2010 (83) ALR 317
ALLAHABAD HIGH COURT
PRAKASH KRISHNA, J.
M/s. ASHOKA CONSTRUCTION CO.
Versus
DISTRICT JUDGE, VARANASI and another
Writ C. No. 49597 of 2010
Decided on: August 26, 2010
Arbitration - Stay of Execution Proceedings - Arbitration & Conciliation Act, 1996 - Section 36 - Summary
Fact of the Case:
The petitioner, a partnership firm, entered into an agreement with the Chief Engineer for supply of earth for road embankment. An arbitration agreement was also in place, and an arbitral award was given in favor of the Union of India. The Union of India initiated execution proceedings to recover the awarded amount, and the petitioner was directed to furnish details of its property and bank account. The petitioner filed a writ petition challenging the order, claiming that the execution proceedings should be stayed under section 36 of the Arbitration & Conciliation Act, 1996.
Finding of the Court:
The Court found that the execution proceedings were not liable to be stayed under section 36 of the Act, as the petitioner had not filed any objection under section 34 of the Act. The Court also noted that the impugned order did not decide anything and that the petitioner, as a contractor, could not be said to be aggrieved by the order.
Issues: The issues involved whether the execution proceedings should be stayed under section 36 of the Arbitration & Conciliation Act, 1996, and whether the petitioner was aggrieved by the order directing it to furnish details of its property and bank account.
Ratio Decidendi: The Court held that the petitioner's argument for staying the execution proceedings under section 36 was misconceived, as the petitioner had not filed any objection under section 34 of the Act. It emphasized that section 36 was enacted for the benefit of the objector who has filed objection under section 34, and that if there is no objection at the instance of the person against whom the award has been delivered, the award becomes final and there is no purpose for staying the proceedings further.
Final Decision: The writ petition was dismissed summarily, and the Court found no merit in the petitioner's claim for staying the execution proceedings under section 36 of the Arbitration & Conciliation Act, 1996.
PRAKASH KRISHNA, J.--Challenging the order dated 2nd August, 2010 passed by District Judge, Varanasi in Execution Case No.6 of 2006 asking the petitioner, judgement-debtor to give the particulars of its assets and bank account number, the present writ petition has been filed.
2. The background facts may be noticed in brief:
The petitioner is a partnership firm and on 5th January, 1994 it entered into an agreement with the Chief Engineer, H.Q. C.E. (P) Hirak, BRO Complex for supply of earth for road embankment for a sum of Rs. 3,97,75,547. There was also an arbitration agreement. A dispute having been arisen between the parties, the matter was referred to arbitrator who gave the award dated 4th April, 2001. He awarded a sum of Rs. 22,35,342/- to the Union of India. The Union of India has put the said award under execution and the Executing Court has proceeded for recovery of the aforesaid awarded amount. On an application filed by the decree-holder under Order XXI, Rule 41, C.P.C., the judgment-debtor i.e., the present applicant by the order under revision has been directed to furnish the particulars of its property and the bank account. Feeling aggrieved by the said order, the present writ petition has been filed.
3. Learned Counsel for the petitioner in support of the writ petition submits that the execution proceedings are liable to be stayed in view of section 36 of the Arbitration & Conciliation Act, 1996. He further submits that the decree holder itself has filed objections against the arbitral award under section 34 of the Act and the said objections are still pending. Reliance has been placed on the Apex Court judgment in the case of Fiza Developers and Inter-Trade P. Ltd. v. AMCI (I) Pvt. Ltd.1.
1. JT 2009 (12) SC 519.
4. Considered the aforesaid submissions of the learned Counsel for the petitioner.
5. The facts are not in dispute. The factum that an arbitral award has been delivered by the arbitrator awarding the aforesaid amount in favour of the Union of India is not in dispute. It is also not in dispute that the present petitioner has not filed any objection under section 34 of the said Act. The objection has been filed by the decree holder i.e., Union of India against the said award. On these facts, the learned Counsel for the petitioner submits that the execution proceedings are liable to be stayed till the disposal of the objections preferred under section 34 of the Act in view of section 36 thereof.
6. There are two aspects of the case. Firstly, no case for interference under Article 226 of the Constitution of India has been made out as by the impugned order, the Court below has only directed the petitioner to furnish the details of its property and the bank account. To put it differently, the impugned order does not decide anything. By no stretch of imagination, the petitioner who is a contractor can be said to be aggrieved by the said order. The Execution Court has not proceeded to execute the award in any manner. It may be a step in the direction of the execution .of the award but at this stage, by no stretch of imagination, it can be said that the petitioner is aggrieved in any manner.
7. The Court was inclined to dispose of the writ petition in view of the aforesaid findings but the learned Counsel for the petitioner insisted upon the Court to consider the larger question that the Executing Court should stay its hands in view of section 36 of the Act. Therefore, the second aspect of the case is whether such proceedings are liable to be stayed under section 36 or not. The sheet-anchor of the argument of the petitioner is that indisputably, the judgment-debtor has applied for setting aside of the award and therefore, in view of mandate laid down in section 36 of the Act, the proceedings are liable to be stayed till the disposal of the said objections.
8. In my considered view, the argument of the learned Counsel for the petitioner is misconceived and the reliance placed by him on the judgment of the Apex Cour
AI
Login now and unlock free premium legal research
Login to SupremeToday AI and access free legal analysis, AI highlights, and smart tools.
Login
now!
India’s Legal research and Law Firm App, Download now!
Copyright © 2023 Vikas Info Solution Pvt Ltd. All Rights Reserved.