Constructions Pvt. Ltd Vs. Sri Ram Badan Singh & Ors  Insc 1020 (9 October 2007)
Chatterjee & P. Sathasivam
out of SLP (C) No. 15858 OF 2006) P. Sathasivam, J.
This appeal is directed against the judgment dated 19.07.2006 passed by the
High Court of Jharkhand at Ranchi in C.R. No.65 of 2006 whereby the learned
single Judge dismissed the Civil Revision filed by the appellant herein against
the order dated 28.06.2006 passed by the Subordinate Judge-I, Bokaro in
Execution Case No. 2 of 2001 rejecting the appellants prayer for
adjustment of the cross-award under the provisions of Order XXI Rules 18 and 19
of the Code of Civil Procedure.
only question, inter alia, arises in this appeal is whether the provisions of
Order XXI Rules 18 and 19 of the C.P.C. are applicable in case of adjustment of
the cross- award as claimed by the appellant herein?
appellant entered into a partnership with the respondents and a partnership
deed was executed on 14.04.1992. The purpose of the partnership was for
completion of certain contract work which the appellant had obtained. One of
the terms of the agreement provided for arbitration, i.e., - that if there
be any dispute among the partners, the same can be referred to the
Arbitrator/Arbitrators as appointed by the partners who would decide the names
in accordance with the provisions of the Indian Arbitration Act, if not
otherwise settled by the partners with mutual consent.
the disputes which arose in the year 1995 among the partners could not be
settled by mutual agreement and the work could not be completed, the partners,
by mutual consent, appointed four persons as Arbitrators. On 19.04.1997, the
Arbitrators, after hearing both the parties, submitted their award. There is no
specific reference whether the award is an interim award or a final award.
to the appellant, the award dated 19.04.1997 was acted upon by the parties and
was never challenged by any of them. Thereafter, the Arbitrators passed various
not in dispute that none of those awards passed after 19.4.1997 was ever
challenged by any of the parties.
on 25.11.2000, the Arbitrators passed an award.
to the appellant, in this award, it was not stated that whether the issues
covered by the earlier awards and especially the award dated 19.4.1997 are to
be merged in the final award.
appellant herein, being aggrieved by the award dated 25.11.2000, filed an
application under Section 34 of the Arbitration and Conciliation Act, 1996
(hereinafter referred to as the Act). The respondents filed Execution Case
No. 2 of 2001 for enforcement of the Award dated 25.11.2000. By order dated
27.6.2003, the application filed by the appellant under Section 34 of the Act was
dismissed by the learned subordinate Judge. On 1.7.2003, the appellant herein
filed Execution Case No. 5 of 2003 for enforcement of the award dated
19.4.1997. Against the dismissal of the application filed under Section 34 of
the Act, on 26.8.2003, the appellant filed an Arbitration Appeal No. 6 of 2001
before the High Court of Jharkhand at Ranchi. By order dated 29.4.2004, the High Court dismissed the said appeal.
The special leave petition against the said order was also dismissed by this
Court on 10.1.2005 with a modification as to the rate of interest.
respondents filed an objection under Section 47 of the C.P.C. in Execution Case
No.5 of 2003. The said objection was numbered as Misc. Case No. 7 of 2005. The
case of the respondents before the Executing Court was that the so-called award of 19.04.1997 was nothing but
a provisional direction of the Arbitrators for successful completion of the job
and it cannot be treated as an interim award and was not enforceable as an
arbitral award. All the directions given in the award dated 19.04.1997 have
merged in the award dated 25.11.2000. After hearing both the parties, the Executing Court by order dated 27.5.2005 dismissed
Misc. Case No. 7 of 2005 holding that the interim award was not executable.
Aggrieved by the same, respondent No.1 herein preferred C.R.No. 75 of 2005.
the Civil Revision stands admitted but no stay of execution has been granted
till date. Thereafter, the appellant filed an application under Order XXI Rules
18 and 19 of the C.P.C. read with Section 36 of the Act in Execution Case No. 2
of 2001 for adjustment of the amount and for recording of full satisfaction of
the amount. By order dated 28.6.2006, the executing Court, after finding that
the question of cross-decree under Order XXI Rules 18 and 19 is not
maintainable, rejected the said application.
the said order, the appellant preferred C.R.No. 65 of 2006 before the High
Court of Jharkhand at Ranchi. By the impugned order dated
19.07.2006, the High Court dismissed the Revision. Hence, the present appeal by
way of special leave has been filed before this Court.
have heard Dr. R.G. Padia, learned senior counsel, appearing for the appellant
and Mr. Bhaskar P. Gupta, learned senior counsel, appearing for the respondents.
Though the learned senior counsel appearing on either side, made elaborate
submissions as to awards dated 19.4.1997 and 25.11.2000 and applicability of
Order XXI Rules 18 and 19 of C.P.C., in the light of the order to be passed
hereunder, we are of the view that there is no need to traverse the same.
However, in order to understand the rival claim, it is useful to refer Order
XXI Rules 18 and 19 which read as under:
18. Execution in case of cross-decrees-
Where applications are made to a Court for the execution of cross-decrees in
separate suits for the payment of two sums of money passed between the same
parties and capable of execution at the same time by such Court, then
the two sums are equal, satisfaction shall be entered upon both decrees; and
the two sums are unequal execution may be taken out only by the holder of the
decree for the larger sum and for so much only as remains after deducting the
smaller sum, and satisfaction for the smaller sum shall be entered on the
decree for the larger sum as well as satisfaction on the decree for the smaller
19. Execution in case of cross-claims under same decree Where application is
made to a Court for the execution of a decree under which two parties are
entitled to recover sums of money from each other, then
the two sums are equal, satisfaction for both shall be entered upon the decree;
the two sums are unequal, execution may be taken out only by the party entitled
to the larger sum and for so much only as remains after deducting the smaller
sum, and satisfaction for the smaller sum shall be entered upon the
decree. Both the learned senior counsel fairly admitted that Rule 18 is
not applicable to the case on hand. From a bare reading of the Rules, extracted
supra, it is clear that Rule 18 is applicable in the case where the
applications are made to the Court for execution of the cross-decrees in
separate suits for payment of two sums of money passed between the same parties
and Rule 19 is applicable in the case where the application is made to the
Court for the execution of a decree under which two parties are entitled to
recover sums of money. As rightly observed by the High Court, in the case on
hand, neither the application has been made for execution of cross-decrees in
separate suits for the payment of money in between the parties nor the
application is for execution of a decree in which the parties are entitled to
recover sums of money from each other. In our opinion, in the instant case, the
particulars furnished clearly show that the applications were in respect of two
awards in the same arbitration case and as such the provisions of Rules 18 and
19 of Order XXI of C.P.C. are not applicable. It is also relevant to mention
that in the Objection Petition under Section 34 of the Act the issue regarding
interim award and final award came up for consideration before the subordinate
Court, Bokaro. The said objection petition was dismissed on 27.6.2003 and the
appeal preferred also met the same result at the hands of the High Court of Jharkhand.
This Court also confirmed the order of the High Court except in the rate of
interest. In the light of these materials and earlier orders including this
Court and various clauses in the awards dated 19.04.1997 and 25.11.2000,
learned subordinate Judge rejected the petition filed by the appellant herein.
The High Court by the impugned order accepted the said factual conclusion and
dismissed the Revision.
view of the conclusion based on the factual details furnished in both the
execution cases while agreeing with the said conclusion of the Courts below, we
are of the view that there is no need to refer various decisions relied on by
both the parties. On the other hand, we are in agreement with the said
the light of the above discussion, the appeal fails and the same is dismissed.
There shall be no order as to costs.