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2015 Supreme(Ker) 1519

IN THE HIGH COURT OF KERALA
K. Abraham Mathew, J.
C. Suresh S/o. C. Kumaran - Petitioner
Versus
India Cements Capital and Finance Limited & Ors. - Respondents
C.R.P. No. 14 of 2015
Decided On : 27-11-2015

Advocates:
Advocate Appeared:
For the Petitioner: Sri. Jamsheed Hafiz
For the Respondents: Dr. George Abraham, Sri. J. Vivek George, Dr. George Abraham

The main legal point established in the judgment is that Section 39 of the Code of Civil Procedure is not applicable in execution proceedings arising from an award under the Arbitration and Conciliation Act 1996, and the question of transfer of arbitral award does not arise.

Headnote:

Section 39 - Applicability of Section 39 of the Code of Civil Procedure in executing the award passed under the Arbitration and Conciliation Act 1996 - Section 39 of the Code of Civil Procedure - Summary of Acts and Sections: The court discussed the applicability of Section 39 of the Code of Civil Procedure in executing an award under the Arbitration and Conciliation Act 1996. It considered various decisions and interpretations related to the transfer of awards, the definition of 'court' under the Act, and the objectives of the Act to minimize the supervisory role of courts in arbitral process. The court concluded that Section 39 of the Code of Civil Procedure is not applicable in execution proceedings arising from an award under the Arbitration and Conciliation Act 1996, and the question of transfer of arbitral award does not arise.

Fact of the Case:

The case involved the applicability of Section 39 of the Code of Civil Procedure in executing an award passed under the Arbitration and Conciliation Act 1996. The petitioner contested the jurisdiction of the court at Manjeri to execute the award, arguing that it had not been transferred to it by the court at Chennai.

Finding of the Court:

The court found that Section 39 of the Code of Civil Procedure is not applicable in execution proceedings arising from an award under the Arbitration and Conciliation Act 1996, and the question of transfer of arbitral award does not arise. Therefore, it dismissed the Civil Revision Petition.

Issues: The pivotal issue was the applicability of Section 39 of the Code of Civil Procedure in executing the award passed under the Arbitration and Conciliation Act 1996. The court also considered the jurisdiction of the court at Manjeri to execute the award without it being transferred from the court at Chennai.

Ratio Decidendi: The court's decision was based on the interpretation of Section 36 of the Arbitration and Conciliation Act, the definition of 'court' under the Act, and the objectives of the Act to minimize the supervisory role of courts in arbitral process. It also considered the purpose behind Section 39 of the Code of Civil Procedure and the potential complications and delays in executing awards if the transfer of awards was insisted upon.

Final Decision: The court dismissed the Civil Revision Petition, affirming the conclusion that the EP filed by the respondent can be executed.

ORDER :

K. Abraham Mathew, J.

Applicability of Section 39 of the Code of Civil Procedure in executing the award passed under the Arbitration and Conciliation Act 1996 (hereinafter called the Act) is the pivotal question in this revision petition.

2. The award involved in this case was passed in favour of the respondent by an Arbitrator at Chennai. Execution Petition was filed in District Court, Manjeri. The contention of the petitioner that the court at Manjeri has no jurisdiction to execute the award as it has not been transferred to it by the court at Chennai was repelled by the learned District Judge.

3. The respondent relies on the decision of a learned Single Judge of this court in Ramaswamy v. Principal Subordinate Judge (1997 (2) KLT 393) in support of his argument that the award need not be transferred. But the question that came up for consideration in Ramaswamy's case was whether a person who has obtained an award in his favour should produce a decree drawn up by the court which has jurisdiction over the subject matter of the award before it can be executed by another court. The court was not called upon to answer the question whether an award can be executed though it has not been transferred by the court concerned.

4. In I.C.D.S Ltd. v. Mangala Builders (P) Ltd (AIR 2001 Kar 364) a learned Single Judge of the Karnataka High Court held that an award should be transferred under Section 39 of the Code of Civil Procedure before it can be executed by a court other than the one which has jurisdiction over the subject matter of the award. This is one of the decisions relied on by the learned counsel for the petitioner. But the very same High Court appears to have taken a contrary view in Chandrasekhar v. Tata Motors Finance Ltd. and others (2014(4) KCCR 3397). The view taken by the Madhya Pradesh High Court in Computer Sciences Corporation India Ltd. v. Harishchandra Lodwal (AIR 2006 MP 34) is that Section 39 of the Code of Civil Procedure is applicable to the proceedings in which an award is sought to be executed.

5. Section 36 of the Arbitration and Conciliation Act reads as follows:

Enforcement- Where the time for making an application to set aside the arbitral award under section 34 has expired, or such application having been made, it has been refused, the award shall be enforced under the Code of Civil Procedure, 1908 (5 of 1908) in the same manner as if it were a decree of the court.

Section 2(1)(e) of the Act defines court.

'Court' means the principal Civil Court of original jurisdiction in a district, and includes the High Court in exercise of its ordinary original civil jurisdiction, having jurisdiction to decide the questions forming the subject matter of the arbitration if the same had been the subject-matter of a suit, but does not include any Civil Court of a grade inferior to such principal Civil Court, or any Court of Small Causes.

6. The expression 'the court' used in Section 36 makes it clear that it is the court mentioned in Section 2(1)(e) of the Act, the learned counsel for the petitioner submits. A literal interpretation of the section may incline one to accept the argument. But it should not be ignored that Section 2(1) commences with the expression "unless the context otherwise requires". So the meaning of the court may be different in different context.

7. In interpreting a provision the object of the legislation should be borne in mind. In Bharat Sewa Sansthan v. Uttar Pradesh Electronics Corporation Limited (AIR 2007 SC 2961) the Supreme Court has observed that one of the main objectives of the Act is to minimise the supervisory role of courts in arbitral process. In Union of India v. Singh Builders Syndicate, [(2009)4 SCC 523] the apex court has further observed that the object of expeditious disposal of arbitral matters would be defeated if the disputes remain pending in courts for months and years. The President of India while delivering the inaugural address of International Council for Commercial Arbi

















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