* IN THE HIGH COURT OF DELHI AT NEW DELHI + OMP (ENF.) (COMM.) 65/2021 JOGINDER SINGH NIJJAR AND ANR .....Decree Holders Through: Ms. Shobhana Takiar, Adv.

versus M/S OMAXE LTD. .....Judgment Debtor Through: Mr. Ramesh Singh, Sr. Advocate with Mr. Mukti Bodh and Ms.

Hage Nanya, Advs.

CORAM:

HON'BLE MR. JUSTICE C. HARI SHANKAR JUDGMENT (ORAL)

% 26.07.2024 EX.APPL.(OS) 948/2024 (Revival of Petition) and EX.APPL.(OS)

952/2024 (Direction) in OMP (ENF.) (COMM.) 65/2021

1. These applications raise the short issue – though no longer res integra – of whether tax can be deducted at source, [$~53], by the judgment (award) debtor, on an amount awarded in an arbitral award.

The lis

2. By the following order dated 11 March 2024, OMP (Enf)

(Comm) 65/2021 was disposed of:

“1. These are petitions seeking execution of the award dated

20.03.2020.

1“TDS”hereinafter

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KUMAR By:CHANDRASHEKHARAN

2. With consent of the parties, it is directed that the amount awarded in the award dated 20.03.2020, along with interest at the rate of 10% per annum with effect from 20.03.2020, shall be paid in 7 Equal Monthly Instalments (EMIs) starting from March, 2024inthefollowingterms:-

a. The instalment for the month of March, 2024 shall bepaidonorbefore31.03.2024.

b. The instalment for the month of April, 2024 shall bepaidonorbefore20.04.2024.

c. Thereafter, the remaining instalments shall be paid onorbefore10^th dayofeverymonth.

3. The statement made on behalf of the judgment-debtor by the learned senior counsel that the above payment schedule will becompliedwith,shall bebindinguponthejudgment-debtor.

4. In case the same is not complied with, the petitioner in addition to reviving the present enforcement petitions, shall also beentitledtoinitiatecontempt proceedings.

5. It is made clear that there is no variation in the interest component pre-award.

6. In addition, the paragraph 16 of the order dated

24.01.2024is modifiedand reads as under;-

"16. The applications are rejected and the captioned executions areallowed."”

3. As there has been no compliance with the direction for the deposit as contained in the above order, the present applications have come to be filed.

4. Ex. Appl. (OS) 948/2024, filed by the petitioners, seeks revival of OMP (Enf) (Comm) 65/2021.

5. Ex. Appl. (OS) 952/2024, filed by the respondent, on the other Signature Not Verified Signature Not Verified Digitally Signed By:AOJIMTP(ENF.)(COMM.)65/2021 Page2of10 Digitally Signed KUMAR By:CHANDRASHEKHARAN

hand, seeks a direction to the petitioner to provide the requisite documents, so that TDS could be deducted by the respondent while

complying with the direction for refund, as passed by this Court.

6. The dispute has percolated down to the issue of whether TDS can be deducted by the respondent on the amounts awarded in favour of the petitioner by the arbitral award under execution.

Rival Stands

7. Ms. Sobhana Takiar, learned Counsel for the petitioner, places reliance on the judgment of S.A. Bobde J, (as he then was), sitting singly in the High Court of Bombay in Islamic Investment Company v. U.O.I., [2(2002)4BomCR685], which, following an earlier decision of the Supreme Court in All India Reporter Ltd v. Ramchandra D. Datar³, holds that, once an amount becomes payable to a decree holder under a decree, it losses its original character and assumes the character of a judgment debt. In the absence of any provision of the Income Tax Act, 1961, which envisages deduction of TDS while paying a judgment debt, the Bombay High Court, following the Supreme Court, held that no TDS could be deducted from the said amount.

8. Mr. Ramesh Singh, learned Senior Counsel for the respondent submitted, yesterday, that if such a view were to be accepted, it would provide fodder for income tax evaders, who may file collusive suits

3(1961)2SCR773

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