IN THE HIGH COURT OF KARNATAKA
N. Kumar, J.
Chandrashekhar – Appellant
Vs.
Tata Motor Finance Ltd. – Respondents
Writ Petition No. 19828 of 2012 (GM-CPC)
Decided On: 13.03.2014
Execution Petition - Arbitration Award - Sections 38, 36 of Arbitration and Conciliation Act, 1996, Sections 38, 39, 40 of Civil Procedure Code - The court held that the award passed by the arbitrator at Bombay is executable in Mysore where the judgment debtor is residing. The judgment debtor's contention that the Execution Petition ought to have been filed in the Court at Bombay and then executed in a Court at Mysore was rejected. The court interpreted the provisions of Section 36 of the Arbitration and Conciliation Act, 1996, and Sections 38, 39, 40 of the Civil Procedure Code to establish that the Court at Mysore had the jurisdiction to execute the award by way of an arbitrator's decree.
Fact of the Case:
The judgment debtor challenged the order passed by the Executing Court rejecting his objections regarding the maintainability of the Execution Petition. The parties had agreed to refer the matter to an arbitrator, who passed the award at Bombay. The judgment debtor contended that the arbitral award cannot be enforced straightaway by the Court at Mysore.
Finding of the Court:
The court held that the award passed by the arbitrator at Bombay is executable in Mysore where the judgment debtor is residing. The Execution Petition was found to be maintainable in the Court at Mysore.
Issues: The main issue was whether the Execution Petition for the arbitral award passed at Bombay could be filed and executed in the Court at Mysore where the judgment debtor was residing.
Ratio Decidendi: The court interpreted the provisions of Section 36 of the Arbitration and Conciliation Act, 1996, and Sections 38, 39, 40 of the Civil Procedure Code to establish that the Court at Mysore had the jurisdiction to execute the award by way of an arbitrator's decree.
Final Decision: The court dismissed the writ petition, upholding the maintainability of the Execution Petition in the Court at Mysore.
N. Kumar, J.
1. This Writ Petition is preferred by the judgment debtor challenging the order passed by the Executing Court rejecting his objections regarding maintainability of the Execution Petition. The undisputed facts are that, the parties to the execution proceedings had agreed for referring the matter to an arbitrator to resolve the dispute. The arbitrator entered appearance and conducted arbitral proceedings at Bombay and also passed the award at Bombay. The said award is sought to be executed before the Principal District and Sessions Judge, Mysore in Execution No. 474/2011. On service of notice of execution proceedings, the judgment debtor entered appearance and filed an application under Section 38 CPC contending that the arbitral award cannot be enforced straightaway by the Court at Mysore; Execution Petition ought to have been filed before the jurisdictional Court at Bombay and it could be transferred to the Court at Mysore on a transfer petition and only then Court at Mysore could enforce the award.
2. The contention of the Judgment Debtor was rejected by the Executing Court on the ground that Section 38 CPC applies to a case where a decree is passed by a Court and such a decree is sought to be enforced in another Court. The said provision is not applicable to a proceeding where execution of an award passed by an Arbitrator is sought as the same is only a deemed decree. The Court also held that the award passed by the arbitrator at Bombay is executable in Mysore where the judgment debtor is residing. Aggrieved by the same, this Writ Petition is filed.
3. Learned Counsel for the petitioner relying on a judgment of this Court in the case of N. Nagaraj v. M/s. Motilal Oswal Securities Limited, W.P. Nos. 38220-221/2010 decided on 27.6.2012 contends that, the Execution Petition ought to have been filed in the Court at Bombay and after obtaining transfer, it could be executed in a Court at Mysore. Since the said procedure is not followed, the Execution Petition is not maintainable.
4. In support of his contention the petitioner also relies on Section 36 of Arbitration and Conciliation Act (hereinafter for short referred to as 'the Act') and Sections 38 to 40 of Civil Procedure Code. Therefore let me examine these provisions before going into merits of the case.
5. Section 38 of CPC deals with Courts by which decree may be executed and the same reads as under:
"38. Courts by which decree may be executed: A decree may be executed either by the Court which passed it, or by the Court to which it is sent for execution."
6. Section 39 of CPC deals with transfer of Decree. It reads as under:
"39. Transfer of decree.--(1) The Court which passed a decree may, on the application of the decree-holder, send it for execution to another Court of competent jurisdiction, -
(a) if the person against whom the decree is passed actually and voluntarily resides or carries on business, or personally for gain, within the local limits of the jurisdiction of such other Court, or
(b) if such person has not property within the local limits of the jurisdiction of the Court which passed the decree sufficient to satisfy such decree and has property within the local limits of the jurisdiction of such other Court, or
(c) if the decree directs the sale or delivery of immovable property situate outside the local limits of the jurisdiction of the Court which passed it, or
(d) if the Court which passed the decree considers for any other reason, which it shall record in writing, that the decree should be executed by such other Court.
(2) The Court which passed the decree may of its own motion send it for execution to any subordinate Court of competent jurisdiction.
(3) For the purposes of this section, a Court shall be deemed to be a Court of competent jurisdiction if at the time of making the application for the transfer of decree to it, such Court would have jurisdiction to try the suit in which such decree was passed.
(4) Nothing in this section shall be deemed
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