Since Award Is A Deemed Decree, Execution Can Be Initiated Anywhere Where Decree Can Be Executed: Allahabad High Court

The Allahabad High Court bench of Justice Neeraj Tiwari affirmed that the enforcement of an award through its execution can be initiated anywhere in the country where the decree can be executed and there is no requirement of obtaining a transfer of the decree from the Court which would have jurisdiction over the arbitral proceedings.

Brief Facts

Land of respondent Nos. 1 & 2 has been acquired for widening of National Highway No. 2 at Maneyamau, Tehsil- Etawah, District-Etawah and in light of Section 3G(2) of the National Highways Act, 1956(hereinafter, referred to as, 'Act, 1956'), amount of compensation has been determined.

In the present case, Additional District Magistrate, Etawah vide order dated 23.12.2016 has fixed the amount of compensation. Against that, petitioners filed arbitration application under Section 3G(5) of the Act, 1956 before the Additional Commissioner, Administration, Kanpur Division, Kanpur, who is the competent authority appointed by the Central Government. Ultimately, the final award was passed vide order dated 05.08.2019.

Against the said award, petitioners have preferred Civil Misc. Case No. 64 of 2022 under Section 34(3) of Arbitration Act, which was also rejected vide order dated 18.07.2023 by the Additional District Judge(POCSO Act), Etawah. Against the order dated 18.07.2023, petitioners preferred Appeal Under Section 37 of Arbitration and Conciliation Act 1996 Defective No. 652 of 2023, delay was condoned vide order dated 21.03.2024 and direction was issued to allot regular number to Appeal. It is undisputed between the parties that till date, no stay or interim order has been passed upon the aforesaid appeal filed by the petitioner.

Now, respondent Nos. 1 and 2 have preferred execution of award before the District Judge, Etawah, which was transferred to Additional District Judge, Etawah and numbered as Execution Case No. 46 of 2023. The objection of petitioners to the execution petition has been rejected vide order dated 05.08.2024. Hence present petition.

Contentions

The petitioners submitted that office of respondent No. 1 is situated at Kanpur and from there it carries its business. Further, arbitration also took place at Kanpur, therefore, Section 36 of the Act, 1996 and provisions of CPC would by applicable and jurisdiction of execution case shall lie with the District Judge, Kanpur.

Per contra, the respondents submitted that against the said award, petitioners have preferred Civil Misc. case No. 64 of 2022 under Section 34(3) of the Act, 1996, which was rejected vide order dated 18.07.2023. Once he has filed appeal before the District Judge, Etawah under Section 34 of the Act 1996, he acquiesces the jurisdiction with the District Judge, Etawah, therefore, in light of Section 4 of the Act, 1996, now he has waived of his right to objection.

That in light of Section 32 of the Act, 1996, arbitral proceeding shall be terminated by the final arbitral award or by an order of the arbitral tribunal under sub-section(2). In the present case, undisputedly, arbitral proceeding has been terminated after pronouncement of award, therefore, Section 42 of the Act, 1996 about the jurisdiction would not be applicable for filing of execution proceeding.

Court's Analysis

The court noted that in Sundaram Finance Limited Vs. Abdul Samad and Ors. 2018 the Supreme Court has held that while award passed by arbitral tribunal is deemed to be a decree under Section 36 of the Act, 1996 and there was no deeming fiction anywhere to hold that the court within whose jurisdiction the arbitral award was passed, should be taken to be the court which passed the decree. In fact the Arbitration Act transcends all territorial barriers and execution may be filed anywhere in the country, where the decree may be executed and there is no requirement for obtaining transfer of decree from the Court.

The court further noted that in Cheran Properties Limited Vs. Kasturi and Sons Limited and Others: (2018) the Supreme Court has held that the enforcement of an award through its execution can be initiated anywhere in the country where the decree can be executed and there is no requirement of obtaining a transfer of the decree from the Court which would have jurisdiction over the arbitral proceedings.

While applying the above law to the facts of the case, the court observed that It is undisputed that the dispute is arising out of acquirement of land of petitioners at District Etawah, meaning thereby, property and assets of the petitioners is situated at there, therefore, even if the office of petitioners is at Kanpur or arbitration award was pronounced at Kanpur, that would make no difference in filing of execution proceeding at Etawah in light of interpretation made by the Hon'ble Apex Court and the provision of CPC as well as Act, 1996 occupying the field. Therefore, it was observed that impugned order is very well in conformity of the law laid down by the Hon'ble Apex Court.

The court further noted that undisputedly against an award given at Kanpur, petitioners themselves have preferred appeal under Section 34 of the of the Act, 1996 before District Judge, Etawah, therefore, petitioners acquiesce their right and their objection is certainly barred by Section 4 of the Arbitration Act.

Accordingly, the present petition was dismissed.

Case Title: National Highway Authority Of India And Another Versus Jagpal Singh And 2 Others

Case Reference: 2024:AHC:175916

Judgment Date: 11/11/2024

Click Here To Read/Download Order