TaxTMI 
TaxTMI 
2019 (11) TMI 1857
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....oner-original claimant is seeking enforcement of the international commercial award(s) namely the Liability award dated 9 February 2006, an award dated 24 August 2007 being a quantum and jurisdiction award and an award dated 27 March 2008 being a Final Award of the International Chamber of Commerce. The prayers in the petition are combined prayers seeking enforcement and execution of the arbitral awards which are required to be noted and read thus:- "(a) That this Hon'ble Court be pleased to pass an order and/or declaration that the said Arbitral Awards, i.e. Liability Award dated February 09, 2016, Quantum Award dated August 24, 2007 and Final Award dated March 27, 2008 passed by the Hon'ble Arbitral Tribunal in Case Reference No. 13339/JNK/EBS, in favor of the Petitioner, are enforceable under the provisions of the Part II of the Arbitration Act and directions to be issued to enforce and execute the said Arbitral Awards as a decree in favor of the Petitioner and against all the Respondents; (b) That all the Respondents be directed to deposit the decretal amount of a sum of U.S. $ 11,309,496.06 plus interest at the rate of U.S. $ 2,512.60 per day from Oct....
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....respondent's Section 34 petition was per se not maintainable as awards in question were foreign awards. 4. By an order dated 10 June 2013 this Court condoned the delay as also held that it had jurisdiction to entertain Section 34 petition filed by the respondents. The petitioner being aggrieved by these orders approached the Supreme Court in a Special Leave Petition. By an interim order dated 19 November 2013, the Supreme Court stayed the proceedings of the respondents Section 34 petition pending before this Court. The proceedings before the Supreme Court were decided finally by an order dated 10 March 2017 whereby the Supreme Court set aside the orders passed by this Court, inter-alia holding that this Court had no jurisdiction to entertain the Section 34 petition challenging the foreign awards. It is thereafter that this petition under Section 47, 48 and 49 of the Arbitration Act was filed by the petitioner on 2 April 2018 seeking enforcement and execution of the foreign award(s) in question. 5. At the outset, an objection is raised on behalf of respondent No.1 to the maintainability of this petition on the ground that the petition is time barred considering the provisions ....
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....ion, for the petitioners to assail the award, started running against the petitioner to file the present Section 47 and 49 proceedings, immediately after the awards were published. It is submitted that considering the dates of the award, it cannot be held that a petition which was filed almost after about 10 years from the last award is within the prescribed period of limitation. Dr. Saraf in supporting this contention would refer to the provisions of Sub-Section (3) of Section 48 which according to him categorically provides that even if an application is made for setting aside or suspension of a foreign award before a competent authority as referred to in clause (e) of sub-section (1) of Section 48, the Court may, if it considers proper, adjourn the decision on the enforcement of the award and may also, on the application of the party claiming enforcement of the award, order the other party to give suitable security. It is thus contended that, the law recognizes that even after proceedings are filed to challenge the foreign awards, there is no impediment for the decree holder to file proceedings for enforcement of the award. 8. Dr. Saraf would submit that there is no applicati....
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....ntentions Dr. Saraf has placed reliance on the decisions of learned Single Judge in Noy Vallesina Engineering Spa v/s. Jindal Drugs Limited [2006 SCC ONLINE BOM 545], M/s. Louis Dreyfus Commodities Suisse S.A., 29 v/s. Sakuma Exports Limited [2015 SCC OnLine Bom 5006], Hameed Joharan (Dead) & Ors. vs. Abdul Salam (Dead) by LRs. & Ors. [(2001) 7 Supreme Court Cases 573], Assam Urban Water Supply and Sewerage Board Vs. Subash Projects And Marketing Limited [(2012) 2 Supreme Court Cases 624] . 9. Per contra Dr. Tulzapurkar, learned Senior Counsel for the petitioner would submit that the objection as urged on behalf of respondent No.1 of the petition being time barred is not well founded. At the outset Dr. Tulzapurkar would submit that the respondent's contention of applicability of Article 137 of the Limitation Act is also not correct. This principally for the reason that the foreign award itself is required to be accepted as a decree and these proceedings as filed by the petitioner under Sections 47 and 48 of the Arbitration Act are required to be considered as proceedings for enforcement and execution of the foreign award. This according to Dr. Tulzapurkar is also clear from the ....
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....by this Court condoning the delay would relate back to the date of filing of section 34 petition. To make good this submissions, Dr. Tulzapurkar has placed reliance on the decision of the Single Judge of Delhi High Court in Delhi Development Authority Vs. Amita Nand Agarwal [2008(1) Arb. LR 588 (Delhi)]. It is next submitted that the interim order dated 19 November 2013 passed by the Supreme Court in the petitioner's SLP merely stayed the Section 34 proceedings pending before this Court. The effect of this order is not that the Section 34 proceedings stood extinguished or were no more on the file of High Court, so as to consider that there is no stay to the enforcement of the award as brought about by pendency of Section 34 petition as per the prevailing law. According to Dr. Tulzapurkar, this stay on the proceedings of the Section 34 petition continued till 10 March 2017 when the Supreme Court set aside the orders passed by the High Court holding that the Section 34 petition as filed by the respondents was not maintainable. Thus according to Dr. Tulzapurkar, the awards in question became available for enforcement only after 10 March 2017 and therefore even if it is assumed tha....
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....t holds that the foreign award is enforceable under the said chapter, the award shall be deemed to be decree of the Court and not before that. It is hence submitted that considering this clear position, Article 136 of the Limitation Act as contended on behalf of the petitioner even otherwise is not applicable. 13. Having heard learned Counsel for the parties, the short question which has arisen for consideration at this stage of the proceeding is as to whether the present petition is filed within the prescribed limitation or the petition would be required to be held as time barred. 14. Some admitted facts are required to be noted. The three awards as sought to be executed by the petitioner are the awards dated 9 February 2006, 24 August 2007 and the final award dated 27 March 2008 of the ICC London. It is also not in dispute that the respondents approached this Court on 27 July 2008 by filing a petition under Section 34 of the Arbitration Act challenging these foreign awards. As the Section 34 petition was filed beyond the period of 90 days, however, within the extended period of 120 days, a delay condonation application (Notice of Motion) No.2560 of 2008 was filed by the res....
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.... of consideration before this Court. The order dated 10 June 2013 condoning the delay would surely relate back to the date on which the petition was filed. Considering the provisions of the Arbitration Act prior to its amendment by the 2015 Amendment Act (with effect from 23 October 2015), filing of the Section 34 petition amounted to stay of the award. The law in this regard is well settled. In Fiza Developers and Inter-Trade Private Limited Vs. AMCI (India) Private Limited & Anr. (supra) the Supreme Court held that until disposal of the application under Section 34 of the Arbitration Act, there is an implied prohibition on the enforcement of the arbitral award as the very filing and pending of an application under Section 34, in effect operated as a stay on the enforcement of the award. The Court in paragraphs 19 and 20 held thus:- "20. Section 36 provides that an award shall be enforced in the same manner as if it were a decree of the court, but only on the expiry of the time for making an application to set aside the arbitral award under Section 34, or such application having been made, only after it has been refused. 20. ..........Until the disposal of the ap....
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.... Thus, it is only after 10 March 2017 the award(s) became available to the petitioner to be enforced. In my opinion, it is at this juncture, even if Article 137 of the Limitation Act as being pressed into service on behalf of the respondents, is applied and a period of three years is to be available to the petitioners to file an enforcement petition, this petition which was filed on 2 April 2018 would be required to be held to be filed within the limitation of three years as prescribed under Article 137, as clear from the above facts. It would be required to be held that the substantive cause of action had arisen to the petitioner to file the present petition only on 10 March 2017 when the Supreme Court set asides the order passed by this Court holding the Section 34 petition to be not maintainable. 19. The respondents have contended that once a stay was granted by the Supreme Court to the proceedings of the Section 34 petition, it would bring about a situation of the Section 34 petition not being on the file of this Court. This may not be a correct proposition for the respondents to urge. In this context and considering the facts of the case, learned Senior Counsel for the peti....
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....rd being delivered after the commencement of the Arbitration Act on 24 September 1997. The issue was whether the provisions of the Arbitration Act, 1940 or Arbitration Act, 1996 would become applicable in regard to enforcement of the foreign award. It is in this context the Court considered as to what is the nature of a foreign award. The Supreme Court while observing that there is not much difference between enforcement of the foreign award under the Old Act and the New Act, held that the only difference is that while under the regime of Arbitration Act, 1940 read with Foreign Awards (Recognition and Enforcement) Act, 1961, a decree follows, whereas under the Arbitration Act, 1996 the foreign award is already stamped as a decree. It would be appropriate to note the observations of the Supreme Court in paragraph 40 of the decision which reads thus:- As a matter of fact if we examine the provisions of Foreign Awards Act and the new Act there is not much difference for the enforcement of the foreign award. Under the Foreign Awards Act when the court is satisfied that the foreign award is enforceable under that Act the court shall order the award to be filed and shall proceed....
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....t in paragraphs 30, 31 and 32 are required to be noted which read thus:- "30. Alternatively it was contended that a party holding a foreign award has to file a separate application and produce evidence as contemplated under Section 47 and also satisfy the conditions laid down under Section 48 and it is only after the Court decides about the enforceability of the award, it should be deemed to be a decree under Section 49 as available for execution. In other words, the party must separately apply before filing an application for execution of a foreign award. The Arbitration and Conciliation Ordinance, 1996 was promulgated with the object to consolidate and amend the law relating to domestic arbitration, international commercial arbitration and enforcement of foreign arbitral award and to define law relating to conciliation and for matters connected therewith or incidental thereto. In para 4 of the Statement of Objects and Reasons contained in the Act, the main objects of the Bill are stated. To the extent relevant for the immediate purpose, they are: "i) to comprehensive cover international commercial arbitration and conciliation as also domestic arbitration and con....
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....ady stamped as the decree. Thus, in our view, a party holding foreign award can apply for enforcement of it but the court before taking further effective steps for the execution of the award has to proceed in accordance with Sections 47 to 49. In one proceeding there may be different stages. In the first stage the Court may have to decide about the enforceability of the award having regard to the requirement of the said provisions. Once the court decides that foreign award is enforceable, it can proceed to take further effective steps for execution of the same. There arises no question of making foreign award as a rule of court/decree again. If the object and purpose can be served in the same proceedings, in our view, there is no need to take two separate proceedings resulting in multiplicity of litigation. It is also clear from objectives contained in para 4 of the Statement of Objects and Reasons, Sections 47 to 49 and Scheme of the Act that every final arbitral award is to be enforced as if it were a decree of the court. The submission that the execution petition could not be permitted to convert as an application under Section 47 is technical and is of no consequence in the vie....
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....on Ltd. Vs. Jindal Exports Ltd. (supra) rejected the contention of the respondent that as the award was passed on 2 March 2000 the petition to enforce the award should have been filed within three years and as the same being filed in the year 2005, the relief was barred by limitation. It was held that the foreign award is already stamped as a decree and the party having the foreign award can straight away apply for enforcement of the foreign award, the party would have 12 years time like that of a decreeholder to execute the foreign award. The Court in paragraphs 41 and 42 has made the following observations:- "41. The next objection of the learned Counsel for the 1st respondent is that as the award was passed on 2.3.2000, the petition to enforce the award should have been filed within 3 years and as the same was filed only in 2005, the relief is barred by limitation. 42. I am unable to accept this submission also. Under the Act, 1996, the foreign award is already stamped as a decree and the party, having a foreign award can straight away apply for enforcement of it and in such circumstances, the party having a foreign award has got 12 years time like that of a de....
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.... in Fuerst Day Lawson Ltd. Vs. Jindal Exports Ltd. (supra) and Thyssen Stahlunion GMBH Vs. Steel Authority of India Ltd. (supra) has held that the observations of the Supreme Court in Fuerst Day Lawson Ltd. Vs. Jindal Exports Ltd. (supra) that "the only difference as found is that while under the Foreign Awards Act a decree follows, under the new Act the foreign award is already stamped as the decree." to mean that the expression "stamped" means "regarded" This means that the foreign award is to be regarded as a decree. The following observations of the Supreme Court in paragraph 19 read thus:- "One sentence in Fuerst Day Lawson (supra) reads, "[T]he only difference as found is that while under the Foreign Awards Act a decree follows, under the new Act the foreign award is already stamped as the decree." This sentence does not lead to the conclusion, following the judgment in Thyssen Stahlunion GMBH Vs. Steel Authority of India Ltd., (1999) 9 SCC 334, that under the 1996 Act, a foreign award is considered to be stamped already. All that this sentence means is that the foreign award is to be regarded as a decree. The expression "stamped" means "regarded". This judgment also....
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....imitation Act. The Supreme Court was considering the meaning of the word "enforce" as used in Article 136 of the Limitation Act. However, in the present facts considering that the award is a foreign award, the reliance on this decision is not well founded, more particularly in view of the principles of law in regard to the enforceability of a foreign award as laid down in Furest Day Lawson Ltd. Vs. Jindal Exports Ltd. (supra) and M/S. Shriram EPC Ltd. Vs. Rioglass Solar SA (supra). 30. The decision in Assam Urban Water Supply and Sewerage Board Vs. Subash Projects And Marketing Limited (supra) would also not assist the respondents, as the question which fell for determination of the Court was as to whether the appellants were entitled to extension of time under Section 4 of the Limitation Act, 1963 and the context of the words "prescribed period" as used in the said provision. It was held that Section 2(j) of the Limitation Act defines the period of limitation and when read in the context of Section 34(3) of the Arbitration Act, 1996, the prescribed period for making an application for setting aside the arbitral award was three months. It was held that the period of 30 days ment....
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...... ..... .... 48. In the said judgment, this Court held that such an application for enforcement of the foreign award would attract Article 137 and according to that Article, the period of limitation is three years and would commence from the date when right to apply occurs. This Court has also observed that the least that could be said is that the question as to whether any period of limitation is prescribed for making an application for enforcement of the foreign award and if there is period of limitation prescribed, what would be that period of limitation, was not a question free from doubt and this Court accordingly, condoned the delay filed by the petitioner. In my view, the petitioner has filed the execution application which was within four months from the date of the said foreign award and was prosecuting the same in good faith and with due diligence. The respondent raised an objection about the maintainability of the said application for the first time before the Division Bench and not earlier. In my view, the petitioner has thus made out a case for condonation of delay in filing the petition under Section 47 of the Arbitration Act. The judgment of this Court in c....