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2003 Supreme(All) 2531
IN THE HIGH COURT OF ALLAHABAD
JANARDAN SAHAI
VIPUL AGARWAL - Appellant
Versus
ATUL KANODIA AND CO - Respondents
C. M. W. P. 49745 Of 2003
Decided On : 11/19/2003
Ashutosh Srivastava, S.K.GUPTA, Shashi Nandan
The main legal point established is that under Section 36 of the Arbitration and Conciliation Act, an arbitral award can be executed when the application under Section 34 has been refused, and the refusal refers to the refusal by the Court where the application is filed.
Headnote:
Arbitration and Conciliation Act - Execution of Award - Section 36
Fact of the Case:
The petitioner sought to set aside an arbitral award under Section 34 of the Arbitration and Conciliation Act, 1996. The district Judge dismissed the application, and the appeal against the order was also dismissed. The respondent filed for execution of the award, which the petitioner objected to, citing the pending appeal before the Supreme Court.
Finding of the Court:
The court analyzed the provisions of Section 36 of the Act and concluded that the award can be executed when the time for filing an application under Section 34 has expired and no application has been filed, or when such application has been refused. The court held that the refusal referred to in Section 36 is the refusal by the Court where the application is filed and not by the appellate Court.
Issues: The key issue was whether the word 'refused' in Section 36 of the Act means a final refusal after all proceedings of appeal, or a refusal by the District Judge is sufficient to make the award executable.
Ratio Decidendi: The court interpreted the language of Section 36 and emphasized that the refusal contemplated in the section is the refusal by the Court where the application is filed and not by the appellate Court. The court also discussed the nature of appeals as a continuation of the original proceedings but not equated in all respects to the original proceedings.
Final Decision: The court dismissed the petition, finding no merit in the petitioner's argument.
JANARDAN SAHAI, J.
( 1 ) AN award was made against the petitioner by the Arbitral Tribunal under the Arbitration and Conciliation Act, 1996 hereinafter referred to as the Act on 17-11-1997. The petitioner filed an application to set aside the award under Section 34 of the Act. The application was dismissed by the district Judge, Kanpur Nagar by order dated 16-1-2003. The appeal against the order filed was dismissed on 7-3-2003. An application for special leave to appeal to the apex Court filed by the petitioner has been allowed and the civil appeal is now pending before the Apex Court.
( 2 ) UNDER Section 36 of the Act an arbitral award is executable as a decree. But it can be enforced only after the time for filing an application under Section 34 has expired and no application is made or such application having been made has been rejected. An application for executing the award has been filed by the respondent before the District Judge. The petitioner objected to the execution on the ground that as the appeal of the petitioner before the Supreme Court against the orders rejecting his application under Section 34 is pending the refusal of the application under Section 34 has not become final and the appeal being a continuation of the proceeding the award can not be executed till the appeal is decided. The District Judge by his impugned order dated 29-10-2003 has rejected the application.
( 3 ) I have heard Sri Ashutosh Srivastava, learned counsel for the petitioner and Sri shashi Kant Gupta, learned counsel for the respondent.
( 4 ) IT is submitted by the learned counsel for the petitioner that no appeal is provided against the award. It is only when an application to set aside the award has been finally refused would the award be open to execution. In support of his submission reliance was placed upon the provisions of sections 34, 35, 36 and 37 of the Arbitration and Conciliation Act, 1996. For the purposes of determining the point in issue it is necessary to quote the provisions of section 36 of the Act, which are as under ; "36. 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 (V of 1908) in the same manner as if it were a decree of the Court.
( 5 ) THE language of the section clearly indicates that the award can be executed in two situations - one when the time for filing an application for setting aside the award has expired and no application has been filed or where the application has been filed and it has been refused. It is not in dispute that an award can be executed as a decree in view of the provisions of Section 36 of the act. The onlyquestion for consideration in this case is whether the word refused used in Section 36 of the Act means a final refusal after all the proceedings of appeal etc. up to the Supreme Court are over or a refusal by the District Judge is sufficient to make the award executable. If the legislature intended that it is only after the application under Section 34 has been rejected at the appellate stage would the award be enforceable it could have used such words as finally refused in the section. As stated above the first situation referred to in the section when an award becomes executable is where the limitation for filing an application under Section 34 has run out and no application has been filed. The application for setting aside the award in the context necessarily means the application filed before the District Judge as It is the running out of the limitation for such an application which would make the award executable. It is clear, that the opening part of the section does not refer to the running out of the period of limitation of filing an appeal. Now the second situation when the award becomes executable is when such application having been made has been refused. The words "such applicatio
