Ross, J.This is an appeal from a judgment of the Subordinate Judge of Darbhanga ordering an award to be filed and a decree to be prepared in its terms. The defendant was a Tahsildar under the plaintiffs and their co-sharers. The plaintiffs brought a suit against the defendant for accounts from 1319 to 1324. An agreement was entered into between the parties to refer the matter to arbitration and to withdraw the suit and the suit was accordingly dismissed on the 27th of February, 1922. The agreement to refer the dispute to arbitration is dated the 25th of February, 1922. Is recites the institution of the suit and declares that "it has been now agreed that the suit be decided by arbitration." Chaudhry Ram Khelawan Rai was appointed arbitrator. The procedure to be followed in the arbitration was prescribed and the 30th of Baisakh 1329 was fixed as the date on which the award should be given. It was agreed that if Rum Khelawan Rai should be unwilling or unable to act as arbitrator, then his brother Chaudhry Ram Rup Rai should act as arbitrator on the same terms. On the 11th of April, 1922, a notice is said to have been given by Ram Khelawan Rai So each of the parties, to the effect that on account of illness ho would be unable to go to the villages and was unable to act as arbitrator, and therefore he had made over the arbitration agreement to his brother Ram Rup Rai who would act as arbitrator: the parties were directed to go to him with their evidence. On the 2nd of May, 1922, a fresh agreement was made between the parties with regard to the arbitration. This agreement recites the suit abovementioned and the previous agreement of the 25th of February. It also recites that Ram Khelawan Rai had expressed his inability to act as arbitrator by notices sent under a registered cover and therefore Ram Rup Rai had worked as arbitrator in the presence of the executants up to the 22nd of April and had done a good deal of work in connection therewith. But the arbitrator could not pass his award by the date fixed. It was, therefore, necessary to execute an agreement for extension of the date and it was agreed, that Ram Rup Rai should act as arbitrator and pass his award in accordance with the stipulations of the registered deed of agreement dated the 25th of February, 1922, by the 29th of Sawan 1329. It should be mentioned that both these agreements were registered. On the 3rd of August, 1922, the arbitrator made his award which refers to the hearing of the arbitration in the presence of both parties on several dates as attested by the signatures of the parties and to the production of the oral and documentary evidence of both parties. It then declares that the defendant is to pay to the plaintiffs Rs. 18,741. The plaintiffs on the 15th of September, 1922, applied to the Subordinate Judge under para. 20 of the Second Schedule to the Civil Procedure Code, that the award be filed in Court. Cause was shown by the defendant and various objections were taken but the Subordinate Judge, after going into evidence, overruled the objections and made the order which is the subject of this appeal.
2. The objections taken before the Subordinate Judge and again in this Court are objections on grounds both of fact and law. The main objections on facts are, first, that Ram Khelawan Rai never refused to arbitrate and that the defendant agreed to the arbitration of Ram Rup Rai on the strength of a false notice which he believed to have been signed by Ram Khelawan Rai, but which in fact was not signed by him; secondly, that the arbitrator refused to accept the defendants evidence, and, in particular, a Safinama or acquittance which, if admitted, would have shown that he had received a full discharge from the plaintiffs; and, thirdly, that the arbitrator refused to hold a local enquiry as requested by the defendant. The objections in law are, first, that the agreement to refer to arbitration having been arrived at while a suit was pending, and being without leave of the Court, it cannot be the basis of an award which can be filed under Schedule 2, nor of a certificate of adjustment under Order 23, Rule 3; and, secondly, that au obvious point of law has not been considered by the arbitrator, namely, that the defendant having been appointed both by the plaintiffs and by their co-sharers, the plaintiffs alone could not call him to account.
3. [His Lordship dealt with evidence and found that Ram Rup Rai was properly appointed arbitrator and that important evidence was not refused to be taken, that no request was made to make local inquiry and proceeded as follows:]
4. I now turn to the objections to the order of the Subordinate Judge in point of law. The contention of the appellant is that there cannot be a reference to arbitration out of Court when a suit is pending because in a pending suit the arbitrator gets his authority both from the parties and from the Court; and that if the parties decide to refer a pending suit to arbitration they must apply to the Court for an order of reference and keep the suit pending so that the Court may have control over the arbitration. A number of cases was referred to in the argument. In the leading case Ghulam Jilani v. Muhammad Hassan (1901) 29 Cal. 167 the Privy Council observed that "where the parties to a litigation desire to refer to arbitration any matter in difference between them in the suit...all proceedings from first to last are under the supervision of the Court." In Tincowry Dey v. Fakir Chand Dey (1902) 30 Cal. 218 Maclean, C.J., said that Section 523 (para. 17 of Schedule II) does not apply to a case of reference to arbitration where there is pending litigation. In Vyankatesh Mahadev v. Ramchandra Krishna (1914) 38 Bom. 687 it was said that where the Court is seised of a cause its jurisdiction cannot be ousted by the private and secret act of parties, and if they, after having invoked the authority of the Court, and placed themselves under its superintendence desire to alter the tribunal and substitute a private arbitrator for the Court, they must proceed according to the law laid down in. the first 16 Clauses of the Second Schedule." In T. Venkatachala Reddi v. T. Rangiah Reddi (1911) 36 Mad. 353 it was held that para. 17 of the Second Schedule to CPC covers only cases where parties without having recourse to litigation agree to refer their difference to arbitration; and that an agreement to refer to arbitration in a pending litigation made without the intervention of the Court could not be filed under para. 17 of the Second Schedule. In Shavakzhaiv D. Davar v. Tyab Haji Ayub (1916) 40 Bom. 386 it was held that a decree could not be made on an award under Order 23, Rule 3. But Macleod, J., went on to observe as follows: An arbitration between the parties to a suit without an order of the Court has not been excluded and must, therefore, come under the provisions which deal with arbitrations without the intervention of the Court. I do not see myself why the words "without the intervention of the Court should not refer to oases where the agreement of reference is made out of Court although the parties to the agreement are already parties to a suit, and in my opinion Section 89 is now conclusive on the question." The learned Judge therefore allowed the application to be treated as an application under para. 20. In Manilal Motilal v. Gokaldas Rowji (1921) 45 Bom. 245, however, the same learned Judge came to the conclusion that that order was wrong; but he did not agree with the trial Judge who had said that an award in a reference by the parties to a suit without the intervention of the Court could not be a valid award. In Amar Chand Chamiria v. Banwari Lal Rakshit 1922 Cal. 404 Rankin, J., has expressed the opinion that the Rules in paras. 20 and 21 cannot be applied in such a case. The authority is clear that no assistance can be obtained from Order 23, Rule 3, C.P.C. As to para. 20 of the Second Schedule, these decisions in my opinion have no application to the present facts. On the 25th of February, 1922, the following petition was filed before the Court in the suit;" On the advice of well-wishers it has been agreed by the parties to get the suit decided by arbitrators. The petitioners have therefore executed an ekrarnama dated 25th February, 1922. Therefore they do not like to prosecute this case. This suit may be dismissed without trial. Costs may be borne by the parties." On this the Subordinate Judge passed the following order: "The suit is dismissed in terms of the solenama." This order is final and cannot be questioned now: and, in any case, I can see nothing illegal in it. I see no reason why the suit should not have been withdrawn by consent of the parties. The suit then was at an end; but the agreement to refer to arbitration stood. There is nothing illegal in such an agreement being made pending litigation: Nanjappa Vs. Nanjappa Rao, , where it was held that there may be an agreement to refer to arbitration in a pending suit without the intervention of the Court. See also Shavakshaw D. Davar v. Tyab Haji Ayah (1916) 40 Bom. 386 and Manilal Motilal v. Gokaldas Rowji (1921) 45 Bom. 245 quoted above. Para. 1 of the Second Schedule is not mandatory, it is permissive. If the parties apply to the Court for an order of reference then the Court must keep control over the proceedings up to the end. But it is not necessary for the parties to take this course and there is nothing to prevent their getting the suit dismissed by consent. Then the whole matter is at large. The point is that in all the eases cited above there was a suit pending at the time when the award was made, and the question was how the award was to be dealt with in the suit; and the better opinion seems to be that it cats only be dealt with by being pleaded as a bar to the further continuance of the suit. But where there is no suit pending when an application is made to the Court under para. 20, I can see nothing to bar the procedure under para. 20 in the fact that the original agreement to arbitrate was made while a suit was pending. Paras. 20 and 21 provide for an adequate cheek of the proceedings before the award becomes a Rule of the Court. This is all that is necessary. The present proceedings fall directly within the terms of para. 20 because the matter was referred to arbitration without the intervention of the Court. The Court made no order in the matter of arbitration in the original suit which was simply dismissed.
5. But here there is another fact. The original agreement to refer to arbitration provided by its fourth Clause that the arbitrator should pass his award by 30bh Baisakh 1329. As the arbitration was not completed by that date a fresh agreement was entered into between the parties extending the time till the 29bb of Sawan 1329. This enlargement of time is equivalent to a fresh submission to arbitration--see Halsburys Laws of England, Vol. I, p. 463, and Stephens v. Lowe (1832) 9 Bing. 32 and Watkins v. Philpotts (1825) M. Cl. & Y. 393. This agreement was not made during the pendency of any suit and was free from the objection that has been urged against the first submission.
6. Finally, as to the error of law said to have been committed by the arbitrator in making an award when all the co-sharers were not plaintiffs, it is sufficient to say that the suit was not an end and that the submission to arbitration was a submission of the dispute between the present plaintiffs and the defendant. There was therefore no question of law for the arbitrator to consider; and, even if there was, then, as was pointed out by the Judicial Committee in Ghulam Jilani v. Muhammad Hassan (1901) 29 Cal. 167, arbitrators are judges of law as well as judges of fact and an error of law certainly does not vitiate their award.
7. My opinion therefore is that on all grounds this appeal fails and it must be dismissed with costs.
8. The stay application is dismissed.
Das, J.
9. I agree.