M/S Ae Infraprojects Pvt. Ltd vs Vadodara Municipal Corporation
2025 Latest Caselaw 4756 Guj

Gujarat High Court

M/S Ae Infraprojects Pvt. Ltd vs Vadodara Municipal Corporation on 16 June, 2025

Author: Sunita Agarwal

Bench: Sunita Agarwal

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                                          C/SCA/7727/2025                      ORDER DATED: 16/06/2025

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                                     IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

                                       R/SPECIAL CIVIL APPLICATION NO. 7727 of 2025
                       ==========================================================
                                                M/S AE INFRAPROJECTS PVT. LTD.
                                                             Versus
                                              VADODARA MUNICIPAL CORPORATION
                       ==========================================================
                       Appearance:
                       MR NV GANDHI(1693) for the Petitioner(s) No. 1
                       MR. MAULIK NANAVATI, ADVOCATE FOR NANAVATI & CO.(7105) for the
                       Respondent(s) No. 1
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                          CORAM:HONOURABLE THE CHIEF JUSTICE MRS. JUSTICE
                                  SUNITA AGARWAL
                                  and
                                  HONOURABLE MR.JUSTICE D.N.RAY
                                               Date : 16/06/2025
                                                ORAL ORDER

(PER : HONOURABLE THE CHIEF JUSTICE MRS. JUSTICE SUNITA AGARWAL)

1. Heard learned Counsels for the parties.

2. The challenge in the present petition invoking

supervisory jurisdiction of this Court under Article 227 of the

Constitution of India as to the order dated 27.03.2025 passed

by the Commercial Court in staying the execution of the

arbitral award subject to the conditions mentioned there. The

Commercial Court categorically records that the averments

made in the application under Section 34 of the Arbitration

and Conciliation Act, 1996 (for short "the Act") requires

consideration and since the applicant has not pleaded that the

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award was cryptic by the fraud or corruption, there was no

question of granting unconditional stay in his favour.

3. Learned Advocate appearing for the Petitioner herein

namely the award holder seeks to submit that there was no

justification for grant of stay of the execution of the award

when Section 34 application was filed after the Execution

Application was filed by the award holder. Moreover, no prima

facie case, balance of convenience and irreparable loss could

be shown by the judgment debtor namely the applicant under

Section 34 of the Act so as to grant any interim order in his

favour. The further submission is that none of the grounds to

challenge the arbitral award under Section 34 of the Act 1996

could be said to have been made out nor any such reasoning

have been recorded by the Commercial Court while granting

stay.

4. All these submissions to challenge the order of staying

the execution of the award subject to deposit of 50% of the

principal decreetal amount before the Court are on the merits

of the order itself. No error of jurisdiction or manifest error of

law in passing the order of stay could be pleaded before us.

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The strict principle of grant of interim injunction under Order

39 Rule 1 of the Civil Procedure Code, 1908 (CPC) are not

attracted in the proceedings under Section 34 of the Act. We

may note that the provisions contained in the proviso to Sub

Section 3 of Section 36 which states that the provision of the

CPC for grant of stay of the money decree would have to be

seen by the Court while granting stay in the case of an

arbitral award for payment of money, has been held to be rule

of guidance by the Apex Court in the case of Pam

Development Pvt. Ltd. Vs. State of West Bengal reported

in (2019) 8 SCC 112. Be that as it may, the Arbitration Act is

a self contained Code and the provisions of the CPC will apply

only in so far as the same are not inconsistent with the spirit

and the provisions of the Arbitration Act. The submission of

the learned counsel for the Petitioner that the provisions of

Order 41 Rule 5 of CPC empowering an Appellate Court to

grant a stay of the proceedings under a decree or order

appealed from, would be attracted in the case of grant of a

stay of the arbitral award under section 34, is found to be

misconceived. At the most, the Court under Section 34 while

considering the application for stay of the arbitral award has

to keep in mind the guiding factors provided in Sub Section 3

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of Section 36 of the Act.

5. Moreover, the interference in the supervisory

jurisdiction of the High Court under Article 227 of the

Constitution of India is not open as no error of jurisdiction or

manifest error of law could be pointed out. Alternative view

cannot be taken by this Court acting as Court of Appeal. We

may also note that the provisions of Section 5 of the Act which

cautioned against the judicial intervention in arbitration

proceedings.

6. For the aforesaid, the present petition is found to be

devoid of merits and hence, dismissed. It goes without saying

that this dismissal of the present petition will not come in the

way of the Petitioner for seeking any further relief before the

competent Court.

7. The Court shall make endeavour to decide the matter as

expeditiously as possible.

(SUNITA AGARWAL, CJ )

(D.N.RAY,J) BINA SHAH