TaxTMI 
TaxTMI 
TaxTMI 
2025 (4) TMI 1749
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....iation Act, 1996 (for short, the Act of 1996) raising a challenge to the judgment dated 24/10/2024 passed by the learned Single Judge in Commercial Arbitration Petition No.414 of 2018. The said proceedings had been filed under the provisions of Sections 47, 48 and 49 of the Act of 1996 for a declaration that three Foreign Awards passed in favour of the appellant - Imax Corporation were enforceable under the provisions of Part-II of the Act of 1996. By the impugned judgment, the learned Judge dismissed the Arbitration Petition holding the same to be barred by limitation with the further finding that the said Foreign Awards in favour of Imax Corporation did not deserve to be enforced and executed. It was also held that the impleadment of the 2nd to 4th respondents in the Arbitration Petition was unwarranted as they were not parties to the arbitration proceedings. 2] Mr. Aspi Chinoy, learned Senior Advocate for the appellant submitted that the learned Judge erred in holding that the Arbitration Petition as filed was barred by limitation. A further error was committed by the learned Judge in holding that the Foreign Awards passed in favour of the appellant were not liable to be enfo....
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.... nd and 3rd respondents. It was urged that the said respondents were neither signatories to the arbitration agreement nor were parties to the Final Award proceedings. Despite aforesaid, the Foreign Awards were sought to be executed against said respondents on the ground that the 1st respondent had diverted its assets in favour of 2nd and 3rd respondents under a fraudulent de-merger scheme. The said respondents had preferred Chamber Summons in the Arbitration Petition seeking deletion of their names from the proceedings. The Chamber Summons filed by them were rightly allowed by the learned Judge after considering the settled law in that regard. Since the Chamber Summons and Arbitration Petition were heard together and as the learned Judge thereafter held that the Chamber Summons deserved to be made absolute, the names of the said respondents were dropped from the array of the parties. The decision on the Chamber Summons had not been challenged by the appellant by raising any ground in that regard. While an order refusing to enforce a foreign award was appealable under Section 50(1)(b) of the Act of 1996, the order passed on the Chamber Summons making it absolute and directing deleti....
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.... of the Commercial Courts Act, 2015 read with the provisions of Orders XLIII and XXI of the Code of Civil Procedure, 1908 (for short, the Code). In that regard, reliance was placed on the order dated 04/02/2025 passed in Commercial Appeal (L) No.14519 of 2024 (Suresh Tulsidas Bhatia and another vs. ARF SV 1 Sarl) decided on 04/02/2025. It was also urged that an indirect challenge to the process of de-merger that had attained finality could not be permitted to be raised in the present proceedings. It was thus submitted that Commercial Arbitration Appeal ought to be dismissed against the 4th respondent as being not maintainable. 5] We have heard the learned counsel for the parties at length on the issue of maintainability of the Commercial Arbitration Appeal filed under Section 50(1)(b) of the Act of 1996 as against the 2nd to 4th respondents. We have also perused the written submissions made on behalf of the parties in that regard and have thereafter given due consideration to the same. 6] In our view, the Commercial Arbitration Appeal deserves to be admitted for its consideration on merits not only against the 1st respondent but also against the 2nd to 4th respondents as the ....
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.... as and by way of attachment and sale of items disclosed by all the Respondents; (e) For ad-interim reliefs in terms of prayers (c) above; (f) Cost of the Petition (g) For such further and other reliefs as the nature and circumstances of the case may require." The prayers as made thus indicate that the appellant seeks enforcement of the aforesaid awards as well as their execution against all the respondents. 6.2 Chamber Summons came to be filed by the 3rd respondent seeking deletion of its name from the cause title on the grounds stated in the affidavit-in-support of the Chamber Summons. Similar Chamber Summons were also preferred by the 2nd and 4th respondents with identical prayers. 6.3 The learned Judge while considering the Arbitration Petition as well as the Chamber Summons referred to the decisions of the Supreme Court in M/s Fuerst Day Lawson (supra) in paragraph 48 and Vedanta Limited (supra) in paragraph 49 of the impugned judgment to record a finding in paragraph 51 that it was open for the award holder to apply for recognition and execution of a foreign award through a common petition. In paragraph 52 it was held that while prayer clau....
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....le of court i.e. a decree. Since the object of the Act is to provide speedy and alternative solution of the dispute, the same procedure cannot be insisted under the new Act when it is advisedly eliminated. If separate proceedings are to be taken, one for deciding the enforceability of a foreign award and the other thereafter for execution, it would only contribute to protracting the litigation and adding to the sufferings of a litigant in terms of money, time and energy. Avoiding such difficulties is one of the objects of the Act as can be gathered from the scheme of the Act and particularly looking to the provisions contained in Sections 46 to 49 in relation to enforcement of foreign award. In para 40 of the Thyssen judgment already extracted above, it is stated that as a matter of fact, there is not much difference between the provisions of the 1961 Act and the Act in the matter of enforcement of foreign award. The only difference as found is that while under the Foreign Award Act a decree follows, under the new Act the foreign award is already stamped as the decree. Thus, in our view, a party holding foreign award can apply for enforcement of it but the court before taking furth....
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....y us) The aforesaid decision indicates that while seeking enforcement of a foreign award, there is no need to take separate proceedings, one for deciding the enforceability of the foreign award to make it rule of the Court and another to take up execution thereafter. 6.6 In LMJ International Ltd. vs. Sleepwell Industries Co. Ltd., 2019 INSC 241, the Supreme Court dealt with the aspect of piecemeal consideration of enforceability of a foreign award and its execution thereafter. In paragraph 14 it was held as under : "14. Be that as it may, the grounds urged by the petitioner in the earlier round regarding the maintainability of the execution case could not have been considered in isolation and de hors the issue of enforceability of the subject foreign awards . For, the some was intrinsically linked to the question of enforceability of the subject foreign awards. In any case, all contentions available to the petitioner in that regard could and ought to have been raised specifically and, if raised, could have been examined by the Court at that stage itself. We are of the considered opinion that the scheme of Section 48 of the Act does not envisage piecemeal consideratio....
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....he learned Single Judge in paragraphs 51 and 52 of the impugned judgment, which finding is not assailed by the 2nd to 4th respondents, the mere fact that the said respondents had filed Chamber Summons seeking deletion of their names, which relief came to be granted, would not render the appeal filed under Section 50(1)(b) of the Act of 1996 as not maintainable. The appellant is aggrieved by the refusal to enforce and execute the Foreign Awards against all the respondents. That was, in fact, the prayer made in the Arbitration Petition filed against all the respondents. The learned Judge having refused the enforcement as well as execution of the Foreign Awards against all the respondents, it goes without saying that an appeal filed under Section 50(1)(b) of the Act of 1996 against all respondents, who were parties to the Arbitration Petition, would be maintainable. 6.8 It is thus held that on an Arbitration Petition having composite prayers seeking recognition, enforcement and execution of a foreign award being dismissed on merits, the enforcement of the foreign award and consequentially its execution would stand declined. The order in its entirety would become appealable for bein....