SUKALU RAM GOND versus STATE OF MP AND ORS.

Citation: [1994] SUPP. 2 S.C.R. 421 · Decided: 05-08-1994 · Supreme Court of India · Bench: K. RAMASWAMY, N. VENKATACHALA · Disposal: Disposed off

Judgment (excerpt)

SUKALU RAM GOND 
A 
v. 
STATE OF MP AND ORS. 
AUGUST 5, 1994 
IK. RAMASWAMY AND N. VENKATACHALA, JJ.) 
B 
Aroitration Act, 1941>-Sections 8, 21 & 31>-Aroitration--Jurisdiction of 
arbitrator to make award against a non-party to contract-A person not a 
party to a reference-Participation in award proceedings with objection & 
under protest-Whether bound by award-Held, No-Acquiscence does not C 
confer jurisdiction. 
In a pending criminal petition, by consent of parties, this Court 
made a reference to an arbitrator to adjudicate .the disputes between 
parties. The Arbitrator filed the Award in this Court with notice to the 
parties. The petitioner and Respondent No. 5 filed their objections. D 
Respondent objected to the Award u/s 30 of the Arbitration Act contending 
that the Award was without jurisdiction and patent error of law had crept 
in, since respondent No. 5 was not a party to the reference; that the award 
was devoi.d of jurisdiction to make him liable to the petitioner in the 
Award, and that the reference was only to adjudicate the disputes between E 
the petitioner and the second respondent, of their respective liabilities. 
It was contended by the petitioner that when the issues were settled 
by the Arbitrator with consent of parties including respondent No. S, and 
he was found liable to pay the amount under the hire purchase agreement 
and that, therefore, the Arbitrator was justified in granting the amount 
against the respondent 5. 
F 
The question for consideration was, when the reference was confined 
only to the petitioner am! respondent No. 3, whether the Arbitrator, 
without the order of refemce being amended, could have gone into the G 
liability of the 5th respondent. 
Disposing of the matter, this Court 
HELD : 1.1. There should exist an agreement showing consent to 
refer a dispute for settlement by the arbitrator. In cases where the Ar-
H 
421 
422 
SUPREME COURT REPORTS [1994] SUPP. 2 S.C.R. 
A bitrator enters into the consideration of the matters which are not referred. 
to him or over which he has no jurisdiction to try, the question is not one 
of waiver or estoppel but of authority. A person, not a party to a reference 
but who participated in the award proceeding with objection and continued 
to participate in the proceeding under protest is not bound by the award, 
B as being without authority. After taking objection to the authority of the 
arbitrator and making protest, unless a proper reference was made by this 
court, the abritrator does not get the authority and jurisdiction to make 
the award against a non-party to the contract. [424-C·D·E] 
1.2. It is settled law that acquiscence does not confer jurisdiction. 
C The jurisdiction cannot be assumed by the Arbitrator on the basis of either 
acquiescence of the parties or consent to the adjudication of the dispute· 
without any reference. [424-E; G·H] 
D 
. CRIMINAL APPELLATE JURISDICTION : Special Leave Peti-
tion (Cr!.) No. 1971 of 1990. 
From the Judgment and Order dated 13.7.90 of the Madhya Pradesh 
High Court in Misc. Cr!. Case No. 1054 of 1990. 
C.L. Sahu for the Petitioner. 
E 
Sudarsh Menon, (NP), R. Sasiprabhu, (NP) Randhir Jain, for Uma 
F 
Nath Singh for the Respondents. 
' 
S.P. Singh, Rajeev Singh and Anil Singh for the Respondent No. 5. 
The following Order of the Court was delivered : 
The Petitioner has challenged the Order dated July 13, 1990 of the 
High Court of Madhya ·Pradesh at Jabalpur in Misc. Cr!. Case No. 1054/90 
passed under Section 482 of the Code of Criminal Procedure 1973 quash-
ing the proceedings of the Judicial Megistrate, First Class, Dhamtari, dated 
G September 7, 1989 in Cr!. Case No. 943/89 registered under section 397 
read Withs. 34 l.P.C. While S.L.P. (Crl.) No. 1971/90 is pending, by consent 
of parties, this Court on August 1, 1991 made a reference to Justice Shiv 
Dayal (retired Chief Justice of the Madhya Pradesh High Court and a 
Senior Advocate of this Bar) to adjudicate the disputes thus : 
H 
"xx xx xx xx x may be appointed as an Arbitrator, by consent, 
I 
S.R. GOND v. STATEOFM.P. 
423 
to go into the question as to the amounts due, if any, by the A 
petitioner to the second respondent or vice versa, in respect of 
Truck No. MKS 9311." 
(The other clauses of reference are not material, hence omitted.) 
The Arbitrator entered upon the reference within the time and given B 
hisaward on December 31, 1992 holding thus: 
"Final answer to the Reference is Anoop Chand (Respondent No. 

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