P. Chakravartti, C.J.
1. A great many points were canvassed in this case in the Court below, but of them only one was canvassed in the appeal. The respondent, against whom an arbitrator had made an award on a claim submitted by the Union of India and also on a counter-claim submitted by himself, challenged it before Sarkar J., on several grounds, all of which, except one, failed. The one ground which succeeded was that the arbitrator who had made the award was not competent to act as arbitrator under the provisions of the arbitration agreement. The Union of India sought to resist that ground by contending that the respondent was estopped from taking it, but the learned Judge overruled the contention and declared the award to be void. Dissatisfied with that decision, the Union of India has preferred the present appeal.
2. The facts of the case are somewhat extraordinary. On 25-6-1943, the respondent entered into a contract with the then Government of India, as represented by the Superintending Engineer, Eastern Aviation Circle II, for the execution of thirteen pieces of work. The contract contained an arbitration clause which said that except where otherwise provided in the contract, all questions and disputes arising out of or relating to the contract would be referred to the arbitration of the 'Superintending Engineer of the Circle for the time being.' The respondent did some work, but disputes soon arose between him and Government as regards the amounts payable to him. According to Government, the respondent had been over-paid, whereas the respondent's case was that a large amount was due to him from Government. On some date in 1949, which It does not appear, the respondent served a notice on Government under Section 80 of the Code of Civil Procedure by which he Informed them, of a claim of Rs. 1,60,000/-. On 19-10-1948, ft pleader, acting on his behalf, wrote to the executive Engineer, Aviation Division, O. P. W. D. and called attention to the fact that his notice under Section 80 had not been attended to and he also made a request that the dispute should be settled, if possible, before the 25th of October, next. Thereafter on 17-10-1950, one Sri C. P. Malik wrote to the respondent that the Chief Engineer, Civil Aviation Wing, Central P. W. D., had appointed him to act as arbitrator in the dispute between him and Government regarding the work of construction of Gopali Benapur Road and, along with that letter, Sri Malik enclosed a copy of the statement of facts which he had received from Government. The letter ended with a request that the respondent should submit his reply or a counterstatement of facts within a fortnight of the receipt of the letter.
3. The respondent replied on 31-8-1950, in the form of a petition addressed to Sri C. P. Malik. He called himself 'this humble petitioner' and, in language brimming over with politeness and humility, submitted that while Government had laid a claim against him and full opportunity to reply to the claim had been offered, he too had a claim against Government which could be decided by arbitration. Clause 25 of the contract, he recalled, provided for arbitration regarding 'all questions and disputes' between the parties. He, therefore, asked Mr. Malik's intervention for including his case also in the arbitration and wanted to know if he was right in thinking that the claim would be admissible for arbitration under Clause 25 of the contract. He did not file his reply to Government's statement of facts at once, because he said that the form and contents of his reply would depend upon whether his counter-claim also was going to be adjudicated on. 'So far as this second party is concerned,' he added, 'this humble petitioner believes and agrees to arbitration of dispute relating to claim and counter-claim between 1st and 2nd parties.'
4. The respondent's request as to his own counter-claim was apparently passed on by Sri Malik to Government. On 12-12-1950, Sri Malik addressed another letter to the respondent by which he informed him that Government was agreeable to submitting to his arbitration the counter-claim of the respondent, subject to the reservation that there could be no arbitration with respect to some of the claims Included in his notice under Section 80, C. P. C., since, with regard to them, the decision of the Superintending Engineer was to be final according to the contract itself and subject to a certain contention which they desired to raise at the hearing. The letter added that the time for filing the award had already expired and Government were filing an application in Court for obtaining an extension up to 31-3-1951 and that the respondent might inform the Executive Engineer, Calcutta Aviation Division No. I, directly that he would have no objection to Sri Malik continuing the arbitration case and to his having the time for filing the award extended up to 31-3-1951. To that letter the respondent replied on 19-12-1950 and he stated that he had no objection to the continuance of the arbitration by Sri Malik and to the time being extended up to 31-3-1951. It appears, however, that in the letter which the respondent addressed to the Executive Engineer, Calcutta Aviation Division No. I, on the same date, he stated that he had no objection to an extension of time up to 31-5-1951. 'May' obviously was a mistake for March.
5. The Union of India and the respondent having thus both agreed that Sri C. P. Malik should arbitrate on the disputes between them, both as regards the claim of Government and as regards the respondent's claim against them, the proceedings before the arbitrator commenced. Government's claim was for an amount of Rs. 41,124-10-0. On 11-1-1951, the respondent filed his counter-statement of facts to that claim and submitted that nothing should be awarded to Government on account of their claim. On the same date, he filed his own counter-claim and thereby asked for an award against Government of a sum of Rs. 1,60,470-11-0. On 8-6-1951, Government filed their counter-statement of facts to the respondent's counter-claim.
6. The hearings before the arbitrator appear to have been numerous and of a very detailed character, as would appear from some of the minutes of the proceedings before him included in the paper book. Sittings were held on the 16th and the 17th of April, 1951 which must have been limited to Government's claim against the respondent, since Government's counter-statement of facts to the respondent's counter-claim had not yet been filed. There were further sittings on the 17th, 18th and the 19th of October, and, so far as can be seen from the paper book, on the 25th of November and probably also on some further dates. The minutes of the 19th of October, 1951, end with the words 'Next hearing on 25-11-1951, at 11 a. m.' The minutes of the 25th of November have not been included in the paper book, but there was obviously a sitting on that date. Since the time for filing the award was finally extended up to 24-5-19S2 and the award was not filed till the 23rd of May, it would seem that many more sittings had taken place. The award went against the respondent.
7. On 16-12-1953, the respondent was served with a notice under Section 14(2) of the Arbitration Act. On 16-1-1954, he made an application for setting aside the award. By an order dated 16-7-1954, Sarkar J., set it aside and thereafter the present appeal was filed on the 27th of August following.
8. The ground of attack which succeeded before Sarkar J., was that the only person competent to arbitrate in disputes between the parties under the provisions of the arbitration clause was the Superintending Engineer of the Eastern Aviation Circle II and that Sri C. P. Malik, not being a holder of that office, could not possibly be a competent arbitrator and no award made by him could be valid. It was not disputed before the learned Judge that the Circle referred to in the arbitration clause was the Eastern Aviation Circle II and that owing to a subsequent reorganisation of Circles, no Eastern Aviation Circle II any longer existed. Nor was it disputed that under the terms of the arbitration clause Sri Malik could not be appointed an arbitrator. What, however, was said was that before Sri Malik was appointed and before the respondent submitted to arbitration by him, he had known that Sri Malik could not be the Superintending Engineer of the Eastern Aviation Circle II and, therefore, could not be a competent arbitrator under the terms of the arbitration clause. If with knowledge of the fact that Sri Malik could not be and was not a competent arbitrator, the respondent had yet gone to arbitration before him and, indeed, invited the arbitrator to adjudicate on a counter-claim made by himself, he was estopped from contending that the arbitrator who had made the award did not possess the requisite qualifications. Sarkar J., repelled that contention. He appears to have accepted the submission that the respondent had known of the incompetence of Sri Malik before he accepted, him as the arbitrator, but held that such knowledge could not ground a plea of estoppel on the facts of the case before him, since the arbitrator's incompetence was equally known to Government who were setting up the plea. The learned Judge referred to the elementary rule that no question of estoppel could arise where the party setting it up was himself aware of the true state of things, because the rule of estoppel presupposes a representation of a fact to a party who was otherwise ignorant of it. In the present case, Government knew better than anybody else that the Eastern Aviation Circle II had been abolished long ago and that there could no longer be any Superintending Engineer of that Circle. There could thus be no question of any representation being made by the respondent that Sri Malik was the Superintending Engineer of the Eastern Aviation Circle II at the time and no question of Government acting on the faith of such representation and altering their position accordingly. On that short ground the learned Judge rejected the Government's contention. He added that apart from taking the plea of estoppel, Government had not raised any other question before him and had not, in particular, tried to make any case of waiver or any case that quite apart from Clause 25 of the contract, there had been a fresh agreement between the parties for a reference of their disputes to the arbitration of Sri Malik. Further, contentions on those lines, the learned Judge added, would raise questions of fact which he could not go into, since the points had not been taken. He observed also that even if a case of a fresh agreement had been set up, Government would have to meet the difficulty of proving that the agreement had been in compliance with 6. 175 (3) of the Government of India Act, 1935.
9. As I said towards the beginning of this Judgment, the facts are somewhat extraordinary. The position is that the respondent, having agreed to the arbitration of Sri Malik on the claim made by Government, having, in addition, submitted a counter-claim of his own to the same arbitrator, having taken part in the arbitration proceedings from the beginning to the end and having agreed to extensions of time for filing the award more than once, has now turned round after the award has gone against him and is repudiating the authority of the arbitrator whose arbitration he not only submitted to, but had himself sought. It is quite clear, both from his reply to Government's claim and the counter-claim framed by himself, that he would have been quite prepared to accept from the arbitrator an award favourable to him. The award did not go in his favour and the question is whether having taken his chance with the arbitrator with knowledge of the arbitrator's incompetence, as the learned trial Judge has found, the respondent is, nevertheless, entitled in law to question the award as passed without jurisdiction. In my view, a very strong case will have to be found in order to hold that the respondent is so entitled.
10. Let us look at the facts. It cannot certainly be denied that the arbitrator contemplated by Clause 25 of the contract was the Superintending Engineer of the Eastern Aviation Circle II and that Sri C. P. Malik was not and could not be such Engineer. But, equally, can it not be denied that before he submitted to the arbitration of Sri Malik, the respondent had known that he did not possess the qualifications required by the arbitration clause. Government, by their affidavit in opposition, sought to make out that under the reorganisation, the Eastern Aviation Circle II had come to be a part of a new Circle called the Calcutta Aviation Circle, of which Sri C. P. Malik was the Superintending Engineer. Assuming that the old Eastern Aviation Circle II had merged in a new and larger Circle, the identity of the two Circles is yet not established and the Superintending Engineer of one could not be the same officer as the Superintending Engineer of the other. We must, therefore, proceed on the footing that Sri Malik did not satisfy the requirements of the arbitration clause, but the respondent as I have pointed out, knew of Sri Malik's want of competence and Sarkar J., appears to have proceeded on the same basis. Indeed, in his application for setting aside the award, the respondent did not even seek to make out that he had submitted to the arbitration of Sri Malik without knowing that he did not possess the qualifications required by the arbitration clause and even after Government had stated in paragraph 20 of their own affidavit-in-opposition that the respondent had acted throughout as if Sri Malik 'was a valid and qualified arbitrator to act in terms of the said arbitration agreement', all that the respondent said in paragraph 13 of his affidavit-in-reply was that he denied that, by consenting to the application for extension of time or by addressing letters to Sri Malik, he had disabled himself from contending that the award was not valid. He was still not saying that he had submitted to the arbitration of Sri Malik without knowing and without having any cause to suspect that he did not possess the requisite qualifications. In each one of the letters, beginning with the letter by which he informed the respondent of his appointment as arbitrator, Sri Malik gave his full designation of 'Superintending Engineer, High Project vide, C. P. W. D.' and therefore each time the respondent had clear notice that Sri Malik did not possess the qualifications required by the arbitration clause. Indeed, the question of the respondent's knowledge is clinched by the statements contained in paragraph 34 of the plaint of his intended suit, a copy of which was served with his notice under Section 80 of the Code of Civil Procedure. In that paragraph he stated as follows :
'That no arbitration is being possible due to the fact that the Circle, that is the Eastern Aviation Circle II, has ceased to function. The plaintiff is to take resort to legal action in Court for the claim of Rs. 1,60,395-3-0.'
The notice under Section 80 is dated 19-10-1949, whereas the intimation that Sri Malik had been appointed arbitrator was conveyed to the respondent by a letter, dated 12-12-1950. There can thus be not the slightest doubt that at the time the respondent received that intimation, he was fully aware that the Eastern Aviation Circle II having ceased to exist, there could no longer be a Superintending Engineer of that Circle and that the arbitrator appointed by Government could not be a competent arbitrator, as concern-plated by the arbitration clause.
11. If in spite of such knowledge, the respondent submitted to the arbitration of Sri Malik On the claim made against him by Government and also submitted a counter-claim to the same-arbitrator on his own account and if he participated in the arbitration proceedings throughout their course, is he entitled in law now to contend that the arbitrator was not qualified to arbitrate? Sarkar J., held that the respondent could not be said to be estopped from so contending: by reason of any representation he had made to Government, but, in my view, he was not right in thinking that the only representation relevant to the case was representation as to the qualifications of the arbitrator. It is true that the respondent could not create any disability for himself by representing to Government a fact which they already knew. Sri Malik's lack of competence to arbitrate in the capacity of the Superintending Engineer of the Eastern Aviation; Circle II was certainly known to Government and Sarkar J., was obviously right in holding that there could not possibly be any question of Government having been induced to act in a particular manner on any representation made by the respondent as regards that matter. The learned Judge, in my view, was also right in holding that the decision in Oakland Metal Co. Ltd. V. D. Benaim & Co. Ltd., (1953) 2 QB 261: (1953) 2 All FR 650 (A), could be of no assistance to Government. That was a case where the arbitration agreement provided for two arbitrators possessed of certain qualifications, one to be nominated by each party, and one of the parties nominated a person who did not possess the requisite qualifications. When the award went against him he contended that the arbitrator nominated by him was not competent to act as an arbitrator at all, but the contention was repelled on the ground that whether or not his own nominee possessed the requisite qualifications was a matter known to him and not known to he opponent and therefore, by nominating the person concerned, he had made a representation to his opponent that his nominee did possess the qualifications required. Having made that representation and having induced his opponent to act on its faith, he was estopped from contending, after the award had gone against him, that in fact his nominee did not possess the requisite qualifications. That case can clearly have no application here, because Sri C. P. Malik was nominated in the first instance by Government and the respondent had certainly not put him forward to Government, as a competent arbitrator or represented to them that he possessed the qualifications required by Clause 25 of the contract. Dealing with a similar contention raised in similar circumstances in an action brought by a party to an arbitration agreement for a declaration that the award was null and void on the ground that neither the arbitrator nominated by him, nor the arbitrator nominated by his opponent possessed the requisite qualifications, Pickford J., observed in the case of Jungheim, Hopkins & Co. v. Foukelmann, (1909) 2 KB 948 (B), that a question of estoppel might arise so far as the plaintiffs' own arbitrator was concerned. 'But I do not see,' continued the learned Judge, 'how that reasoning can apply to the qualification of the arbitrator appointed by the other party. The plaintiffs never represented that the arbitrator appointed by the defendant was properly qualified. They thought that he was qualified, but they made no representation to that effect to the defendant, nor did they make any representation that they would not take objection to the arbitrator's want of qualification of which they were ignorant.' The facts are mostly similar in the present case with, however, the vital difference that the respondent was not ignorant of the arbitrator's want of qualification.
12. Cases where a party to an arbitration agreement submitted to arbitration of an irregular character and, after the award has been made, sought to repudiate it on the ground of the irregularity are numerous. Broadly stated, the preponderance of judicial opinion is in favour of the view that in such circumstances no objection to the award can validly be taken. Most of the cases deal with irregularities in procedure, but there are a few where the competence of the arbitrator was concerned. In the old case of Matson v. Trower, (1824) Ry & Mood, 17: 171 ER 927 (C), the award was made by an umpire appointed by the arbitrators who had no authority to appoint an umpire. The award being challenged by one of the parties on the ground that it was an award made without jurisdiction, Abbott, L. C. J., overruled the contention. 'The parties,' observed the learned Lord Chief Justice, 'have recognised the authority of the umpire by submitting to be examined by him, as to the matters in dispute.' His Lordship thought that having submitted to the jurisdiction of the umpire, none of the parties could have the right to question the award made by him although the appointment of the umpire might have been without jurisdiction. It would be noticed that this was a case of an absolute want of authority in the umpire who had made the award. Similarly, in Donald Campbell & Co. v. Jeshraj Gir-dhari Lal, AIR 1920 PC 123 (D), the facts were that Mr. Peprson, who subsequently became a judge of this Court, was appointed arbitrator by one of the parties to the dispute and proceeded to act as the sole arbitrator, although no notice was given to the other party under Section 9(b) of the Arbitration Act, 1899, to appoint his own arbitrator and although necessarily he had not failed to do so. The other party, however, submitted to arbitration by Mr. Pearson. The Judicial Committee, while pointing out that the appointment of Mr. Fearson was clearly contrary to the provisions of the Act, held that any objection on that score had been waived by the party who was now objecting to the award. 'They, of course, knew,' observed Viscount Fin-lay, 'that no notice in writing to appoint their arbitrator to act along with Mr. Pearson had been sent to them. They knew that he was proceeding as sole arbitrator. They objected to his proceeding with the arbitration on the ground of jurisdiction and construction of the agreement and on the ground that there was no matter in dispute with regard to the shipments. Not a word was said by them as to any defect in his appointment as arbitrator. All the facts on this head were within their knowledge.' Having thus set out the facts, the learned Lord proceeded to hold that the party objecting to the award could no longer be permitted to rely on the defect in procedure which, according to it, had vitiated the award.
13. It may, however, be said that strictly speaking these cases are not relevant, because in none of them was there any basic incompetence or lack of qualification in the arbitrator himself, but there was only an irregularity in the manner of his appointment. This distinction, however, seems to me to be irrelevant when the question is one of estoppel. It may be that in a particular case there was not and could not be any representation by the party, sought to be held to an estoppel, as to the competence of the arbitrator, but if knowing of his incompetence he submitted to arbitration by him, there was clearly a representation that there was no intention to object to the arbitrator on the ground of his incompetence and that there was willingness to go to arbitration before him. With respect, Sarkar J., was not, as I have already said, right in thinking that if there could be no representation by the respondent as to the competence of the arbitrator, no question of estoppel could at all arise, because, in my view, even if there could be no representation of that fact, there could still be a representation of the attitude of the respondent and if there was such a representation on the faith of which Government proceeded with the arbitration, there would be sufficient basis on which estoppel could be grounded. The principle applicable to such cases was very lucidly and forcibly expressed by the House of Lords in the case of Cairncross v. Lorimer, (1860) 3 Macq 827: 7 Jur NS 149 (E). The facts in that case were that, for many years, there had been a dissenting congregation called 'the United Original Seceders'. Some of the members of the congregation acquired as trustees and managers a piece of ground upon which they built a chapel and certain other buildings. The congregation continued to use the chapel for a number of years when a large majority of the members, including the minister, resolved to join another dissenting body, called 'the Free Church', which Was considered to hold substantially the same doctrine. The minister was then admitted as a member of the Free Church and the congregation was declared to belong to that body of Dissenters. Some time later, the minister died and a successor to him was appointed. Thereafter, certain persons who were members of the original congregation instituted a suit for a declaration that the chapel and the ground belonged to them and such other persons as adhered to the original doctrine, for recovery of the properties and also, it would appear, for a declaration that the minister had no right to hold the office. It was found that the plaintiffs and others had for many years acquiesced in the possession of the chapel and the ground by the persons who had seceded from the seceders and also acquiesced in the appointment of the minister and on that finding it was held that the plaintiffs were estopped from claiming-any of the reliefs wanted by them. 'The doctrine will apply,' observed Campbell, L. C., 'which is to be found, I believe, in the laws of all civilised, nations, that if a man, either by words or by conduct, has intimated that he consents to an act which has been done, and that he will offer no opposition to it, although it could not have been lawfully done without his consent, and he thereby induces other to do that from which they otherwise might have abstained, he cannot question the legality of the act he had so sanctioned, to the prejudice of those who have so given faith to his words, or to the fair inference to be drawn from his conduct.' And again. 'I am of opinion that, generally speaking, if a party has an interest to prevent an act being done, and acquiesces in it, so as to induce a reasonable belief that he consents to it, and the position of others is altered by their giving credit to his sincerity, he has no more right to challenge the act to their prejudice than he would have had if it had been done by his previous license.' To my mind, these observations are peculiarly apposite in the present case. A representation in order to attract the rule of estoppel need not always be a representation of a physical fact, but may as well be the representation of an attitude or a state of mind. As has been pithily observed, the state of a man's mind is as much a matter of fact as the state of his digestion. Here, the act that had been done was the appointment of Sri Malik by Government as the arbitrator and the representation which the respondent made was that he would not offer any opposition to it, although the appointment could not lawfully have been made without his consent. By such representation he induced Government to proceed with arbitration by Sri Malik from which they might have abstained if the respondent had questioned its legality. In the words of the second passage I have read from the judgment, the respondent by his conduct induced a reasonable belief in Government that he consented to the appointment of Sri Malik and Government proceeded with the arbitration by Sri Malik by giving credit to the respondent for sincerity. It appears to me that in those circumstances, although there could be no representation by the respondent as to the actual competence of the arbitrator, the rule of estoppel will still bind him and will still prevent him from contending that Sri Malik was not qualified under the terms of the agreement to arbitrate in the dispute.
14. This is sufficient to dispose of the appeal. Sarkar J., has observed, which I have already pointed out, that no case was sought to be made before him, either of waiver or of a fresh agreement. It appears to me, however, that in effect what was pleaded in paragraph 20 of the affidavit-in-opposition was a clear case of waiver, because it was said that the respondent had throughout acted as if Sri Malik was a valid and qualified arbitrator to act in terms of the arbitration agreement and the effect of that pleading was to submit that the respondent had waived his right to insist on a properly qualified arbitrator and was content with Sri C. P. Malik. I need not, however, enlarge on the question of waiver, because the point, though taken, wag not actually argued and because, in my view, the appellant is entitled to succeed even on the ground of estoppel. I would only point out that waiver also presupposes knowledge of the right waived and in this particular case there was knowledge in the respondent that he was entitled to object to the appointment of Sri Malik who was not and could not be an arbitrator qualified under the arbitration clause. If that knowledge was there, as has been proved, by the facts I have already stated, and if there was submission to arbitration by Sri C. P. Malik, which was not and cannot be disputed, I do not see that any other fact is required for making out a case of waiver or that any other fact remains to be found. I may add that although the distinction between estoppel and waiver has now been worked out with some precision and that estoppel is said to be a rule of evidence, while waiver is said to be a cause of action, the line of demarcation between the two is exceedingly thin and perhaps the old statement of Bigelow that when something is called waiver, what is done is that estoppel is given a new name, has perhaps not altogether lost its force.
15. The principles laid down by the House of Lords in the case of (1860) 7 Jur NS 149 (E), were approved of by the Judicial Committee in the case of Sarat Chunder Dey v. Gopal Chunder Laha, 19 Ind App 203 (F). I may also take the liberty of reading a passage from another Privy Council decision where the general principle applicable to such cases is stated. 'On the whole, therefore, their Lordships think that the appellant, having a clear knowledge of the circumstances on which he might have founded an objection to the arbitrators proceeding to make their award, did submit to the arbitration going on; that he allowed the arbitrators to deal with the case as it stood before them, taking his chance of the decision being more or less favourable to himself; and that it is too late for him, after the award has been made, and on the application to file the award, to insist on this objection to the filing of the award': see the case of Chowdhri Murtaza-Hossein v. Mt. Bibi Bechunnissa, 3 Ind App 209 at p. 220 (PC) (G). It is true that the question in the present case is a question of competence of the arbitrator which in a sense is a question of jurisdiction, but it is not like the jurisdiction of a Court, because the jurisdiction of arbitrators is derived from consent of the parties.
16. For the reasons I have given earlier, this appeal is allowed. The order of Sarkar J., dated 16-7-1954, is set aside and the respondent's application for setting aside the award is dismissed. As there has been some remissness on the part of the appellant in the preparation of the paper book which does not include the notice under Section 80 of the Code of Civil Procedure, there would be no order for costs.
S.C. Lahiri, J.
17. I agree.