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IN THE HIGH COURT OF DELHI AT NEW DELHI
C. Hari Shankar, J.
Smt Babita Sharma & Anr. - Appellantss
Versus
The Shankar Coop. Urban T/c Society - Respondent
CM(M) 500 of 2022 and CM Appl. 25426 of 2022, CM Appl. No. 25427 of 2022
Decided On : 26-05-2022
Order XXI Rule 26 - Stay of Execution - The court called upon the respondent to file a reply to the application within three weeks and required the petitioners to file details of their assets. The petitioners challenged the order under Article 227 of the Constitution of India, claiming that the court should have allowed the application seeking stay of the execution proceedings. However, the court found that the order was innocuous and did not result in any prejudice to the petitioners. It recognized that the court had the jurisdiction to issue such a direction under Order XXI Rule 26 of the CPC, as established in the Supreme Court's decision in Rahul S. Shah v. Jinendra Kumar Gandhi (2021) 6 SCC 418. The court concluded that there was no erroneous exercise of jurisdiction by the learned Commercial Court, and dismissed the petition.
Fact of the Case:
The petitioners sought execution of an award passed by the arbitrator, while the respondent sought execution of the same award. The petitioners moved an application seeking stay of the execution proceedings under Order XXI Rule 26 read with Section 151 of the Code of Civil Procedure, 1908 (CPC).
Finding of the Court:
The court found that the impugned order was innocuous and did not result in any prejudice to the petitioners. It recognized the jurisdiction of the court to issue a direction for the petitioners to file details of their assets under Order XXI Rule 26 of the CPC. The court dismissed the petition, stating that there was no erroneous exercise of jurisdiction by the learned Commercial Court.
Issues: The main issue was whether the court should have allowed the application seeking stay of the execution proceedings under Order XXI Rule 26.
Ratio Decidendi: The court recognized the jurisdiction of the court to issue a direction for the petitioners to file details of their assets under Order XXI Rule 26 of the CPC, as established in the Supreme Court's decision in Rahul S. Shah v. Jinendra Kumar Gandhi (2021) 6 SCC 418.
Final Decision: The petition was dismissed, with no order as to costs.
JUDGMENT
1. The impugned order dated 24th March, 2022, passed by the learned District Judge (Commercial Court) (the learned Commercial Court) in Ex. 56/2021 (The Shankar Coop. Urban T/C Society v. Smt. Babita Sharma), reads as under:
EX No. 56/2021
The Shankar Co-op Urban T&C Society Ltd.
Vs.
Babita Sharma & Ors.
24.03.2022
Present: Ms. Deeksha Mishra, Advocate, Ld. Counsel for the DH.
JD No.1 & 3 are in person. (JD No.3 is an advocate by profession and JD No.1 is wife of JD No.3)
JD No.2 is yet to be served.
Notices qua JD Nos.l & 3 returned duly served. As per report, notices have been accepted by Sh. Chaman Kumar Sharma, JD No.3/ husband of the JD No.1 on 15.01.2022.
Notice qua JD No.2 returned unserved with the report of left the premises after selling the same to one Sh. Satish Kumar, Advocate. Regd. Post and Speed post qua JD No.2 also returned unse1ved with the report left without instructions.
Notice qua JD No.2 is awaited.
On being asked, JD No.l & 3 submits that JD No.2 was their guarantor and they do not know about his present whereabout.
Ld. Counsel for the DH needs time to trace out the fresh address of JD No.2. Let it be filed within a period of three weeks, if any.
IA U/o 21 Rule 26 r/w Section 151 for stay of execution filed by JDs :-
Copy of the application is supplied to Ld. Counsel for the DH. Reply, if any, be filed within three weeks.
In the meantime, both the JDs are directed to furnish the detail of their properties including bank accounts on affidavit.
Renotify the matter for disposal of above IA on 20.05.2022.
2. Ex. 56/2021, in which the present petitioners were Judgment Debtors 1 and 3 (hereinafter, JD 1 & 3) sought execution of an award, dated 31st July, 2020, passed by the learned arbitrator in Arbitration Case No. 2878/AR/ARB/2017-18 (The Shankar Coop. Urban T/C Society v. Smt. Babita Sharma & Ors.), whereby the petitioners were directed to pay, to the respondent, ? 15,24,168/- along with interest and penal interest @ 18.6 % p.a. with effect from 18th July, 2020 till realisation of the principal amount.
3. The respondent, as the successful claimant in the arbitral proceedings, sought execution of the aforesaid award by way of Ex. 56/2021. The present petitioners moved an application, in the said execution proceedings, under Order XXI Rule 26 read with Section 151 of the Code of Civil Procedure, 1908 (CPC) seeking stay of the execution proceedings.
4. A reading of the impugned order dated 24th March, 2022 reveals that the learned Commercial Court has called upon the respondent/DH to file a reply to the said application within three weeks and has, in the interregnum, required the petitioners to file details of their assets.
5. I am, frankly, completely befuddled as to how the petitioners have at all chosen to challenge this order under Article 227 of the Constitution of India.
6. The order is, ex-facie, innocuous and does not result in any prejudice to the petitioners at all.
7. Notice has effectively been issued on the petitioners' application seeking stay of the execution proceedings, and the respondent has been called upon to file its reply thereto. The only other direction, in the impugned order dated 24th March, 2022, is for the petitioners to place on record the details of their assets.
8. It is not the contention of the learned Counsel for the petitioners that the learned Commercial Court did not possess the jurisdiction or authority to call upon the petitioners to file details of their assets.
9. Indeed, Order XXI Rule 26 of the CPC specifically empowers the court to issue such a direction.
10. This position also stands recognised by the Supreme Court in its decision in Rahul S. Shah v. Jinendra Kumar Gandhi, (2021) 6 SCC 418.
11. The sole contention of Mr. Sharma, learned Counsel for the petitioners, is that the learned Commercial Court ought to have allowed the said application filed by the petitioners, seeking stay of the execution proceedings.
12. There is no mandate, in law, or otherwise, requiring the executing co
The court has the jurisdiction to issue a direction for the parties to file details of their assets under Order XXI Rule 26 of the CPC.
The court reaffirmed its supervisory authority under Article 227 while finding that procedural requirements for disclosing assets in execution did not warrant intervention.
A stay of execution in civil proceedings can be granted during the pendency of an appeal when sufficient cause is shown, pursuant to Order 21 Rule 26 of the CPC.
Under Order XXI Rule 29 CPC, stay of execution pending judgment debtor's suit is discretionary, not mandatory; belated fraud suit after failed prior challenges and decade-long execution does not enti....
The Review Court lacks jurisdiction to stay execution proceedings initiated in another court, and attempts to delay possession proceedings through misleading filings may result in dismissal with cost....
The court emphasized the limited scope of interference by the court in arbitration proceedings and the need to make a prima facie case for granting a stay of execution of the arbitration award.
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