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TMI Blog2024 (12) TMI 877X X X X Extracts X X X X X X X X Extracts X X X X ..... Accordingly, Section 11 of CPC is not exhaustive of the general doctrine of res judicata. This doctrine is founded on equity, justice and good conscience - the provision in Section 11 of CPC or the doctrine of res judicata says that once a matter is finally heard and decided between two parties, such a matter will not be allowed to be re-agitated amongst the same parties or the parties claiming under them. The Hon'ble Supreme Court in Vijayabai and others vs. Shriram Tukaram and others [ 1998 (11) TMI 703 - SUPREME COURT ] has held that the principle of res judicata would apply not only to two suits or proceedings but also to two different stages in the same suit or proceedings. The Court held that even if the strict parameters of Section 11 of CPC are not attracted, still, principles analogous to res judicata or estoppel would still apply. The matter of maintainability of appeals against judgments and orders made in proceedings for execution or enforcement of arbitral awards was directly and substantially in issue in the former proceedings, which came to be disposed of by judgment and order dated 9 August 2019. It is precisely the very same issue that is directly and substanti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Court. Adopting the mechanism under the CPC does not convert the execution or enforcement proceedings under Section 36 of the Arbitration Act into proceedings under Order XXI of the CPC. Therefore, even if Respondents 1 and 2 may have referred to the provisions of Order XXI of the CPC or Rule 313 of the Bombay High Court (Original Side) Rules, that can make no difference to the character of the enforcement proceedings under Section 36 of the Arbitration Act. Jet airways [ 2011 (10) TMI 783 - BOMBAY HIGH COURT ] precedent - HELD THAT:- The Coordinate Bench in Jet Airways (supra), by adverting to several binding precedents emanating from the Hon ble Supreme Court, held that the execution/enforcement proceedings were proceedings under Section 36 of the Arbitration Act and not proceedings for execution under Section 47 or Order XXI of the CPC. The Coordinate Bench also held that the appealability issue would be governed by Section 37 of the ACA, a special enactment that would prevail over the CPC, which was only a general enactment. Similarly, the Coordinate Bench also held that clause 15 of the Letters Patent was also impliedly excluded by the special provisions of the ACA. Finall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Vishal Mandal i/b. DSK Legal Nos.1 and 2 in COMAP/29/2020 and COMAP/22/2023. From Court Receiver Officer present: Mr N. C. Pawar (O.S.D.) and Mr Gajanan G. Surve, Master (Adm.). JUDGMENT PER (MS SONAK J):- 1. Heard learned counsel for the parties. 2. These are appeals against what the appellants style, the impugned judgment and order dated 22.02.2018 passed by the learned Single Judge of this Hon ble Court in purported exercise of powers referable to Order XXI Rule 2, purportedly recording satisfaction of the Arbitral Award dated 14.07.2014 by way of Consent Terms dated 22.02.2018 . 3. On 18 June 2018, when these appeals were taken up for admission, a preliminary objection was raised about their maintainability. A Coordinate Bench of this Court admitted these appeals only to address the issue in respect of maintainability of appeals as stated above . Interim relief was, however, declined. 4. Since interim relief was declined, the Respondents execution proceedings before the learned Single Judge proceeded. By order dated 24 August 2018, a learned Single Judge appointed a Receiver regarding some of the disputed lands. 5. The appellants filed Commercial Appeal (L) No. 109 of 2019 an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a and others (2023) 10 SCC 529 to support this contention. RESPONDENTS CONTENTIONS 10. Mr Chinoy, learned Senior Advocate for the first and second respondents, submitted that the issue of maintainability of these appeals stands concluded against the appellants by the detailed judgment and order dated 9 August 2019 in Commercial Appeal (L) No. 109 of 2019 and connected appeals involving the same parties and in the same execution proceedings. He submitted that this judgment and order dated 9 August 2019 operates as res judicata, and based upon the same, even these appeals must be dismissed as not maintainable. He submitted that the principle of res judicata applies at two different stages of the same proceedings. 11. Without prejudice, Mr Chinoy submitted that the proceedings for enforcement of the arbitral award were not proceedings under the CPC or the CCA but under the ACA. He, therefore, submitted that the issue of appealability had to be determined by reference to the provisions of the ACA, particularly Section 37 of the ACA and not by any of the provisions of the CPC or the CCA. He submitted that the later two enactments only provided the forum of appeal. He relied upon Jet Air ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s objected to the enforcement and execution of the consent award dated 14 July 2014, alleging that it violated the provisions of FEMA. However, in these enforcement/execution proceedings, the parties once again filed consent terms, based on which the learned Single Judge of this Court (Executing/Enforcement Court) made the impugned order dated 22 February 2018. Under this order, R-1 and R-2 extended further concessions to the appellants. 19. Without complying with any of the directions in the impugned order dated 22 February 2018, the appellants instituted these appeals, alleging that even the consent terms in the execution/enforcement proceedings before the learned Single Judge violated FEMA provisions. 20. As noted earlier, the order dated 18 June 2018 admitted these appeals only to address the issue in respect of maintainability of appeals as stated above. However, since no interim relief was granted to the appellants while admitting these appeals, the respondents execution proceedings before the learned Single Judge proceeded. By order dated 24 August 2018, the learned Single Judge appointed a Receiver for some of the disputed lands. 21. Against the order dated 24 August 2018 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ingly, Section 11 of CPC is not exhaustive of the general doctrine of res judicata. This doctrine is founded on equity, justice and good conscience. [Lal Chand (dead) by L.Rs. vs. Radha Krishan, (1977) 2 SCC 88]. This principle of finality of litigation is based on the high principle of public policy and even the rule of law. [Daryao and others vs. State of U. P. and others, AIR 1961 SC 1457]. In effect, the provision in Section 11 of CPC or the doctrine of res judicata says that once a matter is finally heard and decided between two parties, such a matter will not be allowed to be re-agitated amongst the same parties or the parties claiming under them. The earlier decision will be final with respect to the matter so decided. 26. The Hon'ble Supreme Court has held that the principle of res judicata would apply not only to two suits or proceedings but also to two different stages in the same suit or proceedings. The Court held that even if the strict parameters of Section 11 of CPC are not attracted, still, principles analogous to res judicata or estoppel would still apply. This position was made evident in Vijayabai and others vs. Shriram Tukaram and others (1999) 1 SCC 693, Y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sayed Md. B.E. Edr vs. Musa Dadabhai Ummer and others (2000) 3 SCC 350 . Here, the Court held that if the matter was in issue directly and substantially in a prior litigation and decided against a party, the decision would be res judicata in a subsequent proceeding. The expression directly and substantially must be contrasted with collaterally or incidentally . In paragraph 18, the Court referred to similar tests (Mulla, 15th Edition, p.104). The Court quoted the learned author: A matter in respect of which relief is claimed in an earlier suit can be said to be generally a matter directly and substantially in issue, but it does not mean that if the matter is one in respect of which no relief is sought it is not directly or substantially in issue. It may or may not be. The question arises as to what the test is for deciding into which category the case falls into. One test is that if the issue was necessary to be decided for adjudicating on the principal issue and was decided, it would have to be treated as directly and substantially in the issue. If the judgment was, in fact, based upon that decision, then it would be res judicata in a latter case. 31. The Court then held that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate Bench of this Court in Jet Airways (supra) was cited, the appellants argued that Jet Airways was an appeal concerning challenge to a final order disposing of proceedings for execution or enforcement of an arbitral award under Section 36 of the Arbitration Act. On that ground, the Jet Airways (supra) decision was sought to be distinguished. Now that the present appeals are against a similar order disposing of proceedings for execution or enforcement of an arbitral award under Section 36, the appellants urged that the judgment and order dated 9 August 2019 will not apply because the same concerned a challenge to an interim order. By this logic, the appellants cannot object to the applicability of the precedent in Jet Airways (supra) unless, of course, they wish to persist in approbation and reprobation. 35. In any event, this distinction based upon the impugned order in the appeal, being an interim order or a final order, was considered and rejected in the former proceedings. This is evident from paragraph 18 of the judgment and order dated 9 August 2019, which reads as follows: - 18. The Appellants have sought to get over this position by contending firstly that what was under c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... matter, the Hon'ble Supreme Court has altered the legal position with or without any retrospective effect since the earlier decision. Instead, as will be noticed hereafter, the view taken in Kandla Export Corporation (supra), which was relied upon in the judgment and order dated 9 August 2019, has been subsequently reiterated and followed in BGS SGS SOMA JV (supra) and Government of India vs. Vedanta Limited and others (supra). 39. Thus, we are satisfied that the matter of maintainability of appeals against judgments and orders made in proceedings for execution or enforcement of arbitral awards was directly and substantially in issue in the former proceedings, which came to be disposed of by judgment and order dated 9 August 2019. It is precisely the very same issue that is directly and substantially in issue in the present proceedings. Therefore, all the parameters necessary to attract the doctrine of res judicata, or in any event, the principles analogous to res judicata, are fully satisfied in these matters. None of the exceptions in Canara Bank vs. N. G. Subbaraya Setty and another (supra) apply. Based upon all these factors, we hold that the judgment and order dated 9 Aug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contrary stand to that taken earlier by the previous Bench. Of course, this constraint flows down to the lower judicial echelons or applies to coordinate Benches, but not appellate or higher fora [Ibid] . 43. Applying the law of the case doctrine as well, we hold that these appeals are not maintainable given the judgment and order dated 9 August 2019 in Commercial Appeal (L) No. 109 of 2019 and connected appeals. Since no arguments were advanced on this law of the case doctrine, we clarify that the invocation of this doctrine should not be taken as the basis for deciding the issue of maintainability of these appeals. Our reasoning rests on the principle of res judicata or principles analogous to res judicata upon which the counsel advanced exhaustive arguments. INDEPENDENT OF RES JUDICATA, WHETHER THESE APPEALS ARE MAINTAINABLE? 44. Even independent of the principle of res judicata, we are satisfied that these appeals are not maintainable simply because the proceedings for execution or enforcement of the arbitral award were not proceedings under the CPC or the CCA, but they were proceedings under the ACA. Accordingly, the issue of appealability of orders, whether interim or final, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iction should not be extended beyond its legitimate field. As such, an award rendered under the provisions of the Arbitration Act cannot be construed as a decree . 48. Mr Seervai s contention that the Respondents had themselves styled their execution applications as application for execution under Order XXI, Rule 11 (2) of the Code of Civil Procedure (Rule 313 of the Bombay High Court (Original Side) Rules) does not convert the proceedings for enforcement of an arbitral award under Section 36 to proceedings for execution under Order XXI of the CPC. The titles that the parties may provide are quite irrelevant. Such a title was perhaps used because, as explained by various decisions of the Hon ble Supreme Court and this Court, the Arbitration Act adopts the mechanism of execution from the CPC. 49. However, adopting the mechanism under the CPC does not convert the execution or enforcement proceedings under Section 36 of the Arbitration Act into proceedings under Order XXI of the CPC. Therefore, even if Respondents 1 and 2 may have referred to the provisions of Order XXI of the CPC or Rule 313 of the Bombay High Court (Original Side) Rules, that can make no difference to the character ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g to proceedings under the ACA is to be decided by reference to the ACA itself, which is an exhaustive and self-contained code and not by reference to the provisions of the CPC or the CCA. Only in so far as the forum of appeal is concerned would it be permissible to examine and apply the provisions of CPC and the CCA, but not to determine the appealability issue. 53. In Kandla (supra), the issue which arose for consideration of the Hon ble Supreme Court was whether any order made in proceedings for execution of a foreign arbitral award under Section 48 of the Arbitration Act was appealable under the CPC or the Commercial Courts Act, even though, Section 50 of the Arbitration Act did not provide for any appeal against such order. The Kandla Export Corporation, like the appellants in the present case, had argued that such an appeal was maintainable under the provisions of Section 13 of the Commercial Courts Act. Arguments almost similar to, if not identical to, those made by Mr. Chidambaram and Mr. Seervai in these appeals were advanced, supporting the maintainability of the appeal. However, the Hon ble Supreme Court, upon a detailed consideration of all such contentions, held that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... force, it is clear that Section 50 is a provision contained in a self-contained code on matters pertaining to arbitration, and which is exhaustive in nature. It carries the negative import mentioned in paragraph 89 of Fuerst Day Lawson that appeals which are not mentioned therein, are not permissible. This being the case, it is clear that Section 13 (1) of the Commercial Courts Act, being a general provision vis- -vis arbitration relating to appeals arising out of commercial disputes, would obviously not apply to cases covered by Section 50 of the Arbitration Act. 57. The Court also rejected Kandla Export Corporation s contention that while Section 37 of the ACA was expressly included in the proviso to Section 13 (1) of the CCA, no specific reference was made to Section 50 of the Arbitration and Conciliation Act, 1996, and this factor suggests that the legislature intended to restrict the proviso to Section 13 (1) to matters which concerned Section 37 of the ACA. This is evident from the observations in paragraphs 21 and 22, extracts from which read: One answer is that this was done ex abundanti cautela. Another answer may be that as Section 37 itself was amended by the Arbitration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equal partner, commercially speaking, in the international community. The raison d tre for enacting the CCA is that commercial disputes involving high amounts of money should be speedily decided. Given the objects of both the enactments, if an additional appeal were to be provided when Section 50 does away with an appeal to enforce expeditiously foreign awards, that would amount to turning the Arbitration Act and the Commercial Courts Act on their heads. 61. The Court held that Section 13 (1) of the CCA must be construed in accordance with the object sought to be achieved by the Act. Therefore, any construction of Section 13 of the CCA, which would lead to further delay instead of expeditious enforcement of the foreign award, must be eschewed. Even on applying the doctrine of harmonious construction of both statutes, the Court held that it was clear that they are best harmonised by giving effect to the special statute, i.e. the ACA, vis- -vis the more general statute, the CCA, being left to operate in spheres other than arbitration. Thus, Kandla Export Corporation (supra) provides a complete answer to almost all the contentions raised by Mr P. Chidambaram and Mr Seervai in support ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ise question that arose in Kandla (supra) was as to whether an appeal, which was not maintainable under Section 50 of the ACA, was nonetheless maintainable under Section 13 (1) of the CCA. In this context, after setting out various provisions of the CCA and the ACA, the Court held that there was no independent right of appeal under Section 13 (1) of the CCA, which merely provides a forum for filing appeals. The parameters of Section 37 of the ACA alone must be examined to determine whether the appeals were maintainable. The Court then referred to Section 37(1), which had made it clear that the appeal shall only lie from the orders set out in sub-clauses (a), (b) and (c) and from no others. 67. The argument in the context of the proviso to Section 13 (1A) of the Commercial Courts Act and Order XLIII of CPC was also considered in BGS SGS SOMA JV (supra) in paragraph 14. The Court held that interestingly, under the proviso to Section 13 (1A) of the CCA, Order XLIII of CPC is also mentioned. After quoting Order XLIII Rule 1(a) the Court held that this provision was conspicuous by its absence in Section 37 of the ACA, which alone can be looked at for the purpose of filing appeals agains ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tated in Arun Dev Upadhyaya (supra). The Court also referred to Kandla (supra). Finally, it held that given the categorical judgments of the Supreme Court, Jindal s appeal to the Division Bench (Appeal No. 492 of 2006) challenging the order rejecting its objection to enforcement of the award was not maintainable. 71. Finally, even in Government of India vs. Vedanta Limited and others (supra), the Hon ble Supreme Court held that applications under Sections 47 and 49 for enforcement of foreign awards are substantive Petitions filed under the ACA. The Court held that it was well-settled that the ACA was a self-contained code. The application under Section 47 of the ACA was not an application filed under any of the provisions of Order XXI of CPC, 1908. The application was filed before the appropriate High Court for enforcement, which would take recourse to the provisions of Order XXI of CPC only for the purposes of execution of the foreign award as a deemed decree. Therefore, the bar contending Section 5 of the Limitation Act, which excludes an application filed under any of the provisions of Order XXI of CPC, would not apply to a substantive petition filed under the ACA. Consequently, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate Bench of this Court, in the case of Shailendra Bhadauria and others (supra) , has expressly held that the earlier view in Hubtown Limited (supra) and Sigmarq Technologies (supra) will have to give way and all the more after the judgments of the Hon ble Supreme Court delivered in the case of Fuerst Day Lawson Limited v. Jindal Exports Limited and the authoritative and binding pronouncement in the case of Kandla Export Corporation (supra). The statute has to confer a right of appeal. That has to be conferred in clear words. We cannot, as suggested by Mr Andhyarujina, by an interpretative process carve out a right of appeal, when the law is not creating it. 76. Thus, the Coordinate Bench, in Shailendra Bhadauria and others (supra) upheld that the preliminary objection regarding maintainability of appeals against an order made by the learned Single Judge by this Court in an application for execution/enforcement of an arbitral award, inter alia on the ground that such an appeal was not maintainable under Section 37 of the ACA, and therefore, by tortious interpretation of the provisions of the CCA or the CPC, right of appeal against such orders could not be carved out by the Court. 7 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Judge of this Court, cannot be granted as prayed for. COSTS AND CONCLUSIONS 81. In these matters, we cannot but resist noting that the disputes between the parties culminated in a reference to the Arbitral Tribunal. A consent award dated 14 July 2014 disposed of the arbitral proceedings. Since the appellants failed to honour their undertakings and pay the awarded amounts, the first and second Respondents were forced to file proceedings to enforce the arbitral/consent award dated 14 July 2014. Even these execution/enforcement proceedings were disposed of by consent order dated 22 February 2018, which gave further concessions to the appellants. Instead of honouring the consent order dated 22 February 2018, the appellants instituted these appeals, which we now find were not maintainable. 82. Thus, the appellants are determined not to pay the first and second Respondents under the consent award dated 14 July 2014 and the consent order dated 22 February 2018. Considerable judicial time has been spent dealing with almost identical arguments on the issue of maintainability in Commercial Appeal (L) No. 109 of 2019 and connected matters and the present appeals. This is at the cost of severa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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