IMPORTANT POINT
The court emphasized the need for securing the arbitral award and clarified the criteria for recalling an order. It also provided interpretations of the jurisdictional issues and the verification of pleadings under the relevant legal provisions.

JUDGMENT :

1. The revisional application arises out of an order dated June 13, 2023 passed by the learned Judge, Commercial Court at Alipore in Arbitration Execution Case No.03 of 2022. By the order impugned, the learned court rejected I.A. No.02 of 2023, which was an application for recalling of an order dated April 5, 2023 passed in I.A. No.01 of 2022.

2. I.A. No.01 of 2022 was filed by the award holder with prayers for directions upon the judgment debtor to furnish security to the extent of Rs.3,19,30,564/- or in the alternative to deposit the entire amount in a short term interest bearing fixed deposit till the execution was satisfied. Such application was disposed of on April 5, 2023, by the learned Commercial Judge directing the award debtor to secure the entire amount within four weeks from the date of the order in the form of a renewable bank guarantee in favour of the petitioner/award holder, to be deposited with the learned Registrar, Alipore, till further orders.

3. The learned Commercial Judge considered the allegations made by the award holder that the award debtor was trying to surreptitiously withdraw the money lying in the bank account and was also selling out valuable assets.

4. Relying on the decisions of the Hon’ble Apex Court in the matter of Pam Development Pvt. Ltd. Versus State of West Bengal reported in (2019) 8 SCC 112, Satyen Construction Versus State of West Bengal reported in 2020 SCC OnLine Cal 805 and Siliguri Jalpaiguiri Development Authority Versus Bengal Unitech Universal Siliguri Projects Limited reported in 2022 SCC OnLine Cal 1754, the learned court held that the law mandated that for the execution proceeding to remain stayed, the money awarded would have to be secured. While the rights of the award holder were not crystallised till the disposal of the application under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the ‘said Act’), the award holder had the statutory safeguard under Section 36 of the said Act to be secured in a fruitful manner, for the entirety of the arbitral award.

5. Relying on the decisions of the Hon’ble Apex Court, the learned Commercial Judge held that the award holder should be secured for the amount awarded by the learned Arbitral Tribunal along with interest amounting to Rs.3,19,30564/-, and directed that renewable bank guarantee of the entire amount in favour of the award holder be deposited with the learned Registrar, Alipore, till further orders.

6. The award debtor filed an application for recalling of the said order on the following grounds:-

“(i) The Award Holder should not be permitted to rely on the application filed by them since the verification of the application filed by the Award Holder was not in the manner as per the Order VI Rule 15A of Code of Civil Procedure, 1908, as amended, by the Commercial Court Act, 2016. It was submitted that the effect of not verifying a pleading in the manner provided in order VI Rule 15A of Code of Civil Procedure, 1908, as amended, particularly sub-rule (4) thereof, is that a party shall not be permitted to rely on such pleading.

(ii) The application filed by the Award Holder cannot be entertained since this Ld. Commercial Court cannot entertain the execution application.”

7. The said recalling application was dismissed on the ground that except under situations enumerated by the Hon’ble Apex Court in several decisions, a court could not recall its own order. The Commercial Judge did not recall the order dated April 5, 2023.

8. According to the learned Judge, the tests were laid down in the decision of Budhia Swain and Others versus Gopinath Deb and Others reported in (1994) 4 SCC 396 and the decision of Indian Bank Versus M/s. Satyam Fibres India Pvt. Ltd. reported in 1996 (5) SCC 550. Unless the award was obtained by fraud, misrepresentation or the court committed an apparent error, the power of recall could not be exercised. Referring to the decision of A.R. Antulay Versus R.S. Nayak & Anr