly that the Court in such a case remits the Award "to the Arbitrators" or umpire for reconsideration upon such terms as it thinks fit. Therefore, this consent order remitting the Award must be construed as remitting it to the Arbitration of the Bengal Chamber of Commerce according to the contract of the parties. That is the first ground. Then the second ground is that the Arbitration Agreement between the parties still remains operative even where an order to remit the Award has been made by the Court under Section 16 of the Arbitration Act, for what that section says is that the Court remits the Award or "any matter referred to arbitration". In other words, the reference to arbitration still exists. "By Clause 13 of the contract in this case between the parties it was distinctly and expressly stipulated: "All matters, questi....
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....tors on 3-1-1955, but the applicant was not given any opportunity to file a reply to such written statement. This in face I find is a misconception in the sense that this was not a written statement at all. In fact it was not signed by the respondent or by anyone else. What it purports to be is a typed list of points of argument in one page. That is how also it is described in the minutes of the Arbitrators and I entirely agree with such description. It certainly is not, to my mind, a written statement of the case of the plaintiff. Rule 11 of the Rules of the Tribunal of Arbitration of the Bengal Chamber of Commerce makes it quite clear that: "Parties within such time as may be directed by the Court shall prepare and submit to the Registrar in duplicate a written statement of their respective cases with copies of all relevant documents and other evidence on which they rely. A copy of each party's case shall be given to the other party who shall respectively be entitled to put in a rejoinder thereto within such time as may be directed. Normally 110 more than one rejoinder shall be filed, but the Court shall have discretion if it thinks fit to allow, more than one rej....
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....presentative Mr. P. Bhattacharjee was denied the right to cross-examine the respondent's representative. What happened on that day was that the applicant's representative wanted to cross-examine the respondent's representative. The Arbitrator wanted to know on what points he wished to cross-examine and wanted to sec the nature of points or questions that the applicant's representative wanted to put. Thereupon the applicant's representative placed before the "Arbitrators seven pages of typed questions with which he had come prepared beginning with such questions as, "What is your name?" and ending with the 52nd question as "I put it to you that your entire claims are absolutely false." These typed sheets although bearing no date on the top bear the date at the end of the last question which is the 52nd question and such date is 2-1-55. The Arbitrators looked at those questions and said according to the petitioner that "some of these questions were irrelevant and the majority of those questions were covered by the written submissions of the parties." On 4-1-1954 when the applicant's attorneys were recording this fact) it was only said that the Arbitrator....
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....ute. Parties are forced to depart from, natural justice by Statute and similarly parties can agree to depart from natural justice. In fact they very often do for avoiding delay', expense and formality. In the case before me they have done so in unmistakable terms. 14. For example here what the parties expressly agreed was not only to go to the arbitration of the Tribunal of Arbitrators of the Bengal Chamber of Commerce but also to have such arbitration according to the published and well-known Rules of arbitration of such Chamber of Commerce. Those Rules certainly are not models of natural justice nor were they intended to be so. Now the rules of arbitration here provide, for instance, "that no Party shall without the permission of the Court be entitled to appear bv counsel, attorney or other advocate or adviser". Denial of legal representation to a party does not savour of natural justice. Then again for instance the right to cross-examine which is a statutory right under the Indian Evidence Act in proceedings before a Court of law is not available in arbitration proceedings because of its express exclusion by Section 1 of that Statute. To found, therefore, a right to cr....
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....s-examination they can always permit a party to cross-examine under the ample powers contained in Rule 17(d). 15. Time has come to insist that enthusiasm for natural justice must always be tempered with due and proper regard for contractual justice to which the parties agree. Parties have the right by contract to provide for their own private forum of arbitration and also to provide for their private procedure. Where private procedure speaks in clear terms the voice of natural justice remains silent. 16. In this connection Mr. Meyer relied on a decision of the Supreme Court in -- 'Vengam-ma v. Kesanna', [1953]4SCR119 (A), Mr. Meyer particularly relied on the observations of Ehagwati J. appearing at page 22 of that Report where the learned Judge said: "There is thus no doubt that the Arbitrator heard defendant 1 in the absence of the plain, tiff. No notice of this hearing was given by the Arbitrator to the plaintiff nor had she an opportunity of having the evidence of defendant 1 taken in her presence so that she could suggest cross-examination or herself cross-examine defendant 1 and also be able to find evidence, if she could, that would meet and answer the ....
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....rding to the contract of the parties. The contract of the parties in this case before me follow a well-known pattern of arbitration. It is not a case of a private arbitrator whether mercantile or non-mercantile with no prescribed procedure for arbitration such as that which the Supreme Court was discussing. It was plain that in the case before the Supreme Court it was a private Arbitrator with no rules of arbitration applying at all, and therefore the doctrine and the principles of natural justice applied. Indeed that is just the case where principles of natural justice must apply. There it was a case where a plaintiff filed a suit for arrears of maintenance and residence which was ultimately referred to a private individual 05 the sole arbitrator. No special procedure was there available according to agreed contract of parties to guide the arbitration procedure. 19. Realising that difficulty Mr. Meyer then fell back upon another decision of this Court in -- 'Husein Ebrahim v. Kesardeo Kanoria', AIR1954Cal111 (D). Here Mr. Meyer had the advantage of the fact that it was an award of the Bengal Chamber of Commerce which was successfully impeached. But then there what ha....
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....or even argument on the specific rules of the Bengal Chamber of Commerce on this point of right to cross-examine. The only rule there considered was Rule 7 which has nothing to do with this particular point raised in the present application. The arbitrators in that case in fact did something: wholly illegal, because they wrote a letter calling for information from the Gunny Traders Association and there informations were asked for without any reference to the parties. The Rules of the Bengal Chamber of Commerce did not permit such procedure. The learned Judge, therefore, 'at page 113 says, "In my opinion the Arbitrators were not justified in behaving in this manner". What was worse in that case was that the Arbitrators did not even disclose that letter. Here again Rules of the Bengal Chamber of Commerce do not permit secret evidence behind the back of parties and therefore principles of natural justice intervene to prevent such miscarriage of justice. In fact the parties did not even know the points on which the Arbitrators wanted the information, and that is why the learned Judge in the same page again says: "It was the duty of the Arbitrators, if they wanted to act f....
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...., are only matters of argument and comment before the Arbitrators. Such argument would have been that although in the Statement of Claim it was alleged that the duty was cast on D.L. Miller & Co. Ltd. to open the letter of credit, that allegation, was not supported by the terms of the contract which were before the Arbitrators. The refusal, therefore, by the Arbitrators to allow these questions to be put to the witness was not and could not be misconduct. In fact the arbitrators in my view drew the line correctly and rightly between argument and cross-examination. 22a. Questions 10 and II are as follows: "Q. 10 You will also find that Clause 2, Sub-clause 3 in terms of which the Buyers are to open a letter of credit has been struck out? On the other hand., it is written in place of Clause 3 to the effect that "cash on delivery"? Q. 11 Thus you will agree that as the Clause under which the Buyers were to open a letter of Credit has been struck out and it clearly provides that the payment will be made cash against delivery. It was not duty of the Buyers in the present case to open any letter of credit?" 23. These, again, are arguments. The Terms of the cont....
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....ry questions, and I hold that the Arbitrators were right in refusing the applicant to put them in cross-examination, and in so refusing the Arbitrators were not and could not have been held to have been guilty of any legal misconduct at all. 26. The next question on which Mr. Meyer relied was question 28. That question is: "Q. 28 By your, letter dated 9th June, 1953, you requested the Buyers to extend the- time of delivery for one month. Up to that date you had no complaint against your buyers about the non-payment of the price of the portion of the goods already delivered by 5011?" 27. That, again, is a matter of argument because the letter of 9-6-1953 had already been placed before the Arbitrators and had been referred to in the different statements and counter-statements filed, and the fact clearly appeared that up to that date there war, no complaint. It was therefore, wholly unnecessary and irrelevant to put that question. Therefore, I hold that the Arbitrators were fully justified in refusing the applicant to put that question, and in so refusing, they cannot be held to have been guilty of any misconduct at all. 28. The last group of questions on which Mr. M....