Parties challenging an arbitral award must do so exclusively under Section 34 of the Arbitration Act; raising new grounds or objections in execution proceedings is impermissible.

ORDER :

1. The petitioner/Karnataka State Medical Supplies Corporation Limited is at the doors of this Court calling in question execution proceeding in Commercial Execution Petition No.517 of 2023 pending before the LXXXVII Additional Civil and Sessions Judge, Commercial Court, Bengaluru.

2. Heard Sri Udaya Holla, learned senior counsel appearing for the petitioner and Sri E. Christopher, learned counsel appearing for the respondent.

3. Facts in brief, germane, are as follows: -

3.1. The petitioner floats a tender for supply of drugs, chemicals and miscellaneous items connected to the drugs and chemicals for the year 2017-18. The respondent emerges as the successful bidder in respect of the tender and was consequently issued a work order. The petitioner again floats a re-tender for supply of disposable delivery kit. The respondent again participates and emerges as the successful bidder in respect of the said tender also and work order was issued to the respondent. In terms of conditions of tender, the respondent executes a performance bank guarantee for an amount of Rs. 9,09,394/- in favour of the petitioner and additional bank guarantee as necessary. After supplies were completed, invoices were raised for release of an amount of Rs. 1,83,40,144/- payable to the respondent by the petitioner. Alleging certain discrepancies in the list of invoices or payments demanded, as also the alleged fact of several defectives and goods returned, dispute arose with regard to payment. The respondent who is an MSME, files a claim before the MSME Council. The Council initiates conciliation proceedings as is necessary in law and on failure of such conciliation before MSME, it refers the matter for arbitration. It was referred to arbitration, owing to failure due to the absence of the petitioner for conciliation proceedings.

3.2. An Arbitrator was appointed who passes an award directing the petitioner to pay a sum of Rs. 1,83,40,144/-. On non- compliance with the arbitral award, the respondent files execution petition in Execution No.517 of 2023 claiming an amount of Rs. 4,02,35,197/-. The Commercial Court attaches movables of the petitioner. On such attachment about Rs. 65/- lakhs was paid. A writ petition comes to be filed by the petitioner challenging the proceedings in execution insofar as non-consideration of the plea of the petitioner. The matter was remitted back to the hands of the concerned Court. On such remand, the petitioner files an application under Section 47 of the CPC seeking to urge new facts with regard to forgery and cheating inter alia by the employees of the petitioner/Corporation in connivance with the respondent/Company. The concerned Court rejects the said application in terms of its order dated 30-08-2024 holding that the Court cannot go beyond the decree or beyond the award in the case at hand and Section 47 of the CPC would not permit pleas to be raised for the first time in execution.

4. The learned senior counsel Sri Udaya Holla appearing for the petitioner would submit that the concerned Court ought to have considered the application favourably in the light of the fact that fraud would unravel everything. The award was the product of fraud, as employees of the petitioner/Corporation and the respondent had connived. Therefore, concealment of relevant material facts before the Arbitration itself would amount to fraud. He would seek to place reliance upon plethora of judgments to buttress his submission, all of which would bear consideration qua their relevance in the course of the order. He would, on this score, seek obliteration of complete execution proceedings.

5. Conversely, the learned counsel Sri E.Christopher appearing for the respondent would vehemently refute the submissions in contending that the writ petition itself is not entertainable, as the relief that has to be sought by challenging the arbitral award is now indirectly sought by filing the subject petition. The petitioner has failed to challenge the arbitra