Arbitral Award Is To Be Executed At A Place Where Judgment Debtor Resides, Carries Business Or Has Assets: Delhi High Court
"Irrespective of the place where the award was passed, it is to be executed by a Court within whose jurisdiction the Judgment Debtor resides, carries on business or his property is situated".
The Delhi High Court recently dismissed an execution petition filed under Section 36 of the Arbitration & Conciliation Act by a Decree Holder for an arbitral award because the the Judgment Debtor was carrying out its business in Chennai and it did not have any office or asset within Delhi jurisdiction. The present petition was filed under Section 36 (the award shall be enforced under...
The Delhi High Court recently dismissed an execution petition filed under Section 36 of the Arbitration & Conciliation Act by a Decree Holder for an arbitral award because the the Judgment Debtor was carrying out its business in Chennai and it did not have any office or asset within Delhi jurisdiction.
The present petition was filed under Section 36 (the award shall be enforced under the Code of Civil Procedure, 1908 in the same manner as if it were a decree of the Court) of the Arbitration Act ('the Act'). The Court also relied on Order XXI, Rule 30 of CPC for grant of execution of a money decree.
While going through the assets of the Judgement Debtor, the judge noted that, the Judgement Debtor is a company carrying out its business in Chennai, its primary bank account is based out of Chennai and it does not have any office/ asset located in Delhi. The affidavit of assets filed by the Judgement Debtor also does not disclose an moveable/ immoveable assets within the jurisdiction of the Delhi High Court.The Court also refused the prayer of the applicant to transfer the decree for execution to a competent court in Chennai relying on Section 42 of the Act.
Justice Sanjeev Narula relied on Sundaram Finance v. Abdul Samad, 2018 3 SCC 622 and opined that, "an arbitral award is not equal to a decree passed by a Court, and execution proceedings can be straightaway filed in the court where the Judgement Debtor's assets are located".
"There is no justification for filing an execution petition before the court within whose jurisdiction the arbitral award was passed, and then seek a transfer to the Court which has jurisdiction over the Judgment Debtor or their properties. Irrespective of the place where the award was passed, it is to be executed by a Court within whose jurisdiction the Judgment Debtor resides, carries on business or his property is situated. Since the Judgment Debtor is admittedly residing within the territorial jurisdiction of the courts at Chennai, such courts would certainly have territorial jurisdiction to enforce the arbitral award. Thus, this Court lacks territorial jurisdiction to entertain the present petition".
The petition was dismissed with the liberty to approach the competent court.
Case No: OMP (ENF.) (COMM.) 38/2021
Citation: 2022 LiveLaw (Del) 59
Appearances:Mr. Anil Kher, Senior Advocate with Mr. Kunal Kher and Mr. Sandeep Thukral, Advocates for appellants; Mr. Udian Sharma and Mr. Jaitegan Singh Khurana, Advocates for respondents.