DR. S. MURALIDHAR, J.

These appeals are directed against the common judgment and order dated 17th July 2006 passed by the learned Single Judge of this Court, dismissing the appellant's Execution Applications (E.A.) Nos. 296 of 2005 and 324 of 2005 in Execution Petition No. 13 of 2004.

The facts are that by an inter-corporate agreement dated 19th September 2002 the appellant No. 1 Morpen Laboratories Limited (MLL) availed from the Respondent Morgan Securities and Credits Pvt. Limited (MSCPL) financial facilities in the form an inter-corporate deposit (ICD) of Rs. 5 crores for its business operations. The ICD was for a period of 120 days up to 17th January, 2003 and carried interest at 21 per cent per annum payable in advance with quarterly rests. In case of delay or default in making payment of principal amount or any part thereof, interest at 36 per cent per annum with monthly rests was payable by MLL from the date of default till the date of repayment of the deposit along with interest/overdue interest in full. Clause 5 of the Agreement which provides for interest reads as under :

"5. The normal agreed rate of interest for placement of the ICD is 36% p.a., however as a special case the lender is placing the ICD at concessional rate of 21% front ended payable at quarterly rests. In case of delay or default in making payment of principal amount or any part thereof on its due date, the normal rate of interest of 36% p.a. with monthly rests shall be payable by the borrower from the date of default till the date of repayment of the ICD along with interest/overdue interest in full."

Appellant No. 2 Sushil Suri and Arun Suri furnished personal guarantees for repayment of the loan. In addition, Blue Coast Hotels & Resorts Limited [appellant No. 3 in EFA (OS) No. 19 to 21 of 2006 and the appellant in EFA (OS) No. 4 of 2007] stood surety.

The disputes between the parties in relation to the repayment of the loan were referred to the sole arbitration of Justice A. P. Chowdhry (Retd.).

During the pendency of the arbitration, the parties entered into a memorandum of settlement dated 27th May 2003. Thereafter the learned Arbitrator made an Award on 20th June 2003 under Section 30 of the Arbitration and Conciliation Act, 1996 (Act) in terms of the said settlement.

The decree holder, i.e., MSCPL found that after the Award, the judgment debtor MLL had paid only a sum of Rs. 12,50,000/- and that three cheques issued by it which had fallen due on 28th September 2003, 28th October 2003 and 28th November 2003 had been dishonoured on presentation. MLL made a further payment of Rs. 35 lakhs but thereafter made no other payment. As on 31st December 2003, a total sum of Rs. 6,24,44,250/- was due from MLL. MLL was also liable to pay interest at 30% per annum with monthly rests till the time the entire amount was paid by them to the decree holder. Accordingly, the aforementioned execution petition was filed.

Before the learned Single Judge, it was contended by MSCPL, the decree holder, that the parties had agreed not to challenge the Award which had been made in terms of the settlement arrived at between them. In any event, no application under Section 34 of the Act had been filed within three months of the date of the Award. Further in terms of Section 36 of the Act, since no challenge was made to the award within the further grace period of one month, the award became enforceable under the Code of Civil Procedure, 1908 (CPC) in the same manner as a decree of the court. Accordingly, the decree holder prayed in the execution petition that the properties of the judgment debtor must be attached to realize the outstanding decretal amount.

At that stage, the appellants filed the aforementioned two execution applications, EA Nos. 296 of 2005 and 324 of 2005 raising objections. By the impugned judgment, the learned Single Judge rejected these objections and therefore, the present appeals have been filed.

We have heard the submissions of Mr. Ravishank