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2007 Supreme(Del) 638

DELHI HIGH COURT
Sanjay Kishan Kaul
MARINA WORLD SHIPPING CORPORATION LIMITED
v.
JINDAL EXPORTS PRIVATE LIMITED.
Ex. P. No. 16 of 2006 and EA No. 34 of 2006,
Decided on : March 21, 2007.

Advocates appeared:
Amitava Majumdar, Arvind K. Gupta.
Rajiv Sahai, P. S. Sudheer, P. Hazarika, Anne Mathew.

The exception in Explanation 2 to Section 44A of the Code of Civil Procedure, 1908, excludes the execution of an arbitration award, even if enforceable as a judgment or decree, and the remedy for enforcement of a foreign award is under the Foreign Awards Act, 1961.

Headnote:

Arbitration Award - Execution of Foreign Award - Foreign Judgments (Reciprocal Enforcement) Act, 1933 - Code of Civil Procedure, 1908, Section 44A - The judgment discusses the enforceability of a foreign arbitration award as a decree of the court under Section 44A of the Code of Civil Procedure, 1908, and the exceptions carved out in Explanation 2 to Section 44A. The court analyzes the legal provisions, historical development of the law of enforcement of awards in the United Kingdom, and the applicability of the Foreign Judgments (Reciprocal Enforcement) Act, 1933. The judgment emphasizes that the exception in Explanation 2 excludes the execution of an arbitration award, even if enforceable as a judgment or decree, and concludes that the remedy for enforcement of a foreign award is under the Foreign Awards Act, 1961.

Fact of the Case:

A charter party agreement led to disputes about demurrage, resulting in arbitration proceedings and a subsequent judgment under the Foreign Judgments (Reciprocal Enforcement) Act, 1933. The decree holder filed a petition for execution of the judgment, contested by the judgment debtor. The preliminary issue framed was whether the execution petition is maintainable in view of the provisions of explanation to Section 44A of the Code of Civil Procedure, 1908.

Finding of the Court:

The court held that the remedy for enforcement of the foreign award is under the Foreign Awards Act, 1961, and not under Section 44A of the Code of Civil Procedure, 1908. The petition for execution was held as not maintainable, and the decree holder was given leave to initiate legal proceedings under the provisions of the Foreign Awards Act, 1961.

Issues: The main issue was whether the execution petition for the foreign award was maintainable under Section 44A of the Code of Civil Procedure, 1908.

Ratio Decidendi: The court analyzed the legal provisions, historical development of the law of enforcement of awards in the United Kingdom, and the applicability of the Foreign Judgments (Reciprocal Enforcement) Act, 1933. The court emphasized that the exception in Explanation 2 to Section 44A excludes the execution of an arbitration award, even if enforceable as a judgment or decree, and concluded that the remedy for enforcement of a foreign award is under the Foreign Awards Act, 1961.

Final Decision: The petition for execution was held as not maintainable, and the decree holder was given leave to initiate legal proceedings in accordance with law under the provisions of the Foreign Awards Act, 1961.

JUDGMENT

Sanjay Kishan Kaul, J.

A charter party agreement was executed on 05.11.1994 in terms whereof the judgment debtor chartered the vessel of the decree holder. Disputes arose about the claim of the decree holder for demurrage which resulted in arbitration proceedings between the parties. This was a sequel to Arbitration Clause 19 of the Charter Party Agreement. The sole arbitrator Andreas Savva Christofides made and published his award dated 26.09.2000 at London, England. It may be noticed that the judgment debtor participated in the arbitration proceedings by filing replies and counter-claims. The judgment debtor also addressed a letter dated 02.08.2000 to the arbitrator that they would like to proceed in the arbitration on documents and would like to submit further submissions which were so submitted. In terms of letter dated 01.09.2000 the judgment debtor called upon the arbitrator to give a reasoned award after going through its submission. It may be noticed at this stage that these facts are available from the records of Company Petition No. 278/2002 filed by the decree holder against the judgment debtor and the said records were called for in view of there being some controversy as to the extent of participation of the judgment debtor before the arbitrator.

The decree holder thereafter filed a petition before the Queen's Bench Division which resulted in a judgment/decree dated 12.08.2004 under the Foreign Judgments (Reciprocal Enforcement) Act, 1933 (hereinafter referred to as 'the Act of 1933'). Pursuant to the said judgment a certificate was issued dated 21.10.2004. The purpose of this certificate was specified in the note appended at the end of the certificate which reads as under :

"Note - This certificate is given in order to comply with Section 44A(2) of the Code of Civil Procedure (Amendment) Act, 1937, which was an Act of the Indian Legislation (being Act No. VIII of 1937)."

Another certificate has also been issued under Section 10 of the Act of 1933 dated 06.10.2004 certifying that the judgment granted by the Queen's Bench Division was not stayed or suspended and the time available for its enforcement has not expired and thus the judgment was accordingly enforceable.

The decree holder thereafter filed the present petition for execution of the said judgment/decree. This execution has been contested by the judgment debtor. In view of the pleadings of the parties it was agreed that the following preliminary issue be framed and it was so framed on 01.02.2007 :

Whether the execution petition is maintainable in view of the provisions of explanation to Section 44A of the Code of Civil Procedure, 1908 ?

Learned counsel for the parties have thereafter proceeded to address their submissions on the aforesaid preliminary issue which goes to the root of the matter.

In order to appreciate the controversy it is necessary to first reproduce the provisions of Section 44A of the Code of Civil Procedure, 1908 (hereinafter referred to as 'the said Code'), which reads as under :

"44A. Execution of decrees passed by courts in reciprocating territory -

(1) Where a certified copy of decree of any of the superior courts of any reciprocating territory has been filed in a District Court, the decree may be executed in India as if it had been passed by the District Court.

(2) Together with the certified copy of the decree shall be filed a certificate from such superior court stating the extent, if any, to which the decree has been satisfied or adjusted and such certificate shall, for the purposes of proceedings under this section, be conclusive proof of the extent of such satisfaction or adjustment.

(3) The provisions of Section 47 shall as from the filing of the certified copy of the decree apply to the proceedings of a District Court executing a decree under this section, and the District Court shall refuse execution of any such decree, if it is shown to the satisfaction of the court that the decree falls within any of the exceptions

















































































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