Foreign decree enforcement and interim moratorium claims fail where Section 13 CPC exceptions are not made out and conduct is inconsistent.

A foreign commercial decree based on a guarantee choosing English law and English courts was treated as enforceable in India because the foreign court applied its mind to the evidence, gave reasoned findings, and the objections raised did not bring the case within the exceptions to Section 13 CPC. The court also noted that a breach of FEMA does not by itself void the transaction and that post-facto approval may be obtained. On the insolvency issue, the interim moratorium plea was rejected because the party knew of the personal insolvency proceedings yet continued litigating without timely invoking the moratorium, and its inconsistent conduct amounted to waiver.

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Issues: (i) Whether the foreign decree was unenforceable in India on the grounds in Section 13 of the Code of Civil Procedure, 1908, including want of competent jurisdiction, absence of decision on merits, refusal to recognise Indian law, breach of natural justice, and breach of Indian law; (ii) Whether the execution proceedings were barred by the interim moratorium under Sections 95 and 96 of the Insolvency and Bankruptcy Code, 2016.

Issue (i): Whether the foreign decree was unenforceable in India on the grounds in Section 13 of the Code of Civil Procedure, 1908, including want of competent jurisdiction, absence of decision on merits, refusal to recognise Indian law, breach of natural justice, and breach of Indian law.

Analysis: The decree was passed by a court of competent jurisdiction under a guarantee which selected English law and English courts. The foreign court applied its mind to the evidence, examined the contractual terms, and gave reasoned findings on the nature of the guarantee and the defences raised. The objections based on alleged drafting by the claimant's lawyer and the expert evidence were treated as matters going to merits, and the petitioner had waived any objection by not raising it at the appropriate stage. On FEMA, the legal position recognised was that a breach does not render the transaction void and post-facto approval may be obtained. The judgment therefore did not fall within the exceptions in Section 13.

Conclusion: The foreign decree was held to be conclusive and enforceable, and the objection to execution failed.

Issue (ii): Whether the execution proceedings were barred by the interim moratorium under Sections 95 and 96 of the Insolvency and Bankruptcy Code, 2016.

Analysis: Although an application under Section 95 triggers an interim moratorium, the petitioner had knowledge of the personal insolvency proceedings yet continued to litigate the execution matter without promptly invoking Section 96. The Court treated this conduct as waiver and approbation and reprobation, and also held that the petitioner could not take inconsistent stands after challenging the very provisions in other proceedings. The statutory scheme under Sections 95 to 100 was noted to be time-bound, and the belated plea was rejected on conduct and principle.

Conclusion: The plea of interim moratorium was rejected and the execution proceedings were held not to be stayed.

Final Conclusion: The petitions challenging enforceability of the foreign decree and the continuation of execution proceedings were rejected, and the executing court's orders were sustained.

Ratio Decidendi: A foreign commercial decree remains executable in India unless it squarely falls within Section 13 CPC, and a party who, despite knowledge of personal insolvency proceedings, continues to litigate without timely raising Section 96 IBC may be barred from later claiming its benefit on the basis of waiver and inconsistent conduct.

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