2007 (7) TMI 678 - HC - Indian Laws

Court sets aside dismissal order, directs deposit with interest pending appeal, emphasizes speedy remedy

The court set aside the order dismissing the Execution Petition, directing the Respondent to deposit the amount with interest pending the appeal's ... - Issues involved:The judgment involves the issue of whether the pendency of an appeal under Section 37 of the Arbitration and Conciliation Act, 1996 stays the execution of an award.Issue 1: Appeal against order dismissing Execution PetitionThe appeal was directed against the order dismissing the Execution Petition due to the pendency of appeals under Section 37 of the Act. The Single Judge held that the Execution Petition could not be entertained during the appeals' pendency.Issue 2: Interpretation of Arbitration and Conciliation Act, 1996The counsel for the Appellant argued that the automatic stay due to pending appeals defeats the purpose of the Act. In contrast, the Respondent's counsel contended that the appeal is a continuation of the original proceedings and the award is not final until the appeal is decided.Issue 3: Comparison with a similar caseReference was made to a case where the High Court allowed execution of an award despite a pending appeal in the Supreme Court. The court emphasized the need for a speedy remedy under the Act.Issue 4: Examination of relevant legal provisionsThe court examined Sections 35 and 36 of the Act, emphasizing the finality of arbitral awards and the enforcement process. The Respondent highlighted the significance of 'this Part' in Section 35 and its relation to the Act's different chapters.Issue 5: Legislative intent and interpretationThe court interpreted the Act in line with the legislative intent to provide a speedy remedy for commercial transactions. It differentiated between decrees in civil suits and awards in arbitration, emphasizing the Act's aim to minimize procedural delays.Issue 6: Stay of execution pending appealThe court analyzed Order XLI Rule 5 of the Code of Civil Procedure regarding stays of execution pending appeals. It emphasized the importance of not automatically staying execution unless sufficient cause is shown.Conclusion:The court agreed with the reasoning in a previous judgment and set aside the order dismissing the Execution Petition. The Respondent was directed to deposit the amount with interest, subject to the pending appeal's outcome. Non-compliance would lead to enforcement through coercive means.