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2023 Supreme(Del) 5831
IN THE HIGH COURT OF DELHI AT NEW DELHI
Vibhu Bakhru, Tushar Rao Gedela, JJ.
Ministry of Railways & Anr. - Appellants
Versus
M/s Ambuj Hotel And Real Estate Pvt. Ltd. - Respondent
EFA(OS) (COMM) 23 of 2023 & CM APPL. 48944 of 2023, 48945 of 2023 & 48946 of 2023
Decided On : 20-09-2023
Mr. Mukul Singh, CGSC with Ms. Ira Singh & Ms. Pranjal Mathur, Advs., for the Appellant.
Mr. S.S. Sisodia, Mr. Saurabh Kumar & Ms. Namrata Gupta, Advs., for the Respondent.
IMPORTANT POINT
The failure to secure an interim order for stay of an arbitral award may lead to the requirement for enforcement, and the dismissal of an appeal against enforcement does not preclude the appellant from seeking an appropriate order in a pending application for stay of the award.
Headnote:
Enforcement of Arbitral Award - Stay of Award - The court dismissed the appeal against the order for enforcement of an arbitral award, stating that the appellants' failure to secure an interim order for stay of the award led to the requirement for enforcement. The court clarified that the dismissal of the appeal would not preclude the appellants from seeking an appropriate order in the pending application for stay of the award.
Fact of the Case:
The appellants appealed against an order for enforcement of an arbitral award after failing to secure an interim order for stay of the award.
Finding of the Court:
The court found no ground to interfere with the impugned order and dismissed the appeal, clarifying that the dismissal would not preclude the appellants from seeking an appropriate order in the pending application for stay of the award.
Issues: Enforcement of arbitral award, failure to secure interim order for stay of award, pending application for stay of award.
Ratio Decidendi: The failure to secure an interim order for stay of the arbitral award led to the requirement for enforcement, and the dismissal of the appeal did not preclude the appellants from seeking an appropriate order in the pending application for stay of the award.
Final Decision: The appeal was dismissed, and the court directed that any interim order passed in the pending application for stay of the award would be accorded priority over the impugned order and the dismissal order.
JUDGMENT
Vibhu Bakhru, J.
1. The appellants have filed the present appeal impugning an order dated 09.08.2023 passed by the learned Single Judge in OMP (ENF.) (COMM) No.240/2022 captioned Ambuj Hotels and Real Estate Pvt. Ltd. v. Ministry of Railways & Anr. The respondent had instituted the said proceedings for enforcement of the arbitral award dated 07.07.2022 (hereafter `the Award').
2. The appellants had filed an application [OMP (COMM) No.494/2022 captioned Ministry of Railway and Anr. v. M/s Ambuj Hotel Real Estate Pvt. Ltd.] under Section 34 of the Arbitration and Conciliation Act, 1996 (hereafter `the A&C Act') for setting aside the Award. The appellants had also moved an application (I.A. No. 21131/2022) under Section 36(2) of the A&C Act in those proceedings seeking interim stay of the Award, however, the appellants failed to secure any interim order for stay of the Award in those proceedings.
3. The appellants have placed on record a common order dated 08.02.2023 passed by the learned Single Judge in OMP (COMM) No.494/2022 and OMP(ENF.) (COMM) No.240/2022. The said order indicates that the appellants were called upon to deposit the entire awarded amount without prejudice to their rights and contentions and the matters were directed to be listed, thereafter, on 23.03.2023. However, the order passed on 23.03.2023 is not on record.
4. Concededly, the appellants had failed to secure an interim order in the proceedings in respect of the appellants' application under Section 34 of the A&C Act, for setting aside the Award. Thus, the Award was required to be enforced in the proceedings instituted by the respondent under Section 36 of the A&C Act.
5. The appellants had placed an order dated 19.05.2023 passed by the learned Single Judge in OMP(ENF.) (COMM) No.240/2022 which notes that the appellants had deposited a sum of .4,38,76,595/- with the Registry of this Court and an application under Section 34 of the A&C Act is pending but there is no stay against the enforcement of the Award.
6. Clearly, in absence of any order interdicting enforcement of the Award, the learned Single Judge was required to carry the enforcement proceedings, (OMP(ENF.) (COMM) No.240/2022), to its conclusion. Accordingly, the learned Single Judge had directed the release of the entire awarded amount subject to the respondent furnishing an indemnity bond or surety bond with an undertaking, which indicates that in case the appellants prevail in the application under Section 34 of the A&C Act, the respondent shall re-deposit the amount along with interest within four weeks of any such order.
7. The appellants' grievance, essentially, relates to non-grant of a stay of the Award by the learned Single Judge in OMP (COMM) No.494/2022. Although an application for stay of the Arbitral Award was filed but the same has not yet been disposed of. However, the appellants have not preferred an appeal against the order of the learned Single Judge deferring the appellants' application for stay of the Award. The said controversy is not a subject matter of the present appeal.
8. In view of the above, this Court find no ground to interfere with the impugned order. The appeal is, accordingly, disposed of.
9. It is clarified that notwithstanding the appeal has been dismissed, the same would not preclude the appellants from approaching the learned Single Judge for securing an appropriate order in I.A. No.21131/2020 in OMP (COMM) No.494/2022 which is stated to be pending.
10. It is further directed that in the event any interim order is passed in that application, the same would be accorded priority over the impugned order as well as this order. In other words, the directions to release the amounts in terms of the impugned orders would be subject to any interim order passed in those proceedings.
11. The appeal is disposed of with the aforesaid observations.
