IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD
V.V.S. RAO and B.N.RAO NALLA, JJ.
Bhoomatha Para Boiled Rice and Oil Mill, rep. by its Proprietor, Billa Prabhakar Reddy – Appellant
Versus
M/s. Maheshwari Trading Company, rep. by its Proprietor, Patha Hanmandlu and others – Respondents
C.R.P. No.2820 of 2009
Decided on : 14-12-2009.
V.V.S. Rao, J.
This revision petition under Section 115 of Code of Civil Procedure, 1908 (CPC), involves an important question as to whether arbitral award passed by the arbitral tribunal as per the provisions of the Arbitration and Conciliation Act, 1996 (Arbitration Act, for brevity), can be enforced only by the "Court" as defined in Section 2(1)(e) or whether such arbitral award can be enforced or executed by a competent civil Court having territorial and pecuniary jurisdiction to entertain the matter. This requires to be considered in the light of various provisions in different statutes like Section 89 and Order XXI of CPC, A.P. Civil Courts Act, 1972, and Arbitration Act.
2. The background case is as follows.
First respondent (hereafter, D.Hr) filed O.s.No.86 of 1997 on the file of the Court' of Senior Civil Judge, Karimnagar, for recovery of a sum of Rs.5,06,034/- against the petitioner and others (hereafter, J.Drs). In interlocutory application being I.A.No.529 of 1997, the Court below appointed an arbitrator with the consent of the parties.
An award dated 20.10.1998 was passed for an amount Rs.2,40,000/- in favour of D.Hr.
The amount was not paid. Therefore, E.P.No.42 of 2005 was moved by D.Hr for recovery of award amount by attachment and sale of immovable property, under Section 36 of Arbitration Act read with Order XXI Rule 11 of CPC. The proprietor of J.Dr No.1 filed a counter opposing the execution petition contending that the award cannot be enforced by the Court of Senior Civil Judge, that it is not valid, that it is not properly stamped and that J.Drs and D.Hr did not sign the award, and therefore, it is not binding on them.
3. Learned Senior Civil Judge rejected these pleas holding that (i) Petition to set aside the award was not filed, and therefore, it has become final under Section 35 of Arbitration Act; (ii) the award was passed in the presence of both the parties and even after lapse of three months, the award was not challenged before the competent court, and therefore, the same can be enforced under Section 36 thereof; and that (iii) as per Article 12 of Schedule 1A of Stamp Act, 1899, stamp duty of Rs.200/- is attracted, and therefore, D.Hr is required to pay the amount. Accordingly the Court below allowed the execution petition and ordered attachment of movable properties on condition of D.Hr paying the stamp duty and penalty.
4. Learned Counsel for petitioner submits that an award can be enforced under Section 36 of Arbitration Act only by "the Court" as defined in Section 2(1)(e) of Arbitration Act. He also invites attention of this Court to Sections 8 and 9 of Arbitration Act in support of the contention. He, therefore, submits that the Court of Senior Civil Judge, Karimnagar, has no jurisdiction to entertain a petition for execution/ enforcement of the award under Section 36 of Arbitration Act. Per contra. learned Counsel for contesting respondent No.1 submits that enforcement of arbitral award under Section 36 of Arbitration Act in accordance with provisions of CPC has nothing to do with Section 2(1)(e) of Arbitration Act. He would urge that any arbitral award has to be executed in accordance with the provisions of CPC. Ankati Satyamaiah v. Sallangula Lalaiah (1) 2003 (3) ALT 193 = 2003 (2) ALD 818, SBP & Company v. Patel Engineering Limited (2) 2005 (7) SCJ 461 = (2005) 8 SCC 618 = AIR 2006 SC 450=2005 (6) ALT37.1 (DN SC) and Garhwal Mandai Vikas Nigam Ltd. v. Krishna Travel Agency (3) (2008) 6 SCC 741 have been referred to by the counsel.
5. The question as mentioned supra needs to be considered, after noticing various related aspects of the matter. This is necessary because Section 36 of Arbitration Act makes an arbitral award enforceable under CPC in the same manner as if it were a decree of the Court. The only condition is that the awardee has to wait for a period of three months from the date of arbitral award, which is the time prescribed under Section 34(3) of Arbitration Act for filing an
Ankati Satyamaiah v. Sallangula Lalaiah: 2003 (3) ALT 193. (Para 4)
Garhwal Mandal Vikas Nigam Ltd. v. Krishna Travel Agency: (2008) 6 SCC 741. (Para 4)
M/s.Guru Nanak Foundation v. M/s. Rattan Singh and sons AIR 1981 SC 2075. (Para 13)
M.P.S.E.Board v. ANSALOO Energia
Globsyn Technologies Ltd. v. Eskaaycee Infosys: 2004 (2) ALT 174. (Para 15)
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