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2005 (12) TMI 592

..... rbitrator Mr Samuel A. Houbold Asq. at London, U.K. in ICC case No. 11881/MS. It is also prayed that the order dated 31.5.2005 passed by Ms Shailender Kaur, Additional District Judge, Delhi in Ex. No. 19/2004 be set aside and that the proceedings pending before the Court of the District Judge, Tiruchirapalli, Tamilnadu be stayed. 2. At the outset it must be made clear that the prayers with regard to setting aside the said order of 31.5.2005 and staying of the proceedings before the District Court at Tiruchirapalli cannot be allowed. The former, because this is not an appeal from the said order dated 31.5.005 and, the latter, because the District Court at Tiruchirapalli does not fall within the jurisdiction of this High Court. Thus this petition is to be considered purely from the standpoint of whether the foreign award can be enforced by this Court. 3. Under the foreign award dated 10.11.2003 the Judgment Debtor/Respondent is liable to pay to the petitioner/decree holder (1) U.S. $ 36,584.74 plus 4% interest with effect from 1.11.1999 till date of payment; and (2) £14,484.70 plus U.S. $ 21,000 plus 4% interest on both the sums from 10.11.2003 (date of award) till date of full .....

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..... tition (Ex. No. 19/2004) on the ground that the respondent/judgment debtor had already filed an application for setting aside the award, in question, in the District Court at Tiruchirapalli, Dalmiya Puram, Tamil Nadu. In the said application, it was also contended that the court of the ADJ did not have pecuniary jurisdiction to try the matter as the subject matter was in excess of ₹ 20,00,000/-. On 31.5.2005, the learned Additional District Judge, inter alia, passed the following order:- Decree Holder has filed an execution for an amount of ₹ 19,99,643/-. Thus the same is within the pecuniary jurisdiction of this Court. Section 42 of the Arbitration and Conciliation Act, 1996 provides: Notwithstanding anything contained elsewhere in this Part or in any other law for the time being in force, where with respect to an arbitration agreement any application under this Part has been made in a Court, that Court alone shall have jurisdiction over the arbitral proceedings and all subsequent applications arising out of that agreement and the arbitral proceedings shall be made in that Court and in no other court. However, this Court has no power to transfer the execution proceedin .....

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..... de in a court, that court alone shall have jurisdiction over the arbitral proceedings and all subsequent applications arising out of that agreement and the arbitral proceedings shall be made in that court and in no other court. A plain reading of the provision makes it clear that it has reference to an application under 'this part'.Section 42 falls in Part I of the said Act. Therefore, the expression 'any application under this Part' appearing in Section 42 has reference to an application filed under Part I of the said Act. In other words, by virtue of Section 42, it is made clear that once an application has been filed under Part I of the said Act in a particular Court, that Court alone would have jurisdiction over the arbitral proceedings and all subsequent applications arising out of the arbitration agreement and the arbitral proceedings would have to be made in that Court and in no other Court. The application which has supposedly been filed by the defendant/judgment debtor in the District Court at Tiruchirapalli has been filed under Section 34 of the said Act for setting aside the foreign award. The question that arises is whether a foreign award can at all be .....

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..... ard. - (1) x x x x (2) An arbitral award may be set aside by the court only if - (a) x x x x (b) the court finds that - (i) the subject-matter of the dispute is not capable of settlement by arbitration under the law for the time being in force, or (ii) the arbitral award is in conflict with the public policy of India. It may be further noted that Chapter 7 of Part I bears the heading 'recourse against arbitral award.' There is no such chapter in Part II. It is also intresting to note that Chapter 7 of Part I relates to finality and enforcement of arbitral awards and Part II in its entirety relates to 'enforcement of certain foreign awards'. Section 36 falling in Chapter VIII of part I deals with enforcement and prescribes that where the time for making the application to set aside the arbitral award under Section 34 has expired, or such application having been made, it has been refused, the award shall be enforceable under the Code of Civil Procedure, 1908 in the same manner as if it were a decree of the court. It, therefore, becomes clear that prior to enforcement of an arbitral award under Part I, it has to be seen as to whether any application under Section 34 ha .....

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..... of the Act otherwise the person in whose favor the Award has been made can execute the same as a decree. On the other hand, a person against whom a foreign Award has been made, is not required to challenge the same, because it cannot be executed against him in India unless the Court finds that it is enforceable. He can wait till the person in whose favor the foreign Award has been made, makes an application before the Court (Section 47). It is, therefore, quite clear that an application under Section 34 is not at all contemplated insofar as a foreign award is concerned. That being the case the filing of a Section 34 application by the respondent at Tirichirapalli would be of no consequence. And, for this reason also, the respondent cannot set up the bar of Section 42 as an impediment to this petition. Does this Court has the pecuniary jurisdiction? It was argued by the petitioner/decree holder that this Court had pecuniary jurisdiction inasmuch as the award amount was in excess of ₹ 20,00,000/-. What is interesting to note is that this very petitioner/decree holder did not object to the Execution Petition when the matter was before the learned Additional District Judge on the .....

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..... mp; Finance Co. Ltrd. v. CEC Ltd. & Anr: 1996 II AD (Delhi) 517. In that case, an objection has been raised that the simultaneous execution of the decree at Chandigarh and Delhi would be an abuse of the process of Court and therefore, the execution application at Delhi deserved to be dismissed or adjourned sine die unless and until the decree holder withdrew the execution application pending at Chandigarh. It was also contended, with reference to Section 41 of the Code of Civil Procedure, 1908, that so long as a certificate of non-satisfaction has not been issued and sent by one transferee court to the original executing court, a fresh application for execution seeking its transfer to another court would not lie. Repelling these objections, the Court held that no provision of Civil Procedure Code had been brought to its notice which would expressly prohibit simultaneous execution of a decree before two Courts. With reference to Section 39 of the CPC it was observed that the said provision is permissive in nature inasmuch as it provided for execution of a decree either by the Court which passed it or by the Court to which it is sent for execution. The Court held that the law doe .....

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..... Cholamandalam (supra) is also been clearly distinguishable. There, it was held that more than one Execution Petition was permissible where properties fell in different areas. That decision would have no applicability to the facts of the present case inasmuch as the territory over which the District Court has jurisdiction is also the territory over which this Court has jurisdiction. Therefore, it is not a case where assets and properties of a judgment debtor were located in different areas over which different courts had territorial jurisdiction. Clearly, the two decisions relied upon by the learned counsel for the petitioner would not be applicable to the facts of the present case. There is no difficulty in my coming to the conclusion that a second execution application filed in this Court when the first application is pending before the District Court falling within the territorial jurisdiction of this Court would not lie. 9. Thus, although I have found the objections raised by the respondent in respect of the Section 42argument to be untenable, this petition has to be dismissed because of my view that this Court does not have pecuniary jurisdiction to entertain this petition and .....

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