Supreme Court of India

BHAWARLAL BHANDARIversusM/S UNIVERSAL HEAVY MECHANICAL LIFTING ENTERPRISES

Citation: 1998 INSC 461
Decided: 4 December 1998
Disposal: Appeal(s) allowed
Bench: S B MAJMUDAR

Holding

An executing court cannot go behind a decree unless it is a nullity due to lack of jurisdiction; a decree passed beyond the limitation period is not a nullity and the High Court’s remand was unwarranted.

Summary

The appellant Bhandari had given a short‑term loan of Rs 15 lakh to the respondent Heavy Mechanical Lifting Enterprises. A dispute over interest and repayment was referred to arbitration; the arbitrator passed an award on 17‑Apr‑1985 and, after a four‑year delay, filed it in the Calcutta High Court on 23‑Mar‑1989 to be made a rule of court. No objection was filed under Section 30 of the Arbitration Act, 1940, and an ex‑parte decree was passed on 2‑Jun‑1989. When execution was sought, the respondent contended that the decree was a nullity because the award was filed beyond the limitation period. The executing court rejected the objection, but the High Court Division Bench remanded the matter for re‑examination. The Supreme Court held that an executing court cannot go behind a decree unless it is a nullity due to lack of jurisdiction; a decree passed beyond the limitation period is merely erroneous and can be corrected only on appeal. Consequently, the High Court’s remand was unjustified, the appeals were allowed, and the Single Judge’s decree was confirmed.

Issues considered

Whether the award decree dated 2‑June‑1989 is a nullity on the ground that it was filed beyond the period of limitation.
Whether the executing court has jurisdiction to go behind the decree and examine the limitation issue.
Whether the Supreme Court should interfere with the High Court’s remand order under Article 136 of the Constitution.

Legislation cited

Subjects

Arbitration awardDecree executionLimitation periodJurisdiction of executing courtSection 47 CPCSection 30 Arbitration ActArticle 136 ConstitutionNullity of decreeMixed question of law and fact

Judgment

BHA WARLAL BHANDARI A
v.
MIS UNIV_ERSAL HEAVY MECHANICAL LIFTING ENTERPRISES

DECEMBER 4, 1998

[S.B. MAJMUDAR AND M. JAGANNADHA RAO, JJ.]

- Civil Procedure Code, 1908-Section 47-Jurisdiction of executing
court to go beyond the decree-Repayment of loan-Dispute-Arbitration--
Award-Execution proceedings-Objection that decree a nullity as award
was passed beyond the period of limitation-Objection overruled by executing C
court-However, Division Bench of High Court remanding the matter for re-
examination-On appeal, held, executing court cannot go beyond the decree
unless it is passed by a court without jurisdiction-Decree passed beyond the
period of limitation can be corrected in appellate proceedings-Thus High
Court not justified in remanding the matter to execution court. D
Constitution of India, I 950-Article 136-Special leave jurisdiction--
Interference under-Principles of equity-Applicability of

- The appellant granted a short term loan to the respondent firm. A
dispute arose between the parties regarding the quantum of interest and the E
time for repayment of loan. The dispute was referred to arbitration. The
arbitrator after hearing the parties passed an award on 17.4.1985. First
instalment as per award was paid by the respondent. The arbitrator filed the
award in the Court on 23.3.1989 for making it a rule of the Court. Though
notice was served, the respondent did not file any objection to the award.
Thus, an ex-parte order was passed by the Court making the award rule of F
the Court. On non-compliance of award decree, execution proceedings were
initiated by the appellant. In the said proceedings, the respondent- judgment
debtor raised an objection that the decree was a nullity as the award was filed
by the arbitrator suo motu in the court after four years which was beyond
the period of limitation. The objections were overruled by the executing G
court. However, on appeal, Division Bench of the High Court held that the
question required re-examination by the executing court and remanded the
proceedings. Aggrieved, the appellant has preferred the present appeal.

The appellant contended that executing court had no jurisdiction to go
behind the decree, that the question of law and fact and even assuming that H
. 331
332 SUPREME COURT REPORTS (1998] SUPP. 3 S.C.R.

A it was wrongly decided by the court passing the decree in terms of the award,
that would not make the decree a nullity or without jurisdiction and hence
the remand order passed by the Division Bench of the High Court was

B
clearly unsustainable and amounted to usurpation of jurisdiction which in
execution proceedings the court had not got.

The contention of the respondent-judgment debtor was that after the
-
arbitration proceedings were over no attempt was made by the appeUant to
get the award made rule of the court and after 4 years the arbitrator filed ....
the award only at the instance of the appellant and such late filing of award
by the arbitrator could not have been made the subject matter of proceedings
c before the court which was clearly time barred and hence the award decree
was a nullity; appellant had obtained a mock award by committing fraud on
respondent as well as on the Court; in exercise of its jurisdiction under
Article 136 of the Constitution this Court may not interfere with th1e order
passed by the Division Bench of High Court which is a remand order and
which meets the ends of justice inasmuch as the correct legal positiion can
D be found out by the trial court after remand.

Allowing the appeals, this Court
......
HELD : I.I. The executing court cannot go behind the decree unless
it is shown that it was passed by a court having inherent lack of jurisdiction,
E which would make it a nullity. [338-A)

1.2. In the instant case the award decree on the face of it was not shown
to be without jurisdiction. Thus, the High Court was not justified in remanding
the matter to the execution court for consideration. [339-B; 340-D)

F 2. The award was filed in the Court by the arbitrator and the court
proceeded to deal with the question whether the award should be made rule
of the Court or not. Notice was issued by the Court to the respondent to show
cause as to why this award should not be made rule of the Court. Despite
such service of notice, respondent did not think it fit to contest the proc1~ings
nor did it file any objection under Section 30 of the Arbitration Act, 1940.
G
In the result, the Court passed an award decree on account of absence of any ......
contest by the judgment debtor. It is true that this award decree was sought ·
to be executed years thereafter. But the said delay on the part of the decree-
holder in executing the decree within the permissible period for limitation
in execution of such decree cannot give any sustainable right to the judgment-
H debtor to challenge the execution proceeding on that ground. (337-C-D-E)
B. BHANDARI v. UNI. HEAVY MECH. LIFTING ENTERP. 333
3. The question whether the award decree was filed by the arbitrator A
on his own or not was a mixed question of law and fact. The Division Bench
of the High Court in the impugned judgment itself has noted that if the award
was filed by the arbitrator suo motu then the award decree cannot be said
to be barred by limitation, but if, on the other hand, the award was filed by
the arbitrator at the instance of the appellant-decreeholder then the question B
of limitation would arise. The aforesaid observation of the Division Bench
itself indicates that this is a mixed question of law and fact. That was an issue
to be raised before the award was made a rule of Court. But. such a plea can
never make the decree a nullity especially when the respondent for reasons
best known to it did not think it fit to file objections under Section 30 of the
Arbitration Act, 1940. Even if the decree was passed beyond the period of C
limitation, it would be an error of law or at the highest a wrong decision
which can be corrected in appellate proceeding and not by the executing
court which was bound by such decree. (337-F-G-H; 338-A; 339-B-C(

Vasudev Dhanjibltai Modi v. Rajabhai Abdul Rehman and Ors., (1971]
1~6~h~appl~b~ D
Patel Motibhai Naranbhai and Anr. v. Dinubhai Motibhai Patel &
Ors., (1996] 2 SCC 585, distinguished.

lttavira Mathai v. Varkey Varkey and Anr., (1964] 1SCR495, referred
to. E
4. There is no equity in favour of respondent requiring non-interference
under Article 136 of the Constitution. In the instant case it cannot be stated
that fraud was committed on the respondent by the decree holder or that
there was any equity in favour of the judgment debtor in not complying with
the terms of the award decree or that the execution of the said award decree F
would result in injustice to the respondent. It is a fact that the respondent-
judgment debtor had taken a loan of Rs. 15 lacs from the appellant which
was supported by a promissory note. A dispute regarding quantum of interest
and the time for repayment of loan was referred to arbitrator. In the
proceedings before the arbitrator the respondent's partner appeared and G
after hearing him, the award was passed. The partners of the respondent
firm were aware of the instalments granted by the sole arbitrator almost by
the same time the award was passed. Under these circumstances, it is
difficult to appreciate how the arbitration proceeding was a mock proceeding
or that any fraud was committed on the respondent or the Court when the
award decree came to be passed. Under law and also in equity the appellant H
334 SUPREME COURT REPORTS [1998] SUPP. 3 S.C.R.

A decree holder is entitled to get the fruits of his award decree especially when
despite the award granting instalments and interest at 24 per cent per
annum, the award decree grants interest only 8% per annum from the date.
of the decree till realisation. [341-G; F-H; 342-A-B)

CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 6067-6068
B of 1998.

From the Judgment and Order dated 10.2.98 of the Calcutta High Court
in G.A.No. 65/98 in A.P.O.T. No 23/98 in a A.C. No. 220/89 and G.A. No. 66/
98 in A.P.O.T. No. 24/98 in A.C. No. 220of1989.

C S.K. Kapoor, Dipale Dey, Ms. Rana Mukherjee and Ms. Sumita Mukherjee
for the Appellant.

S.S. Javali, Braj K. Mishra, Subir Ranjan and Ejaz Maqbool for the
Respondent.

D The Judgment of the Court was delivered by

S.B. MAJMUDAR, J. Leave granted in both these Special Leave P~titions.

By consent of learned counsel for the parties, these appeals were finally
heard and are being disposed of by this judgment.
E
A few relevant facts leading to these appeals may be stated at the
outset.

The common appellant as the decree holder got an award decree on
2.6,.1989 from the court of learned Single Judge of the High Court of Judicature
F at Calcutta. The said decree was sought to be executed. At that stage, the
respondent-judgment debtor filed objections under Section 47 of the Code of
Civil Procedure contending that the decree was a nullity as it was barred by
limitation. The objections were overruled by the executing court which resulted
in two proceedings by the respondent-judgment debtor before the Division
G Bench of the High Court. Both the proceedings were disposed of by the
impugned common judgment. The Division Bench of the High Court held that
the question of limitation regarding passing of the award decree was required
to be examined by the executing court and consequently, passed a remand
order directing learned Single Judge to decide the matter afresh. The impugned ·
judgment also observed that the learned Single Judge should decide whether
H the arbitrator had filed the award suo motu or at the instance of the award
B. BHANDARI v.UNL HEAVY MECH. LIFTING ENTERP. [S.B. MAJMUDAR, J.] 335

holder in the light of the decision of this Court in the case of Patel Motibhai A
Naranbhai and Anr. v. Dinubhai Motibhai Patel and Ors., reported in [1996]
2 sec 585 and other case law.

In order to appreciate the grievance of the decree-holder appellant in
these appeals, it is necessary to look at relevant background facts. The B
appellant is said to have granted a short-term loan of Rs. 15 lacs to the
respondent on 9.1.1985. The contention of the appellant was that the loan was
to be repaid within two months with 24 per cent interest on the principal
amount. The respondent disputed the said claim of the appellant and contended
that the loan amount was payable after two years and the interest rate was
also not 24 per cent. This dispute was referred to the arbitration of a sole C
arbitrator who after hearing the parties, passed an award on 17.4.1985. It is
the case of the appellant that as per the instalments granted in the award the
first instalment of Rs. 2 lacs was paid by the respondent-judgment debtor but
thereafter it defaulted. It is pertinent to note that before the award was made
the rule of the Court, the first instalment as per the award was paid by the D
respondent. It appears that the award was filed by the arbitrator in the Court
on 23.3.1989 for making it a rule of the Court. It is also to be noted that though
the notice dated 6.4.1989 as to the filing of the award was served by the court
to the respondent-judgment debtor on 10.4.1989, it did not file any objections
to the award under Section 30 of the Arbitration Act, 1940. It also appears
that the respondent did not choose to contest the proceedings. Ultimately, E
the court passed an ex parte order making the award rule of the Court on
2.6.1989. Thereafter, when the award decree was not complied with by the
respondent execution proceedings were initiated by the appellant. In the
. execution proceedings the respondent-judgment debtor raised a contention
by filing an application under Section 47 of the Code of Civil Procedure that F
the decree was not executable and was a nullity on the ground that the
arbitrator had no power or jurisdiction to file the award suo motu in the court
after four years and hence the award decree could not have been passed as
the award was filed beyond the prescribed period. The executing court after
hearing the parties overruled the objections by holding that such a contention G
could not be raised in execution proceedings. As noted earlier, the respondent-
judgment debtor carried the matter in appeal and in appeal the Division Bench
of the High Court took the view that the question was required to be re-
examined by the executing court and hence remanded the proceedings. That
is how the appellant is before us on grant of special leave under Article 136
of the Constitution of India. H
336 SUPREME COURT REPORTS [1998] SUPP. 3 S.C.R.

A Shri Kapoor, learned senior counsel for the appellant vehemently
contended that the executing court had no jurisdiction to go behind the
decree, that the question of limitation was a mixed question of law and fact
and even assuming that it was wrongly decided by the court passing the
decree in terms of the award such a contention would not make the decree
B a nullity of without jurisdiction and hence the remand order passed by the
Division Bench of the High Court was clearly unsustainable and amounted
to usurpation of jurisdiction which in execution proceedings, the court had
not got. Reliance was placed on judgments of this Court in support of this
contention which we will refer to hereafter.

C Shri Javali, learned senior counsel for the respondent-judgment debtor
on the other hand submitted that the award and decree in question appeared
to have been obtained in a very curious and surreptitious manner by the
appellant, that the dispute was raised within two months of advancement of
loan and within a few days the entire arbitration proceedings were over, that
thereafter curiously enough no attempt was made by the appellant to get the
D award made rule of the court and years rolled by, and when after 4 years the
arbitrator was made to file the award, that attempt would naturally be at the
instance of the appellant, that such late filing of the award by the arbitrator
could not have been made the subject matter of proceedings before the court
for passing decree in terms thereof and that the proceedings were clearly time
E barred and hence the award decree was a nullity. It was also submitted that
even after the award decree of 2.6.1989 the execution proceedings were also
filed belatedly and that also indicated that the appellant had obtained a mock
award and it was a result of the fraud committed by the appellant on the
respondent as well as on the. Court in snatching such an ex parte award
decree. It was lastly submitted that looking to the facts and circumstances of
F this case, in exercise of its jurisdiction under Article 136 of the Constitution
of India, this Court may not interfere with the order passed by the Division
Bench of the High Court which is a remand order and which meets the ends
of justice inasmuch as the correct legal position can be found out by the trial
court after remand. In support of this contention strong reliance was placed
on a decision of this Court in the case of Patel Motibhai Naranbhai & Anr.
G
(Supra) which, according to Shri Javali, learned senior counsel for the
respondent was rightly pressed in service by the Division Bench of the High
Court.

In view of the aforesaid rival contentions, the following points arise for
H our consideration : -
B. BHANDARI v.UNI. HEAVY MECH. LIFTING ENTERP. [S.B. MAJ.MUDAR, J.] 337
(i) Whether the award decree dated 2.6.1989 was a nullity being A
barred by limitation.

(ii) Whether the executing Court can go behirid such a decree.

(iii) Whether any interference under Article 136 of the Constitution
is called for.
B
Having given our anxious consideration to the rival contentions, we
find that none of the aforesaid points for determination can be sustained in
favour of the respondent-judgment debtor. The reasons are obvious.

Point Nos. (i) & (ii) :

The award dated 17.4.1985 was filed in the court on 23.3.1989 by the
c
arbitrator and the court proceeded to deal with the question whether the
award should be made rule of the court or not. Notice was issued by the court
to the respondent to show cause as to why this award should not be made
rule of the court. There is no dispute that this notice was served on the
respondent. Despite such service of notice, for reasons best known to the D
respondent, it did not think it fit to contest the proceedings nor did it file any
objection under Section 30 of the Arbitration Act, 1940. In the result, the court
passed an award decree on 2.6.1989 on account of absence of any contest
by the judgment debtor. It is true that this award decree was sought to be
executed years thereafter. But the said delay on the part of the decree holder E
in executing the decree within the permissible period for limitation in execution
of such decree cannot give any sustainable right to the judgment-debtor to
challenge the execution proceedings on that ground. The contention of shri
Javali, learned senior counsel for the respondent that the award was mock one
and was not intended to be enforced can not be sustained as that stage has
gone for the respondent. In execution proceedings such a contention requiring F
the executing court to go behind the decree cannot be sustained. The question
whether the award decree was filed by the arbitrator on his own or not was
a mixed question of law and fact. The Division Bench in the impugned
judgment itself has noted that if the award was filed by the arbitrator suo
motu then the award decree cannot be said to be barred by limitation but if, G
on the other hand, the award was filed by the arbitrator at the instance of the
appellant-decreeholder then the question of limitation would arise. The
aforesaid observation of the Division Bench itself indicates that this is a
mixed question of law and fact. That was an issue to be raised before the
award was made a rule of Court. But such plea can never make the decree
a nullity especially when the respondent for reasons best known to it did not H
338 SUPREME COURT REPORTS [1998] SUPP. 3 S.C.R.

A think it fit to file objections under Section 30 of the Arbitration Act, 1940. It
is well settled that the executing court cannot go behind the decree unless
it is shown that it is passed by a court having inherent lack of jurisdiction,
which would make it a nullity. In the case of Jttavira Mathai v. Varkey Varkey
and Anr., Reported in (1964] I SCR 495, a Bench of four learned Judges of
B this Court speaking through Mudholkar, J. observed that when the question
of limitation was not raised before the trial court or before the High Court it
could not be raised for the first time before this Court even in the hierarchy
of proceedings arising from the suit when such question of limitation raised
before the Court was not pure question of law but was a mixed question of
law and fact. In the case of Vasudev Dhanjibhai Modi v. Rajabhai Abdul
C Rehman & Ors., reported in [ 1971] I SCR 66, J.C. Shah, J. speaking for a three
Judge Bench of this Court made the following pertinent observation in
connection with the jurisdiction of the executing court, when called upon to
execute the decree and on the question as to under what circumstances the
executing court can go behind the decree sought to be executed. The
D observation at page 68 of the report deserves to be extracted in extenso.

"A Court executing a decree cannot go behind the decree
between the parties or their representatives it must take the decree
according to its tenor, and cannot entertain any objection that the
decree was incorrect in law or on facts. Until it is set aside by an
E appropriate proceeding in appeal or revision, a decree even if it be
erroneous is still binding between the parties.

When a decree which is a nullity, for instance, where it is passed
without bringing the legal representatives on the record of a person
who was dead at the date of the decree, or against a ruling prince
F without a certificate, is sought to be executed an objection in that
behalf may be raised in a proceeding for execution. Again, when the
decree is made by a Court which has no inherent jurisdiction to make
it, objection as to its validity m::iy be raised in an execution proceeding
if the objection appears on the face of the record : where the objection
G 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. In Jnanendra Mohan Bhaduri & Anr. v.
H Rabindra Nt:!:h Chakravarti, the Judicial Committee held that where
B. BHANDARI v.UNI. HEAVY MECH. LIFTING ENTERP. [S.B. MAJMUDAR, J.] 339
a decree was passed upon an award made under the provisions of the A
Indian Arbitration Act, 1899, an objection in the course of the
execution proceeding that the decree was made without jurisdiction,
since under the Indian Arbitration Act, 1899, there is no provision for
making a decree upon an award, was competent. That was a case in
which the decree was on the face of the record without jurisdiction," B
The aforesaid decision of this Court squarely applies to the facts of the
present case. This is not a case in which the award decree on the face of it
was shown to be without jurisdiction. Even if the decree was passed beyond
the period of limitation, it would be an error of law or at the highest a wrong
decision which can be corrected in appellate proceeding and not by the C
executing court which was bound by such decree. It is not the case of the
respondent that the court which passed the decree was lacking inherent
jurisdiction to pass such a decree. This becomes all the more so when the
respondent did not think it fit to file objection against the award which was
sought to be made rule of the court.
D
· The decision of this Court on which the Division Bench in the impugned
judgment relied upon cannot be of any assistance to Shri Javali, learned
senior counsel for the respondent-judgment debtor. In the case of Patel
Motibhai Naranbhai & Anr., (Supra), this court was concerned with the
award decree which itself was sought to be challenged in appeal before this
Court in the hierarchy of proceedings meaning thereby the legality of the E
award decree itself was on the anvil of scrutiny before this Court. In the facts
of that case, it was found that the award was passed by the arbitrator on
26.2.1986. It was sought to be made rule of the court by the arbitrator's filing
the award in the court 6 years thereafter in 1992 and that too at the instance
of one of the parties to the award in whose favour the award was passed.
F
On these peculiar facts ~f the case it was held as under :-

"Under sub-section (2) of Section 14, a duty is cast upon the Arbitrator
to file the award or cause the award to be filed in the court at the
request of the party to the arbitration agreement or if so directed by
the court. There is no provision which requires the Arbitrator to apply G
to the court for filing of the award and pass a .decree in terms of the
award. An application for filing the award in court has to be made
within thirty days from the date of service of the notice of making of
the award under Article I I 9 of the Limitation Act. Even if it is held
that Article I I 9 will apply only to an application made by a party and
not by the Arbitrator, Article 137 will come in the way of the Arbitrator's H
340 SUPREME COURT REPORTS [1998] SUPP. 3 S.C.R.

A making any application beyond the period of three years from the date
of making of the award."

It was also observed that a party who is to make application under
Section 14(2) of the Arbitration Act would indirectly achieve the same frum
the court by getting it filed through the Arbitrator. In view of this fact
B situation, this Court allowed the appeal and set aside the award decree. It
becomes clear that in the aforesaid decision the court was not concerned with
the present fact situation where the award decree which was allegedly passed
after expiry of limitation was sought to be challenged in collateral execution
proceedings if the decree had become final. If the present proceedings had
C arisen against the award decree all these questions would have survived for
consideration. But in the present case the award decree has become final and
that too when the respondent-judgment debtor did not think it fit to contest
the proceedings and did not contend that no decree could be passed. He
cannot now, in execution proceedings, contend that the decree should be
ignored as being a nullity. The Division Bench, with respect, failed to appreciate
D the correct scope and ambit of the ratio of the decision in the case of Patel
Motibhai Naranbhai, (Supra). Consequently, the impugned judgment
remanding the proceedings for consideration by the executing court in the
light of the aforesaid decision of this Court cannot be sustained.

E Point No. (iii) :

Then remains the question whether this Court should interfere with the
impugned judgment under Article 136 of the Constitution of India. Learned
senior counsel for the respondent-judgment debtor, shri Javali vehemently
contended that everything from top to bottom was a mock fight and that the
F alleged dispute arose between the parties within two months of the
advancement of the loan and arbitration proceedings were initiated. They
were also disposed of in a couple of days and thereafter upto four years no
attempt was made by the party in whose favour the award was passed to get
the award made rule of the court and that the respondent came to know of
G the award decree only when the warrant of arrest was issued in the execution
proceedings. It is difficult to appreciate this contention. On the facts of this
case, it clearly emerges that the judgment debtor had taken a loan of Rs. 15
lacs from the appellant on 9.1.1985 as clearly given in writing by the partner
of the respondent-judgment debtor. This loan was supported by a promissory
note. It was the case of the appellant that this loan was repayable within two
H months as it Wa> a short-term loan and was advanced at the rate of 2 per cent
B. BHANDARI v.UNL HEAVY MECH. LIFTING ENT ERP. [S.B. MAJMUDAR, J.] 341

per month meaning thereby 24 per cent per year. As the respondent raised A
a dispute regarding the quantum of interest and the time for repayment of loan
which according to it would start after two years, the dispute was referred to
the sole arbitration of an advocate of standing at Calcutta. It is not in dispute
between the parties that in the proceedings before the Arbitrator the
respondent's partner appeared and after hearing him, the award was passed. B
The award in question gave instalments of Rs. 2 lacs each and that is how
the amount was made payable within two years from 15.7.1985 to 15.4.1987.
The first instalment of Rs. 2 lacs was made payable on or before 15.7.1985 with
interest at the rate of 2 per cent per mensem till payment. The second
instalment of Rs. 2 lacs was made payable on or before 15.10.1985 with
interest as aforesaid till payment and similarly other instalments of Rs. 2 lacs C
each were granted. It is interesting to note that on 17.10.1985 the partners of
the respondent firm addressed a letter to the appellant admitting that they had
undertaken to repay the instalment due on 15.10.1985 and interest from July
to October, 1985 by 15.11.1985 and prayed for accommodation for the time
being. This clearly indicates that the grant of second instalment of Rs. 2 lacs
which was made payable by the award on or before 15.10.198.5 with interest D
from the date of first instalment to the date of second instalment was within
the knowledge of the partners of the respondent finn even as early as on
17. I 0.1985 otherwise they would never have got an idea to pay the instalment
due on 15.10.1985. This shows that they were aware of the instalments
granted by the sole arbitrator, almost by the same time the award was passed E
in the year 1985 itself. If that is so, it must be held to be a mere excuse on
the part of the respondent when it was contended in the execution proceedings
that the respondent's partners had no idea or knowledge about the award or
award decree. Under these circumstances, it is difficult to appreciate how the
arbitration proceeding was a mock proceeding or that any fraud was committed
on the respondent or the Court when the award decree came to be passed. F
These are all afterthoughts and they clearly indicate that the respondent
having received the amount of Rs ..15 lacs under a promissory note as early
as in 1985 did not think it fit to pay up the decretal dues as per the award
decree and was only interested in delaying the proceedings. Consequently,
this is not a case in which it can be pleaded by Shri Javali, learned senior G
counsel for the respondent that fraud was committed on the respondent by
the decreeholder or that there was any equity in favour of the judgment
debtor in not complying with the terms of the award decree or that the
execution of the said award decree would result in injustice to the respondent
so as to persuade us not to interfere under Article 136 of the Constitution
of India with the impugned order of remand. In the fact situation of this case, H
342 SUPREME COURT REPORTS [1998] SUPP. 3 S.C.R.

A it must be held that there is no equity in favour of the respondent which
would require us not to interfere with these proceedings when under law and
also in equity the appellant decree holder is entitled to get the fruits of his
award decree especially when despite the award granting instalments and
interest at 24 per cent per annum, the award decree grants interest only at 8%
B per annum from the date of the decree till realisation.

In the result, these appeals are allowed, the impugned judgment and
order date 10.2.1998 of the Division Bench of the.High Court are set aside and
the decision rendered by the learned Single Judge of the High Court dated
23.12.1997 is confirmed. In the circumstances of the case. There would be no
C order as to costs.

S.V.K. Appeals allowed.

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