TaxTMI 
TaxTMI 
2026 (2) TMI 1104
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....wal and Ms. Kritika Mundra instructed by TRD Associates, Advocate No. 20,22,23,25,27,28,31 to 34, 36 to 42, 22, 25, 50 to 57, 64 and 73. Mr. Swayam Chopda, OSD to the Court Receiver and Ms. Nandini Deshpande, 1st Assistant to the Court Receiver. Mr. Ganesh Murthy i/b K.V. Aiyar & Associates Advocates for Applicants in IA/147/2025 None for the Respondents No. 21,24 and 26. JUDGMENT:- 1. The present Execution Application has been filed by the Applicant Corporation for execution of a Final Award (which incorporates by reference Three Partial Awards) passed by a Sole Arbitrator in London under the London Court of International Arbitration Rules (2014) (LCIA Rules) which has been held to be enforceable against the Respondents in India. 2. The background facts are that, the Applicant Corporation, a Company incorporated in Italy, manufacturing cables and systems for energy and telecommunications and one Ravin Cables Limited ("the Company"), a public limited unlisted company incorporated under the Indian Companies Act, 1956 engaged in manufacturing various electrical control and other cables entered into a Joint Venture Agreement (JVA) on January 19, 2010 . The Respondent....
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...., which they failed to rectify and were therefore obligated to sell all the shares held by them to the Applicant at a 10% discount to the Fair Market Value. The date of assessment of the Fair Market Value of shares to be transferred was linked to the date of sale prescribed within 30 days of the Event of Default Notice. 8. The Third Partial Award ('TPA') issued on January 14, 2015 confirmed the breach by the existing shareholders. The Tribunal declared that "All rights of whatsoever nature conferred on the Respondents and specifically Mr. Karia under the JVA have ceased to be effective." 9. By the Final Award dated April 11, 2017 the learned Sole Arbitrator confirmed the aforesaid Three Partial Awards in favour of the Applicant and directed and ordered as under:- "57. For the reasons set out in this Final Award which itself incorporates by reference the First, Second, and Third PFAs and Procedural Orders 12, 13 and 14, the Tribunal HEREBY FINDS, HOLDS, ORDERS AND DECLARES as follows: 1. The Respondents do transfer to the Claimant (Prysmian) 10,252,275 shares held by them to the Claimant (Prysmian) at the Discounted Price of INR 63.9 share aggregating to INR ....
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....ndry disbursements costs of and relating to this Arbitration in the sum of US. $ 2,317,199.82 7. The Respondents are to bear and insofar as not already paid to reimburse the Claimant, the total costs of the Arbitration as determined by the LCIA Court pursuant to Article 28.1 of the LCIA Rules, which are GBP 283043.71 8. All other claims of the Claimant and Respondents are dismissed." 10. The Respondents have not challenged the Final Award under the English Arbitration Law. Thereafter, in 2019 the Applicant filed Commercial Arbitration Petition No. 442 of 2017 under Section 48 of the Arbitration and Conciliation Act, 1996 ("Arbitration Act") praying for enforcement of the Foreign Award. The Respondents resisted the enforcement on the grounds that the Tribunal has failed to determine the Counter Claim of the Respondents and that the award was in contravention of the Foreign Exchange Management Act, 1999 ("FEMA") and various other objections were raised. 11. The said petition came to be allowed by a Learned Single Judge of this Court (Coram: A K Menon, J, as His Lordship then was) by an Order dated January 7, 2019 rejecting the objections raised by the Responde....
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.... dated 09th September 2025, the Applicant has amended the Petition and deleted Respondents No. 70 and 78. 18. The Respondent No. 1 had filed an Interim Application No. 216 of 2021 inter alia seeking to implead the Reserve Bank of India (the "RBI") in the Execution Application as according to the Respondents, the RBI ought to be heard on the issue of sale and transfer of shares to the Applicant under the Award. The same came to be dismissed by this Court vide its order dated 5th April, 2022 of this Court (Coram: B.P. Colabawalla, J). Paragraph 4 of the said order is relevant and is quoted thus: "4. It is made clear that the points raised by the Applicants in the above Interim Application (Original Respondents) are kept open for the Respondents to agitate at the time of opposing the above Execution Application or any proceedings filed therein. It is further made clear that the Applicants shall not be allowed to canvass in the future that RBI needs to be joined as a party Respondent in the above Execution Application or any proceedings therein." (emphasis supplied) 19. During the pendency of the Execution Application, the connected Chamber Summons and the Inter....
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....emselves as the Chairman and Managing Director and Whole Time Director respectively causing the Company to enter into agreements to that effect. 21. It has been submitted that on, 21st June 2023 and 30th August 2023, the Applicant's nominee director on the Board of Directors of the Company received notices from the Cost Audit Department of the Ministry of Corporate Affairs, concerning the company's non compliance with the provisions of Section 148 of the Companies Act, 2013 for the financial years ending in 31st March, 2019 and 31st March, 2021. 22. It has been submitted that on, 1st September 2023, the Respondent No. 1, acting as director of the company, in breach of the Award, approved a circular resolution for the appointment of a Cost Auditor for the financial year 2023-2024. 23. It is submitted that on 2nd September, 2023, by email addressed to the Respondent No. 1, Respondent no. 11 one Mr. Tayfun Anik, the Company Secretary of the company circulated a Board Resolution passed by Respondents No. 1 and 11, convening the Annual General Meeting of the Company in breach of Award. 24. On 09th September 2025, the learned Senior Counsel for the Applicant, on instructions,....
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....espondents which is contrary to the opinion of the Hon'ble Supreme Court. 30. Mr. Khambata has submitted that objections raised by the Respondents regarding the illegality of the award cannot be raised in the execution proceedings and thus ought to be disregarded. Mr Khambata has urged that the executing court cannot go behind the award and thus it is only where the award sought to be enforced is, on the face of the record, wholly without jurisdiction and thus a nullity, that an executing Court will interfere with the execution of an award/decree. Mr. Khambata has submitted that a decree which is illegal or not passed in accordance with the procedure laid down by law cannot be termed in-executable by the executing court. The only recourse in such situations is for the award debtor to have the decree set aside in appeal/appropriate proceedings and which in the facts of this case has not been done. Reliance has been placed on the following judgments of the Hon'ble Supreme Court to canvass the aforesaid submissions: i. Vasudev Dhanjibhai Modi v. Raja bhai Abdul Rehman & Ors (1970)1 SCC 670. ii. Rafique Bibi (Dead) by LRs v. Sayed Waliuddin (Dead) by LRs and Ors (2....
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....permission and therefore the requirement of such "general or special permission" cannot be construed to mean "prior permission". In support, Mr. Khambatta has relied upon the following judgments: i. Life Insurance Corporation of India v. Escorts Ltd (1986) 1 SCC 264. ii. Videocon Industries Ltd. V. Intesa Sanpaolo SPA 2014 SCC Online BOM 1276. 34. Mr. Khambata, has further submitted that with respect to the Respondents' contention relating to valuation as well as the appropriate valuation date, the same have not only been considered and negatived by the Arbitral Tribunal but also by this Court in the enforcement proceedings and by the Hon'ble Supreme Court in Vijay Karia and Others v. Prysmian Cavi E Sistemi SRL and Others (supra) and therefore the same cannot be re-agitated before this Court. 35. Mr. Khambata has submitted that neither the FEMA Regulations nor the NDI Rules nor the pricing guidelines contained therein impose any restriction in respect of valuation date to be within 6 months from the date of transfer. Mr. Khambata would urge that the Respondents have deliberately misconstrued and wrongly summarized the RBI guidelines and the correspondence b....
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....any and therefore, the reliefs sought herein are not covered under the scope of Sections 241or 242 of the Companies Act. 38. Mr. Khambata therefore submitted that the reliefs sought by the Applicant are neither barred by res judicata on account of NCLT proceedings nor the reliefs sought fall within the exclusive jurisdiction of the NCLT. 39. Mr. Khambata has further submitted that the contentions of the Respondents against Interim Application No. 1401 of 2021 are untenable as the same are not only contrary to the express language of Clause 23.7 of the JVA, but also since this very contention has been rejected by the Arbitral Tribunal in the Third Partial Award at paragraph 30. 40. Mr. Khambata has submitted that the reliefs sought for in Interim Application No. 1401 of 2021 flow from the Awards, and the reliefs sought fall within the powers of the executing court enumerated under Section 51(e) of the Code of Civil Procedure, 1908 ("CPC"). Mr Khambata has submitted that the Hon'ble Supreme Court in State of Haryana v. State of Punjab & Anr (2004)12 SCC 673 has held that the residuary power under Section 51(e) allows a court to pass orders for enforcing a decree in a manner ....
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....o the Applicant must be in accordance with FEMA 1999 and the FEMA NDI Rules, 2019 (including the pricing guidelines contained therein). Mr Khambata has also submitted that if the RBI chooses to direct that a price for the shares higher than awarded is required under Rule 21(2) (b) (iii) of the NDI Rules, then the Applicant subject to its right to challenge the RBI Order in accordance with law will either comply with the RBI Order in this regard or seek the necessary permission/condition from the RBI. 45. On the deletion of Respondents No. 70,71,72,74,75 and 78 from the array of parties to the Execution Application, Mr. Momaya, learned Counsel for the Respondents No. 1, 5 to 7, 9, 58A, 61, 65 and 66 has submitted that the said amendment has far reaching consequences on the execution of the Award in the sense that the arbitral proceedings from which the Award that is sought to be executed were for specific performance of the JVA, and that Clause 23.4 and Clause 23.5.2, as also Clause 23.5.1 clearly provide for purchase by the Applicant of all but not less than all of the shares of the Company held by the Respondent Mr. Karia and the Existing Shareholders. Mr. Momaya has referred t....
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....ution of the Award as the same mentions that the transfer of the equity instruments of the Company from persons resident in India (Mr. Karia and other shareholders) to the foreign investor viz., Prysmian Cavi E Sistemi SRL must be in accordance with the extant FEMA, 1999, rules, and regulations made thereunder, including adherence to the pricing guidelines prescribed under the Foreign Exchange Management (Non-Debt Instruments) Rules, 2019. Mr. Momaya has submitted that therefore the Executing Court cannot grant any relief for transfer of shares till the same is in accordance with FEMA. 49. In response, Mr. Khambata has submitted that under the JVA, specifically in terms Clause 28.16, Mr Karia is the constituted attorney holder for all Existing Shareholders and is the "sole Prysmian interface". Mr Khambata has submitted that in any event the reliefs sought by the Applicant are severable, each relief is independent and distinct from the other reliefs sought which is evident from the TPA which clarifies that the Respondents' obligation to sell their shares is in addition to their obligation to give up their rights under the JVA. Mr. Khambata has submitted that the total shareholdin....
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....ly be under the provisions of municipal law, viz. the CPC and particularly Order XXI and Section 47. That merely because a foreign award is held to be enforceable under Section 48 does not necessarily mean that the foreign award can be or should be executed by the domestic court under the CPC. 54. Mr. Nankani has submitted that I.A. No. 1401 of 2021 and Chamber Summons No. 327 of 2021 cannot be decided before deciding the execution application and only after the award is held to be executable, can the reliefs claimed in the Chamber Summons and the Interim Applications be considered. 55. Mr. Nankani has relied upon the decision of the Apex Court in Forasol v. Oil and Natural Gas Commission 1984 Supp SC 263, submitting that no Court can pass a decree directing the Defendant to do an impossible or an illegal act. Mr. Nankani has submitted that even in Forasol v. Oil and Natural Gas Commission (supra), the Hon'ble Supreme Court caveated it's judgment on enforceability as being subject to the obtaining of approvals under Foreign Exchange Regulation Act, 1973 (the "FERA") from the concerned authorities. 56. Mr. Nankani has further submitted that whilst the executing court cannot....
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....absolute restriction on an Indian entity such as the Respondent Company from receiving investment in India from a person resident outside India, except in accordance with the NDI Rules. Under Rule 5, an investment by a person resident outside India is subject to entry route sectoral caps, or investment limits, as the case may be and the attendant conditionalities for such an investment is laid down in the NDI Rules. That Rule 9 (3) provides that a person resident in India holding equity instruments of an Indian company, may transfer the same to a person resident outside India by way of sale, subject inter-alia to adherence to the pricing guidelines. These pricing guidelines are provided under Rule 21, and under Rule 21(1)(b)(iii), the price of equity instruments of an Indian company transferred from a person resident in India to a person resident outside India shall not be less than the valuation of equity investments done as per any internationally accepted pricing methodology for valuation on an arm's length basis duly certified by a Chartered Accountant or a Merchant Banker registered with the Securities and Exchange Board of India (the "SEBI") or a practicing Cost Accountant, i....
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....pricing guidelines under the NDI Rules require a current valuation, or at the very least a recent valuation. 64. Mr. Nankani has further submitted that apart from the pricing guidelines, in the present case, the valuation of the equity shares is of the year 2014, as against a transfer that is to take place in 2025/2026 i.e. nearly a decade later. 65. Mr. Nankani has submitted that in case of non-compliance, the Respondents as recipients would face huge penalties under Section 13 of FEMA, in the teeth of the bar under Rule 4. 66. Mr. Nankani has further submitted that under Regulation 3.1. Schedule I of the Foreign Exchange Management (Mode of Payment and Reporting of Non Debt Instruments) Regulations, 2019 (NDI Payment and Reporting Regulations), the mode of payment is required to be adhered to. Under sub-regulation (3), if the sale is not completed within 60 days, monies are required to be refunded within 15 days thereafter. Under sub-regulation (4) the Respondents will each be required to open escrow accounts in which the monies will have to be deposited. That under Regulation 4(3), Form FC TRS is required to be submitted and the onus is on the resident transferor, i.e. ....
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....lue as determined under FEMA, which higher value if the Applicant fails to pay, it will be impossible to put the clock back in respect of all the decisions that have taken by the nominee directors of the Applicant during interregnum. Mr. Nankani has therefore submitted that the Executing Court cannot grant any relief whether in respect of appointment of directors or injunctions against Respondent No. 1 and Respondent No. 11 till the transfer of shares is finally concluded in accordance with FEMA. 71. Mr. Nankani has submitted that therefore in the circumstances this Court not grant any relief as the award is not executable and in the absence of RBI permission, the execution as prayed for will result in violations of FEMA. 72. Dr. Birendra Saraf, Learned Senior Counsel appearing for Respondents No. 3, 4, 11 to 18, 46 to 48 and 77 in furtherance of the submissions advanced by Mr. Nankani has submitted that, there is a material difference in the scope of enquiry and the powers by a Court in proceedings for enforcement of a foreign award under Section 48 of the Arbitration Act and the execution of an award as a decree of the Court after the Court is satisfied that the award is en....
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....ers (supra) holding that the subject award is enforceable, Dr. Saraf has submitted that the said decision has primarily dealt with the aspect of breach of the fundamental policy of India and not with the breach of specific provision of statutes in India. 77. Dr. Saraf has relied upon Rules 3 and 9 of the FEMA Rules and upon paragraphs 97,98,102 and 110 of Cruz City Mauritius Holdings v. Unitech Ltd 2017 SCC Online Del 7810 which have been cited by the Hon'ble Supreme Court in Vijay Karia and Others v. Prysmian Cavi E Sistemi SRL and Others (supra) in paragraphs 87 and 88 in support of his contentions. Heavily relying upon paragraph 88 of the said decision, Dr. Saraf submits that even the Hon'ble Supreme Court has observed that if the foreign award directs shares to be sold at a sum less then the market value, the Reserve Bank of India may choose to step in and direct that the said shares be sold only at the market value and not at the discounted value or the Reserve Bank of India may choose to condone such a breach. 78. Dr. Saraf has submitted that the fundamental policy of Indian law must amount to a breach of some legal principle or legislation which is so basic to Indian l....
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....tion of the Indian Law. In support of these submissions Mr. Tamboly has relied on the following decisions of this Court: i. Toepfer International Asia Pvt. Ltd v. Thapar Ispat Limited (2000) 2 Mah LJ 331. ii. Force Shipping Ltd v. Ashapura Minechem Ltd. (2003) Mah LJ 329. 82. In rejoinder, Mr. Behramkamdin, learned Senior Counsel, for the Applicant has submitted that the issues raised on behalf of the Respondents have already been deliberated upon and decided by the Hon'ble Supreme Court in the enforcement proceedings in the matter in Vijay Karia & Ors v. Prysmian Cavi e Sistemi Srl (supra). Mr. Behramkamdin reiterates that by re agitating the same issues, the Respondents' conduct is in the teeth of the Hon'ble Supreme Court's decision, and the executing court ought to ignore any stand taken by the Respondents which is contrary to the opinion of the Hon'ble Supreme Court. 83. Mr. Behramkamdin has submitted that the Respondents' contention that executability of a foreign award ought to be tested at a different threshold runs contrary to the judgment of the Hon'ble Supreme Court in LMJ International Ltd v. Sleepwell Industries Companies Ltd (supra). Learned Se....
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....reliefs falling within the exclusive jurisdiction of the NCLT and to the partial execution of the award have also been raised. 88. Coming to the issue of enforcement v/s executability of the Award it would be first pertinent to consider Section 49 of the Arbitration and Conciliation Act, 1996 which deals with enforcement of a foreign award which reads thus:- "Section 49. Enforcement of foreign awards - Where the Court is satisfied that the foreign award is enforceable under this Chapter, award shall be deemed to be a decree of that Court." 89. Even though the Section refers to 'enforcement' and deals with the enforcing of an award as a decree yet the words 'enforce' or 'enforcement' have not been defined either in the Act or in the CPC. The Code of Civil Procedure only prescribes the mode and procedure for the execution of a decree. Execution has also not been defined. Therefore to understand the scope and ambit of these words let's refer to the meanings assigned to the words in a judicial dictionary. The word 'enforce' is defined in the Black's Law Dictionary as "to give force or effect" and the the word 'enforcement' is defined as "the act or process of compelling ....
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.... "31. Prior to the enforcement of the Act, the law of arbitration in this country was substantially contained in three enactments namely (1) The Arbitration Act, 1940, (2) The Arbitration (Protocol and Convention) Act, 1937 and (3) The Foreign Awards (Recognition and Enforcement) Act, 1961. A party holding a foreign award was required to take recourse to these enactments. The Preamble of the Act makes it abundantly clear that it aims at consolidating and amending Indian laws relating to domestic arbitration, international commercial arbitration and enforcement of foreign arbitral awards. The object of the Act is to minimize supervisory role of the court and to give speedy justice. In this view, the stage of approaching the court for making the award a rule of court as required in the Arbitration Act, 1940 is dispensed with in the present Act. If the argument of the respondent is accepted, one of the objects of the Act will be frustrated and defeated. Under the old Act, after making award and prior to execution, there was a procedure for filing and making an award a rule of court i.e. a decree. Since the object of the Act is to provide speedy and alternative solution of the dispu....
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.... other to take up execution thereafter. In one proceeding, as already stated above, the court enforcing a foreign award can deal with the entire matter. Even otherwise, this procedure does not prejudice a party in the light of what is stated in paragraph 40 of the Thyssen judgment." 91. The aforesaid findings of the Hon'ble Supreme Court would squarely apply to the facts of this case. 92. Therefore, what the law requires is the satisfaction of the Court that the foreign award is enforceable and once that is done there is no necessity for the Executing Court to delve into the very same question once again. To give a restricted and therefore contrived meaning to the word 'enforcement' would lead to an absurd situation where a foreign award creditor would have to face an additional hurdle in the form of objections as to executability of a foreign award alien to the grounds enumerated in Section 48 of the Arbitration Act even after the award has been held to be enforceable. 93. The Hon'ble Supreme Court in the case of LMJ International Ltd and Ors v. Sleepwell Industries Co. Ltd (supra) has held that the grounds urged regarding maintainability of the execution case could n....
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....lation to the execution of foreign awards. Therefore, the subject application filed by the Petitioner deserves to be rejected, being barred by constructive res judicata, as has been justly observed by the High Court in the impugned judgment." 95. Therefore the contention of the Respondents that the enforcement of the arbitral award is distinct from executability is hereby rejected. 96. The reliance of the Respondents on the decision of the Hon'ble Supreme Court in Union of India v. Vedanta Limited (supra) is also misplaced in as much as the said decision itself holds that if the Court is satisfied that the application under Section 48 is without merit, and the foreign award is found to be enforceable, which also is the case herein, then under Section 49 the award shall be deemed to be a decree of that Court and the High Court concerned would enforce the award by taking recourse to the provisions of Order XXI of the CPC. 97. The Respondents have also relied on the judgment of this Court in Force Shipping Limited v. Ashapura Minechem Limited (supra) in support of their contention that executability of a foreign award on the one hand and enforceability of the said award requi....
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....et aside by an appropriate proceeding in appeal or revision. Paragraph 7 of the decision is relevant as well and the same is usefully quoted as under: "7. When a decree which is a nullity, for instance where it is passed without bringing the legal representative on the record of a person who was dead at the date of the decree, or against a ruling prince without a certificate, is sought to be executed an objection in that behalf may be raised in an execution proceeding if the objection appears on the face of the record: where the objection as to the jurisdiction of the Court to pass the decree does not appear on the face of the record and requires examination of the questions raised and decided at the trial or which could have been but have not been raised, the executing Court will have no jurisdiction to entertain an objection as to the validity of the decree even on the ground of absence of jurisdiction...." (emphasis supplied) 102. In the case of Rafique Bibi (Dead) by LRs v. Sayed Waliuddin (Dead) by LRs and Ors (supra) the Hon'ble Supreme Court has held that even if a decree suffering from illegality or irregularity of procedure cannot be termed inexecutabl....
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....ecree does not render a decree to be inexecutable on account of it being in ignorance of law and in fact, the Hon'ble Supreme Court has analysed the meaning of the phrase void ab initio in relation to a decree and in fact held that the High Court was not justified in allowing objections under Section 47 of the CPC. Further the said decision is distinguishable as the said decision pertains to a situation where the award was inexecutable by virtue of a law which declared the award itself to be non-executable which is not the case here. 106. The reliance upon the decision in the case of Jai Narain Ram Lundia vs. Kedar Nath Khetan (supra) by the Respondents in support of the contention that the Applicant has failed to show its readiness and willingness to fulfill its obligations under the final award is not necessary to be dealt with as on behalf of the Applicant but the Respondents have failed to consider that during the course of arguments it has been reiterated that the Applicant is able and to bring the funds into Court as and when the shares are dematerialized. 107. As can be seen, the Respondents / Award debtors had challenged the enforcement proceedings before this Court w....
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....non-resident at a sum which shall not be less than the market value of the shares, and a foreign award directs that such shares be sold at a sum less than the market value, the Reserve Bank of India may choose to step in and direct that the aforesaid shares be sold only at the market value and not at the discounted value, or may choose to condone such breach. Further, even if the Reserve Bank of India were to take action under FEMA, the non-enforcement of a foreign award on the ground of violation of a FEMA Regulation or Rule would not arise as the award does not become void on that count. The fundamental policy of Indian law, as has been held in Renusagar (supra), must amount to a breach of some legal principle or legislation which is so basic to Indian law that it is not susceptible of being compromised. "Fundamental Policy" refers to the core values of India's public policy as a nation, which may find expression not only in statutes but also time-honoured, hallowed principles which are followed by the Courts. Judged from this point of view, it is clear that resistance to the enforcement of a foreign award cannot be made on this ground." 110. It is has been contented on behalf....
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....any payment to, or for the credit of any person, or receiving any payment for, by order or on behalf of any person, or drawing, issuing or negotiating any bill of exchange or promissory note, or transferring any security or acknowledging any debt" 113. As can be seen, Section 3 of the FEMA inter-alia provides that no person can deal in or transfer foreign exchange/foreign security to a person not being an authorised person or make payment to or for the credit of any person resident outside India, "Save as otherwise provided in this Act, rules or regulations made thereunder, or with the general or special permission of the Reserve Bank, no person shall.." 114. Section 3 of the FEMA, by itself does not impose any requirement of prior approval or prior permission. The term "general or special permission" includes within its ambit, both prior permission as well as subsequent permission. 115. In the case of LIC v. Escorts Ltd (supra) the Hon'ble Supreme Court had while considering Section 29(1) of FERA has held that 'permission' of Reserve Bank of India may also be ex post facto and need not necessarily be a prior one. Paragraph 63 of the said decision is usefully quoted as und....
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....the Amendment Act of 1957. The Statement of Objects and Reasons of the 1957 Amendment Act expressly stated, "India still continues to be short of foreign exchange and it is necessary to ensure that our foreign exchange resources are conserved in the national interest." In 1973, the old Act was repealed and replaced by the Foreign Exchange Regulation Act, 1973, the long title of which reads : "An Act to consolidate and amend the law regulating certain payments, dealings in foreign exchange ant securities, transactions indirectly affecting foreign exchange and the import and export of currency and bullion, for the conservation of foreign exchange resources of the country and the proper utilisation thereof in the interest of the economic development of the country." We have already referred to sec.76 which emphasises that every permission or licence granted by the Central Government or the Reserve Bank of India should be animated by a desire to conserve the foreign exchange resources of the country. The Foreign Exchange Regulation Act is, therefore, clearly a statute enacted in the national economic interest. When construing statutes enacted in the national interest, we have necessari....
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....that the valuation date adopted in the Deloitte Valuation on the basis of which the Awards were passed being of 2014 is not in compliance with law, which they contend requires a current/recent valuation. That since the UAE subsidiary's valuation (Power Plus Cable Company LLC) was not included in the Deloitte Report (and was in fact included in the BDO Report commissioned by the Respondents, which yielded a much higher valuation) the Deloitte valuation is improper. That since the Deloitte valuation report was not a report prepared for the purposes of valuation under FEMA read with NDI Rules the same is invalid. 121. Apart from the fact that the issue has already been concluded by the decision of the Hon'ble Supreme Court and cannot be re-agitated before this Court, it is settled law that valuation relating to the date of the passing of the awards in the year 2014 would be relevant and not the current or recent valuation or the date when the Hon'ble Supreme Court passed the order negativing the challenges to the enforcement of the award or the date of the judgment holding the awards to be executable in view of the decision of the Hon'ble Supreme Court holding the a....
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....INR 563 crores. Considering that this aspect was not taken into account by Deloitte, the valuation report ought not to have been accepted by the learned arbitrator, also being contrary to the position taken by both parties. This submission was dealt with by the learned arbitrator in greater detail in para 19 of the final award dated 11-4-2017. Among other things, the learned arbitrator referred to Clause 17 of the JVA and stated that the said clause together with the formula prescribed therein was followed by Deloitte. Since this was done, Deloitee cannot possibly be faulted and cannot further be asked to take into account the stake of Ravin in Power Plus, as that would go outside the JVA. This again is a matter for the arbitrator to determine. This again is a ground wholly outside grounds that can attract challenge to foreign awards under Section 48." (emphasis supplied) 124. The Respondents have further contended that the Deloittte valuation report was not a report prepared for the purposes of valuation under FEMA read with the NDI rules and is thus invalid. This contention has also been considered and negatived by the Hon'ble Supreme Court in Vijay Karia and Others v....
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....the executing court cannot grant such relief. The Respondents have sought to rely on decision of the Hon'ble Supreme Court in Cheran Properties Ltd v. Kasturi & Sons Ltd (supra) in support of this contention. 128. I am unable to agree with the said objection and agree with Mr.Khambata that Section 98 of the Companies Act, 1956, contemplates the NCLT directing convening of a meeting of a company whereas the prayers sought for in Interim Application No. 1401 of 2021 are qua the Respondents in enforcement of the contractual rights confirmed by the award not falling within the purview of Section 98 and that the reliefs sought do not fall within the exclusive jurisdiction of the NCLT. That, this Court being an executing Court can exercise powers under Section 51(e) of the CPC, as has been upheld by the Hon'ble Supreme Court in the case of State of Haryana vs. State of Punjab and Another (supra) which allows this Court to pass orders for enforcement of decrees in a manner to give effect to it. Further, the decision in the case of Cheran Properties Ltd. vs. Kasturi & Sons (supra) is distinguishable and therefore not applicable and would not apply to the facts of this case as the sa....
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....ideration and upon due execution of the deed of sale presupposes and requires the vendor to put the purchaser in possession of the property. It cannot be suggested that when a party comes to Court for a specific performance of a contract he is to be satisfied with simply the execution of the document on payment of the consideration money. The Court when allowing the prayer for specific performance vests the executing court with all the powers which are required to give full effect to the decree for specific performance. By the decree for specific performance, the court sets out what it finds to be the real contract between the parties and declares that such a contract exists and it is for the executing court to do the rest, In may be noticed further that a decree in a suit for specific performance has been considered to be somewhat in the nature of preliminary decree which cannot be set out in the fullest detail all the different steps which are required to be taken to implement the main portion of the order directing specific performance of the contract. The executing court is in such a case vested with authority to issue necessary directions." 130. Section 51(e) of the Code of....
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....graph 88 of the decision of the Hon'ble Supreme Court in the case of Vijay Karia and Others vs. Prysmian Cavi E Sistemi SRL and Others (supra) has considered and negatived this objection which cannot be gone into again, and that, no objection as to the FEMA 1999, Rules, Regulations nor the pricing guidelines can be raised again. The objection sought to be raised by way of a fresh letter dated 19th August 2025 post the filing of the Execution Application, in my view, would therefore not be of any relevance but only to delay the execution proceedings, inviting an order for payment of costs. 137. Moreover, it is pertinent to refer to the decision of the Delhi High Court in case of NTT Docomo Inc v. Tata Sons Limited (supra) wherein the Delhi High Court has held that there is no provision in law which permits RBI to intervene in a petition seeking enforcement of an Arbitral Award to which RBI is not a party. 138. It is also pertinent to note here that the Interim Application No. 216 of 2021 inter alia seeking that the Reserve Bank of India be impleaded to the Execution Application came to be dismissed by this Court vide its order dated April 5, 2022 recording thus: "....
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....ndent. The Statement of Defence and in particular the Counterclaim was served and filed on behalf of all the Respondents." 141. The Final Award, as noted above, held that the Respondents do transfer to the Claimant 10,252,275 shares by them to the Claimant at the Discounted Price of INR 63.9 per share aggregating to INR 655,200,000, and Mr. Vijay Karia (who holds Powers of Attorney executed by each Existing Shareholder) do forthwith and without delay execute the requisite transfer forms for transfer of 10,252,275 shares in favour of the Claimant. 142. The Applicant has therefore filed the execution application to execute the Awards as a decree of this Court and joined all the Respondents in the captioned Execution Application out of abundant caution. Clause 28.16 of the JVA demonstrates that Mr. Vijay Karia is deemed to be the constituted attorney for all the Existing Shareholders. 143. By an order dated 27th March 2019, this Court directed Mr. Vijay Karia to deposit all 10,252,275 shares with the Prothonotary & Senior Master held by Respondents along with the share transfer forms signed by Mr. Karia as the constituted attorney of the transferor-Respondents of which 91,30,....
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.... reliefs he chooses not to press. 148. Accordingly, the relief of transfer of shares is severable and distinct and the Applicant is entitled to pursue the execution against those Respondents whose share transfer obligations are sought to be enforced. 149. Apropos the above discussion, all the objections against the Final Arbitral Award raised by the Respondents are hereby rejected and the Final Arbitral Award is held to be executable and the Execution Application is held to be maintainable. The execution to proceed as per law. 150. It is clear that the stand taken by the Respondents is contrary to the opinion of the Hon'ble Supreme Court in enforcement proceedings viz. in the case of Prysmian Cavi E Sistemi SRL vs. Vijay Karia and Another (supra) and despite that, the Respondents have raised the very same issues only to delay the fruits of the award in favour of the Execution Applicant, by not only re-agitating the grounds already decided and negatived by the Hon'ble Supreme Court but also endeavoured to raise a fresh issue in the garb of a fresh letter from the Reserve Bank of India which cannot be permitted but has to be deprecated by imposition of costs to be pa....
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....inary general meeting of the shareholders of Ravin Cables Ltd., the Applicant's nominees be appointed as directors on the Board. (v) Pending compliance with the aforesaid direction the Respondent No. 1 and 11 and each of them by themselves or through their respective agents, representatives or servants are restrained by an order of injunction from claiming or exercising or attempting to exercise any rights whatsoever under the Joint Venture Agreement dated 19th January 2010 in relation to the Company including but not limited to representation on the Board of Directors of the Company whether at meetings of Board of Director or at meetings of the shareholders of the Company, from claiming or attempting to claim, or representing or attempting to represent the Company in any manner whatsoever, or using or attempting to use any assets, properties or facilities of the Company including but not limited to the Company's offices and communication facilities except for the limited purpose of compliance with this order and directions contained herein. (vi) The Prothonotary & Senior Master is directed to handover to the Court Receiver High Court Bombay the 91,30,175 shares o....
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.... holder(s)]" (xii) The costs for opening of DEMAT accounts or for transfer of shares, if any shall be borne by the Applicant at the first instance and shall be entitled to adjust the same against the sale price payable for the shares. (xiii) The legal and sundry disbursement costs of USD 2,317,188.82 and Euro 2,38,034.71 payable by the Respondents be set-off against the aggregate transfer price amounting to INR Rs.65,52,00,000/- payable by the Applicant in terms of Order XXI, Rule 19(b) of the CPC is allowed to be set-off. (xiv) The Respondents are directed to cooperate fully with the Court Receiver and expeditiously provide and execute all documents and information as may be required for the purpose of transferring the said shares to the Applicant by the Court Receiver. (xv) All concerned including the Manager of the Depository, the Registrar of Companies, the National Securities Depository Ltd and Link Intime India Pvt Ltd., the Registrar and Transfer Agent of Ravin Cables Ltd to act on an authenticated copy of this Order and ensure opening of the DEMAT accounts and the transfer of the shares as per the above timelines. (xvi) The Respo....