The court can impose conditions for the stay of an arbitral award, including the payment of a portion of the award amount.

MOHAMMAD RAFIQ, J.

1. This appeal has been preferred by Jaipur Municipal Corporation through the Chief Executive Officer, Jaipur and Mayor (hereafter the Objector) assailing the order dated 17.8.2018 passed by the Commercial Court No. 1, Jaipur in the course of proceedings under Section 34 of the Indian Arbitration and Conciliation Act, 1996 (Act of 1996) against the award dated 18.7.2016 passed by the Arbitrator. The Arbitrator by his award held the claimant entitled to a sum of Rs.4,66,40,116/- with interest @ 12% per annum effective the date of the award.

2. The objections under Section 34 of the Act of 1996 against the award dated 18.7.2016 originally filed in the Court of District and Sessions Judge, Jaipur Metropolitan, Jaipur, were transferred to the Court of Additional District Judge No. 1, Jaipur Metropolitan City, Jaipur which Court after hearing the application of the appellants by order dated 14.2.2017 held that the respondent was not entitled to execute the award. The respondent then filed a writ petition being S.B. Civil Writ Petition No. 3297/2017 against the order aforesaid, which was dismissed by this Court. The matter was thereafter taken to the Supreme Court by the respondent. The Supreme Court vide order dated 15.5.2018 set aside both the orders of the Commercial Court/Additional District & Sessions Judge, Metropolitan and that of this Court, in view of the judgment of Board of Control for Cricket in India v. Kochi Cricket Pvt. Ltd. etc. reported in (2018) 4 Scale 502 and directed the court below to hear the arguments on the application u/s. 34 as also on the stay application within four months.

3. It may be noted herein that the Supreme Court in Kochi Cricket Pvt. Ltd, supra has taken the view that there would be no automatic stay on the execution of the award of by mere filing objections even in cases arising out of disputes prior to the Arbitration and Conciliation (Amendment) Act, 2015, which came into force with effect from 23.10.2015. In the meantime, Commercial Courts have been established in the State of Rajasthan and the present case has been transferred to Commercial Court No. 1, Jaipur. The learned Commercial Court while hearing the application filed by the petitioner/objector has by the impugned judgment passed a conditional order of stay namely; that the operation of the award dated 18.7.2016 would remain stayed till disposal of the objections, if the objector Jaipur Nagar Nigam deposited 25% amount of the award in the Court or furnished a bank draft of 25% of the award amount to the claimant within 15 days against a bank guarantee as security all subject to the outcome of the objection petition. The Court below further directed that if the objector did not comply with its interim order, the award in issue could be executed. In taking that view, the Commercial Court has relied on the judgment of the Supreme Court in Malwa Strip Pvt. Ltd. v. Jyoti Ltd., (2009) 2 SCC 426 : AIR 2009 SC page 1581 and Kayamuddin Shamsuddin Khan v. SBI, (1998) 8 SCC 676.

4. Dr. Prakash Chandra Jain, counsel for the objector has argued that the Commercial Court ought to have heard the main application u/s. 34 itself and finally decided the objections filed. It has however heard only the application for stay. Dr. PC Jain submitted that Order 41 Rule 5 CPC was not attracted to the present case arising out of the Act of 1996. The compliance of the award even in part and even subject to condition of security by way of a bank guarantee could not to be insisted against the Jaipur Municipal Corporation in view of Order 27 Rule 8A CPC. Dr. PC Jain submitted that the Municipal Council, a statutory body, would fall within the purview of “Government” and therefore it cannot be required to furnish a bank guarantee or security when it challenges a money decree as the award dated 18.7.2016 is. It was submitted that the objector was ready and willing to argue the main objection petition filed under Section 34 of the Arbitratio