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Gujarat High Court

General Manager Western Railway vs Usha Pre Stressed Sleeper Udyog ... on 4 December, 2018

Author: S.R.Brahmbhatt

Bench: S.R.Brahmbhatt, Umesh A. Trivedi

          C/FA/4130/2018                                   ORDER




         IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

           R/FIRST APPEAL NO. 4130 of 2018
                         With
           CIVIL APPLICATION NO. 1 of 2018
======================================
         GENERAL MANAGER WESTERN RAILWAY
                        Versus
      USHA PRE STRESSED SLEEPER UDYOG (PIPLOD)
======================================
Appearance:
MS ARCHANA U AMIN(2462) for the PETITIONER
MR. MIHIR JOSHI, SR. COUNSEL WITH MR. SHASHVATA U. SHUKLA ADVOCATE
(8069) for the RESPONDENT
======================================

 CORAM: HONOURABLE MR.JUSTICE S.R.BRAHMBHATT
        and
        HONOURABLE MR.JUSTICE UMESH A. TRIVEDI

                                Date : 04/12/2018

                                  ORAL ORDER

(PER : HONOURABLE MR.JUSTICE S.R.BRAHMBHATT) Order in First Appeal :­ Admit.

Order in Civil Application :­

1. Rule. Shri Shashvata Shukla, learned advocate waives service of notice of rule on behalf of the respondent.

2. The present application is filed for seeking appropriate interim relief as the appeal is filed challenging the arbitration award dated 19th September 2016 and the judgment and order dated 7th September 2018 passed in Civil Misc. Application No.24 of 2017 by the Page 1 of 4 C/FA/4130/2018 ORDER Commercial Court at City Civil Court, Ahmedabad confirming the arbitration award. With the consent of learned advocates for the parties, the matter is taken­up for final hearing.

3. The Court has heard learned counsels for the parties at length when the appeal was being heard for admission.

4. Learned counsel for the applicant­appellant contended in the appeal that the arbitration award dated 19th September 2016 and the judgment and order dated 7th September 2018 passed in Civil Misc. Application No.24 of 2017 by the Commercial Court at City Civil Court, Ahmedabad are not in consonance with law as the provisions of the Micro, Small and Medium Enterprises Development Act, 2006 (for short 'MSMED Act') would have no applicability in light of the clause no.2400 of the Indian Railway Standard Conditions and Contract (For short 'IRSCC') and in that view of the matter, when the express provision of clause of the contract did not grant any permission for interest, MSMED provision would not be applicable.

5. Learned counsel for the respondent submitted that there are decisions to indicate that MSMED provision would be applicable and shall have overriding effect upon terms of the contract. Learned counsel for the respondent further submitted that even the act, which was existing prior to the advent of MSMED Act and The Interest On Delayed Payments To Small Scale And Ancillary Industrial Undertakings Act, 1993 also provided for granting of the interest in such a situation.

6. Learned counsel for the respondent has placed on record the interim order passed in another matter i.e. Civil Application No.5227 of 2016 in First Appeal No.1080 of 2016 of Railway, wherein the IRSCC clause­2400 was pleaded on behalf of the railway for assailing the award Page 2 of 4 C/FA/4130/2018 ORDER and yet the Court granted stay only on a condition of depositing the entire amount and permitted 50% disbursement therefrom. Learned counsel further submitted that here the respondent has been awaiting to realize the fruits of litigation since 1997 and the same may not be denied to them on account of the specious submission on behalf of the applicant­appellant. We are inclined to grant interim relief as the appeal is already been admitted. However, the said relief and staying of award shall be on appropriate terms and conditions as this is clearly a money decree and the principles governing thereto shall also be borne in mind.

7. Accordingly the arbitration award dated 19th September 2016 as well as the judgment and order of the Commercial Court dated 7th September 2018 are stayed in terms of Para 7(B) of the present application on a condition of appellant depositing the entire awarded amount within the period of 12 weeks from today before the concerned Court i.e. the City Civil Court, Ahmedabad and the present respondent shall be permitted to withdraw 50% amount thereof on furnishing security to the satisfaction of the City Civil Court, Ahmedabad and the balance 50% of the amount so deposited shall be invested in the name of Nazir of the Court in Fixed Deposit in any Nationalized Bank initially for the period of 1 year, which shall be continued to be renewed from time to time till final disposal of the main First Appeal and the said deposit shall be governed by the final outcome of this appeal.

8. At this stage, learned counsel for the applicant­appellant submitted that instead of permitting 50% disbursement, let there be 30% disbursement only as the order placed on record is not pertaining to MSMED Act. Learned counsel for the respondent submitted that the MSMED Act would rather tilt the balance and if the respondent has adjudication in respect of the right of the railway under clause­2400, the applicability of the MSMED Act would persuade the Court for not Page 3 of 4 C/FA/4130/2018 ORDER interfering in the order itself.

9. We are of the view that 50% amount as ordered deserves to be adhered to and accordingly the order remains the same. Rule made absolute to the aforesaid extent. However, there shall be no order as to costs.

(S.R.BRAHMBHATT, J.) (UMESH A. TRIVEDI, J.) AMAR RATHOD...