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PETITIONER: Dr. S. B. DUTT

       Vs.

RESPONDENT: UNIVERSITY OF DELHI

DATE OF JUDGMENT: 03/09/1958

BENCH: SARKAR, A.K. BENCH: SARKAR, A.K. AIYYAR, T.L. VENKATARAMA GAJENDRAGADKAR, P.B.

CITATION:  1958 AIR 1050            1959 SCR 1236

ACT: Arbitration - Award - Direction for enforcement of  contract of personal service-Validity-Such direction, if an error  on the face of the award-Delhi University Act, 1922 (No.   VIII of 1922),s. 45.

HEADNOTE: The appellant, a professor in the respondent University, was dismissed  from  service by the  respondent.   He  thereupon referred  the dispute as to his dismissal and certain  other disputes to arbitration under the provisions Of s. 45 of the Delhi  University Act.  An award was made on  the  reference which  among  other things decided that  the  appellant’s  " dismissal  was ultra vires, mala fide, and has no effect  on his  status.   He still continues to be a professor  of  the University  ".  On proceedings to obtain a judgment  on  the award: Held,  that the award which purported to enforce a  contract of personal service disclosed an error on the face of it and must be set aside. High Commissioner for India v. I. M. Lall, (1948) L. R. 75 I.   A.  225 and Ram Kissendas Dhanuka v. Satya Charan  Law, (1949) L. R. 77 I. A. 128, distinguished. An award may disclose an error on its face though the reason for the erroneous decision was not set out in it. Champsey  Bhara & Co. v. jivraj Balloo Spinning and  Weaving Co.  Ltd., (1923) L.R. 50 I.A. 324, explained. Held,  further, that an award made under S. 45 Of the  Delhi University  Act  to  which  the  section  itself  makes  the provisions of the Arbitration Act, 1940, applicable, is  not the  same  thing as an award under the  Industrial  Disputes Act,  1947, and there can be no analogy between the two  and the  words ’any dispute ’ occurring in that  section  cannot include a dispute relating to reinstatement or authorise the passing of any such direction by the arbitrator. Western India Automobile Association v. Industrial Tribunal, Bombay, [1949] F. C. R. 321, distinguished.

JUDGMENT:

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CIVIL APPELLATE JURISDICTION : CiVil Appeal No. 229 of 1956. Appeal  from the judgment and order dated January 15,  1955, of  the  Punjab High Court in F. A. O. No.  119-D  of  1954, arising out of the judgment and decree 1237 dated  May  27, 1954, of the Court of Sub-Judge  Class  III, Delhi, in Suit No. 206 of 1953. N.   C. Chatterjee, A. N. Sinha and P.K. Mukherjee, for  the appellant. M.C. Setalvad, Attorney-General for India, A. B. Rohatgi and B. P. Maheshwari, for the respondent. 1958.  September 3. The Judgment of the Court was  delivered by SARKAR J.-This appeal arises out of a proceeding for  filing an award in Court and obtaining a judgment thereon. The  award  was  made in respect  of  disputes  between  the appellant, a professor of the respondent, the University  of Delhi,  and the respondent.  The dispute originally  started many  years ago and with the passage of time,  increased  in volume.   A narrative of the disputes is necessary  for  the proper appreciation of the questions arising in this  appeal and this we now proceed to give. On  May 10, 1944, the appellant was appointed  Professor  of Chemistry by the respondent.  In August 1948 the  Government of  India  appears to have sanctioned a  scheme  called  the Selection  Grade  for  a higher grade  of  pay  for  certain professors.   The  appellant claimed to be entitled  to  the benefit  of this scheme but it was not given to him  by  the respondent.  This was the first dispute between the parties. In  March,  1949,  another  professor,  Dr.  Seshadri,   was appointed  by the respondent the Head of its  Department  of Chemistry.  The appellant contended that he was the Head  of the  Department  and had been wrongfully superseded  by  the appointment of Dr. Seshadri as the Head.  This gave rise  to another  dispute.  The appellant’s case is that he tried  to get this dispute solved by arbitration under the  provisions of  the Delhi University Act, 1922, but was unable to do  so owing   to  the  obstructive  attitude  of  the   University authorities, and was, therefore, on October 18, 1949, forced to file a suit for a, declaration that his removal from  his position  of  the Head of the Department  of  Chemistry  was illegal.  The respondent in its turn also had certain 1238 complaints  against the appellant for misconduct of more  or less  serious character into the details of which it is  not necessary to enter.  It appears to have been  agreed between the parties in October 1950 that the mutual grievances would be  investigated by Sir S. Vardachariar and Bakshi  Sir  Tek Chand  and  their decision was to be accepted as  final  and binding.   In view of this agreement the appellant  withdrew his  aforesaid suit on November 3, 1950.  The  investigation was thereafter held and a report submitted on March 1, 1951, which  appears  to  have  gone  substantially  against   the appellant.   The appellant contended that the  investigation had  not been fairly held and that the report was  for  this and  other  reasons defective and not binding  on  him.   He actually made an application on March 26, 1951, to the  Sub- Judge, Delhi, under s. 33 of the Arbitration Act, 1940,  for a  declaration that there was no arbitration  agreement  and hence the two referees had no jurisdiction to act or to make an award and, in the alternative, if there was an award, for an  order  setting  it aside.  While  this  application  was pending,  the Executive Council of the respondent  passed  a resolution  on April 26, 1951, terminating  the  appellant’s service  as  a professor of the University in  view  of  the

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findings against him in the report of the investigators.  On February  11,  1952,  the Sub-Judge,  Delhi,  dismissed  the application under s. 33 on the ground that the agreement  as to  the investigation by Sir S. Vardachariar and Bakshi  Sir Tek Chand of the mutual grievances ",as not a submission  to arbitration  and, therefore, no application under s.  33  of the  Arbitration Act lay.  An appeal to the High  Court  was dismissed on April 22, 1953, for the same reason. What we have stated so far gives the history of the disputes between  the  parties.  We now proceed to  the  events  with which we are immediately concerned in this appeal. On  April  28,  1953, the appellant wrote a  letter  to  the respondent  claiming, under the provisions of s. 45  of  the Delhi University Act, an arbitration with regard to  various disputes mentioned in it.  That section is in these terms: 1239 " Section 45. Any dispute arising out of a contract between the University and  any officer or teacher of the University shall, on  the request of the officer or teacher concerned, be referred  to a Tribunal of Arbitration consisting of one member appointed by  the  Executive  Council, one  member  nominated  by  the officer or teacher concerned, and an umpire appointed by the Chancellor.  The decision of the Tribunal shall be final and no  suit  shall  lie in any Civil Court in  respect  of  the matters  decided by the Tribunal.  Every such request  shall be  deemed to be a submission to arbitration upon the  terms of this section, within the meaning of the Arbitration  Act, 1940, and all the provisions of that Act, with the exception of section 2 thereof, shall apply accordingly." By that letter the appellant appointed Professor M. N. Saha, the  celebrated scientist, now deceased, an  arbitrator  and called  upon the respondent to nominate another  arbitrator. The  disputes  raised  in this letter  were,  (a)  that  the appellant  had  been wrongfully deprived  of  the  selection grade;  (b) that by the appointment of Dr. Seshadri, as  the Head of the Department of Chemistry, the appellant had  been wrongfully superseded; (c) that his dismissal was  wrongful. A copy of this letter was sent to Professor Saha.  On May 2, 1953,  the appellant again wrote to the  respondent  calling attention  to  the  fact  that  he  had  already   appointed Professor Salia an arbitrator and requiring it to appoint an arbitrator  within fourteen days as provided under the  law. On  May 7, 1953, the respondent wrote to the appellant  that his  letter  of April 28, 1953, had been considered  by  its Executive  Council on April 30, 1953, and that the  Council, for  the reasons mentioned, to which it is not necessary  to refer,  did  not propose to take any action in  the  matter. Thereafter,  on  May  18, 1953, the  appellant  addressed  a further  letter to the respondent in which he stated,  "  as the said University had failed for 15 clear days to  appoint after the service of my said notice ", meaning his notice of May 2, 1953, " on the University, please take notice that  I hereby 1240 appoint  Professor M. N. Saba arbitrator appointed by me  to act  as  the  sole  arbitrator  and  give  his  award."  The appellant  also  wrote in similar terms to  Professor   Saba asking  him to proceed with the reference as he  had  become the sole arbitrator.  On May 24, 1953, Professor Saba  wrote to the respondent stating that as he had been appointed  the sole  arbitrator by the appellant, he fixed June  15,  1953, for  the  hearing  of  the case.   On  June  12,  1953,  the respondent  wrote to Professor Saba intimating that  it  had been advised that the appellant had no right to call for  an

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arbitration  and that the respondent did not  recognise  him (Professor  Saba) as an arbitrator and also that he  had  no jurisdiction to act as one.  Notwithstanding this  Professor Saba  started the arbitration proceedings on June 16,  1953. The  respondent appeared by a lawyer before  Professor  Saba and repeated its objection to his jurisdiction to act as  an arbitrator.   Professor  Saba  overruled  the   respondent’s objection  and held that he had jurisdiction to act  as  the sole   arbitrator  whereupon  the  representatives  of   the respondent  retired  from the proceedings  which  were  then continued in their absence. Professor  Saba made an award which is dated June 17,  1953. The material portion of the award is in these terms The points requiring determination by me are as follows:- 1.Whether  the  Selection Grade of Professors  was   rightly withheld in the case of Dr. S. B. Dutt when it was given  to all other professors of his standing and seniority. 2.   Whether Dr. S. B. Dutt was appointed Professor and Head of   the  Chemistry  Department of the  University  and  was rightly removed from the Headship. 3    Whether  the  dismissal  of Dr. Dutt  by  a  resolution passed by the Executive Council on the 26th April, 1951, was mala   fide   and  illegal  and   therefore   wrongful   and ineffectual. 4.Whether  Dr.  Dutt was harassed by the  officials  of  the University and its effect. 1241 After  giving  the case my careful and earnest  attention  I find: (a)  The steps for giving the Selection Grade of  Professors of  the  University to Dr. S. B. Dutt  were  wrongfully  and without  just cause not taken by the University and  he  has therefore been wrongfully deprived of the Selection Grade. (b)  The terms of appointment of Dr. Dutt were that be would be  also the Head of the Chemistry Department.  His  removal from Headship was wrongful. (c)  Dr. Dutt was wrongfully dismissed.  His  dismissal  was ultra vires, mala fide and has no effect on his status.   He still continues to be a professor of the University. (d) He has been subjected to harassment." At  the request of the appellant, Professor Saha  filed  the award  in  the Court of the Sub-Judge, Delhi,  on  June  24, 1953.   The respondent took various objections to  it.   The Sub-Judge overruled these objections and passed a decree  on May  27, 1954, making the award, excepting a  small  portion thereof  with which this appeal is not concerned, a rule  of Court.   The respondent filed two appeals from this  decree, one  in  the Court of the senior Sub-Judge, Delhi,  and  the other  in the Court of the District Judge, Delhi, as it  was in  doubt  as  to which was the proper Court  to  which  the appeal lay.  By an order made on November 26, 1954 the  High Court  withdrew both these appeals to itself for trial,  and by its judgment dated January 15, 1955, allowed the  appeals and  set aside the award on the ground that it disclosed  an error on the face of it.  The present appeal is against this judgment. Two  points  have  been raised in this appeal,  one  by  the appellant  and  the  other by the  respondent  on  a  matter decided against it which will be referred to later. The appellant contends that the High Court was wrong in  its view  that the award disclosed an error on the face  of  it. The  High  Court  had  held that it  was  not  open  to  the arbitrator  "to  grant Dr. Dutt a declaration  that  he  was still a professor in the Univer- 1242

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sity which no Court could or would give him." The High Court felt that this declaration amounted to specific  enforcement of a contract of personal service which was forbidden by  s. 21  of  the Specific Relief Act and therefore  disclosed  an error on the face of the award. We  are in entire agreement with the view expressed  by  the High  Court.  There is no doubt that a contract of  personal service  cannot be specifically enforced.  Section  21,  Cl. (b)  of  the  Specific  Relief Act,  1877,  and  the  second illustration under this clause given in the section make  it so  clear  that  further elaboration of  the  point  is  not required.   It  seems  to us that  the  present  award  does purport  to enforce a contract of personal service  when  it states  that the dismissal of the appellant " has no  effect on  his status", and " He still continues to be a  Professor of  the University ". When a decree is passed  according  to the award, which if the award is unexceptionable, has to  be done  under s. 17 of the Arbitration Act after it  has  been filed  in Court, that decree will direct that the  award  be carried  out and hence direct that the appellant be  treated as  still in the service of the respondent.  It  would  then enforce  a contract of personal service, for  the  appellant claimed  to  be  a professor under a  contract  of  personal service, and so offend s. 21 (b). It  was  said that this might make the award  erroneous  but that  was not enough; before it could be set aside,  it  had further  to be shown that the error appeared on the face  of the  award.   The learned counsel contended  that  no  error appeared  on the face of the award as the reasoning for  the decision  was not stated in it.  It was said that  this  was laid down in the well-known case of Champsey Bhara & Co.  v. Jivraj  Balloo Spinning and Weaving Co. Ltd. (1).   We  were referred to the observations occurring in the judgment at p. 331 to the following effect: "  An error in law on the face of the award means, in  their Lordship’s  view,  that  you  can find in  the  award  or  a document  actually incorporated thereto, as for  instance  a note appended by the arbitrator stating (1)  (1923) L.R. 50 1. A. 324. 1243 the  reasons for his judgment, some legal proposition  which is  the  basis of the award and which you can  then  say  is erroneous." We are unable to agree that the Judicial Committee laid down the  proposition that the learned counsel for the  appellant ascribes to them.  When they referred to the reasons for the judgment, they were contemplating a case where the judgment, that is, the award itself, did not disclose an error but the reasons  given for it in an appended paper, did.   They  did not intend to say that no error can appear on the face of an award  unless the reasons for the decision contained in  the award were given in it.  In our view, all that is  necessary for an award to disclose an error on the face of it is  that it must contain, either in itself or in some paper  intended to  be incorporated in it, some legal proposition  which  on the  face  of  it  and  without more,  can  be  said  to  be erroneous.  This was the decision of the Judicial  Committee in the Champsey Bhara & Co. case (1).  As the award in  this case directs specific enforcement of a contract of  personal service,  it involves a legal proposition which  is  clearly erroneous. Another point raised on behalf of the appellant was that the portion  of the award which held that his dismissal  had  no effect on his status and that he continued to be a professor was   merely  consequential  and  hence  a  surplusage   and

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therefore  an  error disclosed in it would not  vitiate  the award.   This contention seems to us to be  unfounded.   The award held that the appellant had been dismissed  wrongfully and  mala  fide.   Now, it is not consequential  to  such  a finding that the dismissal was of no effect, for a  wrongful and  mala  fide  dismissal is none  the  less  an  effective dismissal  though  it may give rise to a claim  in  damages. The  award,  no doubt, also said that the dismissal  of  the appellant was ultra vires but as will be seen later, it  did not  thereby hold the act of dismissal to be a nullity  and, therefore, of no effect.  We are also clear in our mind that the  contention  about the offending portion  of  the  award being a mere surplusage affords (1) (1923) L.R. 50 I.A 324. 158 1244 no  assistance to the appellant for it was not said  on  his behalf  that  the offending portion was severable  from  the rest  of  the  award and should be struck  out  as   a  mere surplusage.   It, therefore, has to remain as a part of  the award and so long as it does so, it would disclose an  error on the face of the award and make it liable to be set  aside as a whole. It was then contended that a declaration that the  appellant continued  in his service under the respondent in  spite  of his dismissal by the latter was a declaration which the  law permitted  to be made and was not therefore  erroneous.   It was  said that such a declaration had in fact been  made  by the Judicial Committee in The High Commissioner for India v. I.  M. Lall (1).  This contention, in our view,  also  lacks substance.   That  was  not a case based on  a  contract  of personal service.  Indeed the contract of the respondent  in that case provided that the service was " to continue during the pleasure of His Majesty, His Heirs and Successors, to be signified under the hand of the Secretary of State for India ". The respondent had been dismissed by an order made  under the hand of the Secretary of State for India, and as he  was liable  to  be dismissed at the pleasure of  the  Crown,  he could  base no complaint against his dismissal on  the  con- tract  of service and did not, in fact, do so.   He  founded his  suit on the claim that his dismissal by the Crown  from the Indian Civil Service of which he was a member, was  void and  of  no effect as certain mandatory  provisions  of  the Government  of India Act, 1935, had not been complied  with. The  Judicial  Committee accepted this claim  and  thereupon made  the  declaration that the purported dismissal  of  the respondent was void and inoperative and he remained a member of  the Service at the date of the institution of his  suit. The  declaration  did  not enforce a  contract  of  personal service but proceeded on the basis that the dismissal  could only be effected in terms of the statute and as that had not been done, it was a nullity, from which the result  followed that the respondent had continued in service.  All that  the Judicial Committee did in 1245 this  case  was  to  make  a  declaration  of  a   statutory invalidity  of an act, which is a thing  entirely  different from enforcing a contract of personal service. The learned counsel for the appellant also referred, up,  to Ram Kissendas Dhanuka v. Satya Charan Law (1), in support of his contention that the declaration in the form made in  the award was legal.  That was a case of a suit by the  minority shareholders  in  a  company against  its  directors  for  a declaration  that  an  ordinary resolution  of  the  company terminating  the appointment of its Managing Agent was  void

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and  inoperative inasmuch as under art. 132 of the  Articles of  Association of the Company the Managing Agents could  be removed by an extraordinary resolution only.  The High Court had declared the resolution to be void and inoperative.  The Judicial Committee maintained that declaration and  rejected the  argument that " to affirm the continuance in  force  of the  Managing  Agent’s  appointment  amounted  to   specific enforcement  of the contract of personal service and  was  a violation of s. 21(b) of the Specific Relief Act, 1877."  It is  quite clear to us that this decision has no  application to the case in hand.  That was not a case in which  specific performance  of a contract of service was sought.   In  fact the  servant, that is to say, the Managing Agent, was not  a party  to  the  action at all.  As  the  Judicial  Committee observed: " It (the decree) merely prevents dismissal of the managing  agents or termination of their appointment at  the instance  of  a  majority in violation of  the  articles  of association  of the company which the minority are  entitled to  have observed.  As between the company and the  managing agents  it  certainly  has not the  effect  of  enforcing  a contract  of personal service." It was a case, as the  Chief Justice of the Calcutta High Court said in his judgment,  in Ram Kissendas v. Satya Charan (2) at p. 331 " not to enforce a  claim  to  employment with an employer,  but  a  suit  to prevent   third  persons  interfering  with  the   Company’s employees  who  are carrying out their contract  of  service with  the  company.   In other words, it is not  a  suit  to enforce a contract, but a suit to prevent the procurement of a breach of contract." To (1) (1949) L. R. 77 1. A. 128. (2) (1945) 50 C.W.N. 331. 1246 such a suit, of course, s. 21 of the Specific Relief Act has no application. The  learned counsel for the appellant also contended  ;that the  present case was a case of an ultra vires act as I.  M. Lall’s  case  (1)  was and therefore governed  by  the  same considerations.  He relied for this purpose on that  portion of the award which held that the " appellant’s dismissal was ultra  vires  ". We find no basis for this  contention.   No point as to the dismissal of the appellant being ultra vires bad  been  referred  to  the  arbitrator.   The  points  for decision  set  out  by the arbitrator do not  refer  to  any question  of  the dismissal being ultra  vires.   Again  the letter  of the appellant, dated April 28, 1953, setting  out the  disputes of which he required decision  by  arbitration does  not  make  out  any case that  the  dismissal  of  the appellant  by  the respondent was ultra vires  the  latter’s incorporating  statute.  His point about the  dismissal  was that it had been malicious and therefore wrongful ; that  it had  been  brought about by a resolution  of  the  Executive Council  of the respondent on the basis of the report  (also called award) of the investigators, Sir S. Vardachariar  and Bakshi  Sir Tek Chand, procured by the Vice-Chancellor,  Dr. Sen,   by  denying  to  the  members  of  the  Council   any opportunity to discuss the merits of that report.  His  case on this point in his own words was this: "  When the award was put before the Executive  Council  Dr. Sen  definitely  prohibited  all discussions of  it  on  the ground that it was an award and suppressed those who desired to  comment  on it, feeling as they did that  the  decision, specially  in the matter of the supposedly altered  telegram was open to grave doubts.  In regard to this, questions were asked but not answered. If Dr. Sen had not wrongly disallowed discussion, I  venture

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to  say  that  the  Council  would  not  have  agreed  to  a dismissal,   or  at  any  event  any  allegation  of   moral turpitude." It is clear therefore that the appellant was challenging his dismissal  on the ground that the Vice-Chancellor, Dr.  Sen, who, he said, was inimically disposed towards (I)  (1948) L.R. 75 I.A. 225. 1247 him,  had  shut  out  all discussion  on  the  question  and procured  a resolution for the dismissal of  the  appellant, and  that because of such malicious and wrongful barring  of discussion,  the  resolution was wrongful.  It was  not  the appellant’s  case before the arbitrator that  the  dismissal was ultra vires the statute or otherwise a nullity.  We also find that this point was not advanced in the courts below. The  last point raised on behalf of the appellant was  based on  s. 45 of the University Act.  The terms of that  section have  been earlier set out.  The contention of  the  learned counsel  is  that since the section says  that  any  dispute arising  out  of a contract between the University  and  any officer  or teacher of the University shall, on the  request of  the  officer  or teacher concerned,  be  referred  to  a Tribunal  of  Arbitration, a dispute as to dismissal  and  a claim  to  reinstatement might be  referred  to  arbitration under  it, and if that could be done, then, the award  might properly  direct the dismissed professor to  be  reinstated. For  this part of his argument the learned counsel  referred us  to  Western India Automobile Association  v.  Industrial Tribunal,  Bombay  (1).   It had been  held  there  that  an Industrial  Tribunal  had  power  in  an  award  made  on  a reference under the Industrial Disputes Act, 1947, to direct reinstatement of discharged employees.  The learned  counsel referred  us to the following observation occurring in  -the judgment of the Federal Court at p. 332 : "  Any  dispute  connected  with  the  employment  or   non- employment  would ordinarily cover all matters that  require settlement between workmen and employers, and whether  those matters concern the causes of their being out of service  or any  other  question and it would also  include  within  its scope  the reliefs necessary for bringing  about  harmonious relations between the employers and the workers." It  was contended that, as in the Western  India  Automobile Association case (1), the words " any dispute " in s. 45  of the University Act would include a dispute as to a claim for reinstatement and would therefore give the arbitrator  power to  order reinstatement.  We do not think that  any  analogy can be drawn from the, (1)  [1949] F.C.R. 321. 1248 wording  of  the  Industrial  Disputes  Act.   That  Act  is concerned with considerations which are peculiar to it.  The proceedings  before a Tribunal constituted under   that  Act cannot  be  said  to  be  arbitration  proceedings  nor  its decision an award, though called an award in the Act, in the sense  in which the words " arbitration proceedings " and  " award " are used in the Arbitration Act.  An award under the Industrial  Disputes  Act cannot be filed in  Court  nor  is there  any provision for applying to Court to set it  aside. All  considerations  that  apply  to  an  award  under   the Industrial Disputes Act, cannot be said to apply to an award made under the Arbitration Act.  Furthermore, under s. 45 of the  University Act, the arbitration held under it is to  be governed by the provisions of the Arbitration Act, 1940, and the validity of an award made under such an arbitration has, therefore, to be decided by reference to the rules  applying

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to  that Act, one of such rules being that the award  should not  disclose an error on its face.  For these  reasons,  in our view, this argument is unfounded. This  disposes  of all the points raised on  behalf  of  the appellant  and brings us to the contention raised on  behalf of the respondent.  That contention was that the appointment of  Professor Saha as the sole Arbitrator was  illegal.   It was  said that the respondent claimed to  appoint  Professor Saha  the sole arbitrator under s. 9 of the Arbitration  Act but that section could only apply where the reference was to two  arbitrators, one to be appointed by each  party,  while the proper interpretation of s. 45 of the University Act was that the arbitration was to three Arbitrators, one nominated by  each of the parties and the third by the  Chanceller  of the   University.   This  point  was  decided  against   the respondent by the High Court.  As, however, the appeal  must be dismissed for the reason that the award contains an error on  the  face of it, as we have earlier  found,  it  becomes unnecessary  to decide the point raised by  the  respondent. We, therefore, do not express any opinion on this question. In   the  result  this  appeal  is  dismissed   with   costs throughout. Appeal dismissed. 1249