TaxTMI 
TaxTMI 
TaxTMI 
2016 (11) TMI 1541
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....n 14-7-2015 directed for deposit of 75% of the award amount and further directed that till the amount is deposited, the proceedings shall remain in abeyance and that order has attained finality as it has not been sought to be challenged by the petitioner till it is denied. Execution was levied by the respondent herein. The petitioner herein filed two applications, one under Order 7 Rule 11 read with Section 151 of the CPC stating inter alia that since the petitioner Company has been declared sick industry, no execution is maintainable. Second application was filed under Section 151 of the CPC that since the application under Section 34 of the Act of 1996 for setting aside the award is pending consideration, therefore, by virtue of Section 36 of the Act of 1996, execution of the award shall remain suspended automatically. The learned District Judge by its impugned order rejected both the applications feeling aggrieved against which this writ petition under Article 227 of the Constitution of India has been filed by the petitioner. 3. Mr. Raghavendra Pradhan, learned counsel appearing for the petitioner, would submit as under:- "1. The learned District Judge has committed legal err....
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....6 is mandatory to make an application under Section 34 of the Act of 1996 maintainable? ) Whether in view of the objection filed under Section 22(3) of the SIC Act by the petitioner, the executing court has no jurisdiction to execute the award?" Re. Question No. 1 7. In order to consider the plea raised at the Bar, it would be appropriate to consider the provisions contained in the Interest on Delayed Payments to Small Scale and Ancillary Industrial Undertakings Act, 1993 (for short 'the Interest Act of 1993') which was repealed by Section 32 of the Act of 2006. 8. The Interest Act of 1993 was enacted to provide for and regulate the payment of interest on delayed payments to small scale and ancillary industrial undertakings as it was a beneficial piece of legislation, tended to expedite timely payment of money owed to Small Scale Industries. The Interest Act of 1993 was repealed by the Act of 2006. 9. The Act of 2006 has been enacted to provide for facilitating the promotion and development and enhancing the competitiveness of micro, small and medium enterprises and for matters connected therewith or incidental thereto. It is a central enactment which came into force ....
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....y any institution or centre providing alternate dispute resolution services to which a reference is made by the Council, shall be entertained by any court unless the appellant (not being a supplier) has deposited with it seventy-five percent of the amount in terms of the decree, award or, as the case may be, the other order in the manner directed by such court: Provided that pending disposal of the application to set aside the decree, award or order, the court shall order that such percentage of the amount deposited shall be paid to the supplier, as it considers reasonable under the circumstances of the case subject to such conditions as it deems necessary to impose." 11. A careful perusal of the aforesaid provision would clearly state that no application for setting aside any decree or award or order made by the Council constituted under Section 20 of the Act of 2006 shall be entertained by any court unless the appellant therein has deposited 75% of the amount in terms of the decree or award, as the case may be, or the other order in the manner indicated by the High Court. Thus, the requirement of depositing 75% of the amount is mandatory to entertain the application for settin....
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....section, in case of conflict, an overriding effect over the provision or Act mentioned in the non obstante clause. It is equivalent to saying that in spite of the provision or Act mentioned in the non obstante clause, the enactment following it will have its full operation or that the provisions embraced in the non obstante clause will not be an impediment for the operation of the enactment. Thus, a non obstante clause may be used as legislative device to modify the ambit of the provision or law mentioned in the non obstante clause or to override it in specified circumstances. 16. Way back, in the matter of Union of India and another v. G.M. Kokil and others 1984 (Supp) SCC 196, the Supreme Court has considered the nature and effect of non obstante clause by holding it as a legislative device and observed as under:- "A non obstante clause is a legislative device which is usually employed to give overriding effect to certain provisions over some contrary provisions that may be found either in the same enactment or some other enactment, that is to say, to avoid the operation and effect of all contrary provisions." 17. Similar is the proposition laid down in the matter of State of....
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....ch might arise out of the provisions of any other law in the way of the operation of the principal enacting provision to which the non obstante clause is attached. (See Bipathumma v. Mariam Bibi (1966) 1 Mys LJ 162, Mys LJ at p. 165.)" 18. Recently, in the matter of JIK Industries Ltd. v. Amarlal V. Jumani (2012) 3 SCC 255 it has been held by the Supreme Court that the insertion of a non obstante clause is a well-known legislative device and in olden times it had the effect of non obstante aliquo statuto in contrarium (notwithstanding any statute to the contrary). Under the Stuart reign in England the Judges then sitting in Westminster Hall accepted that the statutes were overridden by the process but this device of judicial surrender did not last long. Under the scheme of the modern legislation, non obstante clause has a contextual and limited application. The impact of a "non obstante clause" on the Act concerned must be kept measured by the legislative policy and it has to be limited to the extent it is intended by Parliament and not beyond that. 19. Nature and effect of non obstante clause as held in G.M. Kokil's case (supra) has been followed with approval by the Supreme....
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.... (supra) has clearly held that deposit of 75% of the award amount in terms of Section 7 of the Interest Act of 1993 is the condition precedent for hearing an application under Section 34 of the Act of 1996 and further held that the word "appeal" appearing in Section 7 of the Interest Act of 1993 is referring to application filed under Section 34 of the Act of 1996 and the word "award" includes the arbitral award. It was also held that the Interest Act of 1993 governing small scale industries is a special enactment in order to protect the industries and would have overriding effect. 26. As noticed herein-above, in Goodyear India Limited (supra), Their Lordships of the Supreme Court have relied upon Snehadeep Structures Private Limited (supra) and did not approve the order of the High Court and held that predeposit of 75% under the Act of 1996 is the condition precedent for maintaining application to set aside the award under Section 34 of the Act of 1996, only the Court has no discretion to either waive or reduce the amount of 75% of the award as a predeposit for filing of application or appeal. Thus, legal view in this regard is clearly crystallised that the application under Sect....
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....ication under Section 34 of the Act of 1996 is not maintainable for want of prerequisite deposit under Section 19 of the Act of 2006 as such, the award is clearly executable, as the petitioner's application under Section 34 of the Act of 1996 is not duly constituted and not liable to be entertained, and rightly held so by the trial Court and the petitioner's application has rightly been rejected by the trial Court. Re. Question No. 2 28. This would bring me to the next objection raised by the petitioner that the petitioner industry has been declared as a sick industry under the provisions of the SIC Act. Therefore, by virtue of the provisions contained in Section 22(3) of the SIC Act, the award is not executable and the execution proceeding deserves to be dropped. The award of the Facilitation Council being an award deemed to have been made under the Act of 1996, is executable under Section 36 of the said Act. 29. The Supreme Court in the matter of Jay Engineering Works Ltd. v. Industry Facilitation Council and another (2006) 8 SCC 677 has held that once the awarded amount is included in the scheme approved by the Board, Section 22 of the SIC Act would apply. 30. Very r....