ARBITRATION ACT, 1940, 2001 & 1950, SECTIONS

Arbitration Act, 1940

1st Schedule, Para 2

As the Board of Arbitrators constituted under the agreement between the partners consisted of even number of members, they ought to have appointed an umpire within the prescribed time.

Khitesh Chandra Debnath vs Birendra Chandra Ghose 48 DLR 400.

Arbitration Act, 2001

 

Sections 7 & 10

The defendant has already commenced a proceeding against the plaintiff before the Tribunal of the MCCI under the arbitration clause of the contract, which is not denied by the plaintiff. If it is so, under section 7 of the Act, the Subordinate Judge would have no jurisdiction to proceed further with the suit.

Bangladesh Jute Mills Corporation vs Maico Jute and Bag Corporation and others 56 DLR 224.

Article 3 of the First Schedule to the Act — ­Time for award 4 months

The appellant would seem to have no ground to stand upon, since it appears that the award was made beyond the period mentioned therein.

When the arbitration proceedings continued beyond 4 months with the parties raising no objection-Conclusion is the party concerned has waived its right.

Enlargement of time (beyond 4 months) for giving the award by consent of the both parties, permissible-Such enlargement of time may be provided for in the agreement-In the absence of such agreement consent may be inferred by conduct of parties.

Government of Bangladesh vs Jalaluddin Ahmed 37 DLR (AD) 27.

Sections 45-47

0nce an arbitration proceeding in a foreign country is completed, the Arbitral Award, on an application by any party, will be enforced by a court of this country under 1he Civil Procedure Code in the same manner as if it were a decree of the court.

Canda Shipping and Trading SA vs TT Katikaayu and another (Admiralty Jurisdiction) 54 DLR 93.

Arbitration Act 1950 (English)

Section 10-

If the agreement ‘provides that Ille dispute shall be referred to arbitration, the Rference should be made to a single Arbitrator.

Section 2(b)-Arbitration award-How it is expressed-There is no particular form for expression of an Arbitrator’s decision (award). It is not a judgment and it need not contain the reasoning of the Arbitrator. It is enough if the award contains the decision of the Arbitrator. High Court Division did not err in law in construing the Memo written by the Arbitrator to his superior authority as an award.

Bangladesh & others vs KM Shafi Ltd 43 DLR 217.

Section 2(b)-

Knowledge of making of the award, if any, is not sufficient to fix one with the notice of making of the award within the meaning of Article 178 of the Limitation Act.

Dhaka Leather Complex Ltd BCIC vs Sikder Construction Ltd and another 55 DLR 578.

Section 3-

Item 3-First Sch.-Time limit for arbitration-The conclusion of arbitration proceedings depends upon facts and circumstances of each case. The law has not prescribed a minimum time· limit for this.

Messrs Rising Sun Traders vs Chittagong Port Authority 43 DLR J.

Sections 3 and 8-

When an agreement is silent on the number of arbitrators for. a dispute, the case will be governed by section 3 of the Arbitration Act and reference shall be made according to the provisions of Schedule 1 of the Arbitration Act, which provides that the reference shall be to a sole arbitrator. Section 8 of the Act shall come into play only when the parties fail to concur in the appointment of a sole arbitrator.

Bangladesh Water Development Board vs MR Sikder 55 DLR 682.

Sections 3 and 28-

Enlargement of time (beyond 4 months) for giving the award by consent of the both parties, permissible-Such enlargement of time may be provided for in the agreement-In the absence of such agreement consent may be inferred by conduct of parties.

Government of Bangladesh vs Jalaluddin Ahmed 37 DLR (AD) 27.

Section 8-

Objection against appointment of Arbitrator who he has already entered on the reference following unacceptable – Conduct displayed by the objector appears to be a technical objection not entertainable at a belated stage.

Coal Controller, Government of Bangladesh vs Ventura Industries Ltd 44 DLR (AD) 183.

Section 8 –

If the agreement provides that the dispute shall be referred to arbitration, the reference should be made to a single Arbitrator.

British Airways PLC vs Bangladesh Air Services Pvt Ltd 47 DLR 544.

Sections 8, 30 & 33-

Arbitration­Conclusiveness of award-The work order given to the tenderer became an instrument necessary for understanding the contract with him. Though not a part of the contract itself it is a contemporaneous document accepted by both sides throwing light on the interpretation of schedule of work.

Mohammad Eunus and Brothers (Pvt) Ltd vs University of Chittagong 44 DLR (AD) 296.

Section 8(2)-

In view of the clauses of agreement between the contending parties and having regard to the decisions, the Subordinate Judge, Arbitration Court, Dhaka was not within its jurisdiction in appointing an arbitrator.

British Airways PLC vs Bangladesh Air Services Pvt. Ltd 48DLR 249.

Section 8(2)-

Upon the application, it was duty of the Court to be satisfied that there arose really an arbitral dispute in between the parties as to any thing under or out of the contract for reference to the arbitrators.

National Sports Council vs A Latif and Company 53 DLR 386.

Section 8(2)-

ln order to raise an arbitral dispute, there must be some sort of formal demand to be made by ‘one side and denied by other side either explicitly or by silence.

National Sports Council vs A Latif and Company 53 DLR 386.

Section 11-

Parties refer their dispute to arbitration to get an amicable settlement which is encouraged even though Arbitrators do not follow strict and delicate procedural technicalities. If any party has lack of confidence in the Arbitrator he may seek his removal in accordance with law.

Messrs Rising Sun Traders vs Chittagong Port Authority 43 DLR 1.

Section 11-

There is no requirement of law that a person serving under the respondent Port Authority cannot function as Arbitrator or that the Arbitrator being their employee for some time in the past could not function as such. If the Port Authority had no confidence in him they could seek his removal.

Messrs Rising Sun Traders vs Chittagong Port Authority 43 DLR 1.

Section 12-

The scheme of section 12, particularly of sub-section (2) thereof, clothes the court with the authority of appointing an arbitrator in its discretion after the parties fail to nominate a common arbitrator.

Bangladesh Water Develop­ment Board vs Zakir Construction and Co and another 48 DLR 261.

Section 13-

E.x parte decision in arbitration proceeding-Powers of the Arbitrator-The respondent Port Authority did not appear before the Arbitrator at all nor did they express their intention to appear on receiving notice from the Arbitrator. In such circumstances the Arbitrator is not bound to give them notice about ex parte hearing and passing of ex parte award in the arbitration proceeding before him.

Messrs Rising Sun Traders Ltd vs Chittagong Port Authority. 43 DLR I.

Section 14-

Arbitration proceeding, nature of-A proceeding under section 14(2) of the Arbitration Act, 1940 is not a suit. Section I 0 of CPC is not applicable to proceeding under section 14(2) of the Arbitration Act.

Adamjee Sons Ltd vs Jiban Bima Corporation 45 DLR 89.

Section 14-

In the absence of any evidence or materials or even any allegation arbitrators are guilty of legal misconduct if they come to· any finding to enforce specific performance of a contract.

Bangladesh Telegraph and Telephone Board vs Lithi Enterprise 46 DLR 122.

Section 14-

Period of limitation of 90 days fixed for filing the award in Court will apply only when a notice in writing regarding making of award and signing thereof is given to the parties.

Bajaj Rice Mills vs Bangladesh 41 DLR 504.

Sections 14 and 17-

The learned Subordinate Judge, without following the mandatory provisions of section 14 of the Act, fell in serious error of law in pronouncing the judgment. The decree followed such judgment must be held to be clearly in excess of the award. The appeal from such decree is therefore quite competent and must succeed.

Titas Gas Transmission and Distribution Co. Ltd vs Shams Company and others 54 DLR 128.

Section 14(2)-

The application made under section 14(2) of the Arbitration Act is not a plaint. The application of the petitioner under Order VII rule 11 of the Code for rejection of such application is wholly misconceived.

Dhaka Leather Company Ltd vs ‘Sikder Construction Ltd and another 54 DLR 357.

Section 14(2)-

Filing of the Award in Court – Two alternative pre-conditions – Duty of arbitrator or umpire to cause the award to be filed in Court on fulfillment of either of the two pre­conditions.

Bajaj Rice Mills vs Bangladesh 41 DLR504.

Section 14(2)-

When the appellant took time on number of occasions to file written statement against the award, he had the clear knowledge of the filing of the award. In the circumstances, no further notice was required under section 14(2) of the Arbitration Act to issue.

Dhaka Leather Complex Ltd BCIC vs Sikder Construction Ltd and another 55 DLR 578.

Section 14(2)-

Steps on behalf of the petitioner taking time to file objection against Award filed in Court are sufficient not only to fix him with statutory notice but also dispense with the requirement of such notice by the Court.

Salauddin Jamil vs Amjad Ali Khan and another 56 DLR 87.

Section 17-

If it is found that the appeal is not maintainable under section 17 of the Arbitration Act the same may be converted into a revisional application.

Bangladesh Water Develo­pment Board and others vs Progati Prakaushali and another 49 DLR 335.

Section 7-

Pronouncing of the judgment under section 17 is made subject to the expiration of the period of 30 days from the date of service of the notice of filing of the award and this is a condition precedent to· the exercise of the jurisdiction by the Court under the section.

Titas Gas Transmission and Distribution Co. Ltd vs Shams Company and others 54 DLR 128.

Sections 17, 33 & 39(1)(vi) –

Arbitration award-Question of setting aside an award- The appellants did not file any application to set aside the award or to challenge the existence and validity of the award. It is absurd to say that by making the award a Rule of the Court, the Court has refused to set aside the award. The act of refusal must be in pursuance of a positive move by the party affected either under section 17 or section 33. An ex parte order, as in the present case, making an award the Rule of the Court is not amenable to under section 39 of the Arbitration Act.

Bangladesh vs KM Shafi Ltd 43 DLR (AD) 217.

Section 20—

Arbitration on insurance claim­It is only where there is a dispute between the parties with regard to the amount of any loss or damage claimed by the plaintiff that the same could be referred to arbitration. Since the insurance company repudiated the plaintiffs claim wholly the dispute raised was not covered by condition No. 18 of the insurance policy.

Sadharan Bima Corporation vs Dhaka Dyeing and Manufacturing Company Ltd 43 DLR 286.

Section 20—

Forfeiture of insurance claim­ – The arbitration agreement contained in the insurance policy in question provided that if a claim be made and rejected and an action be not commenced within 3 months after such rejection all benefits under the policy shall be forfeited. The Insurance Company having informed the plaintiff that their claims under the policy were not payable and, as such, rejected the same as per condition No. 13 of the policy and the plaintiff having not commenced any action within 3 months, have forfeited all their rights under the policy.

Sadharan Bima Corporation vs Dhaka Dyeing & Manufacturing Co Ltd 43 DLR 286.

Section 20—

Jurisdiction of Arbitrator­Where the parties submit to the Arbitration without intervention of the court and making prayer for passing the award such parties cannot be allowed to take objection to the validity of the award on the ground of want of jurisdiction of the Arbitrator on the plea that the reference was not in court.

Adamjee Sons Ltd vs Jiban Bima Corporation 45 DLR 89.

Section 29-

Interest for the future, that is, from the date of the award till realisation of the money through section 29 of the Arbitration Act, did not give the Arbitrator this power, he may allow interest on his award till realisation on the same analogy to court’s power. This will be in accord with justice and fairness.

BADC vs Kibria & Associates Ltd 46 DLR (AD) 97.

Section 29-

In the absence of agreement the arbitrator or umpire has no jurisdiction to grant interest on awarded amount till relisation. But the Court has jurisdiction in its discretion to grant interest on the awarded amount or part thereof till realisation.

Asamat Zaman (Md) and others vs Government of Bangladesh and others 55 DLR (AD) 139.

Sections 29 and 30-

Arbitrator’s power to award interest-Even where the. reference to arbitration to settle a dispute is not in court and section 34 CPC is not applicable and the Interest Act, 1839 is not on the statute book, the Arbitrator is not deprived of his power to award interest in that he derives such power impliedly from the very submission to him to arbitrate the dispute when the agreement does not exclude his power to award interest in explicit language.

Kibria and Associates Ltd vs Bangladesh Agricultural Development Corporation 45 DLR 712.

Section 30-

Award-Limit to Court’s interference-The Court is not to go beyond the award in order to examine the evidence. It is competent to set aside the award where it finds error of law on the face of the award or it appears to be bad merely on perusal. If the court is allowed to examine evidence it would be opening flood­gate of litigation which is against the spirit of Arbitration Act.

Adamjee Sons Ltd vs Jiban Bima Corporation 45 DLR 89.

Section 30-

In proceedings arising out of arbitration, a court cannot be regarded as a court of appeal from the decision of the Arbitrator. Courts are in favour of non-interference with his findings unless they are perverse or he has misconducted himself or the proceedings.

Messrs Rising Sun Traders Ltd vs Chittagong Port Authority 43 DLR 1.

Section 30-

In proceedings arising out of arbitration a court cannot be regarded as a court of appeal from the decision of -the arbitrator.

Bangladesh Telegraph and Telephone Board vs Lithi Enterprise Ltd 46 DLR 122.

Section 30-

When an award is unanimously passed by the Arbitrator, the Court of Law shall not interfere with it except in a very rare case where the Arbitrators have mosconducted themselves on any legal point or in their personal dealings.

Titas Prokaushali Limited vs Roads and Highways 46 DLR 665.

Section 30 –

Misconduct on the part of the arbitrators may be a ground for setting aside their award. But such misconduct, when not agitated in the trial Court, could not be raised afresh before the superior Courts.

Bangladesh Telegraph and Telephone Board vs Lithi Enterprises Ltd 50 DLR (AD) 63.

Section 30 –

Where after expiry of four months, the parties submitted themselves to the jurisdiction· of the arbitrators and took part in the proceeding, the arbitrators did not act without jurisdiction in passing the award.

Government of Bangladesh vs Chowdhury Syndicate Limited 51 DLR 330

Sections 30, 32 & 33-

Section 30 seems to be exhausitive of the grounds on which an award may be set aside. The combined effect of sections 30 and 33 is that a party to an arbitration agreement or award may question the validity of the award in the manner provided for in section 33 by filing an application.

Chief Engineer Roads and Highways Department vs Concord Engineers and Construction Ltd 48 DLR 243.

Sections 30 and 33-

Pendente lite interest -An arbitrator may allow pendente lite interest on the analogy of court’s power to grant interest if the disputes were agitated before it.

The Arbitrator may allow interest pendente lite for a period beyond four months if the prolongation of the proceeding is caused by circumstances beyond his control. Again, to avoid any controversy, the period for pendente lite interest will start from the date on which the Arbitrator enters upon the arbitration proceedings and end on the day the award is made.

BADC vs Kibria & Associates Ltd 46 DLR (AD) 97.

Sections 30 and 33-

Arbitrator’s power to award interest-Interest as to pre-reference period-In the absence of any law or agreement providing for payment of interest by an Arbitrator it will not be proper to vest in him power to award interest for the pre-reference.

BADC vs Kibria & Associates Ltd 46 DLR (AD) 97.

Sections 31, 32 & 33-

Arbitration award-It cannot be challenged by way of a suit-Once an award is made and it is filed in Court for making it the Rule of the Court, no suit can be filed for the purpose of avoiding the award. Remedy to the party desiring to challenge the validity of an arbitration agreement or the award itself is as provided in section 33.

Shafiqur Rahman vs Nazmul Hossain Khan 44 DLR 428.

Section 32-

Interpretation of Statute – ­Meaning of word “effect” occurring in section 32-Whether the phrase “decision upon the existence or effect of an award” is wide enough to cover suits which are aimed at implementing the award-There is bar to suit contesting arbitration award.

BIWTA vs United Trading Corporation 4 I DLR 513.

Section 32-

After coming into force of the Arbitration Act in 1940, any suit either for enforcement of an award or challenging the existence or validity of an arbitration agreement or award is prohibited. Section 32 of the Act makes such prohibition absolute.

Paul Reinhurt Limited and another vs Prime Textiles Spinning Mills Ltd and others 54 DLR 17.

Section 32-

A suit for declaration that a contract (even though it contains an arbitration agreement) is void or that there was no existence of any such contract is not barred under the provision of section 32 of the Act.

Paul Reinhurt Limited and another vs Prime Textiles Spinning Mills Ltd and others 54 DLR 17.

Sections 32 and 33 –

A suit to challenge existence of an Arbitration agreement or an award is not maintainable by reason of section 32 which provides that such a challenge must be made by means of an application and not by means of a suit.

Mohsina Rahman alias Jaya vs Abdul Majid and others 54 DLR I 38.

Sections 32 and 33 –

0nce an award has been made and it is filed in Court for making the same Rule of the Court, no suit can be filed for avoiding the award. The only remedy is to apply to the self-same Court. Since section 32 of the Arbitration Act bars such a suit challenging the validity of an award, we find that the suit was barred by the provision of section 32 of the Arbitration Act. The learned Subordinate Judge should have rejected the plaint on the finding that it was barred by the provision of section 32 of the Arbitration Act. Instead he rejected the plaint as being barred under Article 158 of the Limitation Act which is not tenable.

Shafiqur Rahman vs Mvi. Nazmul Hossain Khan 46 DLR 165.

Sections 32 and 33-

A suit to challenge the existence of an arbitration agreement or an award is not maintainable by reason of section 33 which provides that such a challenge must be made by means of an application and not by means of a suit.

Badsha Miah & others vs Abdul Kader and others 52 DLR (AD) 79.

Section 33-

For mere non including of the properties in the security, the same cannot be brushed aside or rejected.

Mr Sikder vs Bangladesh Water Development Board 49 DLR 113.

Section 33-

Failure to make deposit as required by the proviso renders the application under this section non-existent in the eye of law.

Bangladesh Water Development Board and others vs Progati Prakaushali and another 49 DLR 335.

Section 33—

Where after the filing of an award in court one of the parties to the arbitration, being misled by the order of the court files objections instead of an application to set aside the award, the mistake made by the party is nothing more than an irregularity which is not such as to entitle the court to overlook his objections and to pass a decree in terms of the award.

Bangladesh Water Development Board and others vs Progati Prakaushali and another 49 DLR 335.

Section 33—

The deposit contemplated under the law is a condition precedent for entertainment of the application challenging the award. Deposit made during the pendency of the case cannot be treated a valid deposit as the language of the law is mandatory.

Rajdhani Unnayan Kartripakkha (RAJUK) vs MN Alam and Associates Ltd & another 54 DLR 161.

Sections 33 and 30—

Arbitrator’s power to award interest-Interest as to pre-reference period-In the absence of any law or agreement providing for payment of interest by an Arbitrator it will not be proper to vest in him power to award interest for the pre-reference.

Bangladesh Agricultural Development Corporation vs Kibria and Associates Ltd 46 DLR (AD) 97.

Sections 33 and 30-

Pendente lite interest-An arbitrator may allow pendente lite interest on the analogy of court’s power to grant interest if the disputes were agitated before it.

Bangladesh Agricultural Development Corporation vs Kibria and Associates Ltd 46 DLR (AD) 97.

Section 34-

Objection against the maintainability of the suit must be raised at the very preliminary stage of the proceeding even before taking any step for filing written statement. This having not been done, the trial Court’s decree is set aside with a direction to write out a judgment on consideration of materials on record.

Nur Nabi Chowdhury vs Bangladesh Krishi Bank 46DLR 509.

Sections 34 & 39-

Since the Subordinate Judge did not dispose of application for referring the dispute to an arbitration, rather kept the same pending for disposal, there is no scope for any appeal against it.

Israil Hossain vs Himalaya Ice & Cold Storage Limited 46 DLR 44.

Section 35-

In order to hold an arbitration proceeding invalid notice of the legal proceeding must be given to the Arbitrator.

Adamjee Sons Ltd vs Jiban Bima Corporation 45 DLR 89.

Section 37(4)-

Where an arbitration agreement provides that a claim shall be barred unless it is referred to arbitration within certain time the Court is empowered to interfere if it is of the opinion that in the circumstances of the case undue hardship would otherwise be caused to a party.

Sadharan Bima Corporation vs The Dhaka Dyeing and Manufacturing Company Ltd 43 DLR 286.

Section 39-

It is not permissible in law to grant interest on the decretal amount of the award in appeal when no such interest was awarded by the arbitrators and no such claim was made by the respondent before the court which made the award rule of the court.

Bangladesh Oil, Gas and Mineral Corporation (Petro-Bangla) vs Nuruzzaman Khan and others 51 DLR (AD) 52.

Sections 39 and 34-

Since the Subordinate Judge did not dispose of application for referring the dispute to an arbitration, rather kept the same pending for disposal, there is no scope for any appeal against it.

Israil Hossain vs Himalaya Ice & Cold Storage Limited 46 DLR 44.

Section 41(b) and item 42nd Sch-

An Arbitrator exercises a quasi-judicial function. He is both a judge of law and of fact and hence a pure question of law whether the executive authority acted beyond power could be a matter of arbitration reference.

The law in this regard is also well settled that when parties to building construction or supply of goods and the like designate a person to be authorised to finally determine question relating to the execution or non-execution as per terms of the contract and stipulated that the decision of the person shall be final and binding on both the parties, it would be binding except in cases of fraud, gross mistake on his part, as would imply an act of bad faith or failure to exercise an honest judgment on grounds of collusion with the other party or an act of misconduct. AIR 1975 (Madhya Pradesh) 152.

Coal Controller vs Ventura Industries Ltd 46 DLR 5.

Section 41(b)-

When there is no proceeding pending or no proceeding is there before the court it cannot grant an injunction invoking the jurisdiction under section 41(b) of the Arbitration Act.

British Airways PLC vs Bangladesh Air Services Pvt Ltd 47 DLR 544.

Section 42-

After the final decision in the suit and in this appeal therefrom, it is very difficult for us to appreciate the submissions of Mr Rafiqnr Rahman that in view of the arbitration agreement having remained alive, the suit is not maintainable. Moreover, we find no such provisions in the Act barring a suit on the ground of existence of an arbitration agreement.

Bangladesh Water Development Board vs Contractor, Manu Barrage 53 DLR 200.

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