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2019 Supreme(Ori) 201
IN THE HIGH COURT OF ORISSA, CUTTACK
BISWANATH RATH, J.
Orissa Manganese & Minerals Ltd - Appellant
Versus
Birat Chandra Dagara - Respondent
Writ Petition (Civil) No. 7445, 7537 of 2019
Decided On : 09-07-2019
Advocate Appeared:
Rajat Kumar Rath, Adv., A.K. Kanungo, Adv., Jagannath Patnaik, Adv., A. Patnaik, Adv., B. Mohanty, Adv., S.S. Kanungo, Adv., S. Mohapatra, Adv., S. Patnaik, Adv.
An application under Section 151 of the Code of Civil Procedure (CPC) is maintainable in a case where a consent award passed in terms of a settlement arrived at between the parties in an arbitration proceeding is sought to be executed.
Headnote:
ARBITRATION - Consent Award - Execution - Interim Order - Balance of Convenience - Irreparable Loss - Prima Facie Case - Section 151 of C.P.C. - Section 9 of the Arbitration and Conciliation Act, 1996 - Section 36 of the Arbitration and Conciliation Act, 1996 - Section 35 of the Arbitration and Conciliation Act, 1996 - Mineral Concession Rules, 1960 - Rule 24(a)(i) - Rule 37 - MMDR Act, 1957 - Section 21(5) - MMDR (Amendment) Act, 2015.
Fact of the Case:
The Orissa Manganese & Minerals Ltd. (OMM Ltd.) and Shri Birat Chandra Dagara were involved in a dispute concerning a mining lease for iron ore. The dispute was referred to arbitration and a consent award was passed in terms of a settlement arrived at between the parties. OMM Ltd. filed an execution petition to enforce the consent award. During the pendency of the execution petition, OMM Ltd. filed an application under Section 151 of the Code of Civil Procedure (CPC) seeking an interim order to restrain Dagara from carrying out any mining operation in the leasehold area. The District Judge granted an interim order in favor of OMM Ltd. Dagara challenged the interim order before the High Court.
Finding of the Court:
The High Court held that the District Judge had rightly granted the interim order in favor of OMM Ltd. The Court found that there was a prima facie case in favor of OMM Ltd., that the balance of convenience and irreparable loss leaned in favor of OMM Ltd., and that the interim order was necessary to protect the rights of OMM Ltd. under the consent award. The Court also held that the application under Section 151 of the CPC was maintainable as it fell within the ambit of Section 9 of the Arbitration and Conciliation Act, 1996.
Issues: 1. Whether the District Judge was justified in granting an interim order in favor of OMM Ltd. restraining Dagara from carrying out any mining operation in the leasehold area? 2. Whether the application under Section 151 of the CPC was maintainable?
Ratio Decidendi: 1. The Court held that the District Judge was justified in granting the interim order in favor of OMM Ltd. The Court found that there was a prima facie case in favor of OMM Ltd., that the balance of convenience and irreparable loss leaned in favor of OMM Ltd., and that the interim order was necessary to protect the rights of OMM Ltd. under the consent award. 2. The Court held that the application under Section 151 of the CPC was maintainable as it fell within the ambit of Section 9 of the Arbitration and Conciliation Act, 1996.
Final Decision: The High Court set aside the impugned order dated 2.04.2019 and revived the order dated 7.02.2019 passed by the District Judge. The direction therein shall remain operative till disposal of the execution proceeding No.1 of 2019. For already appearances of the Judgment debtor in execution proceeding this Court also directs the District Judge, Mayurbhanj to conclude the hearing of the Execution Petition giving opportunity of hearing to both the sides as expeditiously as possible preferably within a period of six weeks hence.
JUDGMENT :
BISWANATH RATH, J.
1. W.P.(C) No.7445 of 2019 has been filed by the Orissa Manganese & Minerals Ltd. whereas W.P.(C) No.7537 of 2019 has been filed by Shri Birat Chandra Dagara involving a common impugned order but on different context.
W.P.(C) No.7445 of 2019 has been filed assailing the order dated 02.04.2019 at Annexure-22 passed by the District Judge, Mayurbhanj at Baripada involving a miscellaneous application vide Execution Petition No.1 of 2019 arising out of an Arbitration award involving the petitioner and the opposite party herein in disposal of an application U/s.151 of C.P.C. dated 25.1.2019 alongwith disposal of a petition dated 7.02.2019 on behalf of the present opposite party-judgment debtor for recalling of an interim order, which were decided analogously and in disposal thereby modifying the interim order dated 7.02.2019 but however with imposition of condition on the judgment debtor for furnishing a bank gurantee worth rupees five crores within a month also prohibiting the judgment debtor not to dispose of or cause destruction to the schedule-B property appended to the execution petition till disposal of the execution proceeding. It is also directed therein that mining operation shall be intimated to the District Court in shape of affidavit. Whereas W.P.(C) No.7537 of 2019 has been filed by Shri Birat Chandra Dagara the Judgment debtor also assailing the same order dated 02.04.2019 again available at Annexure-1 herein involving Execution Petition No.1 of 2019 but however, involving the condition attached by the District judge so far it relates to the petitioner involving W.P.(C) No.7537 of 2019 the judgment debtor involved herein.
2. On consent of parties, since both the writ petitions involve challenge to the same order and since the parties have common set of submissions, this Court takes up both the matters together and decides both the matters by this common judgment. For the background involved herein, further as it appears, the dispute has a long history, to avoid any doubt in the facts and developments therein, this Court feels it appropriate to bring the history involving the disputes between the parties before proceeding to decide the actual dispute involving the writ petitions.
3. A mining lease for Iron Ore for over an area admeasuring 618 hectares at Suleipat Iron Ore Mines in the District of Mayurbhanj was originally held by one Sri Bajrang Lal Padia for a term of 30 years w.e.f.25.10.1975. This lease area was transferred by Shri Bajrang Lal Padia to the petitioner with prior consent of the State Government w.e.f. 24.10.1984. For the unexpired period of lease Birat Chandra Dagra applied for renewal on 18.10.2004 i.e. twelve months prior to expiry of lease of 25.10.2005. Following the provision under Rule 24(a)(i) of the Mineral Concession Rules, 1960 hereinafter in short be called as "the Rules, 1960" Sri Dagara was undertaking mining operation involving the lease hold area through the raising contractor M/s. Orissa Manganese & Minerals Ltd. hereinafter in short be called as "O.M.M Ltd.". Copy of agreement between Shri Dagara and M/s. Orissa Manganese & Minerals Ltd. appears at Annexure-1 in W.P.(C) No.7445 of 2019. Facts further disclose that while the O.M.M. Ltd. was continuing as the raising contractor on the allegation of clandestine mine raising by the lease holder and involving of financial irregularities at the instance of the several mining lease holders in the State of Orissa, based on a decision to have an inquiry Hon'ble Mr. Justice M.B Shah was appointed as Judge Commission of Inquiry to enquire into illegal mining of Iron and Manganese ore in the State of Orissa commonly known as "Shah Commission". The Hon'ble Commission while submitting his final report made certain recommendations in the matter of prohibition of industrial activity in certain part of Mayurbhanj District. Knowing fully well the aforesaid development and constraints came through the Hon'ble Shah Commission rep
