TMI Blog2004 (3) TMI 810X X X X Extracts X X X X X X X X Extracts X X X X ..... he present respondent, Tata International Ltd., has filed a Special Civil Application No. 11866 of 2003, under Article 227 of the Constitution of India, by which certain observations made by the trial Court in its judgment are challenged. Since, decision in Special Civil Application and Misc. Civil Application depends upon the decision of this Civil Revision Application, parties have addressed the Court at length in this Civil Revision Application. 2. In order to appreciate the controversy between the parties, it is necessary to refer to certain factual aspects of the matter. The respondent of this Civil Revision Application, Tata International Ltd., and the present petitioner entered into two contracts, by which the respondent had agreed to purchase certain quantity of special grade Caster Oil from the present petitioner herein. Subsequently, some dispute arose between the parties, and ultimately, arbitration proceedings have been initiated. The dispute was raised before the Arbitrator, i.e. Federation of Oil, Seeds Fats Associations Ltd., London, U.K. (F.O.S.F.A.). The Arbitral Tribunal passed an award, being Award No. 3747 of 2001 dated 1-2-2001, directing the present ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty of the said proceedings before the City Civil Court on the ground that such Execution Petition is not maintainable as the respondent was required to prefer an application for making such award a decree of the Court and without there being any application of making such award a decree of the Court, the Execution Petition straightaway is not maintainable. 5. After considering the argument of both the sides and after considering the material on record, the trial Court overruled the aforesaid preliminary objections raised by the petitioner. The trial Court came to the conclusion that it has jurisdiction to entertain the said application for enforcement of the foreign award. The trial Court also found that since the opponent (the petitioner herein) is having its property within the territorial jurisdiction of the trial Court, the said Court is entitled to proceed with the application for execution of the aforesaid foreign award. However, while passing the impugned order the trial Court has also made certain incidental observations by observing that since the civil suit being Special Civil Suit No. 19 of 2001 is pending before the Civil Judge (S.D.), Gandhidham, and that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ement of the foreign award. Therefore, it is submitted that there is no substance in the preliminary objections raised by the present petitioner before the trial Court and the trial Court is justified in rejecting said objections. 9. It is required to be noted that there is a special machinery in the Act for enforcement of foreign award. The point which is required to be considered is whether the civil suit filed by the present petitioner in the Gandhidham Court can be equated with an application under Section 34 of the Act. At this stage, it is fruitful to refer to Sections 47, 48 and 49 of the Arbitration Conciliation Act, 1996 which are as under : Section 47. Evidence : (1) The party applying for the enforcement of a foreign award, shall at the time of the application, produce before the Court - (a) the original award or a copy thereof, duly authenticated in the manner required by the law of the country in which it was made; (b) the original agreement for arbitration or a duly certified copy thereof; and (c) such evidence as may be necessary to prove that the award is a foreign award. (2) If the award or agreeme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the country in which, or under the law of which, that award was made. (2) Enforcement of an arbitral award may also be refused if the Court finds that -- (a) the subject-matter of the difference is not capable of settlement by arbitration under the law of India; or (b) the enforcement of the award would be contrary to the public policy of India. Explanation :- Without prejudice to the generality of Clause (b) of this sub-section, it is hereby declared, for the avoidance of any doubt, mat an award is in conflict with the public policy of India if the making of the award was induced or affected by fraud or corruption. (3) If an application for the setting aside or suspension of the award has been made to a competent authority referred to in Clause (e) of Sub-section (1) the Court, may if it considers it proper, adjourn the decision on the enforcement of the award and may also, on the application of the party claiming enforcement of the award, order the other party to give suitable security. Section 49. Enforcement of Foreign Awards :- Where the Court is satisfied that the foreign award is enforceable under this Chapter, the aw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t such foreign award is not enforceable in view of the pendency of the civil suit. Only remedy available to the petitioner is to invoke provisions of Section 48 of the Act and the petitioner can always lodge objections as provided by the said provisions and after considering such objections, the Court has to reach the satisfaction whether such foreign award is enforceable, and ultimately, if any such order is passed under Section 48 of the Act, such order is deemed to be the decree of the Court. Looking to the scheme of the Act, it is clear that whatever objections, which are required to be raised, are required to be raised in consonance with the provisions of Section 48, in enforcement application itself. Ultimately, if the Court comes to the conclusion that such an award is enforceable, only thereafter, such award will be treated as a decree of the Court. Therefore, considering the scheme of the Act, it is clear that such foreign awards are required to be dealt with as provided in Part II of the Act, and as per the provisions of Sections 44 to 49 of the Act. Therefore, the contention of Mr. Gupta that his Special Civil Suit is in the nature of an application under Section 34 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n and enforcement of foreign arbitral awards. The object of the Act is to minimize supervisory role of the Court and to give speedy justice. In this view, the stage of approaching the Court for making the award a rule of Court as required in the Arbitration Act, 1940 is dispensed with in the present Act. If the argument of the respondent is accepted, one of the objects of the Act will be frustrated and defeated. Under the old Act, after making an award and prior to execution, there was a procedure for filing and making an award a rule of Court i.e. a decree. Since, the object of the Act is to provide speedy and alternative solution to the dispute, the same procedure cannot be insisted upon under the new Act when it is advisedly eliminated. If separate proceedings are to be taken, one for deciding the enforceability of a foreign award and the other thereafter for execution, it would only contribute to protracting the litigation and adding to the suffering of a litigant in terms of money, time and energy. Avoiding such difficulties is one of the objects of the Act as can be gathered from the scheme of the Act and particularly looking to the provisions contained in Sections 46 to 49 i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ign award should produce before the Court. Section 48 states as to the conditions for enforcement of foreign awards. As per Section 49, if the Court is satisfied that a foreign award is enforceable under this Chapter, the award shall be deemed to be a decree of that Court and that Court has to proceed further to execute the foreign award as a decree of that Court. If the argument advanced on behalf of the respondent is accepted, the very purpose of the Act in regard to speedy and effective execution of foreign award will be defeated. Thus, none of the contentions urged on behalf of the respondent merit acceptance so as to uphold the impugned judgment and order. We have no hesitation or impediment in concluding that the impugned judgment and order cannot be sustained. 13. Considering the aforesaid aspect of the matter, in my view, there is absolutely no substance in any of the preliminary objections raised by the present petitioner before the trial Court. As observed earlier, the application of the respondent herein before the trial Court for enforcement of the foreign award is not dependant upon the Civil Suit filed by the petitioner in the Gandhidham Court. In the presen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ey. It is, therefore, clear that in respect of an award for money, subject-matter can be said to be money. In other words, therefore, petition for enforcement of the foreign award can be filed to the Court where the party may have money. This is important consideration considering a party need not be tied down as in the case of Part I where the subject-matter is the subject-matter of the arbitration. In other words, if the party has a foreign award in its favour, it can seek to enforce the award in any part of the country where it is sought to be enforced as long as money is available or suit for recovery of money can be filed. In my opinion, therefore, expression subject-matter of the award to the explanation under Section 47 is different from the expression subject-matter of the arbitration under Section 2(e) of Part I of the Act. A foreign award if allowed to be enforced is a deemed decree. It can be enforced anywhere that the respondents may have money. In other words, it is in the nature of forum hunting. The expression subject-matter of the award and the subject-matter of the arbitration agreement are two different and distinct expressions. In respect of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l territorial limits of the Ahmedabad city itself. Therefore, considering the special provision regarding enforcement of a foreign award and considering the fact that the money is available, which can satisfy the foreign award, within the territorial limits of City Civil Court, Ahmedabad, it cannot be said that the City Civil Court, Ahmedabad, is lacking the territorial jurisdiction. Even otherwise, between the same parties, the Bombay High Court itself has observed that such award can be enforced at a place where money is available and it is also an admitted fact that the petitioner-Company is having its branch office at Ahmedabad and it is also not in dispute that the petitioner is a public limited company having its Branch Office at Ahmedabad and having its regular Banking Account at Ahmedabad. Therefore, it cannot be said that the City Civil Court at Ahmedabad has no territorial jurisdiction in connection with enforcement of the foreign award. No other points were argued by Mr. Gupta in this revision application. 17. In view of what is stated above, in my view, the trial Court is absolutely justified in overruling the preliminary objections raised by the present petit ..... X X X X Extracts X X X X X X X X Extracts X X X X
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