2022 (2) TMI 1399 - HC - Indian Laws

Jurisdiction of executing court to entertain and decide the execution proceedings - Section 44A of the Code of Civil Procedure 1908 (CPC) - HELD THAT - It could be well said that the ground that the dispute is not commercial dispute and consequentially the Commercial Court lacks inherent jurisdiction to execute the decree falls flat. It is deprecable that despite the above findings of the Division Bench the very ground is raised and re-raised in yet another present proceedings. Be as it may. Repeating the litigation on the same grounds under different pretext and different context tantamount to abuse of process of law. In VADODARA MAHANAG SEVA SADAN FORMALY KNOWN SS MUNICIPAL CORPORATION VERSUS MS KHURANA ENGINEERING LTD. 2018 (9) TMI 2128 - GUJARAT HIGH COURT the petitioner Corporation had challenged order of the Commercial Court in relation to the award of the arbitrator for which the execution petition was filed before the Commercial Court. The contention was raised on behalf of the petitioner that though the application for setting aside the arbitral award may be pending before the Commercial Court the execution petition of the contractor would not be competent as it was for the amount below Rs.1 Crore. It was observed that since the award was enforceable in terms of the Code of the Civil Procedure in the same manner as it was the decree of the Court the Court having jurisdiction over the subject matter could be the court competent to execute it as per the Section 38 of the CPC. Coming to the facts of the present case it is the decree of English Court the reciprocating territory is being executed under Section 44A CPC. This provision in the CPC 1908 provides for Execution of decrees passed by the Courts in reciprocating territory. It provides that certified copy of a decree of any superior Courts of any reciprocating territory is filed in the district court the decree may be executed as if it has been passed by the district court. Sub section (2) of Section 44A provides for filing of certified copy regarding satisfaction of decree to the extent of such satisfaction or adjustments. Sub section (3) says that as per the provisions of Section 47 shall as from filing of the certified copy of the decree apply to the proceedings of a district court for executing a decree under this Section. The execution can be refused if it is shown that the decree falls within any of the exception in Section 13. In the present case it is the money decree passed by England Commercial Court upon adjudication of commercial dispute and now sought to be executed under Section 44A which is deemed in law to be the decree as if it has been passed by district court. Upon conjoint reading of Section 44A and Section 38 CPC it could be certainly deduced that the decree passed by the English Commercial Court can be executed by the commercial court when presented under Section 44A of the CPC - When the execution is filed from the decree of commercial court the commercial dispute continues to exists. In the execution proceedings initiated to execute the decree of the commercial court the characteristics of the commercial dispute is not lost rather the dispute continues in the same nature that is the commercial dispute . There remains hardly any substance in the submission that since the provisions relating to execution were not amended while amending certain provisions of CPC as per the Section 16 of the Commercial Courts Act the commercial court does not have the jurisdiction to try and decide the execution petitions. Merely because there is no amendment in relation to the execution provisions brought about and certain other provisions of CPC were amended to be applied to the commercial suits it would not mean or imply that the commercial court does not have the power to execute. A clear position of law emerges that commercial court does have the jurisdiction to try and decide the execution applications arising from the judgment and decree passed by the commercial court - the impugned order dismissing the application Exhibit 65 and refusing to hold that the commercial court does not have the jurisdiction to entertain and decide execution proceedings books no error whatsoever - petition dismissed.

Summary

Issues Involved:
1. Jurisdiction of the Commercial Court to entertain and decide execution proceedings.
2. Applicability of Section 44A of the Code of Civil Procedure (CPC) to foreign decrees.
3. Definition and scope of "commercial dispute" under the Commercial Courts Act, 2015.
4. Interpretation of the Commercial Courts Act, 2015 in relation to execution proceedings.

Detailed Analysis:

1. Jurisdiction of the Commercial Court to entertain and decide execution proceedings:
The petitioner challenged the jurisdiction of the Commercial Court at Jamnagar to entertain and decide execution proceedings, arguing that Section 6 of the Commercial Courts Act, 2015 does not encompass execution petitions. The petitioner contended that the executory power cannot be exercised by commercial courts, as the provisions of the Act do not amend Section 44A CPC, which governs the execution of foreign decrees. The court rejected this argument, emphasizing that the execution of a decree is an integral part of the commercial dispute resolution process. The court relied on previous judgments, including the Division Bench's decision in OCI Corporation vs. Kandla Export Corporation, which held that the Commercial Court has inherent jurisdiction to execute decrees arising from commercial disputes.

2. Applicability of Section 44A of the Code of Civil Procedure (CPC) to foreign decrees:
The decree in question, passed by the High Court of Justice, Queen’s Bench Division of England and Wales, was presented for execution under Section 44A CPC. This section allows decrees from reciprocating territories to be executed in India as if they were passed by Indian district courts. The court clarified that Section 44A CPC, read with Section 38 CPC, permits the execution of foreign decrees by the Commercial Court when such decrees arise from commercial disputes. The court emphasized that the decree retains its commercial nature throughout the execution process, thus falling within the jurisdiction of the Commercial Court.

3. Definition and scope of "commercial dispute" under the Commercial Courts Act, 2015:
The petitioner argued that the dispute was not a "commercial dispute" as defined under Section 2(1)(c) of the Commercial Courts Act, 2015, and therefore, the Commercial Court lacked jurisdiction. The court reiterated the Division Bench's findings that the liability arose from a maritime claim, which is inherently a commercial dispute. The court further noted that the nature of the dispute does not change during execution, and the Commercial Court retains jurisdiction over such matters. The court dismissed the petitioner's repeated challenges to the commercial nature of the dispute, labeling them as dilatory tactics.

4. Interpretation of the Commercial Courts Act, 2015 in relation to execution proceedings:
The court interpreted the Commercial Courts Act, 2015, in light of its objective to provide a stable and efficient dispute resolution mechanism for commercial disputes. The court referred to the Law Commission of India Report No. 253, which highlighted the importance of quick enforcement of contracts and recovery of claims for economic development. The court concluded that excluding execution proceedings from the jurisdiction of Commercial Courts would defeat the Act's purpose. The court cited several judgments, including Delhi Chemical and Pharmaceutical Works Private Limited vs. Himgiri Realtors Private Limited, which supported the view that Commercial Courts have jurisdiction over execution applications arising from commercial disputes.

Conclusion:
The court upheld the jurisdiction of the Commercial Court to entertain and decide execution proceedings arising from commercial disputes, including those involving foreign decrees under Section 44A CPC. The court dismissed the petition, affirming that the Commercial Court at Jamnagar was competent to execute the decree passed by the English Commercial Court. The court's decision reinforces the comprehensive jurisdiction of Commercial Courts in handling all aspects of commercial disputes, including execution.