TMI Blog1971 (7) TMI 97X X X X Extracts X X X X X X X X Extracts X X X X ..... of August, 1977, was made in favour of the petitioning creditor by which the company was to pay a sum of Rs. 89,986'90 together with interest thereon at the rate of 15% per annum from 20th of June, 1976, till the date of payment and the costs of arbitration as awarded is Rs. 1,590. As the company did not pay the said sum awarded in favour of the petitioning creditor by the Tribunal of Arbitration in spite of repeated requests and reminders, the petitioning creditors caused a statutory notice to be served on the company through its advocate on record, Jalan Company, dated the 24th of January, 1978. The company did not pay the amount and consequently the present winding-up petition has been filed. The points involved in this application as to whether the winding-up petition can be said to be an abuse of the process of the court and for that purpose it is necessary to find out whether a winding up order can be passed in this proceeding. To arrive at such a finding the court has to see whether the winding up petition can be said to be an abuse of the process of the court and for that purpose it is necessary to find out whether a winding-up order can be passed in this proceeding. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... il court having jurisdiction in the matter he shall pay the costs between attorney and client in connection with the filling and enforcement of the award unless the court shall otherwise direct." Now, it is an admitted fact in this case that the disputes between the parties under the contract were referred to arbitration under the arbitration clause and the award has been made which is not yet filed in court and has not been set aside or challenged in any proceeding. Therefore, the question was raised in this application whether having regard to the specific clause in the arbitration agreement for enforcement of the award, if the same is not satisfied by the party against whom the award is made, would the party, who can enforce the award for realisation of the sum awarded, be entitled to the costs of such proceeding for enforcement and realisation. The petitioning creditor can also enforce the award by way of winding-up proceeding and also there is another question raised by the company that the petitioning creditor's firm, being a sister concern of other firms, Sree Annapurna Financial Corporation and Narendra Kumar Additya Kumar, which had dealings and transactions with the com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titioning creditor had the option either to enforce the said award by obtaining a judgment upon award and execution of the decree passed therein against the company or to present a winding-up petition which is a legitimate mode and alternative method for equitable execution. Mr. Sen also referred to an unreported decision of mine in the Company Petition No. 176 of 1976 ( Dalhousie Jute Company Limited v. Mulchand Laxmichand ) delivered on the 9th of September, 1976, where a question arose whether a winding-up petition can be presented on the basis of an award which has not been filed and made a rule of the court. In the facts of that case, I held that the petitioning creditor was entitled to present the winding-up petition, even though the award was not made a rule of the court under the Arbitration Act for enforcement of the same. I understand that an appeal has been preferred from the said unreported decision of mine but no interim stay was granted and the appeal is pending. Mr. Sen, therefore, submitted relying on my said decision that in the present case also the same principle will apply. In my view, the facts in Dalhousie Jute Company's case was entirely different from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... award is not a mere waste paper unless it is made a rule of the court. Therefore, for the purpose of taking it as a clear and conclusive evidence of the debt due, there is no bar for any court or the winding-up court; that is, when the award is not set aside, it remains final and binding on the parties and has some legal effect. Therefore, unless there is any other reason for which the court will not allow the winding-up petition to be proceeded with, in my view, there is no bar for a court to admit a winding-up petition on the basis of a valid, legal and binding award, which has not been set aside or challenged according to law. As it is well settled that the award can be challenged or set aside according to the provisions laid down in the Arbitration Act, and in no other way, and, it is admitted in this case that there is no such proceeding or challenge made to the award in any court of law under the provisions of the Arbitration Act, the possibility of challenging an award if the same is filed in court is something which the court cannot encourage or take any notice of, unless proceedings are taken and pending under the Arbitration Act, for setting aside the said award or on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dgment upon award and enforcement of the decree. Further, this is a serious question of law as to the interpretation of the arbitration agreement between the parties and in my view, the dispute raised in respect of the said interpretation is a bona fide dispute. As I have already observed the present case is entirely different from the case in which I have decided that without filing an award, a party can present a winding-up petition on the basis of the award as a valid and legal debt due and payable. In that case there was no specific agreement for filing the award and enforcement of the same by the process of the court. Further, in this case, it appears that the petitioning creditor's firm along with its sister firm had gross dealings and transactions with the company, that is, the petitioning creditor's firm and its sister concern supplied cotton to the company and the company in its turn supplied cotton yarn to the petitioning creditor's firm and its sister concern, and, having regard to the fact that a suit is pending, which is filed by the company against one of the sister concerns of the petitioning creditor, it cannot be said that the company's contention or the disputes r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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