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2023 Supreme(Ker) 178

IN THE HIGH COURT OF KERALA AT ERNAKULAM
C.S. DIAS, J.
M/S PENIEL CASHEW COMPANY – Petitioner
Versus
M/S. AHCOM SARL – Respondent
C.R.P. No. 618 of 2019
Decided On : 07-02-2023

Advocates:
Advocate Appeared:
For the Petitioners: T. KRISHNANUNNI, N.D. PREMACHANDRAN, VINOD RAVINDRANATH, D. AJITHKUMAR.
For the Respondent: T.R. ASWAS.

Once an award is found to be enforceable under Section 49, it is deemed to be a decree from the date of the foreign award. Only broader principles of CPC apply to Part II of the Act.

Headnote:Arbitration - Enforcement of Foreign Awards - Arbitration and Conciliation Act, 1996, Sections 34, 47-49 - The court discussed the enforceability of a foreign arbitration award under Chapter I of Part II of the Arbitration and Conciliation Act, 1996. The judgment emphasized that once an award is found to be enforceable, it is deemed to be a decree of the Court from the date of the foreign award. The court also highlighted that only broader principles of the Code of Civil Procedure apply to Part II of the Act.

Fact of the Case:

The respondent filed E.P. No. 97/2013 against the petitioner to enforce a foreign award passed by CENTA.

Finding of the Court:

The court held that there was no illegality, irregularity or impropriety in the impugned order and dismissed the civil revision petition.

Issues:

The issues revolved around the existence of the respondent company, means of the petitioner to pay the decree amount, and procedural aspects related to enforcement proceedings.

Ratio Decidendi:

The court emphasized that once an award is found to be enforceable under Section 49, it is deemed to be a decree from the date of the foreign award. It also clarified that only broader principles of CPC apply to Part II of the Act.

Final Decision:

The civil revision petition was dismissed as there was no illegality, irregularity or impropriety in the impugned order.

ORDER :

1. The civil revision petition is filed by the award debtor in E.P. No. 97/2013 of the Court of the Second Additional District Judge, Kollam, challenging the order of his arrest and detention in the civil prison. The respondent is the award holder.

2. The salient background facts leading to the impugned order are:

    2.1. The respondent has filed E.P. No. 97/2013 against the petitioner to execute a foreign arbitration award passed by Combined Edible Nut Trade Association (CENTA), London.

2.2. The respondent had initiated arbitration proceedings against the petitioner, based on an earlier contract to realise an amount of 2,88,125.20 U.S. Dollars. The petitioner was not served with notice or given an opportunity to contest the arbitration proceedings, but CENTA passed an ex-parte award on 20.12.2012.

2.3. The petitioner challenged the award before the District Court, Kollam, by filing O.P. No. 1/2013 under Section 34 of the Arbitration and Conciliation Act, 1996 (in short ‘Act’). The respondent questioned the maintainability of the original petition. The District Court rejected the objection. The respondent unsuccessfully challenged the order before this Court and the Hon’ble Supreme Court. Consequently, the District Court proceeded with O.P. No. 1/2013.

2.4. The respondent again filed I.A. No. 1464/2016 in O.P. No. 1/2013, to hear the question of maintainability. The District Court dismissed the said application.

2.5. The respondent challenged the order before this Court in O.P. (C) No. 2983/2016. This Court dismissed the original petition but directed the District Court to expeditiously dispose of O.P. No. 1/2013.

2.6. By order dated 6.7.2013, the District Court dismissed O.P. No. 1/2013 on the finding that Part I of the Act does not apply to foreign seated arbitrations.

2.7. The delay in the disposal of O.P. No. 1/2013 was on account of the various petitions filed by the respondent.

2.8. Aggrieved by the order passed in O.P. No. 1/2013 on the finding that the original petition was not maintainable and directing the petitioner to furnish fresh security, the petitioner filed Arbitration Appeal No. 54/2017 and O.P. (C) No. 2932/2017 before this Court.

2.9. This Court dismissed the appeal and confirmed the order in O.P. No. 1/2013. Yet, this Court allowed O.P. (C) No. 2932/2017, observing that the question of security would arise only after ascertaining whether the award was enforceable.

2.10. In the interregnum, the respondent filed E.P. No. 97/2013 to execute the award. After the dismissal of the appeal, the District Court posted the execution petition for evidence. The respondent did not let in oral evidence. On the contrary, the petitioner and two witnesses were examined as DWs. 1 to 3 and Exts.B1 to B33 series were marked.

2.11. The District Court, by orders dated 13.3.2018 and 15.3.2018, held that it has jurisdiction to decide the execution petition and that the award was enforceable.

2.12. The petitioner challenged the above order before this Court in O.P. (C) No. 1005/2018. This Court set aside the order and remanded the matter.

2.13. The District Court, by order dated 17.7.2018, reiterated that it had jurisdiction to decide the issue.

2.14. The petitioner again challenged the above order before this Court in O.P. (C) No. 1877/2018. However, this Court dismissed the original petition on 30.10.2018, and the Hon’ble Supreme Court confirmed the judgment in S.L.P. No. 122/2019.

2.15. The District Court, by its orders in E.A. Nos. 131/2018 and 441/2018, quantified the amount payable by the petitioner including interest.

2.16. Again, the petitioner challenged the above order before this Court in O.P. (C) No. 23/2019.

2.17. After this Court confirmed that the award was enforceable, the respondent filed E.A. No. 132/2018, to arrest and detain the petitioner in civil prison. The petitioner filed his objection to the notice issued under Order 21 Rule 37 of the Code of Civil Procedure (in short, CPC). He, inter-alia, pleaded that he has no means

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