M/S. Indusind Bank Ltd. vs Maheswar Rout And Another
2023 Latest Caselaw 7801 Ori

      IN THE HIGH COURT OF ORISSA AT CUTTACK
                          W.P.(C) No.1897 of 2015
                          (Through Hybrid mode)

  M/s. Indusind Bank Ltd., G. N.                   ....                      Petitioner
  Chetty Road, Chenai

                                        -versus-
  Maheswar Rout and another                        ....             Opposite Parties

  Learned advocates appeared in this case:

  For petitioner                 : Mr. Prakash Kumar Mishra, Advocate


  For opposite parties           : Mr. Chiranjaya Mohanty, Advocate


               CORAM: JUSTICE ARINDAM SINHA
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Date of hearing and judgment: 19.07.2023

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1. The writ petition was moved on contention by petitioner that

it was claimant in the reference and award was made in its favour.

Thereupon, it sought to file for execution before the Court below,

rejected by impugned order dated 27th December, 2014 on direction for

his client to move the principal civil Court having jurisdiction over seat

of the arbitration, in Chennai.

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2. There was direction for issuance of notice to opposite parties

and Mr. Mohanty, learned advocate appears on behalf of opposite party

no.1, respondent in the reference.

3. Mr. Mishra, learned advocate appears on behalf of petitioner

and relies on judgment dated 15th February, 2018 of the Supreme

Court in Civil Appeal no.1650 of 2018 (Sundaram Finance Limited

vs. Abdul Samad). He submits, said Court concluded that enforcement

of an award through its execution can be filed anywhere in the country,

where such decree can be executed and there is no requirement for

obtaining a transfer of the decree from the Court, which would have

jurisdiction over the arbitral proceeding.

4. Mr. Mohanty draws attention to paragraph 12 in impugned

order. He submits, the Court below correctly formulated manner in

which execution is to be obtained of an arbitral award. The Court said

firstly, where place of arbitration has been specified, principal civil

Court of that particular place has got power to entertain challenge

under section 34 in Arbitration and Conciliation Act, 1996 and

subsequently, same Court has got power to enforce the award as a

decree, under section 36. Secondly, where there is no such mention, the

arbitration agreement will yield place of arbitration as per section 20.

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Accordingly, principal civil Court of that place would execute the

award as a deemed decree. Thirdly, where any application with regard

to the arbitral proceeding has already been filed, such Court will only

have jurisdiction to include subsequent applications including

execution petition, as per section 42. Lastly, in above three

circumstances, concerned principal civil Court upon receiving

execution petition may transfer the proceeding under section 39 of the

Code of Civil Procedure, 1908.

5. He relies on judgment of the Supreme Court in Khaleel

Ahmed Dakhani vs. The Hatti Gold Mines Co. Ltd., reported in

(2000) 3 SCC 755 to submit, in that case execution petition had been

filed before the principal District Judge, Raichur in Karnataka. The

executing Court had issued warrants of attachment and, thereafter,

refused to lift the orders of attachment at instance of award debtor.

Award debtor filed for revision before the High Court of Karnataka,

who set aside the orders of the executing Court. The Supreme Court

dismissed the appeal against judgment of the High Court. Hence, by

Khaleel Ahmed (supra) Supreme Court had confirmed quashing of

order made in execution by the Court at Raichur, on contention that the

principal Court at Bangalore had jurisdiction.

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6. In Sundaram Finance (supra) ratio is that section 32 in

providing termination of arbitral proceedings, makes provisions of the

Act traverse a different path from earlier Arbitration Act, 1940. The

latter mandated filing of an award in Court for decree to be passed in

accordance therewith. In that context the Supreme Court said that

section 42 operates in respect of arbitral proceedings and when the

proceedings stand concluded on passing of award, there being no

application made under sub-section (4) of section 34, execution

petition can be filed anywhere in the country.

7. The earlier decision in Khaleel Ahmed (supra) does not go

contrary to the later decision in Sundaram Finance (supra). There

were two factual elements noticed by the Court in the earlier decision.

Firstly, the arbitration agreement between the parties in that case had

by clause 35, stipulation that only the Courts Bangalore would have

jurisdiction to entertain any claim for enforcement of the award.

However, the Court did not dismiss the appeal based on said fact. The

appeal was dismissed because there was application pending in the

civil Court at Bangalore on the question of its jurisdiction, in

proceeding filed earlier in time than the execution petition at Raichur,

Karnataka. The proceeding was challenge under section 34 by award

// 5 //

debtor himself. As such, not only is Khaleel Ahmed (supra) in line

with subsequent declaration of law in Sundaram Finance (supra) but

also there were distinguishing facts found for the High Court of

Karnataka to have quashed the orders of executing Court at Raichur.

8. It is noticed Sundaram Finance (supra) was not cited in the

Court below though Khaleel Ahmed (supra) was.

9. For reasons aforesaid, impugned order is set aside and

quashed and the execution case restored. The Court below is directed

to proceed with the execution case.

10. The writ petition is disposed of.

(Arindam Sinha) Judge

Prasant

Signature Not Verified Digitally Signed Signed by: PRASANT KUMAR SAHOO Reason: Authentication Location: OHC Date: 19-Jul-2023 17:58:51