Calcutta High Court (Appellete Side)
Bla Projects Pvt. Ltd vs Asansol Durgapur Development ... on 24 July, 2019
Author: Sabyasachi Bhattacharyya
Bench: Sabyasachi Bhattacharyya
In the High Court at Calcutta
Civil Revisional Jurisdiction
Appellate Side
The Hon'ble Justice Sabyasachi Bhattacharyya
C.O. No. 1898 of 2019
BLA Projects Pvt. Ltd.
Vs.
Asansol Durgapur Development Authority
For the petitioner : Mr. Jaydip Kar,
Mr. Suman Dutta,
Mr. Sourav Kumar Mukherjee,
Mr. Debdeep Sinha
For the opposite party : Mr. Sayantan Bose,
Ms. A. Banerjee
Hearing concluded on : 11.07.2019
Judgment on : 24.07.2019
Sabyasachi Bhattacharyya, J.:‐
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1. The award‐holder in an arbitral proceeding under the Arbitration and
Conciliation Act, 1996 (hereinafter referred to as "the 1996 Act") has preferred
the instant application under Article 227 of the Constitution of India. By the
impugned order, the executing court upheld a challenge to the
maintainability of the proceeding for execution of the arbitral award and
dismissed the execution case.
2. Threefold objections were taken by the award debtor to the execution case:
(i) the execution case was filed before the court of an Additional
District Judge, which was not a Court under Section 2 (1) (e) of
the 1996 Act;
(ii) the Additional District Judge did not have authority to transfer
the case to the Court of the Civil Judge (Senior Division); and
(iii) since an application under Section 34 of the 1996 Act had been
filed by the award‐debtor before the court of the District Judge at
Alipore, District: South 24‐Parganas previously, the execution
case also had to be filed in the said court under Section 42 of the
1996 Act.
3. Learned counsel for the petitioner submits that the first question was
answered in favour of the petitioner and as such, being unchallenged, need
not be dwelt upon. The trial judge placed reliance upon the judgement of West
Bengal Housing infrastructure Development Corporation v. M/s Impression,
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reported at AIR 2016 Cal 236, wherein it was held that the court of an
Additional District Judge was a 'Court' within the meaning of Section 2 (1) (e)
of the 1996 Act.
4. As regards the applicability of Section 42 of the 1996 Act, learned counsel for
the petitioner argues that Section 36 of the 1996 Act envisages that the
procedure provided in the Code of Civil Procedure would be applicable to the
enforcement of an arbitral award. Section 32 (1) of the 1996 Act provides that
the arbitral proceedings shall be terminated by the final award. As such, it is
argued, a proceeding under Section 36 of the 1996 Act is filed subsequent to
such termination and is beyond the ambit of the arbitral proceeding. Hence
the provisions of Section 42 of the 1996 Act are inapplicable to such a
proceeding.
5. Learned counsel for the award‐holder/petitioner seeks to distinguish a three‐
judge bench decision of the Supreme Court, reported at (2015) 1 SCC 32 [State
of West Bengal and Others v. Associated Contractors], relied on by the trial court,
on the ground that the same was rendered on the question, which court will
have the jurisdiction to entertain and decide an application under Section 34
of the 1996 Act, and as such is not an authority for Section 36 of the said Act.
Learned counsel submits that the language of Section 36 clearly presses into
service the procedure for execution as provided in the Code of Civil
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Procedure to the enforcement of an award, which ingredient is entirely
absent in Section 34.
6. The petitioner argues that Section 36 of the 1996 Act does not provide for any
application, but stipulates that the modalities of execution, as stipulated in the
Code of Civil Procedure, would apply to arbitral awards as if they were
decrees of courts.
7. It is submitted on behalf of the petitioner that a proceeding envisaged under
Section 36 of the 1996 Act is initiated only after termination of the arbitral
proceedings by the final arbitral award, as contemplated in Section 32 (1) of
the Act. Hence, it is argued, such a proceeding does not fall within the
purview of an "application with respect to an arbitration agreement" to
qualify for Section 42 of the 1996 Act. Learned counsel submits that the 1996
Act does not provide anything on execution of an arbitral award but leaves
the same to a civil court.
8. Learned counsel for the petitioner argues that the judgment of Sundaram
Finance Limited, represented by J. Thilak, Senior Manager (LEGAL) v. Abdul Samad
and Another, reported at (2018) 3 SCC 622, is much more appropriate in the
present context, since the same deals with a Section 36 situation. It was held
therein that, under Section 36 of the 1996 Act, the arbitral award can be filed
for execution before the court where the assets of the judgment‐debtor are
located.
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9. It is argued on behalf of the petitioner that there was no conflict
between Sundaram Finance (supra) and Associated Contractors (supra), since the
former dealt specifically with Section 36 of the 1996 Act and the latter with
Section 34 of the Act.
10. As regards the Additional District Judge having transferred the matter to the
Civil Judge (Senior Division), learned counsel for the petitioner argues that
the relevant time for deciding the jurisdiction of a court is when the decree is
passed finally and not when the suit is filed. In support of such proposition,
learned counsel cites a judgment reported at (2006) 1 SCC 141 [Sudhir G.
Angur and Others v. M. Sanjeev and Others] , wherein it was held that the law
to be applied in determining jurisdiction of court was the law as on the date
on which the suit comes up for hearing and not the date of institution of the
suit. If the court has jurisdiction to try the suit when it comes for disposal, it
then cannot refuse to assume jurisdiction by reason of the fact that it had no
jurisdiction to entertain it at the date of institution.
11. The Civil Judge (Senior Division), before whom the application under Section
36 was ultimately transferred, had jurisdiction under the Code of Civil
Procedure, as assets of the award‐debtor were located within his territorial
jurisdiction. Hence even the lack of jurisdiction of the court of filing, that is,
the Additional District Judge, would not be a deterrent for the Civil Judge
(Senior Division) to take up the matter.
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12. On the question of competence of the Additional District Judge to initially
entertain the application under Section 36 of the 1996 Act, it is submitted by
the petitioner that even under the said Act, the Additional District Judge
would be competent to do so. Learned counsel relies on a special bench
judgment of this court in West Bengal Housing Infrastructure Development
Corporation v. M/s Impression, reported at AIR 2016 Cal 236 which was
rendered on reference on the question, whether the court of the Additional
District Judge was a court within the meaning of Section 2 (1)(e) of the 1996
Act. It was answered in the affirmative.
13. On the other hand, learned counsel for the opposite party opened his
argument with the proposition that the Additional District Judge had no
authority to accept the filing of the original application for enforcement of
award. By placing reliance on Section 8 (2) of the Bengal, Agra & Assam Civil
Courts Act, 1887 (hereinafter referred to as "the 1887 Act"), learned counsel
submits that the Additional District Judges (referred to in the Act as
"Additional Judges") discharge only those functions of a District Judge which
the District Judge assigns to them, although in the discharge of those
functions they exercise the same powers as the District Judge.
14. Next placing Section 21 (3) of the 1887 Act, learned counsel for the opposite
party submits that the said provision specifies that where the function of
receiving any appeal which lies to the District Judge under sub‐sections (1) or
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(2) of the said section has been assigned to an Additional District Judge,
the appeals may be preferred to the Additional District Judge. It is thus
argued that by providing specifically for appeals, the legislature has excluded
other matters by implication. As such, the Additional District Judges have
power to discharge functions of the District Judge when assigned, but those
functions are restricted to administrative ones. In respect of receiving judicial
matters, however, Section 21 (3) restricts such power of the Additional District
Judges to appeals. Hence, no original suit or application (as opposed to
appeals) maintainable before a District Judge can be entertained by the
Additional District Judges.
15. In support of such submission, learned counsel for the opposite party cites a
judgment reported at AIR 2010 Cal 26 [Shirsha Nath Mallick v. Arun Kumar
Sarkhel]. A co‐ordinate bench held in the said case that Additional District
Judges are not subordinate to District Judge in discharge of judicial functions
and do not require any special authorization under Section 4‐A of the
Guardians and Wards Act, 1890 for consideration of a proceeding under
Section 8 of the Hindu Minority and Guardianship Act, 1956 when such an
application is transferred and/or assigned to the Additional District Judges for
disposal. On a consideration of the provisions of Section 8(1) and 8(2) of the
1887 Act, the court held that the District Judge and the Additional District
Judges taken together collectively represent the District Court, for discharge
of judicial functions of the District Court. But, at the same time, the court held
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that Additional District Judges cannot independently receive
presentation of any such application, as no territorial jurisdiction is conferred
upon them individually over which they can exercise their independent
jurisdiction. The Additional District Judges can only discharge those functions
which are assigned to them by the District Judge under Section 8(2) of the
1887 Act or under Section 24 of the Code of Civil Procedure. Jurisdiction to
entertain such applications, it was held, has exclusively been vested upon the
District Judge, being the Principal Judge of the civil court of original
jurisdiction functioning over the local limits of its jurisdiction within the
district.
16. Dealing with the case of M/s Impression (supra), which was cited by the
petitioner, learned counsel for the opposite party submits that although the
Additional District Judge had the power to entertain an application under
Section 36 of the 1996 Act on transfer from the District Judge's court, the
Additional District Judge did not have power to entertain an original
application under the said provision as in case of appeals under Section 21(3)
of the 1887 Act.
17. It is further submitted on behalf of the opposite party that even an application
under Order XXI Rule 10 had to be filed to the court which passed a decree or
to the officer, if any, appointed in this behalf, or if the decree has been sent
9
under the provisions thereinbefore contained to another court, then to such
court or to the proper officer thereof.
18. As such, even if the present application was one for execution under Order
XXI of the Code of Civil Procedure, the court having jurisdiction over the
assets could not have entertained the original application for execution, unless
the same was filed first before the court which passed the decree and then
transferred thereto.
19. It is further argued that since the award of an arbitral tribunal was not a
'decree' but the provisions of the Code of Civil Procedure were merely
applicable to such award, the forum provided in the Code of Civil Procedure
could not govern the filing of an application for execution of an arbitral
award.
20. Learned counsel for the opposite party places reliance on Section 36(1) of the
1996 Act to indicate that the said section was the parent provision under
which an application for enforcement was filed. It not only provides when the
award shall be enforced but the manner in which it would be so enforced. The
modalities pertaining to such enforcement are also provided in Section 36,
making it the source of power for a court to entertain an application for
enforcement of an arbitral award. As such, it has to be deemed that an
application for enforcement of an arbitral award is an 'application with
respect to an arbitration agreement' under Part I of the 1996 Act, as
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contemplated in Section 42 of the said Act, and had to be filed in the court
where the first application with respect to such agreement (in the present
case, the application under Section 34 of the 1996 Act) had been filed.
21. Harping on the non‐obstante clause of Section 42, learned counsel argues that
the provisions of Section 42 were applicable notwithstanding anything
contained elsewhere, not only in any other law but also elsewhere in Part I of
the 1996 Act. As such, it is argued that neither the provisions of Order XXI of
the Code of Civil Procedure nor anything in Section 36 of the 1996 Act could
alter the forum envisaged in Section 42 of the said Act.
22. Learned counsel next cites paragraph nos. 16 and 17 of Sundaram Finance
Limited (supra) for the proposition that the logic behind the ratio laid down in
the said judgment was encapsulated in the said two paragraphs, being that
Section 32 of the 1996 Act provides for arbitral proceedings to be terminated
by the final arbitral award and the consequential inapplicability of Section 42
to a proceeding under Section 36, which happens only after termination of the
proceeding.
23. Learned counsel argues that not only is such logic contrary to the previous
judgment rendered in Associated Contractors (supra), which was delivered by a
bench of larger strength than Sundaram Finance, but it also militates against
Section 42 of the 1996 Act itself. It is submitted that Associated Contractors dealt
with Sections 9 and 34 of the 1996 Act, both of which could be filed after
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termination of the arbitral proceeding. Hence, the ratio laid down
in Associated Contractors could not have been distinguished in Sundaram
Finance, which was of a bench of lesser strength, on the ground that
enforcement under Section 36 was a post‐termination scenario.
24. It is further argued that even if the Additional District Judge had the
jurisdiction, on transfer, to decide an application under Section 36 of the 1996
Act (which it did not), no further sub‐delegation to the Civil Judge (Senior
Division) was permitted under the statute, since the Additional District Judge
itself would have been a transferee/delegate.
25. In support of this proposition, learned counsel cites a judgment reported at
AIR 1967 SC 295 [Barium Chemicals Ltd. and another vs. Company Law Board and
others], wherein it was held that a delegated authority cannot be re‐delegated,
relying on the principle Delegatus Non Potest Delegare.
26. As such, it is argued that the Additional District Judge did not have the
power, in the present case, to re‐delegate the matter on transfer to the Civil
Judge (Senior Division), hence denuding the latter of authority to decide the
proceeding for enforcement of award.
27. Learned counsel for the opposite party next lays stress on paragraph no. 14 of
Sundaram Finance (supra), wherein it was held that the enforcement
mechanism was akin to the enforcement of decree but the award itself was
not a decree of the civil court. It is the arbitral tribunal, it was held, which
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renders an award and the tribunal does not have the power of execution of
a decree; for the purposes of execution of a decree the award is to be enforced
in the same manner as if it was a decree under the said Code. Thus, it is
argued, an application for enforcement of an arbitral award lies under Section
36 of the 1996 Act itself and not under Order XXI of the Code of Civil
Procedure, and the provisions of the Code of Civil Procedure regarding the
forum of such application would not to be a deterrent to the applicability of
Section 42 of the 1996 Act.
28. Falling back upon Associated Contractors (supra), learned counsel for the
opposite party argues that the said judgment, contrary to the petitioner's
contention, was not restricted to Section 34 of the 1996 Act but was an
authoritative pronouncement on Section 2(1)(e) and Section 42 of the 1996 Act,
as evident from paragraph no. 9 of the said judgment. Paragraph no. 11 of the
said judgment noticed that Section 42 is in almost the same terms as its
predecessor section except that the words "in any reference" are substituted
with the wider expression "with respect to an arbitration agreement". It was
also noticed that the expression "has been made in a court competent to
entertain it" was no longer there in Section 42. These two changes were
observed to be of some significance in the said paragraph of Associated
Contractors. The non‐obstante clause of Section 42 of the 1996 Act was also
noted in the said judgment.
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29. As such, it is argued that the ratio of the said judgment covers an
application under Section 36 of the 1996 Act as well and could not be
distinguished on that score.
30. It is next argued on behalf of the opposite party, by placing reliance on (1992)
4 SCC 711 [Nelson Motis vs. Union of India and another] that if the language of
the statute was plain and unambiguous and admits of only one meaning, it
has to be given effect to, irrespective of the consequences. As such, it is argued
that the alleged consequence of hardship could not be a consideration for
ascertaining jurisdiction of court to entertain an application under Section 36
of the 1996 Act, as circumscribed by Section 42 of the said Act.
31. Upon considering the submissions of both sides, it is necessary to consider
certain provisions, which are set out below:
"Arbitration and Conciliation Act, 1996:
S. 2.(1)(e). "Court" means -
(i) in the case of an arbitration other than international commercial arbitration,
the principal civil court of original jurisdiction in a district, and includes the
High Court in exercise of its ordinary original civil jurisdiction, having
jurisdiction to decide the questions forming the subject matter of the
arbitration if the same had been the subject matter of a suit, but does not
include any civil court of a grade inferior to such principal civil court, or any
Court of Small Causes;
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(ii) in the case of international commercial arbitration, the High Court in
exercise of its ordinary original civil jurisdiction, having jurisdiction to decide
the questions forming the subject matter of the arbitration if the same had been
the subject matter of a suit, and in other cases, a High Court having
jurisdiction to hear appeals from decrees of courts subordinate to that High
Court.
‐‐‐ ‐‐‐ ‐‐‐
S. 32. Termination of proceedings.-- (1) The arbitral proceedings shall be
terminated by the final arbitral award or by an order of the arbitral tribunal
under sub‐section (2).
(2) The arbitral tribunal shall issue an order for the termination of the
arbitral proceedings where--
(a) the claimant withdraws his claim, unless the respondent objects to the
order and the arbitral tribunal recognises a legitimate interest on his part in obtaining a final settlement of the dispute,
(b) the parties agree on the termination of the proceedings, or
(c) the arbitral tribunal finds that the continuation of the proceedings has for any other reason become unnecessary or impossible. 15 (3) Subject to section 33 and sub‐section (4) of section 34, the mandate of the arbitral tribunal shall terminate with the termination of the arbitral proceedings.
‐‐‐ ‐‐‐ ‐‐‐ S. 36. Enforcement.--(1) Where the time for making an application to set aside the arbitral award under Section 34 has expired, then, subject to the provisions of sub‐section (2), such award shall be enforced in accordance with the provisions of the Code of Civil Procedure, 1908 (5 of 1908), in the same manner as if it were a decree of the court.
(2) Where an application to set aside the arbitral award has been filed in the court under section 34, the filing of such an application shall not by itself render that award unenforceable, unless the court grants an order of stay of the operation of the said arbitral award in accordance with the provisions of sub‐section (3), on a separate application made for that purpose.
(3) Upon filing of an application under sub‐section (2) for stay of the operation of the arbitral award, the court may, subject to such conditions as it may deem fit, grant stay of the operation of such award for reasons to be recorded in writing:
Provided that the court shall, while considering the application for grant of stay in the case of an arbitral award for payment of money, have due 16 regard to the provisions for grant of stay of a money decree under the provisions of the Code of Civil Procedure, 1908 (5 of 1908).
‐‐‐ ‐‐‐ ‐‐‐ S. 42. Jurisdiction.--Notwithstanding anything contained elsewhere in this Part or in any other law for the time being in force, where with respect to an arbitration agreement any application under this Part has been made in a Court, that Court alone shall have jurisdiction over the arbitral proceedings and all subsequent applications arising out of that agreement and the arbitral proceedings shall be made in that Court and in no other Court."
"The Bengal, Agra and Assam Civil Courts Act, 1887:
S. 8. Additional Judges. ‐ (1) When the business pending before any District Judge requires the aid of Additional Judges for its speedy disposal, the State Government may, having consulted the High Court, appoint such Additional Judges as may be requisite.
(2) Additional Judges so appointed shall discharge any of the functions of a District Judge which the District Judge may assign to them, and, in the discharge of those functions, they shall exercise the same powers as the District Judge.
‐‐‐ ‐‐‐ ‐‐‐ 17 S. 21. Appeals from Civil Judge (Senior Division) and Civil Judges
(Junior Division) . ‐ (1) Save as aforesaid, an appeal from a decree or order of Civil Judge (Senior Division) shall be ‐
(a) to the District Judge where the value of the original suit in which or in any proceeding arising out of which the decree or order was made did not exceed sixty thousand rupees, and
(b) to the High Court in any other case.
(2) Save as aforesaid, an appeal from a decree or order of a Civil Judge (Junior Division) shall lie to the District Judge.
(3) Where the function of receiving any appeals which lie to the District Judge under sub‐ section (1) or sub‐ section (2) has been assigned to an Additional Judge, the appeals may be preferred to the Additional Judge.
(4) The High Court may, with the previous sanction of the State Government, direct, by notification in the Official Gazette, that appeals lying to the District Judge under sub‐ section (2) from all or any of the decrees or orders of any Civil Judge (Junior Division) shall be preferred to the Court of such Civil Judge (Senior Division) as may be mentioned in the notification, and the appeals shall thereupon be preferred accordingly." 18
32. A glance at Section 42 of the 1996 Act shows that the said provision is applicable to all the applications in part I of the 1996 Act, irrespective of whether such application is filed before or after termination of the arbitral proceedings. Since the language used in the said section covers applications "with respect to an arbitration agreement", no line of distinction can be drawn between pre and post‐termination proceedings. This view, in fact, is endorsed in Associated Contractors (supra).
33. That apart, the non‐obstante clause at the beginning of Section 42 curtails the scope of the said provision being restricted by any other provision contained in the 1996 Act or any other law.
34. However, the interesting thing about Section 36 of the 1996 Act is that no application is contemplated in the said provision, unlike other provisions in the said Act relating to an action before a 'court'. Sections 8, 9 and 34 of the Act contemplate initiation of proceeding under the said sections themselves, by way of filing an application before the court. Section 11, although on a somewhat different footing, also contemplates a 'request' to the Supreme Court or the High Court in the form of an application. Section 37, on the other hand, refers to an appeal and is not in the nature of an application at all. Thus, it is seen that all challenges/actions before a court under part I of the 1996 Act are self‐contained as regards the mode of such challenge or motion, being mostly applications.
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35. However, Section 36 merely provides for enforcement of an arbitral award and acts as a bridge enabling the provisions of the Code of Civil Procedure to be applied to the enforcement of an arbitral award, in the same manner as if it were a decree of the court. No application is envisaged under the said section for the enforcement of an award.
36. Hence, it cannot be said that an application for enforcement of an arbitral award is made under Section 36, sufficient to bring it within the fold of Section 42 of the 1996 Act. An application for execution, as provided in Section 36, would have to be made "in accordance with the provisions of the Code of Civil Procedure, 1908", thereby enabling full application of Order XXI of the Code of Civil Procedure and other connected provisions as regards the mode and manner of application as well as the form of such application.
37. While considering Sundaram Finance (supra), it strikes the eye that the same was rendered on the question, whether an award under the 1996 Act is required to be first filed in the court having jurisdiction over the arbitral proceedings for execution and then to obtain transfer of the decree, or whether the award can be straightway filed and executed in the court where the assets are located. As far as applicability of Section 42 of the said Act is concerned, paragraph 16 of the said judgment proceeded on the premise that the said provision applies to arbitral proceedings. Paragraph 17 of the judgment stated that Section 32 of the 1996 Act provides for arbitral 20 proceedings to be terminated by the final arbitral award. On such logic, it was observed that when an award is already made, of which execution is sought, the arbitral proceedings already stood terminated on the final award being passed. Thus, it was not appreciated as to how Section 42 of the said Act, which deals with the jurisdiction issue in respect of arbitral proceedings, would have any relevance.
38. The Supreme Court went on to hold that an award under Section 36 of the 1996 Act is equated to a decree of the court for the purposes of execution and, only for such limited purpose, the award was deemed to be a decree. On such premise, it was held that the 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 proceedings. It was also observed that the 1996 Act transcends all territorial barriers.
39. It is evident that the logic, that Section 42 was not applicable to a proceeding for enforcement of the award since the same arose after termination of the proceedings, was contrary to the three‐Judge bench decision of Associated Contractors (supra). In the said case, it was decided that the expression "with respect to an arbitration agreement" in Section 42 of the 1996 Act are words of wide import and would take in all applications made before, during or after the arbitral proceedings are over. On such premise, the Supreme Court went 21 on to observe that Section 42 would apply to applications made after the arbitral proceedings have come to an end, provided they are made under Part I.
40. The Supreme Court, in its conclusive paragraph (paragraph 25) took into consideration applications under Sections 9 and 34 of the 1996 Act.
41. However, it is notable to mention that Section 36 of the 1996 Act did not find place in the said consideration.
42. In fact, in the opening paragraph of Associated Contractors (supra), it was indicated that the reference in that case was on the question, which court will have the jurisdiction to entertain and decide an application under Section 34 of the 1996 Act. The entire judgment was rendered in such context.
43. Nowhere in Associated Contractors (supra) did the Supreme Court consider the context of Section 36 of the 1996 Act.
44. As such, although one could arguably be justified in observing that Sundaram Finance (supra) (rendered by a two‐Judge bench) went contrary to the logic of Associated Contractors (three‐Judge bench decision) inasmuch as the effect of Section 42 on post‐arbitral proceeding termination applications was concerned, Associated Contractors was not rendered in the context of the of Section 36 of the 1996 Act and did not consider the legal effect thereof. 22
45. Thus, Sundaram Finance can at best be seen as an authority on the proposition that an award was enforceable as a decree under Section 36 of the 1996 Act and thus, could be filed anywhere in the country where such decree could be executed, without obtaining a transfer of the decree from the court, which would have jurisdiction over the arbitral proceedings. However, the same ought not to be deemed as an authority on the proposition that Section 42 is inapplicable to applications within part I of the 1996 Act initiated after termination of arbitral proceedings, in view of being contrary to Associated Contractors.
46. Even if we see the conclusions arrived at in Associated Contractors, in paragraph 25 thereof, it is abundantly clear that the Supreme Court held that Section 42 would apply to 'applications' made under part I.
47. A close examination of Section 36 of the 1996 Act, which never fell for consideration in Associated Contractors (supra), shows that no application for enforcement of an arbitral award is envisaged in the said provision.
48. Section 36 at best creates a fiction that an arbitral award would operate as a decree of a civil court for the limited purpose of being executed. The section provides that an arbitral award shall be enforced in accordance with the provisions of the Code of Civil Procedure, 1908, in the same manner as if it were a decree of the court.
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49. It is noteworthy that Section 36(1) does not make any distinction as to modalities and forum while making the provisions of the Code of Civil Procedure applicable to an arbitral award. Hence, nothing in the Arbitration Act, in particular Section 36 thereof, provides that an application for execution of an arbitral award has to be filed before the district court, as provided in Section 2(1)(e) of the 1996 Act. In fact, the application for enforcement/execution of an arbitral award is not an application under Section 36 of the 1996 Act at all but under Order XXI of the Code of Civil Procedure, as provided in Section 36 itself.
50. Thus, such an application is not an "application under part I" of the 1996 Act, which takes it outside the purview and rigours of Section 42 of the 1996 Act.
51. Associated Contractors (supra) contemplated only 'applications' under part I to be governed by Section 42.
52. In view of the discussion above, an application for enforcement of an arbitral award is not covered by Section 42 of the 1996 Act.
53. Contrary to the arguments of the opposite party that Section 36 is the source of power for the court to enforce an arbitral award, the source of power is Order XXI of the Code of Civil Procedure. Section 36 of the 1996 Act only enables the Code to apply to arbitral awards as in decrees and does not provide for any mode or forum for an application for enforcement of such an award.
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54. That apart, a larger issue is involved herein. The applications to a 'court' under Section 2(1)(e) of the 1996 Act, as contemplated in the said Act, all lie before a superior forum.
55. For obvious reasons, applications under Sections 8 and 11 of the 1996 Act are independent applications to a court and to the High Court respectively, being rather unconnected with a pending arbitral proceeding. However, both Sections 34 and 37 lie before a forum superior to the arbitral tribunal. Section 34 specifically provides for a challenge to the award before a superior forum. Sub‐section (2) of Section 37, by its very nature, has to lie before a superior forum.
56. Section 37(1)(a) is from an independent court proceeding, having no connection with the arbitral tribunal in the context of the present analogy.
57. Sub‐section (1)(b) pertains to grant/refusal of an order under Section 9 of the 1996 Act. In view of Section 17 of the 1996 Act having conferred somewhat similar powers on the arbitral tribunal, Section 9 has to be construed to lie before a superior forum. Otherwise there would be a conflict of jurisdiction, since a similar power would have to be conferred under two separate provisions, (Section 17 and Section 9) on the arbitral tribunal and a collateral forum (here, the court), which would obviously create judicial anarchy. Thus, such a construction cannot be imputed to the legislative intent. As such, even 25 in the context of sub‐section (1)(b), the court has to be treated to be a superior forum than the arbitral tribunal.
58. The same logic as sub‐section (1)(b) applies to sub‐section (1)(c) of Section 37 as well. Therefore, the general scheme of the 1996 Act provides for a remedy before a court, as defined in Section 2(1)(e), at least as far as part I of the 1996 Act is concerned, before a superior forum. Taking into consideration the said scheme, it would be an absurd construction if the enforcement of an arbitral award is also deemed to be levied before a District Court, which is a superior court according to the scheme of the Act all through part I. Not only the Code of Civil Procedure but all statutes in general are unanimous on the issue that execution of a decree/award/order is levied before the same court or a court on the same stratum of judicial hierarchy. Such scheme would be militated against, in the event an application for enforcement of an arbitral award has to be filed before a District Court.
59. As such, taking into consideration the scheme of Section 36 of the 1996 Act, the only feasible conclusion is that an application for enforcement of the award is filed under Order XXI of the Code of Civil Procedure, not before the highest forum in the district but before the lowest court competent to entertain such application, as contemplated in the Code of Civil Procedure.
60. Taking such view in conjunction with the ratio laid down in Sundaram Finance, even excluding the portion thereof which is contrary to Associated 26 Contractors, an application for enforcement of an award can be filed directly before the court where the assets of the award debtor are situated, since it is not a civil court's decree but an award which is being applied.
61. Hence, the Civil Judge (Senior Division), who passed the order impugned in the present revisional application, had the jurisdiction to entertain the application for enforcement of the award in the first place.
62. The other important question is, whether the Additional District Judge could function as a 'court' under Section 2(1)(e) of the 1996 Act. However, in view of the discussion above, the said question becomes academic, since the hierarchy stipulated in the Code of Civil Procedure, and not that provided in the 1996 Act, will be applicable to a proceeding for enforcement of an arbitral award.
63. Although the tenor of the judgments cited by the opposite party, in particular those of Shirsha Nath Mallick (supra), M/s Impression (supra) and Barium Chemicals Ltd (supra) go on to suggest that the Additional District Judge did not have the administrative power to delegate its authority to the Civil Judge (Senior Division), such a proposition could not be held to be absolute in the present circumstances.
64. A dilution can arguably be introduced to the said principle, as applied in the present context, to the extent that the Additional District Judge did not 'delegate' its power to the Civil Judge (Senior Division) but transferred the case to the Civil Judge (Senior Division), which is governed by Section 8(2) of 27 the 1887 Act and/or Section 24 of the Code of Civil Procedure. However, it is doubtful as to whether the Additional District Judge could exercise such power of transfer under either of the provisions to send the matter for disposal before the Civil Judge (Senior Division).
65. Strictly speaking, such a transfer was the prerogative of the District Judge and could not have been exercised by the Additional District Judge.
66. However, since ultimately it was the Civil Judge (Senior Division), who had jurisdiction to enforce the award‐in‐question, in the event the impugned order is affirmed, the effect would be unnecessary multiplicity. What would happen is that the award‐holder, after the prayer for enforcement by the Civil Judge (Senior Division) being turned down only on the ground that the said court did not have such authority on transfer from the Additional District Judge, the award‐holder would only have to re‐present the self‐same application on the very next date before the court of the Civil Judge (Senior Division) itself to have a competent adjudication thereon. In order to avoid such meaningless formality, it should be construed that the Civil Judge (Senior Division) had the authority to decide the said application.
67. What should be the relevant date in the context of jurisdiction is the date when the execution application is ultimately decided and not the date of initial presentation of the same. This is borne out by the decision of Sudhir G. Angur (supra).
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68. Although it cannot be said that jurisdiction was conferred on the said court upon any change of law which was not available to the award‐holder on the date of presentation of the enforcement application, ends of justice would demand that the date of decision on the enforcement application ought to be taken as the yardstick of jurisdiction.
69. It is not that the Civil Judge (Senior Division) did not have jurisdiction when the application was presented first. The only fetter is the technical objection, that the Civil Judge (Senior Division) received the said application on transfer from the Additional District Judge and not in the form of an original application. There are several provisions of the Code of Civil Procedure to permit a return of the plaint in case of lack of jurisdiction and re‐presentation before the proper forum, for rejection of a plaint and re‐presentation before the appropriate forum as well as for transfer to the appropriate forum in the event the initial forum did not have jurisdiction.
70. The mere technicality of a transfer by the Additional District Judge being unauthorized by law, would be entirely procedural and, as such, the handmaid of justice.
71. Viewed from such perspective, since the Civil Judge (Senior Division) had jurisdiction to entertain the application for enforcement in the present case from the day of the presentation of the application, although such presentation was initially before a wrong forum, dismissal of the enforcement 29 application would be contrary to the ends of justice as well as norms of jurisprudence. Such a procedure, if adopted, would only lead to a fresh application for enforcement on similar ground being filed on the next date and as such ought to be avoided.
72. Thus, the Civil Judge (Senior Division) refused to exercise jurisdiction vested in him by law in dismissing the application for enforcement of the arbitral award.
73. Accordingly, C.O. No.1898 of 2019 is allowed on contest, thereby setting aside the impugned order and directing the Civil Judge (Senior Division) at Durgapur to dispose of Money Execution Case No. 48 of 2018, pending in the said court, afresh on merits, as expeditiously as the business of the said court permits.
74. There will be no order as to costs.
75. Urgent certified website copies of this order, if applied for, be made available to the parties upon compliance with the requisite formalities.
( Sabyasachi Bhattacharyya, J. ) 30