Gujarat High Court
Divyam Real Estate Pvt. Ltd vs M2K Entertainment Pvt. Ltd on 1 August, 2022
Author: Sonia Gokani
Bench: Sonia Gokani
C/SCA/14799/2022 ORDER DATED: 01/08/2022
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 14799 of 2022
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DIVYAM REAL ESTATE PVT. LTD.
Versus
M2K ENTERTAINMENT PVT. LTD.
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Appearance:
MR KUNAL VYAS, GANDHI LAW ASSOCIATES(12275) for the Petitioner(s)
No. 1
MR SIDDHARTH H. RAVAL with MS URMI H. RAVAL for the Respondent(s)
No. 1
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CORAM:HONOURABLE MS. JUSTICE SONIA GOKANI
and
HONOURABLE MR. JUSTICE HEMANT M.
PRACHCHHAK
Date : 01/08/2022
ORAL ORDER
(PER : HONOURABLE MS. JUSTICE SONIA GOKANI) 1 In this matter under Articles 226 and 227 of the Constitution of India, challenge is made to the order dated 17.06.2022 passed by the Commercial Court, Ahmedabad under the provisions of Commercial Courts Act, 2015. 2 The petitioner company, as per the chronology of events was planning to lease out the third floor of R3 The Mall at Manav Mandir, Ahmedabad. The respondent contacted the petitioner and for that purpose Memorandum of Understanding ("the MOU" for short) was executed between the parties in February, 2006. A dispute arose and on account of various breaches by the respondent, the MOU was terminated. As per the Arbitration Clause contained in Page 1 of 7 Downloaded on : Wed Aug 03 21:26:54 IST 2022 C/SCA/14799/2022 ORDER DATED: 01/08/2022 the MOU, matter has been referred to the arbitration and on such reference to the arbitration on 07.03.2012 for due adjudication, the award for the sum of Rs. 24,54,458.33 with 12% interest, came to be passed in favour of the respondent. 3 An application under section 34 of the Arbitration & Conciliation Act, 1996 ("the Act" for short) was preferred being O.MP. No.723 of 2012 before the Delhi High Court praying for setting aside the arbitral award. The interim application came to be filed being Interim Application No.14331 of 2012 for the stay of the arbitral award, where the notice was issued on 08.08.2012. The other side appeared and time was sought for tendering the reply under section 34 of the Act. After the pleadings came to be completed on 22.07.2013, the matter was directed to be listed in the category of finals as per its age and seniority. 3.1 It was a time when there was a legal regime of automatic stay of the award and during the pendency there was a change in the law. It is the say of the petitioner that the parties were exploring the possibility of settlement when the matter was not listed for about 05 years and when it came up for the first time for hearing on 16.11.2018, it was changed to a commercial matter OMP No.162 of 2020.
3.2 The grievance is also made that on 12.11.2021, the execution proceedings being Commercial Execution Petition No.14 of 2021 had been preferred before the District Court, Page 2 of 7 Downloaded on : Wed Aug 03 21:26:54 IST 2022 C/SCA/14799/2022 ORDER DATED: 01/08/2022 Ahmedabad seeking enforcement of the arbitral award dated 07.03.2012, where the notice came to be issued by the Court and petitioner entered its appearance on 22.04.2022 and sought adjournment was sought. The respondent also filed an application for issuance of the award for attachment. Therefore, Interim application was moved being I.A.No.9041 of 2022 before the Delhi High Court on 01.06.2022 for early hearing of the application under section 34 of the Act which has been posted on 03.08.2022 as per such request. However, in the meantime, the execution petition when was listed on 17.06.2022, it was conveyed to the Executing Court of the matter being posted before the Delhi High Court on 03.08.2022. Serious grievance is raised that on 17.06.2022 despite the petitioner having disclosed of the matter being posted on 03.08.2022, noting it to be rejection, it has chosen to issue the warrant of attachment of movable and immovable properties of the petitioner.
4 This petition has been preferred questioning the haste on the part of the respondent as also for the reason that the automatic stay regime, which was in place as per the settled position of law, now since has been changed, after striking off of section 87 in the Amendment Act, there would be a requirement for the Court to intervene, as the order impugned does not recognise the factum of the matter being posted on 03.08.2022 for final hearing.
Page 3 of 7 Downloaded on : Wed Aug 03 21:26:54 IST 2022 C/SCA/14799/2022 ORDER DATED: 01/08/2022 5 We had issued the notice on 29.07.2022 and directed the parties to deposit the principal amount in the following manner:-
"1. Questioning the order dated 17.06.2022 passed by the learned Commercial Court in Execution Petition being the Execution Petition No.14 of 2021 instituted for enforcement of Arbitral Award dated 07.03.2012 which is under challenge before the Delhi High Court, this petition is preferred with the following prayers:
"9...
(A) Your Lordships may be pleased to issue Writ in the nature of Certiorari and/or any other appropriate Writ, Order or Direction quashing and setting aside the impugned Order dated 17.06.2022 passed by the learned District Court, Ahmedabad (Rural) below Exhibit 6 and 9 in Commercial Execution Petition No.14 of 2021 in the interest of justice;
(B) Pending admission, hearing and final hearing of the Petition, Your Hon'ble Court may be pleased to stay the operation, implementation and execution of the impugned Order dated 17.06.2022 passed by the learned District Court, Ahmedabad (Rural) below Exhibit 6 and 9 in Commercial Execution Petition No.14 of 2021.
(C) Pass such other and further Order or Orders as may be thought fit in the interest of justice."
2. Issue Notice, returnable on 01.08.2022.
3. Learned advocate appearing for the appellant ensures to deposit the entire principal amount being Rs.24,54,458/-
presently.
4. The principal amount shall be deposited on or before 01.08.2022.
5. Over and above the regular mode of service, direct service through speed post is also permitted, TODAY."
6 Today, learned advocate for the respondent have appeared and has strenuously resisted this application. According to him, this is not a matter where the Court, under Articles 226 Page 4 of 7 Downloaded on : Wed Aug 03 21:26:54 IST 2022 C/SCA/14799/2022 ORDER DATED: 01/08/2022 and 227 of the Constitution of India, should entertain the petition, particularly, when the judgement creditor has waited for nearly 8 years. It is also his say that the amount should have been deposited with the Delhi High Court and the request could have been made for the early hearing. Instead, the judgement debtor has chosen to challenge and question the order of the Commercial Executing Court, which has acted within its purview. Again, it is urged that protection in terms of stay against execution is not granted by the Court at Delhi and, therefore, there is no earthly reason why the Executing Court should not issue the warrant of attachment of movable and immovable property in favour of judgement creditor. It has also not disputed that the regime of automatic stay continued for nearly 8 years and thereafter when that cloud was cleared, there was execution proceedings initiated by the judgement creditor, which was in the year 2021 and yet the application for early hearing has been preferred by the judgement debtor and such application for early hearing has come up only on 15.03.2022. The other side has waited for long time for the matter to be heard and, therefore, this Court may not interfere in its jurisdiction under Articles 226 and 227 of the Constitution of India.
7 At the same time, learned counsel has fairly agreed that it is incorrect to note on the part of the Executing Court concerned that the Delhi High Court has rejected the Page 5 of 7 Downloaded on : Wed Aug 03 21:26:54 IST 2022 C/SCA/14799/2022 ORDER DATED: 01/08/2022 application for early hearing. He has further fairly submitted that now only two days are left when the matter is to be heard on 03.08.2022 and the principal amount since is already deposited, the respondent would request the said amount to be transferred to the Executing Court and the Executing Court to act as per the outcome of the pending matter before the Delhi High Court.
8 Before this Court chooses to enter into any kind of details, as a fair proposal has come on the part of learned counsel appearing for the respondent and as other side has also no objection to his requesting being acceded, noticing the short time within which the matter is to be heard by the Delhi High Court, we choose not to enter into any of the aspects. Noticing the fairness along with self-restraint on the part of the judgement creditor and the deposit of the principal amount on the part of the petitioner judgement debtor, when the respondent ensures not to insist on implementation of the order of warrant of attachment for movable and immovable property till the Delhi High Court decides OMP No.162 of 2020, we dispose of this petition.
9 The Registry shall ensure that the amount of the sum of Rs. 24,54,458.33 (Rupees Twenty Four Lakhs Fifty Four Thousand Four Hundred Fifty Eight and thirty three paise only) deposited by the petitioner with the High Court Registry shall be transferred within 24 hours of this order to the Page 6 of 7 Downloaded on : Wed Aug 03 21:26:54 IST 2022 C/SCA/14799/2022 ORDER DATED: 01/08/2022 Executing Court, Ahmedabad which, on getting the certified copy of the order of the Delhi High Court, in OMP No.162/2020 shall act upon the same.
10 Application stands disposed of accordingly (MS. SONIA GOKANI, J. ) (HEMANT M. PRACHCHHAK,J) SUDHIR Page 7 of 7 Downloaded on : Wed Aug 03 21:26:54 IST 2022