Grasim Industries Ltd. and ANR. Vs. M/S. Agarwal Steel  INSC 1659 (20
IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.
5994 OF 2004 Grasim Industries Ltd. & Anr. .... Appellants Versus Agarwal
Steel .... Respondent WITH CIVIL APPEAL NOS. 7477/2004 AND 1733/2005
O R D E R
learned counsel for the parties.
appeal by special leave has been filed against the judgment and order dated
14th May, of the High Court of Judicature at Madhya Pradesh at Jabalpur.
in detail have been set out in the impugned judgment and hence we are not
repeating the same here. Briefly stated the facts are that the appellant herein
entered into an agreement with the respondent and appointed the appellant as a
principal dealer for sale of its cement 'Vikram Premium Brand'. On 21.3.1997,
the respondent became the consignment agent of the appellant company and in
this behalf an agreement dated 1.5.1997 was 2 signed between the parties.
Disputes and differences arose between the parties under the said agreement
dated 1.5.1997 and the same were referred to an arbitrator. A copy of the
arbitration award dated 6.8.2000 is annexed as Annexure-P/10 to this appeal. In
the award the arbitrator has rejected the plea of the claimant-respondent that
the signature on Ex.D-8 dated 21.10.1997 were only in lieu of a receipt. The
case of the appellant was that the document Ex.D-8 was a joint statement of
account. The arbitrator held that the signatures on Ex. D-8, joint statement of
account, were made by the parties. However, he held that the signature on
behalf of the claimant-respondent was made under a mistake and hence the same
was not binding. Accordingly, the arbitrator re-examined each head of account
and ultimately held the appellant liable to pay to the respondent a sum of Rs.
49.90 lakhs along with interest. Objections under Section 34 of the Arbitration and
Conciliation Act, 1996 (hereinafter for short 'the
Act') were filed by the respondent before the IXth Addl. District Judge,
order dated 25.6.2001, the learned Addl. District Judge held that the appellant
was entitled to receive a sum of Rs. 62,000/- along with interest @ 18%. The
said order of the learned Addl. District Judge was put in challenge before 3
the High Court under Section 37 of the Act.
not going into the details of the impugned judgment except to note that in para
24 of the said judgment it has been stated that the arbitrator did not accept
the claimant-respondent's plea that the signatures on Ex.D-8 were only in lieu
of receipt. However, the arbitrator addressed himself to the facet whether the
admission was erroneous or mistaken or it was conclusive proof of the matter.
opinion, when a person signs a document, there is a presumption, unless there
is proof of force or fraud, that he has read the document properly and
understood it and only then he has affixed his signatures thereon, otherwise no
signature on a document can ever be accepted.
particular, businessmen, being careful people (since their money is involved)
would have ordinarily read and understood a document before signing it. Hence
the presumption would be even stronger in their case. There is no allegation of
force or fraud in this case. Hence it is difficult to accept the contention of
the respondent while admitting that the document Ex.D-8 bears his signatures
that it was signed under some mistake. We cannot agree with the view of the
High Court on this question. On this ground 4 alone, we allow this appeal, set
aside the impugned judgment of the High Court and remand the matter to the High
Court for expeditious disposal in accordance with law.
questions of law and fact, except the one decided by us hereinabove shall
remain open for the parties to be urged before the High Court. We make it clear
that we are making our observation that there was no mistake in the document
Ex. D-8, which the parties have signed.
order of this Court dated 23.9.2004, as modified on 9.1.2006, shall continue to
remain in operation till final disposal of the matter by the High Court.
allowed. No order as to the costs.
APPEAL NOS. 7477/2004 AND 1733/2005 In terms of our order in Civil Appeal No.
5994/2004, these appeals also stand disposed of.
.....................J. (MARKANDEY KATJU)
.....................J. (ASOK KUMAR GANGULY)