1. HAMOODUR RAHMAN, C. J.--These two appeals by special leave arise out of the same judgment of the High Court of West Pakistan, Lahore, whereby a suit filed by the appellant in Civil Appeal No, 132 was dismissed with costs throughout and the defendants in the suit were directed to deposit a sum of Rs, 6,000 in the Court of the trial Judge within one month. Civil Appeal No, 133 of 1965 is directed against this portion of the order of the High Court requiring the defendants to make the said deposit.
2. The facts giving rise to the suit, from which these appeals arise, may briefly be stated as follows :- The appellant in Civil Appeal No, 132, Ch. Muhammad Saleem, purchased by a registered deed of sale (Exh. P. 5) executed on 4-9-55 by Faiz Muhammad Khan, Imam Bux and Jan Muhammad their undivided shares in a joint-holding in Chak No, 42/P, Tehsil Khanpur, District Rahimyar Khan, for the price, mentioned in the sale deed, of Rs, 1,50,700. The lands comprising an area of 1,214 kanals and 4 marlas were recorded in two khatas, namely, Khatas Nos, 2 and 3, and the shares which the vendors purported to sell were 68/107 in Khata No, 2 and 1/4 in Khata No, 3 of the revenue estate.
3. After his purchase Ch. Muhammad Saleem got a mutation entered on 23-4-55, being mutation No, 16, which was attested in his favour on 14-7-56. Thereafter Muhammad Akram, Noor Muhammad and Sher Muhammad, who were the defendants in the suit and co-sharers in the Khatas, got mutation No, 17 entered in their own favour with regard to the same lands claiming that although according to the revenue records the vendors of Ch. Muhammad Saleem were still recorded as co- sharers their right, title and interest had been extinguished by reason of the fact that the said defendants had been in exclusive and adverse possession of these lands for more than 40 years.
4. They further claimed that under a settlement brought about through the mediation of one, Maulvi Akhtar Ali, a retired Deputy Commissioner, of Bahawalpur, Ch. Muhammad Saleem had agreed to convey to them the shares purchased by him under the deed (Exh. P. 5) for a sum of Rs, 36,000.
5. The amount of Rs, 36,000 was fixed by Maulvi Akhtar Ali, although the consideration actually paid by Ch. Muhammad Saleem before the Sub-Registrar was only Rs, 26,218 and a further sum of Rs, 2,832 had been spent for the purchase of stamp paper for the deed, its drafting and registration.
6. The consideration mentioned in the sale deed (Exh. P. 5) was a fictitious and inflated amount which had been put in merely to prevent pre-emption.
7. Both these mutations were attended on 14-7-56, on the basis of a "ruqqa" written by Ch. Muhammad Saleem to the girdawar requesting him to enter a mutation of sale in favour of the defendants for the price of Rs, 36,000. Thereafter Muhammad Saleem sought to have the mutation No, 17 set aside by appeal and revision under the revenue laws as also by a writ petition in the High Court of West Pakistan but failed throughout.
8. The writ petition was dismissed on the short ground that the dispute involving investigation into facts was not fit for adjudication under the writ jurisdiction.
9. Ch. Muhammad Saleem thereupon on 31-5-60, filed the present suit in the Court of the Senior Civil Judge, Rahimyar Khan, for possession on the basis of his purchase from the recorded co-sharers under the sale-deed (Exh. P. 9). He disputed that the defendants had acquired any title by adverse possession or that the alleged settlement or award purported to have been made by Maulvi Akhtar Ali was enforceable in law. In his amended plaint he specifically averred that the alleged award was a false and fictitious document.
10. Ch. Muhammad Saleem also alleged that the defendants were estopped from denying the validity of his sale-deed, because, their brother Wahid Bakhsh had filed a suit for pre-emption of the same transaction and in that suit Sher Muhammad, one of the defendants in the present suit had actually stood surety for the payment of the sale price on behalf of his brother, Wahid Bakhsh.
11. This suit was contested by the defendants, Muhammad Akram, Noor Muhammad and Sher Muhammad. They set up the defence that Ch. Muhammad Saleem was estopped from challenging the correctness of mutation No, 17, as the same was entered on the basis of a writing (Exh. D. 8) executed by him on 20-10-55. They also maintained that they had acquired title by adverse possession. According to them, Ch. Muhammad Saleem had agreed to have the dispute settled by Maulvi Akhtar Ali, in whom both parties had confidence, because he could not get possession of the lands purchased by him. The said Maulvi Akhtar All acting as a Mediator had held discussions with the parties and ultimately brought about the settlement, recorded in Exh. D/1, whereby Ch. Muhammad Saleem had agreed to transfer the lands purchased by him to the defendants on payment of Rs, 36,000. A sum of Rs, 30,000 was paid to Ch. Muhammad Saleem then and there in the presence of Maulvi Akhtar Ali and the balance of Rs, 6,000 was agreed to be paid at the time of registration or mutation, as the case may be. In fact Ch. Muhammad Saleem ten days later, in implementation of the settlement, on 20-10-1955, actually wrote a letter to the girdawar requesting him to enter a mutation of sale from his name in the names of Muhammad Akram, Sher Muhammad and one, Nazar Ahmad, for the consideration of Rs, 36,000. It was on the basis of this letter that both the mutations Nos, 16 and 17 were simultaneously attested on 14-7- 1956.
12. On these pleadings the following issues were framed by the Senior Civil Judge :- "(I) Does not the plaint disclose cause of action ?
13. (2)Whether the plaint had been properly valued for the purposes of court-fee ?
14. (3)Whether the award is a fictitious document ?
15. (4)Whether the award is illegal and void for the reasons stated in para. 3 of the plaint?
16. (5)Whether the plaintiff and the original vendor have been out of possession for more than 12 years and for that reason the suit is barred by limitation?
17. (6)Whether the alleged award is in fact an agreement between the parties and is not an award?
18. (7)Did the plaintiff enter into an agreement to sell the land to the defendants and received a sum of Rs, 30,000 from the defendants?
19. (8)Whether rukka dated 20-10-1955 was written by the plaintiff and for that reason the plaintiff is estopped from challenging the rights of the defendants?
20. (9)Is the plaintiff in possession in pursuance of an agreement of sale and for that reason they are entitled to retain the possession?
(10) Whether act of defendant No, 3 by which he stood as surety of pre-emptor in a pre-emption suit regarding the land in dispute amounts to admission of the plaintiff's title?
(11) Relief."
21. At the trial, however, the parties agreed that the proper valuation of the suit for the purposes of court-fees should be Rs, 42,443 and issue No, 3 was given up by the plaintiff. The issue was, accordingly, decided against him and so was issue No,
10. Other issues were decided against the defendants and the suit was decreed with costs.
22. The defendants then went up in first appeal to the High Court where only the findings on issues Nos, 4 and 6 to 9 were challenged. The appeal came up for hearing before J. H. Rizvi and S. A. Mahmood, JJ. There was a difference of opinion between them. J. H. Rizvi. J. took the view that Maulvi Akhtar Ali had not been appointed an arbitrator, as there was no reference to arbitration at all. He, therefore, only acted as a mediator. Hence the document (Exh. D/1) drawn up on 10-10-1955 was only an agreement to sell and not an award. This learned Judge also came to the conclusion that a sum of Rs, 30,000 had, in fact, been paid by the defendants to the plaintiff Ch. Muhammad Saleem. The latter was also held to be estopped from challenging the rights of the defendants by reason cf the execution of the rukka (Exh. D/8) addressed to the Girdawar for the mutation of the lands in dispute in favour of the defendants. The latter were, however, directed to deposit a sum of Rs, 6,000 to complete the consideration agreed upon.
23. The other learned Judge took a contrary view. In his opinion, the parties intended to appoint Maulvi Akhtar Ali as the sole arbitrator in the case and he, in fact, purported to act as such. Hence an arbitration agreement in writing was necessary. Furthermore, the award, since it affected property of the value of more than Rs, 100, was compulsorily registerable. Since these were not done, the arbitration was wholly illegal and the award was inadmissible in evidence. No rights, therefore, accrued thereunder to the defendants. This learned Judge further held that the payment of Rs, 30,0')0 by the defendants to the plaintiff Ch. Muhammad Saleem had not been proved. Neither the award (Exh. D/1) nor the ruqqa (Exh. D/8) were effective for conveying any title to the lands in dispute to the defendants. The suit was, accordingly, rightly decreed and the appeal should fail.
24. Due to this difference of opinion the matter was referred to Muhammad Yaqub Ali, J., a third learned Judge of the said High Court. He agreed with the findings of J. H. Rizvi, J. on all the issues on which there was a difference of opinion. The appeal was, accordingly, disposed of on the basis of the majority opinion on issues Nos, 4 and 6 to 9, the judgment of the trial Court set aside and the suit dismissed with costs throughout but the defendants were directed to deposit Rs, 6,000 with the trial Court within one month or in default the plaintiff was to be entitled to recover the amount by execution as a decree in his favour.
25. Leave was first given on 21-5-1964 to Ch. Muhammad Saleem to consider the correctness of the majority decision of the High Court. Thereafter leave was also given to Muhammad Akram, Noor Muhammad and Sher Muhammad on 14-10-1964 to consider whether the High Court was competent to pass a money decree in a suit filed only for possession and as to whether the High Court was justified in passing such a money decree without placing any obligation on the purchaser Ch. Muhammad Saleem to execute another sale deed conveying the properties to them.
26. Both these appeals have been heard together and will be disposed of by this judgment.
27. The main dispute in this case relates to the capacity in which Maulvi Akhtar Ali acted in regard to the dispute between the parties in these appeals and as to the true legal character of the document (Exh. DM drawn up by him on 10-10-1955. If he acted as an arbitrator, decided the dispute and made an award, then the validity of his acts will have to be judged in the light of the provisions of the Arbitration Act, 1940. On the other hand, if he acted as a mediator and brought about only a settlement between the parties, then the validity of that agreement will have to be determined upon totally different considerations.
28. Learned counsel for the appellant has supported the reasonings given by S. A. Mahmood, J. in his dissenting judgment and has contended that the document (Exh. D/1) was drawn up in the form of an award, it was so understood by the parties themselves, the arbitrator and even the witnesses of the other side. He has taken us through the document which begins with the recital that a dispute having arisen between the parties named therein they have appointed him salish {{URDU TEXT}}. Then the nature of the dispute in set out and it is recorded that the parties have told him that whatever he decides will be acceptable to them.
29. URDU TEXT}} The document then goes on to state that the parties have admitted that the real consideration paid by Ch. Muhammad Saleem for the deed (Exn. P. 5) was only Rs, 36,000 and that he was prepared to make a sacrifice to end the dispute. He was, accordingly, agreeable to convey his right, title and interest in the property ; half share to Noor Muhammad and Sher Muhammad and another half share to Muhammad Akram, for the sum of Rs, 36,00J, Maulvi Akhtar Ali then notes the agreement (-194.2.-ye4,24 u) {{URDU TEXT}}and thereafter gives his decision. Finally he records : "Heard the parties, who are present, they have accepted this award a copy of which has been given to each party." {{URDU TEXT}} This is signed by Ch. Muhammad Saleem, Mian Wahid Bakhsh, Mian Noor Muhammad and Mian Kadir Bakhsh. Mian Sher Muhammad did not sign and Muhammad Akram was not even present at this arbitration.
30. At the end of this document there is a note to the effect that Rs, 30,000 has been paid to Ch. Muhammad Saleem in the presence of Moulvi Akhtar Ali and the balance of Rs, 6,000 will be paid at the time of the "registry or mutation". After this comes the signature of Maulvi Akhtar Ali and the date.
31. Learned counsel for the appellant has also referred us to the evidence of Maulvi Akhtar Ali where he has stated that the parties came to him and told him that a dispute had arisen between them over these lands and they wanted to have it decided by him {{URDU TEXT}} On this he told them that they should have a proper reference to arbitration drawn up and registered, otherwise he would not entertain the matter. Ch. Muhammad Saleem was agreeable to adopt this course bat Noor Muhammad said that there was no need for any such formality, because his side were prepared to accept whatever he would decide. Then on the appointed date the parties came, he heard them, took the plaintiff Ch. Muhammad Saleem aside and there disclosed to him his own mind regarding the manner in which he thought the dispute should be settled. At first Muhammad Saleem demurred but ultimately accepted his suggestion. Then they came back to the place where the parties and other people were also present. He wrote out his faisla' and then announced it. The parties announced their acceptance and affixed their signatures to the document. Some others also signed it as witnesses. In his evidence, it is pointed out, he had consistently used the words tasfia, muamla and nateeja to describe the nature of the dispute brought to him and the actions he had taken in connection with this matter. These, it is suggested, clearly indicated that he undertook to decide the dispute as an arbitrator and not merely to act as a mediator between the parties.
32. Similarly, the other witnesses Zia-ud-Din (D. W. 4), Haji Abdul Majid (D. W. 5) and Abdul Ghafoor (D.
33. W. 6) have all stated that Maulvi Akhtar Ali was appointed a salish and that he after listening to the parties wrote out his faislah. They were present on this occasion at the request of the defendants who had asked them to be present at this tasfia.
34. Learned counsel, therefore, urges that it is abundantly clear that there was a dispute which the parties wanted to be adjudicated upon by Maulvi Akhtar Ali. He heard the parties, came to a decision, wrote it out and announced it. Since Maulvi Akhtar Ali was not a Court, he could only have acted as an arbitrator, for, the procedure, followed by him possessed all the essential characteristics of an arbitration. The use of the word "Salish", it is said, clearly connotes the intervention of a third person for the adjudication of a dispute. Faisla, tasfia, nateeja and ral similarly connote the sense of adjudication and decision.
35. Learned counsel appearing for the defendants, who are the respondents in Civil Appeal No, 132 and appellants in Civil Appeal No, 133, on the other hand, contends, that we must not be misled merely by the terminology adopted by Maulvi Akhtar Ali or the witnesses in describing what was done in the present case, for, the expressions used loosely by non-technical persons cannot determine - the true legal character of the acts themselves. It does not necessarily follow that a proceeding must be an arbitration if it is described as such by the parties. In order to determine the true character of the transaction we must look at the substance of the acts done or action taken and not merely to its form or the terminology employed for describing it.
36. In the present case, learned counsel contends that Maulvi Akhtar Ali was fully aware of the fact that if an arbitration was intended then there must be a proper reference to arbitration in writing. It is, therefore, reasonable to assume that if Maulvi Akhtar Ali, knowing this to be a legal requirement for a valid arbitration, intervened in this matter, he must have done so in some capacity other than that of an arbitrator. The words salish, or faisla or tasfia or rai, which have been used by Maulvi Akhtar Ali and the other witnesses to describe the nature of the proceeding before Maulvi Akhtar Ali, do not by themselves establish that the proceeding was an arbitration proceeding, because, salish literally means a third person through whose intervention something is done. Similarly faislah is a generic term to describe any decision. Thus even if a person by himself makes up his own mind with regard to a particular matter, he may well say that I have made this faisla {{URDU TEXT}}.
37. This does not mean that he has made a decision in the capacity of an arbitrator. All that it means is that he has come to a conclusion or formed a firm opinion. Similarly the words tasfia or rai do not exclusively refer to a judicial decision or a judicial opinion. Learned counsel for the defendants contends that in this case what had actually happened was that Mauivi Akhtar Ali had brought about an agreement or a settlement between the parties, reduced it into writing (Exh. D/and then the parties in acceptance of the agreement affixed their respective signatures to the document. It is for this reason that Maulvi Akhtar Ali did not sign it but he only appended his signature to the note evidencing the payment of Rs, 30,000 in his presence. If it was an award simplicity then there was no necessity at all for the parties to sign it. The signature of the arbitrator Maulvi Akhtar Ali would have been quite sufficient. Indeed, what happened in the present case was that by speaking to the parties individually Maulvi Akhtar Ali made them see reason and ultimately induced the appellant Ch. Muhammad Saleem to agree to his formula. After Ch. Muhammad Saleem had agreed he came back to the meeting, recorded the agreement and got the parties to sign it. Then when the money was pail in his presence he attested the payment by putting his signature at the end of the note.
38. Before I take up for consideration the question relating to the true nature of the document (Exh.
39. D/1), namely, as to whether it is an award or only an agreement, I have to notice another contention advanced on behalf of the appellant, Ch. Muhammad Saleem, to the effect that this document should not be allowed to be set up as a defence by the respondents. Learned counsel contends that section 32 of the Arbitration Act prohibits not only the maintenance of a suit on any ground whatsoever for a decision upon the existence, effect or validity of an arbitration agreement or an award but it also debars a defendant from setting up such a document as a defence merely by describing it as an agreement. According to the learned counsel the bar is absolute and it does not make any difference as to whether it is set up by the plaintiff or the defendant in a suit.
40. The defendants, on the other hand, urge that the bar should be operative against the appellant himself, tor, in paragraphs 2 and 3 of his amended plaint, he averred that the alleged award was illegal, inadmissible in evidence, invalid, Farzi and fraudulent as the parties had appointed no arbitrator. It was in answer to this averment in the plaint that the defendants pleaded that the appellant, by erroneously describing the said document (Exh. D/I) as an award of an arbitrator, was himself creating unnecessary complications and raising imaginary objections in advance although the document in question was clearly nothing more than an agreement to sell.
41. It appears, therefore, that it was the appellant himself who wanted to question the validity of the alleged award. He could not do so by reason of the provisions of section 32 of the Arbitration Act. In the circumstances, if there is any force in this contention, it is the appellant's suit which should be held to be not maintainable. The appellant having himself put this question into issue cannot now turn round and prevent the respondents from setting up a different case. The respondents never accepted the said document as an award. It was their case throughout that it was nothing more than an agreement. In this view of the matter it is not necessary to enter upon an examination of the decisions cited in support of the contention that there can be no distinction between a plaintiff who relies on an award for obtaining a decree and a defendant who wants to resist the suit relying on it.
42. It will, however, be sufficient to point out that even in the Full Bench decision of the Madras High Court in the case of Muhammad Yousaf v. S. Haji Muhammad Hussain Rowther , cited by Mr. A. S. Farooqi it was held that an unfiled award may be relied upon as a defence by one of the parties thereto if it has been performed by him. The learned Chief Justice of the High Court who delivered the judgment of the Court observed: "But that does not mean that under no circumstances can an unfiled award be relied on as a defence to an action. If the terms of the award had been fully performed by one of the parties thereto it must certainly afford a good defence to an action on the original cause of action by the other party. If in pursuance of the award a party had done every- thing he was obliged to do under it, he should be deemed to have fulfilled his part of the contract, and there would thereby be accord and satisfaction in respect of the original cause of action. The accord exists if the two minds agree as to how their obligation having discharged in the manner contemplated there will be a satisfaction. Therefore, if there had been a performance in its entirety of the obligations imposed on a party by an award, there would be discharge of the original claim or cause of action."
43. The contention of the learned counsel for the appellant that the principle of accord and satisfaction can only apply in the case of money suits cannot be spelled out from this judgment, for, there is nothing in the passage quoted above to indicate that the principle is so limited. On principle also we see no reason to limit the doctrine to money claims only.
44. Even if the document (Exh. D/1) is treated as an award then according to the above principle the defendants-respondents would be entitled to set it up as a defence on the basis that they had performed a substantial part of their obligations thereunder by paying to the appellant a sum of Rs, 30,000 in the presence of Maulvi Akhtar Ali, the so-called arbitrator, and by agreeing to pay the1 balance at the time of registration or mutation. The plea of accord and satisfaction would, therefore, have been fully available to them.
45. In the present case the defendants-respondents rested their case on a firmer ground, for, according to them the alleged unfiled award had not only been accepted by the parties but also implemented by the appellant himself by writing the letter (Exh. D. 8) on the 20th October 1955, to the Girdawar requesting him to enter a mutation of sale from his name in the names of the said respondents. This, according to them, constituted a complete accord and satisfaction of the appellants claim and, as such, they were entitled to raise the defence that the suit filed by the appellant, even if it was a suit to enforce his title under his earlier deed of sale, was not maintainable. Such a plea is in no way precluded by anything contained in the Arbitration Act.
46. Section 32 of the above-mentioned Act does not, in my view, debar a defendant from setting up a plea that an unfiled award which had been fully performed by him is a complete answer to the plaintiff's claim which was the subject-matter of the award. A similar view, we find, was taken by the Supreme Court of India in the case of Kashinathea Yamosa Kabadi, etc. v. Naraingea Bhaskarea Kabadi, etc. , where, in more or less similar circumstances, it was held that such a defence is not "founded on the plea that there is an award which bars the suit, but that the parties had by mutual agreement settled the dispute and that the agreement and the subsequent actions of the parties are binding." The defendant in such a case does not seek to obtain any decision upon the existence, effect or validity of the award but merely seeks to assert that the claim sought to be set up by the plaintiff has already been satisfied by the mutual consent of the parties. This is exactly what the defendants-respondents also sought to do in the present case. They merely asserted that the plaintiff-appellant's claim had already been fully satisfied by his acceptance of the unfiled award; assuming that it was an award; the subsequent implementation thereof by mutual consent and the entering of the mutation as per his own request in his letter (Exh. D. 8).
47. Thereafter his title to the lands in dispute was extinguished and no further question of declaration of his title to the same lands could arise.
48. Learned counsel for the appellant alternatively contended that even if there was an agreement between the parties and the arbitrator merely incorporated that agreement into the award, the agreement would merge in the award and if the document (Exh. D/1) was an award then the same objections would apply to it. viz., that it was not an award under the provisions of the Arbitration Act of 1949 and, therefore, vested no right at all in the respondents. If the document was an award then there can be no doubt that the agreement would merge in the award and would have no independent existence of its own after such merger. Such an agreement would not also be enforceable independently if the award was not filed and made a rule of Court. There can be no doubt that where the parties have referred their disputes to a domestic forum that forum may decide those disputes either by adjudicating upon them or it may decide upon the basis of the consent of the parties but the decision of the forum whether by consent or in invitum will be an award and not a mere compromise or agreement which can be enforced aliunde. But if the award has been made in an arbitration out of Court and the award has neither been filed nor made a rule of Court then the parties will be entitled to sue or defend on the basis of that award if it has been accepted and acted upon by the parties by mutual consent.
49. From what has been said above it will be manifest that the main question that falls to be decided in this case is as to whether the parties agreed to appoint Maulvi Akhtar Ali as an arbitrator to adjudicate upon their disputes and whether he made an award. In other words, as to what is the true legal character of the document (Exh. D/1). The most important characteristic of an award, of course, is that it must emanate from a judicial determination. If a dispute is referred to a person and if that person decides that dispute by holding an enquiry and coming to a decision then undoubtedly what that person decides would constitute an award. On the other hand, if a matter is2 referred to a person and he is not called upon either to hold an enquiry or to give a decision but by the exercise of his sagacity, knowledge or experience to bring about merely an understanding between the parties and restoring peace between them than he would only be discharging functions other then those of an arbitrator. But in order to determine this question one must not look merely at the form adopted or the expressions employed but rather at the substance of what the parties to the dispute really intended the person approached in that behalf to do and how that person acted in that particular matter.
50. 'As Lord Esher, H. R. observed in the case of In re : Carus-Wilson & Greene :-- "If it appears from the terms of the agreement by which a matter is submitted to a person's decision, that the intention of the parties was that he should hold an inquiry in the nature of a judicial inquiry, and hear the respective cases of the parties, and decide upon evidence laid before him, then the case is one of an arbitration. The intention in such cases is that there shall be a judicial inquiry worked out in a judicial manner. On the other hand, there are cased in which a person is appointed to ascertain some matter for the purposes of preventing differences from arising, not of settling them then they have arisen, and where the case is not one of arbitration but of a mere valuation. There may be cases of an intermediate kind, where, though a person is appointed to settle disputes that have arisen, still it is not intended that he snail be bound to hear evidence or arguments. In such cases it may be often difficult to say whether he is intended to be an arbitrator or to exercise some function other than that of an arbitrator. Such cases must be determined each according to its particular circumstances."
51. The present is a case which falls in this last category. There was a dispute which the parties wanted to be settled but the question is whether they wanted it to be decided by an enquiry of a judicial nature in a judicial manner. Since there is no written submission or reference in this case we can only gather the intention of the parties from the facts and circumstances of the case.
52. Looking, therefore, at the circumstances of this case, appears, that Maulvi Akhtar Ali who was a retired Deputy Commissioner familiar with the forms of legal proceedings was fully aware that if the parties intended him to act as an arbitrator then there should be a formal agreement in writing to refer the dispute to him. Indeed he even asked the parties to execute such a document and get it registered if they wanted him to act as an arbitrator but the respondents did not consider this necessary, for, according to them they were prepared to abide by whatever he did. If knowing that this necessary condition for a valid arbitration had not been complied with Maulvi Akhtar Ali accepted the assignment he could by no means be said to have agreed to become an arbitrator or to act as such. He could only have undertaken the task in the belief that the parties wanted his services for bringing about a settlement otherwise than as an arbitrator. It could well be on this understanding that the procedure he adopted was not that of a judicial proceeding, for, as retired Deputy Commissioner, he would certainly have known the procedure of a judicial determination.
53. He did not adopt the same. Having talked to the parties he took the appellant aside and tried to induce him to agree to settle the matter. This is confirmed by the statement of the appellant himself. He has stated in his evidence that when he reached the place where the respondents and others were also present Maulvi Akhtar Ali took him aside and told him that the respondents were Jabir persons and if he wanted to reside in the locality then he should settle with them. He agreed that there should be a settlement for he admits saying, {{URDU TEXT}} but he contends that he did not agree to giving up the lands. He wanted a settlement without having to give up the lands. But if that was what was being done and he ultimately accepted the settlement and signed the minutes of the agreement then his bare assertion that he did not accept the settlement actually arrived at can be no avail now. The appellant states that he put his signatures on some blank papers. If he was not agreeable to the settlement then it is hardly likely that he would have put his signatures on blank papers. Be that as it may, so far as the question whether Maulvi Akhtar Ali acted as an3 arbitrator or merely as a mediator is concerned, the version of the respondents that he was only acting as a mediator appears to find support even from the testimony of the appellant himself that Maulvi Akhtar Ali asked him to settle with the respondents.
54. If Maulvi Akhtar Ali was really acting as an arbitrator then, as an experienced Deputy Commissioner, he would never have adopted the procedure of taking one of the parties aside and speaking to him in private. He would, on the other hand, have heard the respective cases of the parties in their presence, taken evidence, held an enquiry and given a decision according to the conclusions arrived at upon the evidence. This was clearly not done in the present case. There was no enquiry of any judicial nature nor was a judicial determination given. The disputing parties were only induced to arrive at a settlement, which was reduced into writing and got signed by the parties through the intervention of Maulvi Akhtar Ali. The proceeding, therefore, that was held before Maulvi Akhtar Ali lacked the essential characteristic of an arbitration. It is clear that the respondents were, at any rate, not agreeable to appoint him as an arbitrator. Neither they agreed to execute any formal agreement of arbitration nor did the appellant insist upon the adoption of this procedure. The intention of the parties, there-fore, was that he should act only as a mediator.
55. We are also unable to accept the contention that the document (Exh. D/1) is an award, for, had it been an award there would have been no necessity at all of getting the parties to affix their signatures on it. The only person who is required to sign an award is the arbitrator himself and no one else. It is not without significance, therefore, that the signature of the arbitrator should be missing at the bottom of the memorandum which the appellant contends is an award. His signature appears only underneath the note evidencing the payment of Rs, 30,000. This note is not signed by the appellant, but only by Maulvi Akhtar Ali. In the circumstances, I am of the opinion that there was no arbitration and Maulvi Akhtar All did not act as an arbitrator and the document drawn up was only a memorandum of the agreement arrived at between the parties through the intervention of Maulvi Akhtar Ali who had undertaken only to settle the dispute between the parties and not to adjudicate upon them or to give a decision of his own thereon.
56. I am not also prepared to accept that the appellant Ch. Muhammad Saleem affixed his signatures on blank papers. If he had only signed on blank papers and not agreed to the settlement arrived at he would not have written the letter (Exh. D/8) to the Girdawar ten days later requesting him to enter a mutation of sale in respect of the land in dispute. His explanation of the circumstances in which he came to write the letter (Exh. D. 8) is wholly unconvincing. If all that he says had actually happened in the house of Maulvi Akhtar Ali then it is inconceivable that he would still have written such a letter to the Girdawar directing him to enter a mutation of sale. I am, therefore, satisfied that the appellant did agree before Maulvi Akhtar Ali to settle this dispute by transferring his right, title and interest in the disputed land to the respondents for the consideration mentioned therein. He cannot now be allowed to resile from that position or to challenge the validity of that settlement.
57. In view of the above finding that the document (Exh. D. 1) was only an agreement to sell and not an award, it is unnecessary to consider the other arguments advanced on behalf of the appellant to challenge the validity of the award. It will be sufficient to mention that had I come to the conclusion that Maulvi Akhtar Ali had acted as an arbitrator and made an award then I would have had no hesitation in agreeing with the learned counsel for the appellant that the award would have been invalid by reason of the provisions of the Arbitration Act of 1940. There was no written submission to arbitration nor was the award filed in any Court or made a rule of Court. If it had been found to be an award, the provisions of the Arbitration Act would have applied by reason of the provisions of section 47 of the said Act.
58. The alternative contention of the learned counsel for the appellant is that even if the said document is held to be an agreement simpliciter then it should not have been admitted into evidence because it was neither stamped nor registered. Learned counsel for the respondents, however, contends that the appellant is debarred from taking the objection regarding admissibility due to want of stamps at this stage because of the provisions of section 36 of the Stamp Act, 1899.
59. This section provides that except as provided in section 61 of the said Act if an unstamped instrument has been admitted in evidence such admission shall not be called in question at any subsequent stage of the same suit or proceeding on the ground that it has not been duly stamped.
60. No objection, it appears, was taken to the admission of this document in evidence when it was proved and marked as an exhibit. It was thereafter event put to several witnesses including two of the witnesses examined by the appellant himself. There is also nothing in the judgment of the trial Court to show that any objection was taken to the admission of this document on the ground of want of stamp. The document was held inadmissible by the trial Court on the ground of non- registration only. In the circumstances, we are in agreement with the learned counsel for the respondent that this objection cannot be raised at this stage the worst that can happen is that this Court may under section 61 of the Stamp Act even now impound the document, determine the amount of duty chargeable thereon and send it to the Collector for realization of the duty. This will not, however, affect the provisions of section 36 of the Act for the sole object sought to be achieved by section 61 thereof is the protection of the revenue.
61. Learned counsel for the respondents has cited a number of decisions in support of this contention but it will be sufficient to refer to only one of them, viz., the case of Javir Chand v. Pukhraj Swana where the Supreme Court of India took the view that section 36 of the Stamp Act is "categorical in its terms" and once a document has been admitted in evidence such admission cannot be called in question at any later stage on the ground that the instrument has not been duly stamped. The only exception to this is that which is contemplated by section 61 of the said Act. To quote the Indian Supreme Court :-- "Once a document has been marked as an exhibit in the case and has been used by the parties in examination and cross-examination of their witnesses, section 36 comes into operation. Once a document has been admitted in evidence, as aforesaid, it is not open either to the trial Court itself or to a Court of Appeal or Revision to go behind that order."
62. This view is on principle too sound for once a document has been admitted in evidence without objection its admissibility cannot subsequently be challenged on any technical ground or any ground which does not affect the parties. The col section of revenue is no concern of the parties.
63. That purpose is adequately served by section 61. There is no reason, therefore, as to why the bar created by section 36 should not be given effect to. In the present case there can be no manner of doubt that the document was admitted, marked as an exhibit without any objection and then it was put to a number of witnesses in examination and cross-examination. The objection on the ground of want of stamp cannot, therefore, be raised at this stage.
64. The objection that the document cannot be impounded or any penalty imposed because the original which, according to Maulvi Akhtar Ali, was in his possession has not been produced is also not tenable, for, under section 62 of the Evidence Act "where a document is executed in counterpart, each counterpart being executed by one or some of the parties only, each counterpart is primary evidence as against the parties executing it." The evidence in this case is that Maulvi Akhtar Ali had three copies of the document prepared, each of these copies was signed by the parties, one was given to the appellant, the other to the respondents and the third was kept by Maulvi Akhtar Ali himself. The copy (Exh. D. 1) that has been produced is the one given to the respondents. It is, thus, clear that each of the documents written out was the counterpart of the other and each counterpart was signed by the parties. Therefor', the copy produced is admissible in evidence against those who signed the same. The appellant signed the same. He cannot, therefore, now object to this counterpart being treated as primary evidence of the agreement to sell binding on the parties who have signed it. As against him it is just as good as the original which4 can be impounded if not stamped or insufficiently stamped.
65. It appears that out of the respondents now before this Court only Noor Muhammad signed the document but the question before us is as to whether the appellant Ch. Mohammad Salim is to be bound by this document or not. The respondents have accepted the document and now have set it up as a defence in order to bind the appellant to it. The appellant cannot say that it is not binding on him in these proceedings, whatever might be the position of the respondents who have not signed the document. In this view of the matter the objection that the respondents cannot invoke in aid the provisions of section 53-A of the Transfer of Property Act to resist the claim of the appellant with regard to the properties in dispute is equally untenable. All that section 53-A requires is that the transferor or some one on his behalf should have signed the document of transfer. If it has been so signed, then the transferor or any person claiming under him is debarred from enforcing against the transferee and persons claiming under him any right in respect of the property if the transferee has taken possession of it or being already in possession continues to remain in possession. In the present case since it has been accepted that the appellant, who was the transferor, had signed the document (Exh. D/1) and the respondents being already in possession of the property in dispute had continued in possession after part performance of the contract by the payment of a substantial part of the consideration, viz., Rs, 30,000, and by entering of a mutation in their favour, they were fully entitled to resist the claim of the appellant in accordance with the provisions of section 53-A of the Transfer of Property Act.
66. So far as the objection relating to the admissibility of the document (Exh. D/l) in evidence due to want of registration is concerned it need only be pointed out that under the explanation appended to subsection (2) of section 17 of the Registration Act an agreement for the sale of immovable property is not a compulsorily registerable document. Since it has been J found that the document (Exh. D/1) was only an agreement to sell, it follows, that its non-registration does not render it inadmissible in evidence.
67. It remains now to consider as to whether the finding of the majority in the High Court regarding the payment of Rs, 30,000 is correct. The trial Court has disbelieved the oral evidence adduced in this behalf by the respondents on mainly the ground that no receipt was obtained from the appellant himself with regard to the payment of such a heavy amount.
68. The postscript at the bottom of Exh. D/1 was treated as a. unilateral act of the arbitrator which did not bind the appellant Ch. Muhammad Saleem. The learned Judges in the High Court have, on the other hand, accepted the evidence of Maulvi Akhtar Ali that the amount was, in fact, paid to the appellant in the former's presence. Learned counsel for the appellant has, however, contended that the postscript was a subsequent interpolation by Maulvi Akhtar Ali, for, it is improbable that the respondents would have been carrying such a large sum of money with them without knowing as to what the result of the Salish by Maulvi Akhtar All would be. But we are not entitled to speculate at this stage. The respondent, Noor Muhammad, who appeared as a witness stated that he placed a sum of Rs, 30,000 on the table in front of Maulvi Akhtar Ali but he was not asked in cross- examination as to how he happened to be carrying with him such a large amount. Evidently the cross-examiner did not press for an explanation, because, in the written statement it had already been stated that the actual amount paid for the previous conveyance (Exh. P. 5) obtained by the appellant Ch. Muhammad Saleem was only Rs, 26,218 and a further amount of Rs, 2,832 was spent for the purchase of stamp papers for the deed, its drafting and registration. This came to a little over Rs, 29,000. Thus, making allowances for other expenditures at the registration office, the respondents could well have calculated that the amount payable might be in the region of Rs, 30,000. It cannot, therefore, be said that it was not possible for the respondents to have made a rough calculation and brought the money with them.
69. We are also unable to accept the contention that the postscript in the document was a subsequent interpolation. If, as we have held, there was no award but only a memorandum of the agreement reached between the parties drawn up then it was not necessary at all for Maulvi Akhtar All to have appended his signature at the bottom of that memorandum. The memorandum would be binding on the parties who had signed it. The signature of Maulvi Akhtar All under the postscript, therefore, was, in our view, intended to evidence the payment of Rs, 30,000.
70. We see no reason also to disbelieve the statement of Maulvi Akhtar All that this amount was actually paid merely because no receipt had been obtained from the appellant Ch. Muhammad Saleem. In assessing the evidence of the appellant, we cannot overlook the fact that Ch. Muhammad Saleem not only signed the memorandum of agreement (Exh. D/1) but also ten days later on the 20th of October 1955, actually wrote a letter (Exh. D/8) to the Girdawar requesting him to mutate the land in the names of the respondents as he had sold the lands to them for Rs, 36,0)0.
71. If the appellant was not aware that the agreement was for the transfer of the land to the respondents on consideration of the payment of Rs, 36,000. then he could not possibly have mentioned this exact amount in his letter. We are not prepared to believe his story that he merely affixed his signatures on some blank sheets of paper and handed them over to Maulvi Akhtar Ali, or that he wrote the letter to the Girdawar on the representation of the respondents that they would pay the full amount of the consideration at the time of the attestation of the mutation. It is not without significance that Ch. Muhammad Salim does not mention the exact amount payable. He merely states that he told the respondent Noor Muhammad that you pay me so much money and take the land. If he had mentioned a different figure then instead of writing Rs, 36,000 in the letter he would have mentioned the amount which he demanded. The fact that he has not done so clearly indicates that he had accepted the position that he would transfer the lands, as settled before Maulvi Akhtar Ali, for Rs, 36,000.
72. The argument, that because nothing has been said in Exh, D/8 about the receipt of Rs, 30,000 it should be treated as belying the statement of the respondents and Maulvi Akhtar All that Rs, 30,000 had actually been paid before the writing of this letter cannot be accepted, because, in our view, there was no necessity at all of mentioning this fact in the letter written by the appellant to the Girdawar. We are in agreement with the majority view of the High Court that this letter (Exh. D/8) is wholly inconsistent with the case now sought to be set up on behalf of the appellant. If he had not agreed to the terms recorded in the memorandum (Exh. D/1) and bad not already received the amount of Rs, 30,000 he would not have asked the Girdawar to enter a mutation.
73. In coming to this conclusion it is not necessary for us to draw any adverse inference against the appellant for the non-production of the copy of the memorandum of agreement allegedly made over to him by Maulvi Akhtar Ali. Since the copy produced bears the signature of the appellant and it is a counterpart copy which can be admitted as primary evidence it is sufficient to bind the appellant.
74. For the reasons given above the appeal of Ch. Muhammad Saleem must, in our opinion, fail and is, accordingly, dismissed.
75. We also, under section 61 of the Stamp Act, 1899, declare that the memorandum of agreement (Exh. D/1) should be impounded and sent to the Collector for the realization of the appropriate duty payable on a memorandum of agreement for the sale of immovable property along with a penalty equivalent to twice the appropriate duty.
76. So far as the appeal No, 133 of 1965 is concerned, the same should also in our opinion be dismissed, for, it is clear that the consideration agreed upon was Rs, 36,000 and only Rs, 30,000 has so far been paid. The balance was payable at the time of registration of mutation. Mutation has now been obtained, therefore, the balance sum of Rs, 6,000 became payable and should have been paid. Learned counsel for the appellants, who are respondents in the other appeal, has stated that he has no objection to paying this amount if his title to the property in dispute is declared. We are unable to declare his title to the said property in these proceedings, particularly, since the agreement itself between the parties was that the amount would be payable either on registration of the deed of conveyance or on mutation of the land. Since they have chosen to have only a mutation entered they must perform their part of the contract if they want to avail of the protection given by section 53-A of the Transfer of Property Act. Actually before raising this plea they should have tendered this amount in Court in evidence of the fact that they always were and are still ready and willing to perform their part of the contract. If they had done so, the Court could have directed the payment of this amount to the appellant and even now we see no objection to the Court directing the party raising the plea under section 53-A of the Transfer of Property Act to perform his part of the contract as a condition for the acceptance of the plea. He who seeks equity must do equity is a well-accepted principle and since our Courts or both Courts of equity and law there can be no legal bar to the making of such an order in the equity jurisdiction for doing complete justice.
77. If the said appellants are still anxious to have a deed of conveyance, they should file a suit for specific performance of the contract between them and Ch. Muhammad Saleem. They cannot insist in these proceedings to have a document of title executed in their favour. This appeal is, accordingly, also dismissed. The appellants state that they already deposited this amount in Court, if so, the respondent will be entitled to withdraw the same on payment of the appropriate court- fee payable on a claim for Rs, 6,000.
78. Having regard, however, to the fact that both parties have failed in their respective appeals I would leave them to bear their respective costs in both these appeals.
79. SAJJAD AHMAD, J.--I agree.
80. WAHEEDUDDIN AHMAD, agree. AIR 1964 Mad. 1 AIR 1961 SC 1077 L R 18 Q B D 7 AIR 1961 SC 1955
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