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SUPREME COURT OF INDIA
Dipak Misra, C. Nagappan, JJ.
Arun Dev Upadhyaya – Appellant
Versus
Integrated Sales Service Ltd & Anr. – Respondents
Civil Appeal Nos. 8475-76 of 2016 (Arising out of S.L.P. (C) Nos. 22991-92 of 2016)
Decided On : 30-09-2016
(b) Arbitration and Conciliation Act, 1996 – Section 5, 13, 47 and 50 – Commercial Appellate Division created u/s 5 – Amended Explanation of section 47 ousting jurisdiction of District court where the High Court exercises original jurisdiction – Instantly District court erroneously passed the order without jurisdiction where the High Court had jurisdiction – Instantly Single Judge passing the impugned judgment u/s 50(1)(b) in the original side of the High Court – Section 13 barring appeal under Letters Patent unless provided in the Act – Section 50(1)(b) providing for an appeal – Held, LPA is maintainable against judgment of the Single Judge. (Para 24)
(2009) 14 SCC 16; (2008) 10 SCC 128; (2004) 11 SCC 672; AIR 1962 SC 256 : (1962) 3 SCR 497 – Relied upon
2016 SCC ONLINE BOM 255; (2005) 2 SCC 591; 2011 SCC Online Bom 1379; (2002) 5 SCC 520; (2002) 5 SCC 510; (1996) 2 SCC 132 – Referred
Facts of the case:
An award was passed in favour of the 1st respondent by the International Arbitration Tribunal making the appellant the DMC Management Consultants Limited and another jointly and severally liable to pay USD 6,948,100 within ten days from the date of passing of the award.
The 1st respondent filed an application under Sections 47 and 49 of the Arbitration and Conciliation Act, 1996 for enforcement of the Award before the District Judge, Nagpur and the proceeding continued before the concerned District Judge till the Arbitration and Conciliation (Amendment) Act, 2015 came into force with effect from 23rd October 2015, by which the High Court was conferred with the original jurisdiction in case of International Commercial Arbitration. After the 2015 Act came into force, the 1st respondent filed Misc. Civil Application before the High Court for enforcement of the award. The Single Judge held that the award was enforceable against the DMC Management Consultants Limited and passed a decree against it in terms of the award. However, the single Judge opined that the award was not enforceable in India against the other respondent as the arbitral tribunal could not have passed the award against them.
The 1st respondent preferred an appeal under Section 50(1)(b) of the 1996 Act read with Clause 15 of the Letters Patent of the High Court of Bombay which was registered as Arbitration Appeal No. 3 of 2016.
The appellant filed application contending that the appeal was not maintainable in view of the abolition of the Letters Patent Appeal by Section 3(1) of the Maharashtra High Court (Hearing of Writ Petitions by Division Bench and Abolition of Letters Patent Appeals) Act, 1986. The Division Bench opined that the appeal is maintainable.
Thereafter the appellant filed an Misc. Civil Application (Review) propounding the point that the Letters Patent Appeal under Clause 10 was not available in arbitration matters and Section 13 of the Commercial Courts, Commercial Division and Commercial Appellate Division of the High Courts Act, 2015 would not be applicable to an arbitration appeal. The High Court dismissed the application for review.
Finding of the Court:
LPA is maintainable against judgment of the Single Judge passed u/s 50(1)(b) of the 1996 Act in the original side of the High Court.
Result: Appeal dismissed.
JUDGMENT :
Dipak Misra, J.
Aggrieved by the order dated 23.06.2016 passed by the Division Bench of the High Court of Judicature at Bombay, Nagpur Bench, Nagpur in C.A.M. No. 34 of 2016 in Arbitration Appeal No.3 of 2016 rejecting the preliminary objection raised by the appellant and further being dissatisfied with the order dated 15.07.2016 expressing disinclination to entertain the Civil Miscellaneous Application (Review), the present appeals, by special leave, have been preferred for annulling the same.
2. The facts which are relevant to be stated for adjudication of the appeals are that an award was passed in favour of the 1st respondent in ICDR Case No. 50-181-T-00327-09 by the International Arbitration Tribunal (for short, “the tribunal”) making the appellant the DMC Management Consultants Limited and another jointly and severally liable to pay USD 6,948,100 within ten days from the date of passing of the award.
3. It is the case of the respondent that the international arbitration award had attained finality as the appellant herein had not challenged it under Delaware Law which is the applicable law. On 29.04.2010, the 1st respondent filed an application under Sections 47 and 49 of the Arbitration and Conciliation Act, 1996 (for brevity, “the 1996 Act”) for enforcement of the Award before the District Judge, Nagpur and the proceeding continued before the concerned District Judge till the Arbitration and Conciliation (Amendment) Act, 2015 (for short, “2015 Act”) came into force with effect from 23rd October 2015, by which the High Court was conferred with the original jurisdiction in case of International Commercial Arbitration. After the 2015 Act came into force, the 1st respondent filed Misc. Civil Application No. 1319 of 2015 before the High Court for enforcement of the award. The Learned Single Judge by his final order dated 18.04.2016 came to hold that the award dated 28.03.2010 was enforceable against the DMC Management Consultants Limited and passed a decree against it in terms of the award. However, the learned single judge opined that the award was not enforceable in India against the other respondent as the arbitral tribunal could not have passed the award against them. The opinion expressed by the learned Single Judge reads as follows:-
“(1) The award dated 28.3.2010 passed by the International Arbitration Tribunal in ICDR Case No. 50181T0032709 becomes unenforceable in India to the extent it operates against the non-applicant No. 2-Arun Dev s/o Govindvishnu Upadhyaya and No. 3 Gemini Bay Transcription Pvt. Ltd., and the claim for passing a decree against them in terms of the said award is refused.
(2) The award passed by the International Arbitration Tribunal in ICDR Case No. 50181T0032709 to the extent it operates against the non-applicant No. 1-DMC Management Consultants Ltd. is made enforceable in India and the decree is passed in terms of the said award against the non-applicant No. 1.”
4. Being dissatisfied with the decision of the learned single judge, the 1st respondent preferred an appeal under Section 50(1)(b) of the 1996 Act read with Clause 15 of the Letters Patent of the High Court of Bombay which was registered as Arbitration Appeal No. 3 of 2016.
5. The appellant herein who was the respondent before the High Court filed application C.A.M. No. 34 of 2016 contending, inter alia, that the appeal was not maintainable in view of the abolition of the Letters Patent Appeal by Section 3(1) of the Maharashtra High Court (Hearing of Writ Petitions by Division Bench and Abolition of Letters Patent Appeals) Act, 1986 (for short, “the 1986 Act”). The Division Bench repelled the said submission by placing reliance on an earlier Division Bench judgment rendered in Padamshri Purushottam Vyas & Ors. v. Tusar Dhansukhlal Shah, 2016 SCC ONLINE BOM 255 and opined that the appeal is maintainable.
6. After the preliminary objection was rejected the appellant filed an Misc. Civil Application (Review) No. 688 of 2016 by bringing
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