Law: Arbitration Act, 1940

Section: 19,20,first Schedule,25,29,30

(a) Arbitration Act (X of 1940), Ss. 19 and 20-Under terms of contract, a dispute was required to be referred to the arbitration of a certain person-Application under section 20 filed in civil suit-Matter referred to the arbitrator-Award made after four months-Award filed in Court, but set aside for not having been made within time-Court can supersede reference and direct that Arbitration agreement shall cease to have effect. The application made by Sardar Abdul Halim Khan in the first instance was correctly laid under section 20 of the Arbitration Act, seeking intervention of the Court where there was no suit pending. Such an application is to be registered as a suit and notice is to be given to all parties to the agreement other than the applicant, to show cause why it should not be filed. The provision (of paragraph 3 of Schedule I) is expressed in mandatory terms, its contravention involves avoidance of the award. It is also sufficiently clear that by the operation of subsection (5) of section 20, to which reference has been made above, the provisions of section 19 are applicable to a case falling under section 20. Court has power under section 19 when it has set aside an award made upon reference under subsection (4), of section 20, to supersede the reference and thus avoid the arbitration agreement. It would also seem to follow that where a Court, while making an order under section 19, does not expressly supersede the reference and direct that the arbitration agreement shall cease to have effect, it must be deemed to have declined to exercise the power, and consequently that the arbitration agreement notwithstanding that it has been filed in Court, still remains of full force according to its tenor, not only with respect to the difference which was referred to arbitration, but also with reference to all disputes between the parties which properly fall within the agreement. (b) Arbitration Act (X of 1940), S. 25-Section 19 inapplicable to a case falling under section 20. The variant provision in section 25 serves to indicate that section 19 is applicable to a case falling under section 20, where there is no pending suit, but the agreement to refer has…

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