JUDGMENT
N.G. Nandi, J.
(1) The award dated 15th November 1989 rendered by the sole arbitrator resolving the disputes pursuant to reference agreement dated 9th October 1989 by the four brothers, is the subject matter of the controversy in these proceedings.
(2) By award dated 6.8.1987, seven sons and one married daughter of late Pt.Kanhaiya Lal Punj were awarded various companies, assets and properties. Subsequent thereto the disputes arose between the four brothers, namely, Virender Prakash Punj, Satya Narain Prakash Punj, Ravinder Prakash Punj and Nilinder Prakash Punj about running of their businesses and the allocation and determination of their respective shares so that they can work independently as far as possible and run their own affairs, also as regards the ownership of the properties. As there could not be any agreement on the terms and conditions for controlling and running the businesses, Reference Agreement dated 9th October 1989 (hereinafter referred to as the agreement) admittedly came to be executed by V.P.Punj (respondent No.1), S.N.P.Punj (respondent No.5), R.P.Punj (respondent No.11) and N.P.Punj (respondent No.16) referring the disputes for resolution to the sole arbitrator of Sh. S.C.Mathur. The sole arbitrator – S.C.Mathur rendered the award dated 15th November 1989 (hereinafter referred to as the award) distributing/allocating businesses, assets, properties amongst the parties to the agreement.
(3) The arbitrator S.C.Mathur filed the award alongwith the proceedings, under Sections 14 and 17 of the Indian Arbitration Act, 1940 (hereinafter referred to as “the Act”) and prayed for making the said award rule of the Court. Pursuant thereto, notices under Section 14 of the Act regarding the filing of the award was issued to the parties also requiring the filing of the objections, if any, to the said award within the statutory period. Vide I.A. 2828/90 respondent No.9 filed objections under Sections 30-33 of the Act. Respondent No.6 filed objections to the award vide I.A. No.2967/90. Vide I.As. No.6984/90 and 6985/90 respondent No.6 and 9 respectively, under Section 5 of the Limitation Act, prayed for condoning the delay in filing the objections. I.A. No.5658/90 by Mrs. Arti Singh daughter of respondent No.5, I.A. No.5659/90 by M/s. Atna Engineering Pvt. Ltd. and I.A. No.5660/90 by Dev Automobiles under Sections 30-33 of the Act have been filed by the persons who claim not to be the parties to the arbitration proceedings. These applicants also prayed for leave to file the objections vide I.As. No.6721/90, 6722/90 and 6723/90 respectively.
(4) Respondent No.1 filed reply/objections to I.As. No.2967/90 and 2828/90 and contended that the agreement has been by respondents No.1, 5, 11 and 16 as heads of their families and as such they executed the agreement and adduced evidence before the arbitrator; that the award has been accepted for themselves and their respective family/group and that the award has been acted upon; that the objectors are estopped from objecting to the award; further contending that there is no objection to the clarification on the award in the decree to the extent that arbitrator cannot deal/decide future disputes, the award be made rule of the Court. The alleged misconduct on the part of the arbitrator has been denied. Respondents No.16 to 18 filed reply to the applications by the above objectors on the lines of respondent No.1 Respondents No.11 to 15 also filed reply to the objections against the award, on the same lines as that of respondent No.1 and respondents No.16 to 18. Respondent No.5 filed objections under Sections 30-33 of the Act of the award dated 15th November 1989 vide I.A. No.1374/94 contending that the clarification on the award in the decree be made to the extent that arbitrator cannot deal/decide the future disputes; that the arbitrator has exceeded the jurisdiction; that only business assets, shares, etc. were referred for resolution; that the shares of Dev Automobiles and Atna Engineering could not have been transferred at nil value; that after the award the arbitrator has become functus officio; that personal properties of the parties to the reference could not have been dealt with by the arbitrator; that the arbitrator misconducted himself and the arbitration proceedings rendering the award liable to be set aside. Vide I.A. No.1590/90 respondent No.8 (wife of respondent No.5) filed objections under Sections 30-33 of the Act and contended that only business assets, shares, etc. were referred to the arbitrator and not the personal assets/properties; that groups A to D in the reference/award do not and cannot include married daughters. it is alleged that the arbitrator misconducted himself and the arbitration proceedings and the award is liable to be set aside.
(5) The aware divides the parties to the reference and the award into four groups. The groups are Group A – respondent No.1 (V.P.Punj), Group B – respondent No.5 (S.N.P.Punj), Group C – respondent No.11 (R.P.Punj) and Group D – respondent No.16 (N.P.Punj). The award refers to the above persons as the heads of their respective families with their family members and also the companies and firms stated to be under their control.
(6) It will be seen from the above that the objections under Sections 30-33 of the Act to the award dated 15th November 1989 are by Group B, namely, respondent No.5, his family members and the companies and firms stated to be under his/their control. Respondent No.6 and 9 who have filed objections vide I.As. 2967/90 and 2828/90 are the son and daughter-in-law respectively of respondent No.5. The objections vide I.A. 5658/90 are by Mrs. Arti Singh who is admittedly the daughter of respondent No.1 with regard to property No.24, Vayu Nagar, Gwalior as the owner thereof stating that the said property has been let out to M/s. Lepinus Rockwool Private Limited for Rs. 4,000.00 per month w.e.f. 1st November 1989; that she is not a party to the agreement; that she did not refer this property vide agreement to the arbitrator; that the arbitrator exceeded the jurisdiction and misconducted himself inasmuch as the applicant’s property has been included in the award. I.A. 5659/90 and I.A. No.5660/90 are the objections by M/s. Atna Engineering Pvt. Ltd. and Dev Automobiles respectively who are the two shareholders to the extent of 20510 shares each in M/s. Lepinus Rockwool Private Limited stated to be the tenant in 24, Vayu Nagar, Gwalior, contending that each of these objectors guaranteed the repayment of loan taken by M/s. Lepinus Rockwool Private Limited; that their shares have been transferred at nil value by the arbitrator. Both have also stated that the shares with blank transfer forms were handed over to the arbitrator. It may be seen that the deponent of the affidavit in support of I.A. No.5660/90 is the husband of Mrs. Arti Singh applicant in I.A. No.5658/90. Respondent No.1 (Group A), respondents No.11 to 15 (Group C) and respondents No.16 to 18 (Group D) have not objected to the award being made rule of the Court with no objection to the clarification as regards the power of arbitrator to deal/decide future disputes.
(7) It may be noted at the outset that the award has been filed by the arbitrator on 8th February 1990 for making the said award rule of the Court/decree and thereupon notices under Section 14(2) of the act of filing of the award were issued to the parties to the award requiring filing of objections, if any, to the said award within the statutory period. Respondent No.5 filed objections to the award vide I.A. No.1374/94 on 10th February 1994. Respondents No.16 to 18 filed reply to the said objections to the award by respondent No.5 and contended that the objections to the family settlement and/or the award filed by respondent No.5 are barred by limitation. There does not appear any formal application under Section 5 of the Limitation Act seeking condensation of delay caused in filing the objections u/s. 30-33 of the Act by respondent No.5. in para 26 of I.A. No.1374/94, respondent No.5 – objector has stated that the applicant has not been served with a notice of the filing of the award and proceedings, as directed by the Court; that the limitation for filing objections has not begun; that the objections are being filed in order to avoid any technical objection and by way of abundant caution. Learned counsel appearing for respondents 1, 3 and 16 to 18 has stated that there is no objection to the condensation of delay in filing the objections under Sections 30-33 of the Act by respondent No.5. In view of this concession by the learned counsel for respondents 1, 3 & 16 to 18, the contention in the reply to the objection by respondents No.16 to 18 with regard to the limitation pales into insignificance, and the delay in filing objections by respondent No.5 is condoned. Respondents No.6 and 9 filed their objections to the award vide I.As. No.2828/90 & 2967/90 respectively and also prayed for condensation of delay which is one day, under Section 5 of the Limitation Act vide I.As. No.6984/90 and 6985/90. The learned counsel appearing for respondents 1, 3 and 16 to 18, as far as the delay in filing of objections to the award by respondent No.6 and 9, conceded that the delay be condoned and stated that concession with regard to condensation of delay be also extended to respondents 6 and 9. In view of the no objection to condone the delay caused in filing the objections to the award under Sections 30-33 of the Act by respondents 6 and 9, the delay needs to be condoned. Therefore, I.A. No.6984/90 and I.A. No.6985/90 are allowed and the delay in filing the objections to the award dated 15th November 1989 by respondents 6 and 9 is condoned.
(8) Vide I.A. No.5659/90, M/s. Atna, Engineering Private Limited, vide I.A. No.5660/90, M/s. Dev Automobiles Private Limited and vide I.A. No.5658/90 Mrs. Arti Singh filed objections to the award. It may also be noted here that M/s. Dev Automobiles Private Limited vide I.A. No.6721/90. M/s. Atna Engineering Private Limited vide I.A. No.6722/90 and Mrs. Arti Singh vide I.A. No.6723/90 sought leave of the Court to file objections to the award as these objectors, according to them, are not the parties to the agreement as also the award. It has been submitted by the learned counsel appearing on behalf of the applicants in I.As. 5658, 5659, 5660/90 and I.As. 6721, 6722 & 6723/90 that these applicants, in view of the bar of suit contained in Section 32 of the Act, could not have filed civil suit and that the only remedy available to them is by way of objections under Sections 30-33 of the Act; that respondent No.5 did not represent these applicants and that the agreement does not give authority to the arbitrator qua any of these applicants; that there is no resolution passed by the Board of Directors of the companies; that the applicant of I.A. 6722/90 is the owner of the property bearing No.24, Vayu Nagar Gwalior; that how the property of this objector can be included in Schedule-II of the Agreement when this property did not belong to Punj Brothers and how the same could have been given to respondent No.5 under the award; that respondent No.5 did not represent any of these objectors and that respondent No.5 is one of the Directors of the two companies M/s. Dev Automobiles Private Limited and M/s. Atna Engineering Private Limited and nothing further; that property bearing No.24, Vayu Nagar, Gwalior has been acquired after the marriage of the applicant/objector in I.A. No.5658/90. As against this, it has been submitted by learned counsel appearing for respondents 1, 3 and 16 to 18; that M/s. Dev Automobiles Private Limited and M/s. Atna Engineering Private Limited are shown in the schedule of agreement; that respondents No.5 to 8 cannot probate and reprobate; that if M/s. Dev Automobiles Private Limited and M/s. Atna Engineering Private Limited are no party to the award, then they are outsiders and the award would not be binding upon them and they can have the remedy available under the law but not by way of objections under Sections 30-33 of the Act which do not cover these objectors and they have no locus standi; that objector Mrs. Arti Singh is the daughter of respondent No.5 and that she has given power of attorney dated 12th August 1975 in favour of her father respondent No.5; that respondent No.5 also gave blank transfer forms along with the original script of the shares of M/s. Atna Engineering Private Limited and M/s. Dev Automobiles Private Limited and that both these companies are covered under Schedule-II of the Agreement.
(9) Perusal of the agreement suggest that respondent Nos.1, 5, 11 and 16 are the signatories to the said agreement. It refers to the agreement dated 11th July 1987 and states that the above parties had appointed Mr.Suresh C. Mathur as sole arbitrator and referred all their unresolved disputes to him for settlement by arbitration. It further provides that by various resolutions passed by the Board of Directors and share-holders, some of the companies referred to herein after had agreed to consider themselves to be bound by the ΒΈ directions given by the said arbitrator since it was anticipated that in view of achieving an overall settlement which would also have an adverse effect on the business of the companies, some reallocation of their assets may become necessary. It may be noted that these recitals in the agreement are in relation to the various resolutions passed by the Board of Directors and share-holders. It further provides that by memorandum dated 9th October 1989, the parties referred their disputes regarding the allocation of their shares in the business and the property allotted to the parties to this agreement vide award directing settlement dated 6th August 1987 and by this reference referred all the unresolved disputes for allocation of shares in the business and property as also the new assets created since the award directing settlement dated 6th August 1987. It is further provided in the agreement that the parties have been carrying on business as share-holders and/or directors and/or partners in the following companies or firms (Schedule-I) in their own names along with their wife and children as individuals and through their HUFs wherever applicable and also with a small number of shares held by various outsiders who are close, family friends; that the various businesses, companies, firms, etc. belonging to the parties are listed as Schedule-I attached; that the parties of the above said companies and firms have factories and immovable properties as are mentioned in Schedule-II attached; that certain differences and disputes which the parties have been unable to resolve themselves are still subsisting among themselves regarding the distribution and division of management and assets of the above said companies and firms and ownership of the businesses. Such differences, if unresolved, would adversely affect the businesses and assets of the companies and firms and it is in the interest of all the parties to expeditiously resolve the same. The agreement provides the matters referred to Sh.Suresh C. Mathur as sole arbitrator which would be binding on the parties to the said agreement and their families. The matters referred to are :-
“(A)Mode and manner of Division and distribution of the ownership, management and business of companies, firms referred to above and the allocation and distribution of the Immovable Properties in Schedule-II, between the parties.
(B)In connection with the above, to consider the position of accounts of the respective companies and firms and to assist in the handing over of the running businesses to the parties with financial books, all records, documents and related files since its inception and possession of the premises, etc. as a on-going concerns.”
The agreement further suggests that the parties agreed that all matters are referred to the arbitrator considering the nature of disputes and it is requested that the arbitrator give an oral award after proceeding in such a manner as he thinks fit and at his discretion and that along with the award, the arbitrator may give other appropriate directions for transfer of properties, transfer of shares, interest and other matters, as deemed necessary. Schedule-I of the agreement speaks of (a) private limited companies, whereas (b) deals with firms, whereas (c) refers to investment companies. In `C’ – investment companies/firms at item No.1 Atna Engineering Private Limited and at item No.5 M/s. Dev Automobiles Private Limited have been shown. Schedule-II speaks of details of properties and at serial No.18, House No.24, Vayu Nagar, Gwalior has been shown. It appears that under the award, M/s. Atna Engineering Private Limited and M/s. Dev Automobiles Private Limited have been allocated to respondent No.5.
(10) As far as objections vide I.A. No. 5658/90 (I.A. No.6723/90) are concerned, the objector is with regard to property bearing No.24, Vayu Nagar, Gwalior on the basis of owner thereof. Contending that, this property has been let out to M/s. Lepinus Rockwool Private Limited – a company for Rs. 4,000.00 per month with effect from 1st November 1989 and that the arbitrator misconducted himself and the arbitration proceedings by including this property. The reply by respondent No.1 is that the record of the arbitration proceedings demonstrates that the aforesaid property was brought in the hotchpotch by respondent No.5 and declared to be available for reallocation as part of the property of the family; that the agreement covers the wives and children as individual and their Huf and certain outsiders who are close family friends connected with the investment companies and holding properties. Item No.18 in Schedule-II sets out House No.24, Vayu Nagar, Gwalior and discloses the current owner. Similarly, House No.25 also brought simultaneously from Mr. Sushil Kumar Verma shown in the name of Rohini Chibba, D/o respondent No.11 (R.P.Punj) is also shown as property which is the subject of distribution. The arbitration reference clearly mentions that the parties and above said firms have factories and immovable properties as mentioned in Schedule-Ii attached; that award in Schedule-IV demonstrates that the aforesaid property has gone to the share of respondent No.5. The agreement as pointed out above at serial No.18 in Schedule-II, includes House No.24, Vayu Nagar, Gwalior. It is also suggested from Schedule-II that House No.25 has also been brought simultaneously from Sh. Sushil Kumar Verma which is shown in the name of Rohini Chibba, D/o respondent No.11 and all these properties are shown the subject of distribution and reallocation. This would go to show that this applicant is a party to the agreement and the award and, therefore, bound by the award and the remedy is by way of objection under Sections 30-33 of the Act and the bar of suit contained in Section 32 of the Act would apply. I.A. 6723/90 is disposed of accordingly. According to the objector, Mrs. Arti Singh, House No.24, Vayu Nagar, Gwalior has been let out to M/s. Lepinus Rockwool Private Limited for Rs. 4,000.00 per month with effect from 1st November 1989. It may be appreciated that the reference agreement is dated 9th October 1989 i.e. prior to the letting out of the property to M/s. Lepinus Rockwool Private Limited for Rs. 4,000.00 per month. A certified copy of the power of attorney dated 12th August 1975 executed by Mrs. Arti Singh, D/o Sh. S.N.P.Punj in favour of her father respondent No.5 suggests that respondent No.5 is the constituted general power of attorney of the objector. Apart from anything else, even on the strength of this general power of attorney, the objector Smt. Arti Singh could be legally bound by her attorney so long as the power of attorney dated 12th August 1975 is not revoked/cancelled by her.
(11) It would be seen from the agreement reproduced above that all the unresolved disputes for allocation of shares in the business and property as also the new assets created since the award directing settlement dated 6th August 1987 have been referred. It is also suggested that the parties have been carrying on business as shareholders and/or directors and/or partners in the companies or firms in their own names along with their wives and children as individuals and through their HUFs wherever applicable and with a small number of shares held by various outsiders who are close family friends. The various businesses, companies, firms, etc. belonging to the parties to the reference are listed as Schedule-I and that the companies and firms have factories and immovable properties mentioned in Schedule-II. It is suggested that certain disputes and differences subsisted which the parties were not able to resolve themselves. Regarding the distribution and division of management and assets of the companies and firms and the ownership of the businesses referred in Schedule-I, Ii and the agreement was with a view to resolve the disputes and differences as these disputes and differences remained unresolved that might adversely affect the business and assets of the companies and firms and it was realised that it was in the interest of all the parties to expeditiously resolve the same. As pointed out above, the matters referred to include mode and manner of division and distribution of the ownership, management and business of companies, firms and the allocation and distribution of the immovable properties in Schedule-I and Ii respectively between the parties. The agreement also provides that the arbitrator was also required to give other appropriate directions for transfer of properties, transfer of shares, interest and other matters, as deemed necessary. It may be seen that Schedule-I of the agreement include private limited companies/firms, investment companies/firms and that M/s. Atna Engineering Private Limited and M/s. Dev Automobiles Private Limited are included in Schedule-I of the said agreement. Page 21 of the award suggests that M/s. Atna Engineering Private Limited and M/s. Dev Automobiles Private Limited have fallen to the share of respondent No.5. It is suggested from the record of the arbitration proceedings that respondent No.5 produced the copies of the resolutions No.7, 8, 11 and 12 whereby unanimously, the Board of Directors accorded the consent to the terms of the award of Mr. Suresh C. Mathur. It may be appreciated that both these objectors, as pointed out above have been included in Schedule-I `C’ – Investment companies/firms. It appears that these two companies under the award dated 6th August 1987 fell to the share of respondent No.5 and continued to remain with respondent No.5 and his Huf also under the award. Looking to the object of the agreement which is suggested from the language employed therein, referring all unresolved disputes to the sole arbitrator including the questions of distribution and allocation of shares, ownership of the companies, firms, etc. In my opinion, these two objectors which are included in Schedule-I `C’ in investment companies/firms cannot be said to be strangers to the reference as well as the award and the remedy for these objectors would be by way of objections to the award under Sections 30-33 of the Act considering the provisions contained in Section 32 of the Act and, therefore, I.As. 6721 and 6722/90 are answered accordingly.
(12) As far as the objections vide I.As 5659 & 5660/90 are concerned, it may be seen that these two companies fell to the share of respondent No.5 and his Huf pursuant to the award dated 6th August 1987. Respondent No.5, before the arbitrator, has submitted blank share transfer forms with the original share scripts of both these companies pursuant to the agreement. The agreement reproduced above clearly suggests that all unresolved disputes were referred to the sole arbitrator including the questions of distribution and allocation of companies, firms as also transfer of shares in the companies/firms and the handing over of the blank transfer forms with the original scripts of the shares of these two companies by respondent No.5 was in consonance with the object and spirit of the agreement as unresolved disputes and differences were also in respect of the private limited companies and investment companies/firms shown in Schedule-I of the reference agreement and for the implementation of the award that was to be passed pursuant to the agreement. Since these two companies, which were prior to the agreement with respondent No.5 and his H.U.F./his family members, with a view to have comprehensive settlement of all the disputes including Private Limited Companies/firms, investment companies, etc. have been brought within the purview of the agreement. These two companies, even pursuant to the award have fallen to respondent No.5. It may also be appreciated that the agreement refers to the agreement dated 11th July 1987 and states that the parties had appointed Mr.Suresh C. Mathur as sole arbitrator and referred their unresolved disputes to him for settlement by arbitration and that by various resolutions passed by the Board of Directors and shareholders, some of the companies referred to hereinafter had agreed to consider themselves to be bound by the directions given by the said arbitrator since it was anticipated that in view of achieving an overall settlement which would also have an adverse affect on the business of the companies, some reallocation of their assets may become necessary and thereafter the companies have been shown in Schedule-I of the agreement. Thus, according to the agreement, the companies referred to in Schedule-I agreed to be bound by the directions given by the arbitrator and various resolutions came to be passed by the Board of Directors and shareholders of these companies. This may be seen in light of the subsequent conduct of respondent No.5 of handing over the blank transfer forms and the original share scripts to the arbitrator. Under the circumstances, objections under Sections 30-33 of the Act vide I.As. 5658, 5659 and 5660/90 being devoid of merits are liable to be dismissed.
(13) Objections under Sections 30-33 of the Act vide I.As. No.2967-2828/90 are by respondents No.6 and 9 respectively, who happen to be the son and daughter-in-law of respondents No.5 and 8. Their objections to the award are that the arbitrator cannot be the permanent agency for resolving the future disputes between the parties to the award and that his jurisdiction was limited to the disputes and differences which were pending on the date of the reference i.e. 9th October 1989. It is also their say that the award of the arbitrator is liable to be modified to the extent that the arbitrator could not vest with him the jurisdiction to deal with and adjudicate upon any dispute that may arise at a subsequent stage inters the brothers and the members of their families, etc; that the award is beyond the scope of the reference and liable to be modified to that extent. In reply, respondents No.1, 11 to 15 and 16 to 18 have stated that there is no objection to the clarification on the award in the decree to the extent that the arbitrator cannot deal/decide future disputes. Apart from objection/no objection by respondents No.1, 11 to 15 and 16 to 18, in law the arbitrator could not have appointed himself as permanent/future agency to resolve all future disputes that might arise between respondents No.1, 5, 11 and 16 and their family members nor an arbitrator can be an award implementing agency. The arbitrator cannot be a permanent agency for resolving the disputes, if any, that might arise in future. It need hardly be said that the jurisdiction of the arbitrator would be restricted only to resolve the disputes referred, to him under the reference agreement and nothing beyond and the arbitrator would become functus officio on pronouncement of the award. Since these two I.As. are only with regard to the clarification/modification as above and no other specific objection to the award dated 15th November 1989 is suggested therefrom, considering the legal position in this, regard being as above, the modification/clarification needs to be granted. These two I.As. are decided accordingly.
(14) It would be seen from the above that out of the parties to the arbitration agreement and the award, respondents No.5, 8 and 10 have chosen to challenge the award dated 15th November 1989 by filing objections vide I.As. No.1374/90 and 1590/90 respectively. It may be appreciated that the agreement provides that four brothers i.e. respondent No.1, 5, 11 and 16 also represented the members of their families and all these family members have been specifically named in the reference agreement. Respondents No.1, 5, 11 and 16 represented their respective H.U.F. and each branch of the family has been represented through the head of the respective branch. In the case of Keshrimal Pyarchand and others v. Basantilal Pyarchand the Division Bench held that “a Karta of the joint family can make a valid reference to arbitration and where he acts bona fide the award binds other members. Where as between different branches, the question as to division of joint family property arises, head of each branch properly represents the interest of other members of his branch. He can therefore make a reference with reference to the dispute in the family as to division of the family property.”
(15) One of the arguments on behalf of respondents 5, 8 and 10 is that The arbitrator misconducted himself and the arbitration proceedings inasmuch as he travelled beyond the scope of reference and adjudicated the disputes not referred to him namely personal properties, assets of the parties to the reference. As pointed out above, as per the reference agreement all unresolved disputes have been referred to the sole arbitration by the parties as above to the reference and the companies, firms and investment companies/firms referred in Schedule I and the properties mentioned in Schedule Ii were also the subject matter of the dispute referred to the sole arbitration with an object of an over all settlement of all unresolved disputes. It has been specifically provided in the agreement that the parties referred their disputes regarding the allocation of their shares in the business and properties allotted to the parties to this agreement vide the award directing the settlement dated 6th August 1987 and referred all the unresolved disputes for the allocation of shares in the business and properties as also new assets created since the award directing the settlement dated 6th August 1987. The basis for the present reference was the settlement/allocation/distribution vide award/settlement dated 6th August 1987. Vol.I, page 9 of the arbitration proceedings suggests that an emergent meeting was convened at 3 p.m. on 31st October 1989 at 10 P.R.Road, New Delhi. Note there below addressed to respondent No.5 suggests that all statutory books of all companies in dispute and share scripts of all companies with property titles and files should be brought. It is mentioned that details have already been circulated and discussed. Page 10 suggests that respondent No.5 placed the title deed of correspondence of 34 properties as per the list attached (Annexure-A). Page 35 is the letter by respondent No.16 which suggests that as per the original understandings and norms, equal number of shares will be held by each family, especially in the case of Lnl shares, these were held on equal basis by the families of respondent No.5 and 16. Confirmation was sought with regard to this having been done in new lots purchased. Page 37 is the letter by respondent No.5 that units Punj-Lloyd/PLD and Lepinus, as per the minutes of 2nd November 1989 are not to be covered under the understanding which may be clarified to respondent No.1 and others. The letter also suggests that it was also mentioned that as soon as the award is made it would be implemented immediately and fully within 30 days and hence the portions which have been implemented, would become free and clear to the person whosoever has been given the unit. Page 38 is the letter by respondent No.5 to the arbitrator which suggests that the duly executed share transfer forms from Dev Automobiles and Atna Engineering for the transfer of 20,510 shares each and 8740 share scripts issued by Lepinus Rockwool Pvt. Ltd. favouring Atna Engineering Pvt. Ltd. each have been handed over to the arbitrator. It is also suggested therefrom that Annexure-II list of 11 companies/firm are held by the family of respondent No.5 Annexure-II to the said letter refers to Atna Engineering Pvt. Ltd. at No.1 and Dev Automobiles at No.5. Page 46 is the Memorandum of Understanding dated 9th October 1989 signed by respondents No.1, 5, 11 and 16 which suggests that in case any information regarding other companies/firms/proprietorships is found, the person concerned will have to pay a monetary fine of Rs. 10,00,000.00 to the other parties. It further provides that the same company/firm shall be brought into arbitration proceedings. This suggests the comprehensive settlement contemplated/intended by the parties to the reference agreement dated 9th October 1989. Page 53 is the letter dated 10th November 1989 by respondent No.5 to respondent No.16 with regard to the shares held in Lakhanpal Pvt. Ltd. by respondent No.5 and his family members. Page 79 is the letter dated 13th November 1989 by respondent No.5 clarifying the correct shareholding in Lakhanpal Pvt. Ltd. by respondent No.5 and his family. Vol.II page 10 contains the list of companies as well as the properties. At Sl.No.20, the property of the ownership of Smt. Rohini in Vayu Nagar, Gwalior is shown whereas at Sl.No.21, property at Vayu Nagar, Gwalior of the ownership of Smt. Arti has been shown. Page 164 is the letter dated 21st October 1989 by respondent No.5 to respondent No.1, 11 and 16 with a copy of the arbitrator supplying the list of the shareholders in group companies, further stating that the shares of Lnl held by each family will be handed over and that the shares of various companies held by individual families are being listed and being handed over.
(16) One of the arguments advanced on behalf of respondents 1, 3, 11-15 and 16-18 is that the award is accepted by the parties and acted upon and implemented. It is not much disputed by respondents 5, 8 and 10 that the award is not accepted by these respondents. It has been submitted by the learned counsel on behalf of these respondents that the acceptance of the award by these respondents was without seeing the award. Respondent No.1 alongwith his reply to the objection to the award filed by respondents 6 and 9 has also filed the copy of the acceptance of the award signed by respondent No.1, respondent No.5, respondent No.11 and respondent No.16. It reads as follows : "WE,Shri Virendra Prakash Punj, Shri Satya Narain Punj, Shri Ravinder Prakash Punj and Shri Nilinder Prakash Punj, vide our Reference dated 9th October, 1989, had agreed to transfer all over disputed matters for settlement to Shri S.C. Mathur. His Award dated 15-11-1989 is accepted. 1.Virendra Prakash Punj sd/- 2.Satya Narain Prakash Punj sd/- 3.Ravinder Prakash Punj sd/- 4.Nilinder Prakash Punj sd/-
Thus, it will be been that the award dated 15th November 1989 has been accepted by the parties to the reference. As far as the implementation/acting upon the award is concerned, it has been the say of respondent No.1, 3, 5, 11-15 and 16-18 that the award has been substantially acted upon/implemented. The learned counsel for respondents 5, 8 and 10 in course of the submissions has stated that every property barring two properties, is available; that one property at G.B.Road, Delhi is sold by respondent No. 16 whereas the other property is sold by respondent No.11. It may be appreciated that as far as these two properties are concerned, the equities have changed and the award dated 15th November 1989 after the acceptance of the same has been acted upon. Page 47 is the letter dated 9th November 1989 by respondent No.5 suggesting that they have been discussing various valuations and packets for implementation by the arbitrator in terms of award. It is also suggested that respondent No.5 was interested to have the award at the earliest and also desired for the implementation to be completed at the earliest. Page 58 is the copy of letter dated 13th November 1989 by the arbitrator to respondent No.5 and his family members whereby certain informations were asked for and also the non-judicial stamp papers as per the list given by the arbitrator. Page 74 is the letter dated 13th November 1989 by respondent No.5 suggesting that share scripts of the family of respondent No.5 will be handed over to the arbitrator. Para 7 thereof reads that the list of shareholders, directors and activities of the investment companies of respondent No.5 has already been given to the arbitrator. Para 9 provides that non-judicial stamp papers as per the list approved by the arbitrator and given to Uday have been handed over to the arbitrator. Page 85 is the letter dated 16th November 1989 to the arbitrator by respondent No.16 suggesting that respondent No.5 is perturbed if he wants to exchange his package; that he (respondent No.16) will be happy to exchange his (respondent No.5) with him (respondent No.16); please let him (respondent No.16) know within 3 days prior to any implementation of the award dated 15th November 1989. Page 86 is the letter dated 17th November 1989 by respondent No.1 to the arbitrator stating that the award dated 15th November 1989 has been received; that there is some resentment about the allocation of the share to respondent No.5; that respondent No.1 is prepared to consider the exchange of his package with him (respondent No.5) if he (respondent No.5) so desires; that the offer is open till Saturday, November 18, 1989. Page 87 is the letter dated 23rd November 1989 by respondent No.5 to respondent No.11 (R.P.Punj) with copy to the arbitrator, respondent No.1 and respondent No.16. The letter suggests that the file containing original purchase deed and lease deed of property bearing No.25 Vayu Nagar, Gwalior has been enclosed with a request to send the original papers to send to Rohini Chibba. Page 89 is the letter dated 23rd November 1989 by respondent No.5 to the arbitrator with copies to respondents No.1, 11 and 16 suggesting that the division of companies to be given to respondent No.5 should be free and clear as is the position in other companies. It is further stated that unless the documentation, resolution are given to respondent No.5 there arises no question of arbitrator releasing records, scripts, books and documents pertaining to other companies. Page 93 is the letter dated 27th November 1989 by respondent No.5 to the arbitrator. It is suggested therefrom that even though no proper notice was required to be given, it was given and now it is the responsibility of the arbitrator to ensure that the award is fully implemented. It is suggested from the above that the award dated 15th November 1989 has been signed and accepted by the parties and the same has been acted upon inasmuch as two properties referred to above have been dealt with by respondent No.11 and 16. In the case of Bijendra Nath Srivastava (Dead) through Ors. versus Mayank Srivastava & Ors. it has been observed by the Supreme Court that “circumstance of award having been acted upon inasmuch as the parties alienated the property would require the award made by the arbitrator should be maintained and should not be upset.”
(17) One of the arguments on behalf of the counsel for the respondents 5, 8 and 10 is that the arbitrator has directed the transfer of shares at nil value which could not have been legally done by the arbitrator. It may be appreciated that under the award dated 15th November 1989 the properties, businesses have been distributed/reallocated amongst the parties to the arbitration proceedings and in the process the shares have been directed to be transferred at nil value considering the disputes referred to and the properties distributed/re-allocated including the transfer of shares. The transfer of shares at nil value would be nothing but a part of the lump-sum award for each of the party and it would be permissible for the arbitrator to deliver a consolidated award on all the disputes referred including the transfer of shares which may be at nil value, as held by the Supreme Court in the decision (supra).
(18) It is suggested from the agreement as well as the award that the object of reference to the sole arbitration was the allocation and determination of the respective shares so that they can run their businesses and work independently and run their own affairs. It may also be seen that it was left to the sole arbitrator as to how the running businesses are to be allotted, finally divided and shared between the parties to the agreement, namely, four brothers and their heirs who are also the parties to the arbitration, as pointed out above, and to decide as to how their assets, liabilities and running businesses are to be settled. It can not be disputed that the appointment of the arbitrator and the object of reference of all unresolved disputes/differences amongst the brothers and their heirs the endeavour was to have negotiated family settlement agreeable to all the parties. Page 42 is the letter dated 9th November 1989 by respondent No.16 which refers to the settlement. Page 44 is the letter dated 9th November 1989 by respondent No.5 which also refers to “family dispute” and “fair value”, is left to be determined by the arbitrator. Page 80 is the letter dated 14th November 1989 by respondent No.5 to the arbitrator which suggests the regular meetings were held with the arbitrator in the matter of disputes within the family. It also suggests that the family has reposed utmost trust and faith in the arbitrator. The award suggests that the negotiated family settlement has been confirmed as an award for the disputes arising amongst the family members. It is pertinent to note that respondents No.5, 6, 8, 9 and 10 have no where in their objections under Sections 30-33 of the Act denied that the award is not a family settlement or that there was no family settlement which was confirmed as an award. It is true that in the agreement word “family settlement” is not there but there is no denial to the award being a negotiated family settlement in the objections under Sections 30-33 of the Act. Page 19, a letter addressed by respondent No.5 to the arbitrator suggests that the list of shares held by the individuals of companies outside the Group have been enclosed. It further suggests that shares purchased by the individuals were debited to their accounts. The letter further provides that for the last two years the shares have been purchased from the personal bank accounts of each individual and hence they are treated as their personal property and have been declared a such in the wealth tax. The main objection to the award is an unequal allotment of shares. It cannot be disputed that this Court, while considering the objections under Sections 30-33 of the Act to the award, is not sitting in appeal against the award and it would not be open to this Court to re-appreciate the evidence and consider the findings in the award in that light. The objections to the award on the score of unequal allotment of shares/property would not be entertainable under the law, as held by the Supreme Court in the decision (supra).
(19) It will be seen from the above that the award dated 15th November 1989 is not only accepted but has been acted upon as a family settlement. The submissions by the learned counsel that the acceptance of the award by respondent No.5 was without seeing the award, cannot be accepted. The acceptance of the award by respondent No.5, as pointed out above, will not only be presumed to be with full understanding but the award has been subsequently acted upon. The letters by respondent No.5 referred to above suggest it was only a matter of implementation/execution of the award/family settlement and nothing else.
(20) It may be appreciated that the perusal of the award with reference to the agreement suggests that the arbitrator has considered the relevant aspects of all the unresolved disputes in light of the object of the agreement and the intendment by the parties. The award is a detailed family settlement distributing/reallocating businesses/properties and the transfer of shares etc. Considering all these, it does not appear that the arbitrator misconducted himself or the arbitration proceedings by exceeding the jurisdiction vested in him under the agreement.
(21) Considering the arbitration agreement, record and proceedings and the award/family settlement, the only thing that can be said against the award is that the arbitrator could not have appointed himself as the permanent agency to resolve the disputes that might arise between the parties to the agreement and their family members and the arbitrator could not have undertaken the execution/implementation of the award. In my opinion, the award needs to be modified to the extent that the arbitrator shall not deal/decide the future disputes in relation to or arising out of the award dated 15th November 1989. In my opinion, with this modification the award dated 15th November 1989 needs to be made rule/decree of the Court. In view of the above objections under Sections 30-33 of the Act vide I.As. No.1374/94 and 1590/90 being devoid of merits deserve to be dismissed.
(22) In the result the award dated 15th November 1989 rendered by the sole arbitrator Mr. S.C.Mathur with the modification/clarification that the arbitrator Mr. S.C.Mathur shall not deal/decide the future dispute in relation to or arising out of the award dated 15th November 1989, is made rule/decree of the Court under Section 17 of the Act.