Union Of India And Others vs Vipin Khanna

Caveat No. 384/2019

Caveat stands discharged.

OWP No. 166/2019, IA No. 01/2019 (Oral)

The present petition has been filed under section 104 of the Constitution of Jammu and Kashmir read with Article 227 of the Constitution of India, challenging the order dated 01.01.2019 passed by the Court of learned 2nd Additional District Judge, Jammu, whereby the Court below has, in the proceedings pending before it with reference to the execution of an interim award, issued a direction to the petitioners to ensure implementation of the award or furnish their operative accounts heads, failing which, it has been ordered that appropriate proceedings would be initiated against the officers of the petitioners, who would then be committed to civil imprisonment.

The only challenge to the order impugned is that the execution proceedings itself are non-est in the eyes of law inasmuch as the interim award has not been made a rule of the Court. It was urged that since the arbitration proceedings were being conducted, under the Jammu and Kashmir Arbitration and Conciliation Act, Svt. 2002 (1945 A.D.) (for short, the old Act), any interim award passed in terms of the old Act was first to be made a rule of the Court, whereafter alone the execution proceedings could be permitted. It was urged that in the present case, the execution proceedings had been directed without adopting the procedure so prescribed under the old Act.

With a view to buttress and support of his case, reliance was placed on the application seeking reference under section 20 of the old Act filed by the claimant-respondent herein.

On a perusal of the application filed first in the year, 1998 which was numbered as AA No. 69/1998, it can be seen that the petition was one purported to be filed under section 20 of the Arbitration Act for directing the respondents to file the original agreement before the court and for appointment of an arbitrator.

It appears that a Co-ordinate Bench of this Court vide judgment and order dated 03.03.2000 rejected the prayer of the claimant-respondent for appointment of an independent Arbitrator, but nevertheless referred the disputes for adjudication in accordance with the procedure prescribed in the agreement. The order of the Court, however, did not make any specific reference to the old Act.

In the second round of litigation, it appears that since the nominated arbitrator had not entered upon the reference, a petition under Sections 5, 8, 11 and 20(4) of the Arbitration Act was filed for appointment of an independent arbitrator yet again. The said application was also filed in terms of the old Act and was disposed of vide order and judgment dated 09.03.2004 with certain directions. However, the claimant filed yet another petition seeking appointment of an independent Arbitrator which was registered as AA No. 06/2004 and was allowed by a Co-ordinate Bench of this Court vide judgment and order dated 13.12.2013 whereby Hon'ble Mr. Justice, O. P. Sharma (Retd.) was appointed as independent Arbitrator.

Learned counsel for the petitioners vehemently urged that not only the applications which were filed by the claimant seeking reference of the disputes were filed in terms of the old Act, but even the Arbitrator had entered upon the reference, exercising his powers under the old Act. In those circumstances, it was stated that the entire proceedings which included the reference were to be governed under the old Act, which necessitated the interim award to be made a rule of the Court first, before the same could be put to execution in execution proceedings. The argument, however, attractive it may appear in the first blush is legally untenable for the simple reason that reference of the disputes in the present case is in regard to a contract which was executed between the claimant and the petitioners herein in the year, 1998. By that time, the Jammu and Kashmir Arbitration and Reconciliation Act, 1997 (for short the, new Act) had already been promulgated in the State of Jammu and Kashmir and by virtue of section 68 of the new Act, the old Act stood repealed.

Notwithstanding the fact that the claimant-respondent in the petition seeking reference of disputes filed in the year 1998, had erroneously referred the provisions of section 20 of the repealed Act, yet for all practical purposes, the order of reference of disputes must be one deemed to have been issued in the year 1997 in terms of the provisions of the new Act.

Learned counsel for the petitioners, however, tried to emphasize that section 68 sub clause 2 (a) of the new Act would protect the proceedings initiated notwithstanding the repealing of the old Act. However, on a perusal of the said provisions, it becomes clear that only such proceedings, which stood already commenced before the new Act came into force, could be protected with the agreement of the parties.

In that view of the matter, in my opinion, the argument that the interim award ought to have been first made a rule of the court under the old Act legally unsustainable and is accordingly rejected.

Notwithstanding the above, it appears that the executing court below is exercising powers in terms of the Rule 30 of the Order 21. Under the said provision, the executing court has the power to satisfy the decree by attachment and sale of the properties of the judgment debtor or by ordering detention in the civil prison or by both. On a perusal of the order impugned it appears that two senior officers of the Indian Army have been informed that they satisfy the award dated 30.04.2015 or furnish their accounts heads failing which it has been made clear that they would be committed to civil prison.

While the power to convict a judgment debtor in execution proceedings to civil prison certainly vests in the executing court, yet the said power has to be exercised only if all other attempts to execute the decree fail.

Considering the fact that the officers are very senior level officers of the Indian Army which has a vital role in maintaining the unity and integrity of the country and lest such an order has a demoralizing effect on the Force, in my opinion the power of commitment to civil prison should be exercised as a last option.

It is, therefore, ordered that the court below shall not use any coercive process in the nature of commitment to civil prison for a period of two months within which period the amount under execution be satisfied.

Disposed of accordingly.