Basheer and Abdul Salam v. Mahindra & Mahindra Financial Services Ltd.

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** **PRESENT :** **THE HONOURABLE MR. JUSTICE THOMAS P.JOSEPH** **TUESDAY, THE 13TH DECEMBER 2011 / 22ND AGRAHAYANA 1933** **OP(C).NO. 4075 OF 2011(O)** **--------------------------------------AGAINST THE ORDER IN EP 5/2011 IN ARB.4499/2009 OF DISTRICT COURT THODUPUZHA** **PETITIONER:** **--------------------** **1. BASHEER, AGED 47 YEARS, BLOCK 1134, THIRD CAMP P.O., UDUMBANCHOLA, IDUKKI DISTRICT.** **2. ABDUL SALAM, AGED 49 YEARS, BLOCK 1134, BALAGRAM P.O., UDUMBANCHOLA, IDUKKI DISTRICT.** **BY ADV. SRI.K.S.HARIHARAPUTHRAN SRI.M.D.SASIKUMARAN** **SRI.GEORGE MATHEW SRI.DIPU JAMES SRI.K.P.UNNIKRISHNAN (ELOOR)** **RESPONDENT(S):** **-------------------------** **M/S.MAHINDRA & MAHINDRA FINANCIAL SERVICES LTD., SADHANA HOUSE, 2ND FLOOR, 570 P.B. MARG, BEHIND MAHINDRA TOWERS, WORLI, MUMBAI, REPRESENTED BY ITS POWER OF ATTORNEY HOLDER, VINOD, EXECUTIVE LEGAL, ERNAKULAM-682021.** **THIS OP (CIVIL) HAVING COME UP FOR ADMISSION ON 13/12/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** ## **O.P(C) NO.4075 OF 2011** ## **APPENDIX** ## **PETITIONER(S)' EXHIBITS:** |**EXHIBIT P1:**|**TRUE COPY OF E.P.NO.5 OF 2011 DT.22-01-2011.**| |---|---| |**EXHIBIT P2:**|**TRUE COPY OF DISCHARGE SUMMARY DT.21-7-2011.**| |**EXHIBIT P3:**|**TRUE COPY OF OBJECTION DT.24-7-2011.**| |**EXHIBIT P4:**|**TRUE COPY OF THE JUDGMENT DATED 10-10-2011 IN OPC**| ||**2600/2011.**| |**EXHIBIT P5:**|**TRUE COPY OF THE ORDER DT.10-11-2011 IN EXT.P1.**| ## **RESPONDENT(S)' EXHIBITS: NIL** ## **TRUE COPY** **P.S. TO JUDGE** ## **THOMAS P.JOSEPH, J.** **==================================== O.P(C) No.4075 of 2011 ==================================== Dated this the 13[th] day of December, 2011** ## **J U D G M E N T** This Original Petition is in challenge of Ext.P5, order passed by the learned District Judge, Thodupuzha in E.P. No.5 of 2007 overruling objection of petitioners as to executability of award passed by the Arbitrator under the Arbitration and Conciliation Act, 1996 (for short, “the Act”). Earlier warrant of arrest was issued to the petitioners. At that time petitioners approached this Court with O.P(C) No.2600 of 2011 contending that plea raised by petitioners regarding executability of the award and jurisdiction of learned District Judge to execute were not considered. This Court by Ext.P4, judgment directed learned District Judge to consider the said objections. Learned District Judge considered the objection and passed Ext.P5, order holding that the award is executable. It is contended by learned counsel that as held by the Madhya Pradesh High Court in **Computer Sciences Corpn. India (P) Ltd. v. Harishchandra Lodwal** (AIR 2006 MP 34) unless the decree certificate is transferred to the court of learned District Judge under Sec.39 of the Code of Civil Procedure **O.P(C) No.4075 of 2011** -: 2 :- (for short, “the Code”) the award cannot be executed in another court. 2. Two objections which petitioners raised regarding executability of the award are that a copy of the award was not given to the petitioners and that in the absence of a decree certificate transmitted to the learned District Judge, no execution is possible. 3. So far as the first objection is concerned, learned District Judge noticed from Exts.P8 and P9 that the Arbitrator had sent a copy of the award to the petitioners by registered post, intimation of the postal article was given to the petitioners on 11.11.2010 but they refused to receive the same and that amounted to proper service of the award. That part of the finding is not under challenge before me. 4. Challenge is to the jurisdiction of learned District Judge for the reason that a decree certificate is not transmitted to that court as required under Sec.39 of the Code. In support of the above contention petitioner has relied on the decision of the Madhya Pradesh High Court (supra). Learned Judge of the Indore Bench took the view that where award passed at place 'T', could be initiated at place 'D' where the judgment debtor resided ## **O.P(C) No.4075 of 2011** ## -: 3 :- provided the court at place 'T' transferred the decree certificate to the court at place 'D'. Learned District Judge has referred to certain decisions of other High Courts which, after referring to the decision of the Madhya Pradesh High Court took the view that transfer of the decree certificate as provided under Sec.39 of the Code is not required. 5. I must understand Section 17 of the Arbitration and Conciliation Act, 1940 (for short, “the Act of 1940) while considering the scope and amplitude of Sec.36 of the Act. Section 17 of the Act of 1940 provided that a decree has to be drawn up by the court concerned. But that requirement has been given up by the Act. Section 36 of the Act says that where the time for making application to set aside an arbitral award under Sec.34 of the Act has expired or such application having been made it has been refused, the “award shall be enforced under the Code of Civil Procedure 1908 (5 of 1908) in the same manner as if it were a decree of the same court. 6. In other words as distinguished from Sec.17 of the Act of 1940 where the award was required to be made a decree of the court a marked difference is made by Sec.36 of the Act that the award shall be enforced in the same manner as if it were a ## **O.P(C) No.4075 of 2011** ## -: 4 :- decree of the court. 7. The presence of article “the” before the expression “court”, necessarily means the “court” referred is the “court” as defined in Sec.2(e) of the Act and before which the award is produced for execution. In the present case it is the court of learned District Judge, Thodupuzha. When a copy of the award as required under law is produced before learned District Judge, Thodupuzha that award has to be treated as a decree of that court for execution. Hence the question of the decree being transmitted to the learned District Judge under Sec.39 of the Code does not arise. 8. This position is made clear by Rule 9 of the Kerala Arbitration and Conciliation (Court) Rules 1997 where it is stated that parties seeking enforcement of the award under Secs.36,49 and 58 of the Act shall file execution petition as provided under the Code which shall be accompanied by a copy of the award delivered to him by the Arbitrator. 9. P.C. Markanda in Law relating to Arbitration and Conciliation 15[th] Edn. at page 664 referring to Sec.36 of the Act states that the award shall be considered as a decree and shall be enforced under the Code in the same manner as if it were a ## **O.P(C) No.4075 of 2011** ## -: 5 :- decree of the court and in such a case the court before which a copy of the award is produced for execution cannot insist for a decree to receive execution application to its file. The executing court is duty bound to accept the execution petition filed with a certified copy of the award. (See also **Ramaswamy v. Principal Subordinate Judge** – 1997 [2] KLT 393). An award filed under the Act (before the executing court) has the status of a decree of that court though it is not a decree of the said court and the provisions of the Act afford no scope to the court to of refuse to enforce the award in the same manner as a decree of that court except in cases where either the court remits the award back to the Arbitrator for reconsideration or sets it aside. 10. Going by Sec.36 of the Act it leaves me in no doubt that when a copy of the award as provided under law is produced before the court for execution, that court has to treat it as a decree of that court and execute it. A transmission of the award from the court at Chennai which was the venue of the Arbitrator in this case is not required. I am unable to agree with the view taken by the Indore Bench of the Madhya Pradesh High Court. Instead I am inclined to accept the view taken by the other High ## **O.P(C) No.4075 of 2011** ## -: 6 :- Courts in the decisions referred by the learned District Judge in the impugned order. The challenge to the jurisdiction of the learned District Judge to execute the award has to fail. 11. It is contended by learned counsel that the plea of petitioners regarding no means was not considered by the learned District Judge. But I find that finding regarding means was entered by the earlier order passed by the learned District Judge. That finding was not challenged in this Court. The present order only disposes of the objection as to jurisdiction. Therefore, while challenging the present order petitioners cannot canvass any argument as to the finding of learned District Judge regarding means of petitioners. 12. Learned counsel submitted that petitioners have filed an application for review of the finding regarding means. This judgment shall not stand in the way of petitioners proceeding with the application for review as provided under law. 13. Having regard to the circumstances stated I am inclined to grant time to the petitioners so that (without prejudice to the application for review they have filed) petitioners could request learned District Judge facility to pay the amount due in installments. **O.P(C) No.4075 of 2011** -: 7 :- Resultantly, this Original Petition is disposed of as follows: (a) While no interference is required with Ext.P5, order, it is directed that the warrant of arrest issued to the petitioners will stand in abeyance for a period of one month from this day on condition that petitioners pay/deposit in the executing court for payment to the respondent Rs.20,000/- (Rupees Twenty thousand only) within two weeks from this day. (b) It is made clear that (without prejudice to the application for review said to be pending before the learned District Judge or the right of petitioners to challenge the finding regarding means) it is open to the petitioners to request learned District Judge to permit them to pay the amount in installments and if any such request is made learned District Judge shall consider the same after hearing the respondent as well and pass appropriate orders as provided under law. ## **O.P(C) No.4075 of 2011** -: 8 :- (c) In case learned District Judge is to consider the application for review on merit I make it clear that payment/deposit made by petitioners as per the direction in this judgment shall not be taken into account in deciding the means of petitioners. ## **THOMAS P. JOSEPH, JUDGE.** vsv