JUDGMENT :

SANJAY KISHAN KAUL, J.

1. The contours of the legal controversy which arise for consideration in the present appeal emanate from the plea of the appellants claim based as an assignee of the decree-holder in terms of Order XXI Rule 16 of the Code of Civil Procedure, 1908 (hereinafter referred to as the ‘CPC’) in their application filed under Section 47 of the CPC by taking recourse to Section 146 of the CPC read with Section 2(1)(g) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the ‘A&C Act’). The significant aspect is the addition of the explanation to Order XXI Rule 16 of the CPC, which was added pursuant to the recommendation made by the Law Commission of India in its 54th Report on the CPC in 1973, which in turn was a sequitur to the conflicting views of the High Courts on the matter in issue.

The facts:

2. In order to appreciate the controversy, relevant facts are being set out. On 29.12.1995, a contract was awarded by the Union of India to one Surendra Nath Kanungo @ S.N. Kanungo for executing the work of extension of runway at Port Blair Airport (hereinafter referred to as ‘Works’). Shri S.N. Kanungo passed away in the year 2012 and is rep