TMI Blog2018 (2) TMI 1131X X X X Extracts X X X X X X X X Extracts X X X X ..... Civil Appeal No.1650 of 2018 - - - Dated:- 15-2-2018 - MR. J. Chelameswar And Mr. Sanjay Kishan Kaul JJ. For the Appellant(s) : Mr. Balaji Srinivasan, AOR, Mr. Mayank Kshirsagar, Adv., Ms. Pratiksha Mishra, Adv., Ms. Vaishnavi Subrahmanyam, Adv., Mr. Abhishek Bharti, Adv., Ms. Srishti Govil, Adv., Mr. Arunava Mukherjee, Adv. And Mr. Alok Kumar, Adv. For the Respondent(s) : Mr. Pashupathi Nath Razdan, AOR JUDGMENT SANJAY KISHAN KAUL, J . 1. The divergence of legal opinion of different High Courts on the question as to whether an award under the Arbitration Conciliation Act, 1996 (hereinafter referred to as the said Act ) is required to be first filed in the court having jurisdiction over the arbitration proceedings for execution and then to obtain transfer of the decree or whether the award can be straightway filed and executed in the Court where the assets are located is required to be settled in the present appeal. Facts: 2. The appellant claims that the first respondent approached the appellant for grant of a loan for purchase of a Tata Lorry-HCV 2005 model, which loan was granted by the appellant on the terms conditions specifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court by filing the Special Leave Petition on the ground that no useful purpose would be served by approaching the Madhya Pradesh High Court in light of the view already expressed by that Court in conflict with the opinions of some other High Courts. The Conflicting Views: A. The transfer of decree should first be obtained before filing the execution petition before the Court where the assets are located: 5. The aforesaid view has been adopted by the Madhya Pradesh and the Himachal Pradesh High Courts: i. Computer Sciences Corporation India Pvt. Ltd. v. Harishchandra Lodwal Anr. AIR 2006 Madhya Pradesh 34 The learned single Judge of the Madhya Pradesh High Court took recourse to the provisions of Section 42 of the said Act, dealing with the issue of jurisdiction in respect of an arbitration agreement read with Section 2(e) of the said Act which defines the Court . In the context of Section 36 of the said Act dealing with the enforcement of an award prescribing that the award shall be enforced under the Code of Civil Procedure, 1908 (5 of 1908) in the same manner as if it were a decree of the Court, it was observed that the same principle would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on Limited v. V. Balaji G. Anr. 2011 (4) KLJ 408 (Kerala High Court) The learned single Judge expressed the view that the Court cannot insist for a decree to receive an execution application on its file and, thus, there was no question of transfer of a decree. The execution court was to accept the execution petition with a certified copy of the award wherever it was filed. iii. Kotak Mahindra Bank Ltd. v. Sivakama Sundari Ors. (2011) 4 LW 745 (Madras High Court) Section 39 of the Code enables the Court which passed the decree to transfer it to any subordinate court even of its own motion without application by the decree holder. The learned single Judge of the Madras High Court examined the provisions of the said Act and the said Code and in the process, a reference was made to Section 41 of the said Code imposing an obligation upon the executing court to inform the court which passed the decree about the completion of execution or about the failure to execute the decree along with attending circumstances. A passing reference was made to Section 46 of the said Act which speaks of precepts. In a nutshell the conclusion made was that every decree of a civi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he learned single Judge observed that the arbitrator cannot be treated as a court although the award made by him will be executed as a decree. Thus, Sections, 38 39 of the said Code would have no application and the award can, thus, be filed for execution as a decree of civil court wherever the judgment debtor resides or carries on business or has properties within the jurisdiction of the said court. vi. Indusind Bank Ltd. v. Bhullar Transport Company MANU/PH/2896/2012 (Punjab Haryana High Court) The view of the Delhi High Court referred to aforesaid was adopted. vii. Sri Chandrashekhar v. Tata Motor finance Ltd. Ors. (2015) 1 AIR Kant R 261 (Karnataka High Court) The learned single Judge of the Karnataka High Court opined that the question of filing an execution petition before the court which passed the decree and then seeking a transfer of the decree to the court where the assets are located would not arise, as an award is not a decree passed by the court. Our View: 6. In order to appreciate the controversy, we would first like to deal with the provisions of the said Code and the said Act. 7. Part II of the said Code deals wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tent to execute such decree to attach any property belonging to the judgment-debtor and specified in the precept. (2) The Court to which a precept is sent shall proceed to attach the property in the manner prescribed in regard to the attachment of property in execution of a decree: Provided that no attachment under a precept shall continue for more than two months unless the period of attachment is extended by an order of the Court which passed the decree or unless before the determination of such attachment the decree has been transferred to the Court by which the attachment has been made and the decree-holder has applied for an order for the sale of such property. Questions to be determined by Court executing decree 10. The relevance of the aforesaid provision is that the application of the decree holder is made to the Court which passed the decree, which issues the precepts to any other Court competent to execute the said decree. As noticed, the expression the Court which passed the decree is as per Section 37 of the said Code. We may note at this stage itself that in the case of an award there is no decree passed but the award itself is executed as a decree by f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cree sought to be executed; (h) the amount of the costs (if any) awarded; (i) the name of the person against whom execution of the decree is sought; and the mode in which the assistance of the court is required, whether- (i) by the delivery of any property specifically decreed; (ii) by the attachment, or by the attachment and sale, or by the sale without attachment, of any property; (iii) by the arrest and detention in prison of any person; (iv) by the appointment of a receiver; (v) otherwise, as the nature of the relief granted may require. 13. A perusal of the aforesaid shows that what is sought to be disclosed is that the details like the number of suits, appeal against the decree, etc. find a place, which really does not have a relevance to the fiction of an award to be treated as a decree of the Court for purposes of execution. 14. We would now like to refer to the provisions of the said Act, more specifically Section 36(1), which deals with the enforcement of the award: 36. Enforcement. (1) Where the time for making an application to set aside the arbitral award under section 34 has expired, then, subject to the provisions of sub-section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roceedings shall be made in that Court and in no other Court. 18. The aforesaid provision, however, applies with respect to an application being filed in Court under Part I. The jurisdiction is over the arbitral proceedings. The subsequent application arising from that agreement and the arbitral proceedings are to be made in that court alone. However, what has been lost sight of is Section 32 of the said Act, which reads as under: 32. Termination of proceedings.- (1) The arbitral proceedings shall be terminated by the final arbitral award or by an order of the arbitral tribunal under sub-section (2). (2) The arbitral tribunal shall issue an order for the termination of the arbitral proceedings where- (a) the claimant withdraws his claim, unless the respondent objects to the order and the arbitral tribunal recognises a legitimate interest on his part in obtaining a final settlement of the dispute, (b) the parties agree on the termination of the proceedings, or (c) the arbitral tribunal finds that the continuation of the proceedings has for any other reason become unnecessary or impossible. (3) Subject to section 33 and sub-section (4) of section 34, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
