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2002 DIGILAW 1068 (BOM)

Re Dhirendra Bhanu Sanghvi v. ICDS Limited

2002-10-14

D.Y.CHANDRACHUD

body2002
Judgment Dr. CHANDRACHUD D.Y., J.:---In these three Notices of Motion which have been heard together, a common question of law arises for consideration. The issue which the Court is called upon to decide is whether an Insolvency Notice under sub-section (2) of section 9 of the Presidency Towns Insolvency Act, 1909, can be sustained on the basis of an Arbitral Award that has been passed under the Arbitration and Conciliation Act, 1996. In all the three cases before the Court, an Arbitral Award has been passed against debtors who have moved this Court and the Arbitral Award, it is common ground, had not been challenged under section 34 of the Arbitration and Conciliation Act, 1996. On the basis of the Award, Insolvency Notices came to be issued by the petitioning Creditors under sub-section (2) of section 9 of the Presidency Towns Insolvency Act, 1909. These notices are impugned on the ground that an Arbitral Award is neither a decree nor an order within the meaning of section 9(2) of the Act and that, therefore, such an Award cannot form the foundation of a valid Insolvency Notice. In Notices of Motion Nos. 72 of 2002 and 132 of 2001, the principal debtors are companies in respect of which proceedings under the Sick Industrial Companies (Special Provisions) Act, 1985 are stated to be pending and, therefore, an ancillary question which has been urged before the Court in these two cases is as to whether the arbitral proceedings were a nullity in so far as the guarantors are concerned, and whether execution proceedings would be required to be preceded by the consent of the BIFR under the provisions of section 22 of the Act. 2. The submissions before the Court in this group of matters have principally been advanced by Mr. S.H. Doctor, Senior Advocate. The other learned Counsel appearing on behalf of the applicants have adopted the submissions made by Mr. Doctor on the question of law involved and have supplemented to those submissions in so far as the facts of individual cases in which they appear are concerned. Written submissions have been filed by the parties. The submissions which have been urged before the Court in support of the challenge to the Insolvency Notices can now be considered. THE FIRST SUBMISSIONS : AN INSOLVENCY NOTICE CANNOT BE ISSUED ON AN ARBITRAL AWARD : 3. Written submissions have been filed by the parties. The submissions which have been urged before the Court in support of the challenge to the Insolvency Notices can now be considered. THE FIRST SUBMISSIONS : AN INSOLVENCY NOTICE CANNOT BE ISSUED ON AN ARBITRAL AWARD : 3. The submission is that the expression "decree or order" used in section 9(2) does not include an Arbitral Award. The submission is that the expression "decree", as defined in section 2(2) of the Code of Civil Procedure, 1908 does not include an Award. Under section 36 of the Arbitration and Conciliation Act, 1996, an Award can be enforced under the Code of Civil Procedure "in the same manner as if it were a decree of the Court". Consequently, it has been urged that an Award is not a decree and that the fiction which has been enunciated in section 36 is only for the limited purpose of making an Arbitral Award enforceable in accordance with the provisions of the Code of Civil Procedure. The fiction, it was urged, cannot be extended beyond the purpose for which it was engrafted by the legislature. Moreover, it was urged that the Rules framed under the Insolvency Act and the forms appended thereto do not comprehend within their scope, an Award of an Arbitral Tribunal. 4. In considering the correctness of the submission which has been urged on behalf of the applicants, it would be meaningful to refer to the legislative history of section 9 of the Presidency Town Insolvency Act, 1909. Section 9 as it stands today is in Part II of the Act, which is entitled "proceedings from act of insolvency to discharge". The marginal note to section 9 is entitled "acts of insolvency". Sub-section (1) of section 9 defines in its eight clauses various acts of insolvency and for the purposes of these proceedings, it would be instructive to advert to those clauses. Sub-section (1) of section 9 is as follows: "9. The marginal note to section 9 is entitled "acts of insolvency". Sub-section (1) of section 9 defines in its eight clauses various acts of insolvency and for the purposes of these proceedings, it would be instructive to advert to those clauses. Sub-section (1) of section 9 is as follows: "9. Acts of insolvency.---(1) A debtor commits an act of insolvency in each of the following cases, namely :- (a) if, in the States or elsewhere, he makes a transfer of all or substantially all his property to a third person for the benefit of his creditors generally; (b) if, in the States or elsewhere, he makes a transfer of his property or of any part thereof with intent to defeat or delay his creditors; (c) if, in the States or elsewhere, he makes any transfer of his property or of any part thereof, which would, under this or any other enactment for the time being in force, be void as a fraudulent preference if he were adjudged an insolvent; (d) if, with intent to defeat or delay his creditors,- (i) he departs or remains out of the States. (ii) he departs from his dwelling-house or usual place of business or otherwise absents himself. (iii) he secludes himself so as to deprive his creditors of the means of communicating with him; (e) if any of his property has been sold or attached for a period of not less than twenty-one days in execution of the decree of any Court for the payment of money; (f) if he petitions to be adjudged an insolvent; (g) if he gives notice to any of his creditors that he has suspended, or that he is about to suspend, payment of his debts; (h) if he is imprisoned in execution of the decree of any Court for the payment of money". (emphasis supplied) At this stage, it would suffice to take notice of the fact that Clause (e) of sub-section (1) refers to a situation in which any property of the debtor has been sold or attached for a period of not less than 21 days in execution of the decree of any Court for the payment of money. Similarly, Clause (h) refers to a situation where a debtor is imprisoned in execution of the decree of any Court for the payment of money. Similarly, Clause (h) refers to a situation where a debtor is imprisoned in execution of the decree of any Court for the payment of money. For the sake of completeness, it would be necessary to notice that the expression "creditor" is defined by Clause (a) of section 2 to include a decree-holder; the expression "debtor" is defined by Clause (b) to include a judgment-debtor. 5. The contents of sub-section (1) of section 9 as it stands comprised of the entirety of that section since the enactment of the Act in 1909 until the Insolvency Laws (Amendment) Act, 1978 was enacted by Parliament and brought into force with effect from 1st August, 1979. 6. In so far as the State of Maharashtra was concerned. Section 9 of the Act as it originally stood had been amended in the year 1948 by Bombay Act 51 of 1948 which was brought into force with retrospective effect from 19th June, 1939. As a result of the amendment, an additional clause viz. Clause (i) came to be inserted in section 9 so as to provide for one more ground which would constitute an act of insolvency. As a result of the amendment, an additional clause viz. Clause (i) came to be inserted in section 9 so as to provide for one more ground which would constitute an act of insolvency. Clause (i) as inserted by the Bombay Amendment of 1948 was in the following terms; "(i) if, after a creditor has served an insolvency notice on him under this Act in respect of a decree or an order for the payment of any amount due to such creditor, the execution of which is not stayed, he does not, within the period specified in the notice which shall not be less than one month, either comply with the requirements of the notice or satisfy the Court that he has a counter claim or set off which equals or exceeds the decretal amount or the amount ordered to be paid by him and which he could not lawfully set up in the suit or proceeding in which the decree or order was made against him." As a result of the Amending Act which was brought into force in the then State of Bombay, Clause (i) provided that if the debtor upon a creditor serving him with an insolvency notice in respect of a decree or an order for the payment of any amount due to such creditor, the execution of which had not been stayed, did not within the period specified in the notice comply with the requirement of the notice he would be deemed to commit an act of insolvency. The period which the debtor was given for complying with the terms of the notice was not to be less than one month. Within this period of one month, the debtor either had to comply with the requirements of the notice or satisfy the Court that he had a counter claim or set off which equalled or exceeded the decretal amount or the amount ordered to be paid by him and which he could not lawfully set up in the suit or proceedings in which the decree or order was made against him. In other words, upon the issuance of the notice by the creditor, the debtor was required either to comply with the notice within the time prescribed or to establish before the Court that he had a counter claim or set off of the nature and extend set out in Clause (i) and which he could not lawfully set up in the suit or proceeding in which the decree or order was made. 7. In exercise of the powers conferred by the Act, the Bombay Insolvency Rules, 1910 were made and these Rules came into operation on 1st January, 1910. The Rules provided in Rule 3 that the forms in Appendix I hereto, shall be used with such variation as circumstances may require. Rule 52-A dealt with the manner in which the notice was to be issued and provided as follows: "52-A. (1) A creditor, desirous that an insolvency notice may be issued, shall produced to the Insolvency Registrar a certified copy of the decree or order on which the notice is founded and file the notice, together with a request for issue. The creditor shall at the same time lodge with the Insolvency Registrar two copies of the insolvency notice to be sealed and issued for service. (2) An insolvency notice shall be in Form No. 1-B with such variations as circumstances may require." Rule 52-C provided that an application to set aside the insolvency notice, shall be by a notice of motion, and if the application cannot be heard until after the expiry of the time specified in the notice as the day on which the act of insolvency will be complete, the Insolvency Registrar shall extend the time and no act of insolvency shall be deemed to have been committed under the notice until the application shall be heard and determined. Form 1-A is the form in which the application for the issuance of an Insolvency Notice has to be filed and Form 1-B is the form of the Insolvency Notice. These two forms are as follows : "No. 1-A Application for issue of Insolvency Notice In the High Court of Bombay (In Insolvency) 1. I ....................., of hereby request that an Insolvency Notice be issued by this Court against (a) 2. The said (judgment-debtor) (b) within the limits of the Ordinary Original Civil Jurisdiction of this Court. 3. These two forms are as follows : "No. 1-A Application for issue of Insolvency Notice In the High Court of Bombay (In Insolvency) 1. I ....................., of hereby request that an Insolvency Notice be issued by this Court against (a) 2. The said (judgment-debtor) (b) within the limits of the Ordinary Original Civil Jurisdiction of this Court. 3. I produce a certified copy of a Decree or Order against the said obtained by (c) in the Court on the day of 19.... 4. Execution of the said decree or order has not been stayed. Dated this day of 19..... Judgment-Creditor (d). .......... No. 1-B Insolvency Notice (Title) To A.B. or (A.B. and Co.) Take notice that within *thirty-five days after service of this notice on you excluding the day of such service, you must pay to---of (or to of his (of their) agent duly authorised) (a) the sum of Rs.---claimed by (b) as being the amount due on a decree or order obtained by (c) against you in the Court, dated---whereon execution has not been stayed, or you must furnish security for the payment of the said sum to (d)---satisfaction (or the satisfaction of his (or their) said agent) (a)---or you must satisfy this Court that you have a counter-claim or set-off, against (c)---which equals or exceeds the sum claimed by (c)---and which you could not lawfully set up in the suit or proceeding in which the decree or order was obtained. Dated this day of 19. Insolvency Registrar." 8. The amendment to the Presidency Towns Insolvency Act, 1909 continued to hold the field in the then State of Bombay and thereafter in the State of Maharashtra. In the year 1978, Parliament stepped in, as well shall see, by substantially incorporating the Bombay Amendment into the provisions of the parent Central Legislation. Dated this day of 19. Insolvency Registrar." 8. The amendment to the Presidency Towns Insolvency Act, 1909 continued to hold the field in the then State of Bombay and thereafter in the State of Maharashtra. In the year 1978, Parliament stepped in, as well shall see, by substantially incorporating the Bombay Amendment into the provisions of the parent Central Legislation. As a result of Amending Act 28 of 1978 of Parliament, sub-section (2) of section 9 came to be inserted which provided as follows : "(2) Without prejudice to the provisions of sub-section (1), a debtor commits an act of insolvency if a creditor, who has obtained a decree or order against him for the payment of money being a decree or order which has become final and the execution whereof has not been stayed, has served on him a notice hereafter in this section referred to as the insolvency notice as provided in sub-section (3) and the debtor does not comply with that notice within the period specified therein: Provided that where a debtor makes an application under sub-section (5) for setting aside an insolvency notice- (a) in a case where such application is allowed by the Court, he shall not be deemed to have committed an act of insolvency under this sub-section; and (b) in a case where such application is rejected by the Court, he shall be deemed to have committed an act of insolvency under this sub-section on the date of rejection of the application or the expiry of the period specified in the insolvency notice for its compliance, whichever is later: Provided further that no insolvency notice shall be served on a debtor residing, whether permanently or temporarily outside India, unless the creditor obtains the leave of the Court therefore". The Statement of Objects and Reasons underlying the enactment of the Amendment provides as follows : "The difficulties experienced by a litigant in India in executing even a simple money decree have been commented upon by the Privy Council as well as by the Law Commission and the Expert Committee on Legal Aid. The Statement of Objects and Reasons underlying the enactment of the Amendment provides as follows : "The difficulties experienced by a litigant in India in executing even a simple money decree have been commented upon by the Privy Council as well as by the Law Commission and the Expert Committee on Legal Aid. The Law Commission in its Third Report on the Limitation Act, 1908, has recommended that the most effective way of instilling a healthy fear in the mind of a dishonest judgment-debtor would be to enable the Court to adjudicate him an insolvent if he does not pay he decretal amount after notice by the decree-holder, by specifying a period within which it should be paid, on the lines of the amendment made to the Presidency-Towns Insolvency Act, 1909, in Bombay. This recommendation was reiterated by the Law Commission in its Twenty Sixth Report on Insolvency Laws. 2. The Expert Committee on Legal Aid was also of the view that the above recommendation of the Law Commission should be implemented immediately without waiting for the enactment of a comprehensive law of insolvency. 3. It is, therefore, proposed to amend the Presidency Towns Insolvency Act, 1909 and the Provincial Insolvency Act, 1920, to add a new Act of insolvency, namely, that a debtor has not complied with the insolvency notice served on him by a creditor, who has obtained a decree or order against him for the payment of money, within the period specified in the notice. If the amount shown in the insolvency notice is not correct, it would be invalidated if the debtor gives notice to the creditor disputing the amount. The debtor can, however, apply to the Court to have the insolvency notice set aside on the ground, among others, that he is entitled to have the decree re-opened under any law relating to relief of indebtedness or that the decree is not executable under any such law. 4. The Bill seeks to achieve the above objects." 9. The debtor can, however, apply to the Court to have the insolvency notice set aside on the ground, among others, that he is entitled to have the decree re-opened under any law relating to relief of indebtedness or that the decree is not executable under any such law. 4. The Bill seeks to achieve the above objects." 9. Sub-section (3) of section 9 provides the form and contents of the Insolvency Notice is as follows : "(3) An insolvency notice under sub-section (2) shall- (a) be in the prescribed form; (b) be served in the prescribed manner; (c) specify the amount due under the decree or order and require the debtor to pay the same or to furnish security for the payment of such amount to the satisfaction of the creditor or his agent; (d) specify for its compliance a period of not less than one month after its service on the debtor or if it is to be served on a debtor residing, whether permanently or temporarily, outside India, such period (being not less than one month) as may be specified by the order of the Court granting leave for the service of such notice; (e) state the consequences of non-compliance with the notice." 10. Sub-section (4) lays down that no insolvency notice shall be deemed to be invalid by reason only that the sum specified therein as the amount due under the decree or order exceeds the amount actually due, unless the debtor, within the period specified in the insolvency notice for its compliance, gives notice to the creditor that the sum specified in the insolvency notice does not correctly represent the amount due under the decree or order. The proviso thereto stipulates that if the debtor does not give any such notice, he shall be deemed to have complied with the insolvency notice if, within the period specified therein for its compliance, he takes such steps as would have constituted a compliance with the insolvency notice had the actual amount due been correctly specified therein. 11. As noted earlier, Clause (i) of section 9 which had been inserted in the year 1939 by the Bombay Amendment for furnishing an additional act of insolvency, was based upon a non-compliance with an insolvency notice founded on a decree or order for the payment of money. 11. As noted earlier, Clause (i) of section 9 which had been inserted in the year 1939 by the Bombay Amendment for furnishing an additional act of insolvency, was based upon a non-compliance with an insolvency notice founded on a decree or order for the payment of money. Clause (i) of section 9 had provided a remedy of recourse to the Court to the debtor. Section 9-A of the Bombay Amendment had provided for the form and contents of the insolvency notice and expounded upon the remedy which was provided to the debtor to move the Court against the insolvency notice. Section 9-A provides as follows : "9-A. Insolvency notice.---(1) An insolvency notice under this Act shall be in the prescribed form and shall be served in the prescribed manner. It shall require the debtor to pay the amount due under the decree or order, or to furnish security for the payment of such amount to the satisfaction of the creditor or his agent, or to satisfy the Court that he has a counter claim or set off which equals or exceeds the decretal amount or the amount ordered to be paid by him and which he could not lawfully set up in the suit or proceeding in which the decree or order was made against him and shall state the consequence of non-compliance with the notice. (2) Such notice shall not be invalidated by reason only that the sum specified in the notice as the amount due exceeds the amount actually due, unless the debtor within the time allowed for payment gives notice to the creditor that he disputes the validity of the notice on the ground of such misstatement; but if the debtor does not give such notice, he shall be deemed to have complied with the insolvency notice if within the time allowed he takes such steps as would have constituted a compliance with the notice had the actual amount due been correctly specified therein." After the Act came to be amended by Parliament while enacting the Insolvency Laws (Amending) Act, 1978, the contents of section 9-A of the Bombay Amendment have been distributed between sub-sections (3), (4) and (5) of section 9 of the Central Act. Sub-sections (3) and (4) have already been noted earlier. Sub-sections (3) and (4) have already been noted earlier. Sub-section (5) expressly confers upon the debtor the right to move the Court for setting aside the insolvency notice on the grounds set out therein. Sub-section (5) of section 9 now provides as follows : "(5) Any person served with an insolvency notice may, within the period specified therein for its compliance, apply to the Court to set aside the insolvency notice on any of the following grounds, namely :- (a) that he has a counter-claim or set off against the creditor which is equal to or is in excess of the amount due under the decree or order and which he could not, under any law for the time being in force, prefer in the suit or proceedings in which the decree or order was passed; (b) that he is entitled to have the decree or order set aside under any law providing for the relief of indebtedness and that- (i) he has made an application before the competent authority under such law for the setting aside of the decree or order; or (ii) the time allowed for the making of such application has not expired; (c) that the decree or order is not executable under the provisions of any law referred to in Clause (b) on the date of the application. Explanation.---For the purposes of this section, the act of an agent may be the act of the principal, even though the agent has no specific authority to commit the act." In so far as the grounds for challenging the insolvency notice are concerned, the amendment brought about by Parliament recognises two additional grounds of challenge. These are specified in Clauses (b) and (c) of sub-section (5). 12. The contention which has been urged on behalf of the applicants is that the expression "decree" must be construed as it is defined in section 2(2) of the Code of Civil Procedure and that the expression "order" similarly as defined in section 2(14). Section 2(2) of the Code of Civil Procedure, defines the expression "decree" as follows : "decree" means the formal expression of an adjudication which, so far as regards the Court expressing it, conclusively determines the rights of the parties with regard to all or any of the matters in controversy in the suit and may be either preliminary or final. Section 2(2) of the Code of Civil Procedure, defines the expression "decree" as follows : "decree" means the formal expression of an adjudication which, so far as regards the Court expressing it, conclusively determines the rights of the parties with regard to all or any of the matters in controversy in the suit and may be either preliminary or final. It shall be deemed to include the rejection of a plaint and the determination of any question within section 144, but shall not include- (a) any adjudication from which an appeal lies as an appeal from an order, or (b) any order of dismissal for default. Explanation.---A decree is preliminary when further proceedings have to be taken before the suit can be completely disposed of. It is final when such adjudication completely disposes of the suit. It may be partly preliminary and partly final." By section 2(14) the expression "order" is defined as follows : "(14) "order" means the formal expression of any decision of a Civil Court which is not a decree." 13. In assessing the correctness of the submission of the applicants it would, at the outset, the necessary to note that Clauses (e) and (h) of the section as it originally stands, refer to a decree of any Court. Clause (e), as already noted, dealt with the situation of an attachment of the property of a debtor in the execution of a decree of any Court for the payment of money. Clause (h) dealt with the imprisonment of the debtor in execution of the decree of any Court for the payment of money. When the legislature of the then State of Bombay enacted the Amending Act of 1939, the legislature had before it, the existing provisions of section 9, particularly Clauses (e) and (h) which expressly refer to a decree of any Court. Even so, a conscious departure was made while framing the language of the amendment in words which make a provision for the service of an insolvency notice "in respect of a decree or an order for the payment of any amount due" to the creditor. The legislature has advisedly not circumscribed the expression "decree" or "order" with the words "of any Court". The legislature has advisedly not circumscribed the expression "decree" or "order" with the words "of any Court". This aspect is fortified if a reference is made to sub-section (1) of section 9-A under which the debtor was entitled to move the Court upon the service of the insolvency notice explaining that his counter claim or set off which was at least equal to the decretal amount could not be lawfully set up in the suit or proceeding in which the decree or order was made. The use of the expression "suit or proceeding" cannot be regarded as surplusage. The legislature has not qualified the expression "proceeding" by the word "in the said suit or" or by the words "therein". When Parliament enacted the Amending Act of 1978, it has similarly not qualified the expression "a decree or order" by the requirement that it must be of any Court against the debtor. 14. Sub-section (2) of section 9 allows the creditor to serve an insolvency notice on the debtor under sub-section (3) where the creditor has obtained "a decree or order against him for the payment of money". The Bombay Amendment while being pari materia in so far as this aspect was concerned, required that the execution of the decree or order has not been stayed. Sub-section (2) of section 9 as enacted by Parliament, provides that the decree or order be for the payment of money and be a decree or order which has become final and the execution whereof has not been stayed. Therefore, the two fold test which is required to be met is that there must be a decree or order for the payment of money by the debtor to the creditor and this decree or order must be final and of which execution has not been stayed. 15. The learned Counsel appearing on behalf of the applicant urged before the Court that the expression "decree" should be construed in the sense in which that expression is defined by section 2(2) of the Code of Civil Procedure and the expression "order" as it is defined in section 2(14). 15. The learned Counsel appearing on behalf of the applicant urged before the Court that the expression "decree" should be construed in the sense in which that expression is defined by section 2(2) of the Code of Civil Procedure and the expression "order" as it is defined in section 2(14). In so far as the Code of Civil Procedure is concerned, three essential conditions are necessary in order to meet the definition of expression "decree" therein : (i) the adjudication must be given in a suit; (ii) the suit must start with a plaint and culminate in a decree; and (iii) the adjudication must be formal and final and must be given by a civil or revenue Court. These three requirements of the section have been elucidated in a judgment of three learned Judges of the Supreme Court in (Diwan Brothers v. Central Bank, Bombay)1, A.I.R. 1976 S.C. 1503. In that case, the Supreme Court construed the provisions of Schedule II, Article 11 of the Court Fees Act, 1870, which dealt with the Court fee payable on a Memorandum of Appeal when the appeal was not from a decree or order having the force of a decree and was presented to a High Court or Chief Commissioner or other Chief Controlling Executive or Revenue Authority. The Supreme Court held that the expression "decree" as used in the Court Fees Act is a term of art and must be deemed to have been used in the same sense as understood by the Code of Civil Procedure. In the case which arose before the Supreme Court, an order had been passed by the Tribunal under the Displaced Persons (Debts Adjustment) Act, 1951. Neither the Court Fees Act nor the Displaced Persons (Debts Adjustment) Act had defined the term "decree". The Supreme Court held that the concept of a decree had been crystallised in Act No. VIII of 1859 passed by the Governor-General in Council and that consequently, when the Court Fees Act was enacted in 1870 and used the term "decree", it must have intended to use the word "decree" so as to bear the same connotation as in the Act of 1859. Moreover, the Supreme Court noted that an order rejecting a plaint was mentioned as falling under the term "decree" both in the Code of Civil Procedure of 1882 and of 1908. Moreover, the Supreme Court noted that an order rejecting a plaint was mentioned as falling under the term "decree" both in the Code of Civil Procedure of 1882 and of 1908. Having regard to that definition, Schedule II, Article 11 of the Court Fees Act was amended so as to delete the words "from an order rejecting the plaint" for the reason that an order rejecting a plaint was incorporated in the expression "decree" and it was, therefore, not necessary to retain it in the Court Fees Act. In paragraph 10 of the judgment of Court Mr. Justice Fazal Ali, therefore, held that this was the most important intrinsic evidence to show that the legislature in enacting the Court Fees Act used the term "decree" in the same sense as it was used in section 2(2) of the Code of Civil Procedure, 1908. The Court was of the view that the Court Fees Act and the Code of Civil Procedure are, more or less, complementary to each other. 16. In a judgment of a Division Bench of this Court in (Pushpatai and others v. Official Liquidator, Sholapur Oil Mills Ltd.)2, A.I.R. 1970 Bom. 271, the Court dealt with a case where an order had been passed in winding up proceedings and the question that arose before the Court was in relation to Schedule I, Article 7 and Schedule II, Article 13 of the Bombay Court Fees Act, 1959. The Division Bench of this Court held that when the expression "a decree or an order" are used in Schedule II, Article 13, it could not have been intended by the legislature to confine the words to decrees or orders only of Civil Courts inasmuch as Column 2 showed that it was intended to apply to any memorandum of appeal presented to any Civil Court, to any Revenue Court, Executive Officer, or Chief Controlling Revenue Authority or Executing Authority. The Court noted that in considering the expression "an order having force of a decree", the Court must be guided by the substance of the matter and not merely the form. The substance of the matter was that when an order of winding up is made, it is enforceable exactly in the same manner as a decree and is appealable in the same manner and to the same extent as a decree. The substance of the matter was that when an order of winding up is made, it is enforceable exactly in the same manner as a decree and is appealable in the same manner and to the same extent as a decree. Moreover, as in the case of a decree, an order of the Court in winding up proceedings is binding which means that the question decided therein cannot be reagitated. In the circumstances, it was held by this Court that it could not be stated that an order made in winding up proceeding had not the force of a decree. 17. The decision of the Division Bench in the Solapur Oil Mills case (supra) emphasises the principle that the expression "decree" or "order" has to be construed in the context in which it is used. The Insolvency Act does not define the expression "decree" or "order" but, there is intrinsic evidence in section 9 of the Act that when the legislature intended to refer to a decree as a decree of a Court, the statutory provision has been so qualified in Clauses (e) and (g) of sub-section (1) of section 9. On the other hand, in sub-section (2), the legislature has not qualified the expression "decree" or "order" by the requirement that it must be a decree or order of a Court. The qualification which the legislature has introduced is that the decree or order must be one which has become final and the execution whereof has not been stayed. 18. Alternatively, for the purposes of the present proceedings, one may proceed on the basis of hypothesis that the expression 'decree' in section 9(2) ought to be construed as a decree of a Civil Court within the meaning of section 2(2) of the Code of Civil Procedure. Even on this hypothesis, an Award of an Arbitral Tribunal made under the provisions of the Arbitration and Conciliation Act, 1996, cannot be excluded from the scope of sub-section (2) of section 9 provided the Award has become final and its execution has not been stayed. In order to appreciate this position, it would, at the outset, be necessary to refer to some of the provisions of the Arbitration and Conciliation Act, 1996. The Act of 1996 defines the expression "Arbitral Award" to include an interim Award. In order to appreciate this position, it would, at the outset, be necessary to refer to some of the provisions of the Arbitration and Conciliation Act, 1996. The Act of 1996 defines the expression "Arbitral Award" to include an interim Award. Section 31 of the Act provides for the form and contents of an Arbitral Award and section 34 provides for recourse against an Arbitral Award. Sub-section (2) of section 34 provides the grounds upon which an Arbitral Award can be set aside. Under sub-section (3) of section 34, a period of three months is provided to institute an application for setting aside an Award and that period is reckoned from the date on which the Arbitral Award has been received by the party making an application. The Court is empowered to condone the delay in filing an application under section 34 for a period no more than 30 days beyond the stipulated period of three months. The power of the Court to condone delay is thus restricted to a period not exceeding 30 days provided sufficient cause is shown. Section 35 of the Act provides that an Arbitral Award shall, subject to the other provisions of Part I, be final and binding on the parties and on persons claiming under them respectively. Section 36 lays down that where the time for making an application to set aside the Arbitral Award under section 34 has expired, or such application having been made, it has been refused, the Award shall be enforced under the Code of Civil Procedure, 1908 in the same manner as if it were a decree of the Court. Prior to the enactment of the Arbitration and Conciliation Act, 1996, an Award had to be made a rule of the Court before it could be enforced. That requirement has now been dispensed with by providing that the Award can be enforced under the Code of Civil Procedure in the same manner as if it were a decree, once the time for challenging the Award has expired or, in the event that an application to challenge the Award has been made within time, it has been refused. 19. On behalf of the applicants it has been urged that a fiction has been created by section 36 of the Arbitration and Conciliation Act, 1996 and that fiction is for the limited purpose of the enforcement of the Award. 19. On behalf of the applicants it has been urged that a fiction has been created by section 36 of the Arbitration and Conciliation Act, 1996 and that fiction is for the limited purpose of the enforcement of the Award. It was urged that for the purpose of enforcement under the Code of Civil Procedure, the Award has to be treated as a decree of the Court. Consequently, it was submitted that the Award can be regarded as a decree only for the purposes of enforcement and the fiction cannot be extended beyond the said purpose. In so far as the expression "as if it were a decree" is concerned, reliance was placed upon the judgment of the Supreme Court in (A.C.A. I. Society v. Workmen)3, A.I.R. 1963 S.C. 1489. In that case, a Constitution Bench of the Supreme Court construed the provisions of section 25-FF of the Industrial Disputes Act, 1947 which provides for the payment of compensation to workmen in an undertaking, the ownership of which was transferred. The compensation was liable to be paid "as if the workman had been retrenched" under section 25-FF. While construing the words "as if the workman has been retrenched", the Supreme Court held that the legislature wanted to provide that though such termination may not be retrenchment technically so-called, nevertheless the employees in question whose services were terminated by the transfer of the undertaking should be entitled to compensation. The expression "as if" was also construed in a judgment of the Supreme Court in (Maganlal v. M/s. Jaiswal Industries, Neemach)4, A.I.R. 1989 S.C. 2113. In that case, a Bench of two learned Judges of the Supreme Court considered the provisions of sub-section (8) of section 32 of the State Financial Corporations Act, 1951, which used the expression "in execution of a decree as if the Financial Corporation were the decree holder". The Supreme Court held that these words showed that even though an order under section 32 is not a decree stricto sensu as defined in section 2(2) of the Code of Civil Procedure and the Financial Corporation could not, as such, be called a decree holder, section 32(6) of the Act imports a legal fiction whereby the order under section 30 of the Act for the purposes of execution would be a decree and the Financial Corporation, a decree holder. The Supreme Court referred to the well known dictum laid down by Lord Asquith in (East End Dwellings Company Limited v. Finsbury Borough Council)5, 1952 A.C. 109: "If you are bidden to treat an imaginary state of affairs as real, you must surely, unless prohibited from doing so, also imagine as real the consequences and incidents which, if the putative state of affairs had in fact existed, must inevitably have flowed from or accompanied it........ The statute says that you must imagine a certain state of affairs; it does not say that having done so, you must cause or permit your imagination to boggle when it comes to the inevitable corollaries of that state of affairs." 20. Now, if these principles are borne in mind, what emerges is, under sub-section (2) of section 9 of the Insolvency Act, the pre-requisite is that the creditor must have obtained a decree or order against the debtor for the payment of money and that decree or order must be final and of which execution has not been stayed. The well settled principle of law is that the provisions of the Insolvency Act constitute an equitable mode of execution and this was recognised in the judgment of a learned Single Judge of this Court in (Bhurmal Kapurchand Co. v. P.M. Tools Co.)6, A.I.R. 1977 Bombay 305 at paragraph 12 page 308. This has also been reiterated in a subsequent judgment of a Division Bench of this Court in (Sharad R. Khanna v. Karimjee Limited)7, 1994(3) Bom.C.R. 223 where Mrs. Justice Sujata Manohar (as the learned Judge then was) speaking for the Court was of the view that the issuance of an insolvency notice "is an independent proceeding with its own consequences although it may be considered as a mode of equitable execution". 21. For the purposes of sub-section (2) of section 9 what Parliament has in contemplation is that there must be in existence, a decree or order which has been obtained by the creditor against the debtor for the payment of money and that this decree or order has become final and the execution whereof has not been stayed. 21. For the purposes of sub-section (2) of section 9 what Parliament has in contemplation is that there must be in existence, a decree or order which has been obtained by the creditor against the debtor for the payment of money and that this decree or order has become final and the execution whereof has not been stayed. An Arbitral Award attains finality (i) upon the expiry of the period of limitation for a challenge to the Award and in the event of no challenge being preferred to the Award or (ii) upon the challenge preferred to the Award within the period of limitation being refused. Once either of these two events has taken place, the Award is final and binding upon the parties and upon persons claiming under them. Section 36 of the Act provides that the Award shall be enforced under the Code of Civil Procedure, in the same manner as if it were a decree of the Court. In so far as sub-section (2) of section 9 of the Insolvency Act is concerned, the emphasis in that statutory provision is on the character of enforceability of a decree. Hence, for that purpose the statute has spelt out that the decree, or as the case may be, an order ought to be final and its execution ought to have been stayed. Once an arbitral Award has become final and binding upon the person or persons claiming under and bound by the Award, the Award is impressed with the character of a decree and can be enforced under the Code of Civil Procedure, 1908 in the same manner as if it were a decree of the Court. That being the position, an Award which has become final and binding can be regarded as constituting a valid foundation for the issuance of an insolvency notice under sub-section (2) of section 9. Learned Counsel appearing on behalf of the applicants is correct in urging that where the legislature incorporates a legal fiction, that fiction must be extended for the purpose for which it has been enacted and no further. However, in the present case, the interpretation which the Court is called upon to place is on the proper ambit of sub-section (2) of section 9 and there arises no question of extending the fiction created by section 36 of the Arbitration and Conciliation Act, 1996 beyond its proper scope. However, in the present case, the interpretation which the Court is called upon to place is on the proper ambit of sub-section (2) of section 9 and there arises no question of extending the fiction created by section 36 of the Arbitration and Conciliation Act, 1996 beyond its proper scope. For the purposes of sub-section (2) of section 9 of the Insolvency Act, an Award passed under the Arbitration and Conciliation Act, 1996, which has become final and binding and is, therefore, enforceable as a decree can validly form the subject- matter of an insolvency notice. 22. Counsel for the applicants adverted to three judgments which have been rendered in the context of the provisions of section 9 of the Insolvency Act as they stood prior to the amendment of 1939 in relation to the then State of Bombay and necessarily therefore, prior to the Central Amendment of 1978. These three judgments can now be considered but, it would be necessary to emphasise that none of these judgments deals with the amended provisions of Clause (i) of section 9 in relation to the then State of Bombay or with sub-section (2) of section 9 consequent to the Parliamentary amendment. The first judgment is a judgment of a learned Single Judge of this Court in (Tribhuwandas Kalliandas Gajjar v. Jivanchand Lallubhai and Co.)8, I.L.R. 35 Bom. 196. The Chief Justice, Sir Basil Scott, before whom the matter came up for consideration, considered the provisions of Order 21, Rule 29 of the Code of Civil Procedure. The plea before the Court was that the Court should stay the execution of an Award made under the Indian Arbitration Act, 1899 until the disposal of a suit between the parties. The learned Chief Justice held that such an order of stay could be made by the Court only if there is a suit pending on the part of a person against whom a decree has been passed, against the holder of a degree of the Court. The learned Chief Justice held that such an order of stay could be made by the Court only if there is a suit pending on the part of a person against whom a decree has been passed, against the holder of a degree of the Court. The Court held that the petitioner was not the holder of a decree of the Court, nor were the respondents persons against whom a decree has been passed, "for the Award, to which the applicants seek to give the force of a decree, is nothing more than an Award, although it is enforceable as if it were a decree." The Court, relied upon the decision of Fletcher Moulton, L.J., in (Re : Bankruptcy Notice)9, 1907(1) K.B. 482 wherein it was held that section 12 of the English Arbitration Act of 1889 gave to the Award the same status as a judgment for the purpose of enforcement, but it left it what it was before, viz., an Award. This decision of a learned Single Judge came up for consideration in a subsequent judgment of this Court in (Manilal Lalubhai v. Bharat Spg. Wvg. Co. Ltd.)10, I.L.R. 58 Bom. 162. In that case, this Court was called upon to determine the correctness of a preliminary objection raised which was to the effect that Order 21, Rule 50(2) of the Code of Civil Procedure would not apply to a proceeding to enforce an Award. That sub-rule provided that where the decree-holder claims to be entitled to cause the decree to be executed against any person, as being a partner in the firm, he may apply to the Court which passed the decree for leave, and where the liability is not disputed, such Court may grant such leave or, where such liability is disputed, may order that the liability of such person be tried and determined in any manner in which any issue in a suit may be tried and determined. The judgment of the learned Single Judge, Mr. Justice Kania (as the learned Chief Justice then was), is reported in the I.L.R. series while the judgment in appeal of the Division Bench is reported in (35 Bom.L.R. 941)11. Before the learned Single Judge, reliance was sought to be placed upon the earlier judgment of Sir Basil Scott, C.J., in I.L.R. 35 Bom. 196. In that context, the following observations are contained in the judgment of Mr. Before the learned Single Judge, reliance was sought to be placed upon the earlier judgment of Sir Basil Scott, C.J., in I.L.R. 35 Bom. 196. In that context, the following observations are contained in the judgment of Mr. Justice Kania : "In support of their argument the respondents strongly rely on the decision of Tribhuwandas Kalliandas Gajjar v. Jivanchand. In that case the provisions of Order XXI, Rule 29, came to be considered in connection with an Award. It is provided in Order XXI, Rule 29, that the Court could stay the execution of a decree when a suit is pending before the Court against the holder of a decree. The word "decree" in that rule was held not to cover an Award and the learned Chief Justice relied on A Bankruptcy Notice, In re, where Fletcher Moulton L.J., observed that section 12 of the English Arbitration Act did not give the Court power to turn an Award into a judgment. It only gave the Award the same status as a judgment for the purpose of enforcement but it left it what it was before, viz. an Award, With all respect to the learned Chief Justice, I am unable to agree with his reading of Order XXI, Rule 29. I accept without hesitation the observations of Fletcher Moulton L.J. as mentioned above that the Award attains the status of a judgment for the purpose of enforcement. If so, the question whether the enforcement of that judgment should be stayed or not, appears to be clearly within the provisions of Order XXI, Rule 29, unless one unduly stresses the word "decree" in that rule. In Order XXI, Rule 29, the word "decree" only could be used because when framing that Rule the legislature had in contemplation only the decree passed in a suit according to the procedure laid down in the Code. However, when by another Act it is provided that a particular judgment would be enforceable as if it were a decree, I feel that all provisions in respect of enforcement of a decree, as provided in the Code, irrespective of the question whether the word "decree" is used therein or not, would be applicable to the enforcement of such judgment." (emphasis supplied) The judgment of the learned Single Judge was carried in appeal. The Division Bench of this Court affirmed the judgment of the learned Single Judge. The Division Bench of this Court affirmed the judgment of the learned Single Judge. It must be stated that the doubt adverted to in the judgment of Mr. Justice Kania on the correctness of the view of Sir Basil Scott, C.J., has not been dealt with in the judgment of the Division Bench. Beaumont, C.J., while delivering the judgment of the Division Bench held that the Court had essentially two courses of option open; the first was that section 15 of the Indian Arbitration Act would be regarded as being of no effect, because there was no provision by which the Award could be enforced as if it were a decree. Alternatively, the Division Bench held, the relevant provisions of Order 21 must be read as a covering an Award by treating the expression "decree" as including an Award which has become enforceable as a decree and by treating the Court which passed the decree as referring to the Court whose decree the Award is to be treated as being for the purposes of execution, that is, in this particular case, the High Court, Mr. Justice Rangnekar while delivering a concurring judgment observed thus : "It is not disputed that in the case of an Award under the Indian Arbitration Act against an individual the Award can be enforced in accordance with the provisions of Order XXI of the Code. That being the case, by reading the relevant provisions of the Act and the provisions of Order XXI, I think it must be held that in such a case the party applying to enforce an Award is "the holder of a decree", and the High Court in this particular case is the "Court which passed the decree". The result of holding otherwise would be to make section 15 of the Indian Arbitration Act for all practical purposes a dead letter, prevent the parties from enforcing their rights summarily, and thus defeat the very object for which the law of arbitration is enacted. I think, therefore, this contention must also be overruled." (emphasis supplied). 23. Counsel appearing on behalf of the applicants also adverted to two decisions in which the provisions of section 9(e) of the Insolvency Act came up for consideration. I think, therefore, this contention must also be overruled." (emphasis supplied). 23. Counsel appearing on behalf of the applicants also adverted to two decisions in which the provisions of section 9(e) of the Insolvency Act came up for consideration. Now, in so far as section 9(e) is concerned, the act of insolvency which is referred to therein is that the property of the debtor has been sold or attached for a period of not less than 21 days "in execution of the decree of any Court for the payment of money". (emphasis supplied). In this context, it has been held in a judgment of a Division Bench of the Calcutta High Court in (Ramshai MullMore v. Joylall)12, A.I.R. 1928 Calcutta 840 that the words "in  execution of the decree of any Court for the payment of money" cannot be extended by analogy and that the extension, if at all, could only be brought about by the legislature. The Court held that an Award could not be treated as a decree except for the purpose of enforcing that Award. Here again, it would be necessary to note that the words of the statute which have been construed by the Court expressly refer to the execution of "a decree of any Court" for the payment of money. The same distinguishing features also apply to the judgment of a learned Single Judge in (Ghulam Hussein Khatau v. Shahban Mohib)13, A.I.R. 1938 Sind. 220, where it was held that section 9(e) of the Insolvency Act has to be strictly construed. 24. In more recent times, a Division Bench of this Court in (Re : Nilesh Lalit Parekh)14, 2002(1) Bom.C.R. 357 considered the application of the provisions of section 9(2) of the Insolvency Act in the context of a consent order passed by the Company Court in a petition for winding up. The submission which was urged before the Court by the creditor was that she was entitled to serve an insolvency notice under section 9 in respect of a consent order which had the force of a decree or an order for the payment of an amount due to her as a creditor. Section 634 of the Companies Act, 1956 provides that any order made by a Court under the Act may be enforced in the same manner as a decree made by the Court in a suit pending therein. Section 634 of the Companies Act, 1956 provides that any order made by a Court under the Act may be enforced in the same manner as a decree made by the Court in a suit pending therein. A Division Bench of this Court consisting of Mr. Justice B.N. Srikrishna (as the learned Judge then was) and Mr. Justice S.A. Bobde upheld the contention of the creditor to the effect that a consent order passed in the course of a proceeding for winding up could validly form the foundation of an insolvency notice under section 9(2) of the Act. The Division Bench relied upon the judgment of the Privy Council in (Lyllapur Bank v. Ramji Das)15, 1945(15) Comp. Cases 57 and upon the Division Bench judgment of this Court in Pushpabai's case (supra) while coming to the following conclusion : "29. Undoubtedly, no decision has been cited before us in which it is clearly held that a Company Court has power to pass an order, having force of a decree to pay money to a party before it. We are also conscious of the position that in a winding up petition, it is not possible for a Company Court to assess evidence and to draw up a decree in favour of the petitioner and then to proceed to wind up the company. It is well settled that where a debt is bona fide disputed, a Company Court will not entertain a winding up petition. We are, however, of view that where a company admits its liability in a certain sum towards the petitioner, the situation must be viewed differently. In such a situation, there is no need for a Court to fold its hands and consider itself powerless to make an appropriate order for payment of money." This Court relied upon the judgment of the Supreme Court in (Harinagar Sugar Mills Co. Ltd., Bombay v. MN. W. Pradhan, Court Receiver, High Court, Bombay)16, A.I.R. 1966 S.C. 707, where the Supreme Court held that "a winding up petition is a perfectly proper remedy for enforcing payment of a just debt" and that it is a mode of execution which the law gives to a creditor against a company unable to pay its debts. Ltd., Bombay v. MN. W. Pradhan, Court Receiver, High Court, Bombay)16, A.I.R. 1966 S.C. 707, where the Supreme Court held that "a winding up petition is a perfectly proper remedy for enforcing payment of a just debt" and that it is a mode of execution which the law gives to a creditor against a company unable to pay its debts. Consequently, the Division Bench held that having regard to the settled position in law, a petition for winding up "is a proper remedy for enforcing a just debt and a mode of realisation of such a debt" and that the company Court, trying such petition is entitled to pass an order directing the company to make payment of money to the petitioning creditor. This Court held that such an order for payment of money when passed will have the same force as a decree of a Court passed in a suit and shall be executable as such and in accordance with the provisions of the Code of Civil Procedure. The Division Bench was of the view that it would constitute an abuse of the process of law if a debtor company were allowed to ward off a company petition filed against it by one of its creditors by simply signing on the consent terms and inviting the Court to pass a decree in terms of the consent terms and then raise such pleas which would defeat the very purpose of the consent order. The challenge to the insolvency notice, therefore, failed. 25. I am of the view that, bound as I am by the judgment of the Division Bench, it would be appropriate and proper for this Court to hold that sub-section (2) of section 9 can be invoked by a creditor in whose favour an Arbitral Award has been passed under the Arbitration and Conciliation Act, 1996 when the Award has become final and binding as a result, either of no challenge being preferred within the period of limitation or upon such a challenge being preferred, it has been rejected. The Award in such a case is enforceable as if it were a decree of a Court. The Award in such a case is enforceable as if it were a decree of a Court. For the purposes of section 9(2) of the Insolvency Act, what matters is the character of enforceability of a decree or order for the payment of money; a character which such a decree or order assumes once it becomes final and its execution is not stayed. Finally, even if for the purposes of argument an Arbitral Award is regarded as not constituting a decree in the strict sense of the term in which it is used in section 2(2), it cannot but be regarded as an order for the payment of money. 26. On behalf of the applicants it has been sought to be urged that none of the forms which have been appended to the Insolvency Rules apply to an arbitral Award on the basis of which an insolvency notice is issued. There is no merit in that submission. For one thing, Rule 3 of the Insolvency Rules expressly provides that the forms in Appendix I shall be used with such variation as circumstances may require. Therefore, the forms which have been prescribed under the Insolvency Rules will have to be suitably modified in relation to the issuance of an insolvency notice on the basis of an Arbitral Award. But, more fundamentally, it would be necessary to notice that even the Code of Civil Procedure does not expressly provide for the enforcement of an Arbitral Award. Order 21, Rule 10 of the Code of Civil Procedure, 1908, provides for an application for the execution of a decree by the holder of a decree. Similarly, Order 21, Rule 16 provides for an application for execution of a decree by a transferee of a decree. Appendix E of the Code of Civil Procedure deals with the execution of decrees in the strict sense of that expression as used in section 2(2). Under the Arbitration and Conciliation Act, 1996 the mode for the enforcement of an Arbitral Award is under the Code of Civil Procedure. However, the Code of Civil Procedure which was enacted in 1908 does not contain any specific provision for the enforcement of an Arbitral Award. That can, however, not be a ground for holding that an Award under the Arbitration and Conciliation Act, 1996 cannot be enforced under the Code of Civil Procedure. However, the Code of Civil Procedure which was enacted in 1908 does not contain any specific provision for the enforcement of an Arbitral Award. That can, however, not be a ground for holding that an Award under the Arbitration and Conciliation Act, 1996 cannot be enforced under the Code of Civil Procedure. Therefore, unless the provisions of section 36 of 1996 Act are to be regarded as a dead letter, it would be necessary to read into the provisions of the Code of Civil Procedure, the implicit mandate that an Award which is to be enforced as if it is a decree under the Code of Civil Procedure shall be enforced as if it were a decree of the Court before whom an application for execution is made. The forms contained in the Insolvency Rules cannot have an overbearing importance so as to supersede the mandate of sub-section (2) of section 9. In (L.I.C. v. Escort)17, A.I.R. 1986 S.C. 1370, much the same arguments in relation to forms were urged before the Supreme Court which were repelled with the following observations : "Shri Nariman argued that none of the prescribed forms provided for the application and grant of subsequent permission. That may be so for the obvious reason that ordinarily one would expect permission to be sought and given before the act. Surely, the form cannot control the Act the Rules or the directions. As one learned Judge of the Madras High Court was fond of saying that 'it is the dog that wags the tail and not the tail that wags the dog'. We may add what this Court had occasion to say in (Vasudev Ramchandra Shelat Pranlal Jayanand Thakar)18, 1975(1) S.C.R. 534 : A.I.R. 1974 S.C. 1728: "The subservience of substance of a transaction to some rigidly prescribed form required to be meticulously observed, savours of archaic and outmoded jurisprudence." 27. A view contrary to the view which I am inclined to take in these matters has, however, been taken in a judgment of a learned Single Judge in (Re : Siddharth Srivastava)19, 2002(5) Bom.C.R. (I.J.)620 : 2002 (4) Mh.L.J. 281 . In the case which came up for consideration before the learned Single Judge, in an arbitration petition under section 9 of the Arbitration and Conciliation Act, Consent Terms were arrived at on 7th August, 1997. In the case which came up for consideration before the learned Single Judge, in an arbitration petition under section 9 of the Arbitration and Conciliation Act, Consent Terms were arrived at on 7th August, 1997. The judgment of the learned Single Judge also adverts to the fact that on 5th September, 1997 an Award came to be passed in terms of Consent Terms. In order to place the matter beyond doubt, the papers of Insolvency Petition No. 1 of 2001 were produced before this Court and from those papers, it emerges that in the said case, a consent Award came to be passed by an arbitrator appointed by the Bombay Chamber of Commerce and Industry on 15th September, 1997. Since there was a default in the payment of the instalments due and payable under the Consent Terms, a contempt petition was filed before this Court in which Consent Terms were arrived at between the parties on 9th December, 1998. Thereafter, a second contempt petition was filed in which it was alleged by the petitioning Creditor that there was a breach of the Consent Terms arrived at on 9th December 1998. The parties thereafter arrived at Consent Terms on 9th May 2000. Before the learned Single Judge, the question which was urged related both to whether an insolvency notice under section 9(e) could be founded on an Arbitral Award and on the Consent Terms filed before the Court in the contempt petition. The learned Single Judge has relied upon the judgment of the Calcutta High Court in Ramshai Mull More v. Joylall, A.I.R. 1928 Calcutta 840, and on the decision in Ghulam Hussein Khatau v. Shabhan Mohib, A.I.R. 1938 Sind 220 as well as the decision of the Calcutta High Court in Khusal Chand Sadani v. Balkissen Mohta, A.I.R. 1975 Calcutta 169. The first two decisions which have been relied upon in the judgment of the learned Single Judge have, as already noticed earlier, been rendered in the context of the provisions of section 9(e). Section 9(e) as already noted earlier has used the expression "decree of any Court". The first two decisions which have been relied upon in the judgment of the learned Single Judge have, as already noticed earlier, been rendered in the context of the provisions of section 9(e). Section 9(e) as already noted earlier has used the expression "decree of any Court". In the judgment of the Calcutta High Court in (Khushal Chand Sadani v. Balkissen Mohta)20, A.I.R. 1975 Calcutta 169, it was held that an order passed by the Company Court although it may involve an adjudication by a Court of the matters in controversy is an order which can be enforced under section 634 in the same manner as a decree made by the Court; that it may have any attributes of a decree but it is not a decree. The judgment of the Calcutta High Court takes a view which is contrary to that which is taken by the Division Bench of this Court consisting of B.N. Srikrishna, J. (as the learned Judge then was) and S.A. Bobde, J., in Re : Nilesh Lalit Parekh, 2002(1) Mh.L.J. 785 . 28. The learned Single Judge has referred to the judgment of the Supreme Court in Diwan Brothers v. Central Bank, A.I.R. 1976 S.C. 1503 and held that for the purposes of Insolvency Act, the expression "decree" must be construed in the same sense in which it is used in section 2(2) of the Code of Civil Procedure. The learned Single Judge held that in that case the consent Award was not on the basis of an adjudication and that the Award did not fulfil the essential conditions of a decree as contemplated by section 2(2) of the Code of Civil Procedure. In the circumstances, it has been held that though the Award is enforceable as if it were a decree, it is not still a decree within the meaning of section 2(2) of the Code of Civil Procedure and, therefore, the obtaining of the Award does not fulfil the requisite conditions contemplated by Clause (i) of section 9(1) of the Insolvency Act. With the greatest of respect, I am inclined to take a view contrary to that of the learned Single Judge. With the greatest of respect, I am inclined to take a view contrary to that of the learned Single Judge. The judgment of the learned Single Judge in 2002(4) Mh.L.J. 281 should, in my view, be referred to a Division Bench for reconsideration for the following reasons : (1) The attention of the learned Single Judge appears not to have been drawn to the legislative history underlying the Presidency Towns Insolvency Act, 1909 which has been spelt out in considerable detail in the earlier part of the present order : (2) In relying upon the decisions in A.I.R. 1928 Calcutta 840 and A.I.R. 1938 Sind. 220, the attention of the learned Single Judge was not drawn to the difference in terminology between sections 9(e) and 9(2) of the Insolvency Act; (3) The view taken by the Calcutta High Court in A.I.R. 1975 Calcutta 169 is contrary to the view taken by a Division Bench of this Court consisting of B.N. Srikrishna S.A. Bobde, JJ., reported in 2002(1) Mh.L.J. 785 : (4) Even if, the Court was to uphold the contention that the expression "decree" in section 9(2) must be construed as a decree of a Court, an Arbitral Award which has attained finality (either because it is not challenged within the period of limitation or upon a challenge being preferred, the challenge is refused) is enforceable as if it were a decree of the Court. The Award assumes the character of a decree for the purpose of enforcement. What sub-section (2) of section 9 postulates is that there should be a decree or order for the payment of any amount due to the creditor which has attained finality and the execution of which is not stayed. An Award which is enforceable as if it were a decree can form the foundation of an insolvency notice provided its enforcement has not been stayed and it has attained finality. 29. In these circumstances, the view which has been taken by my learned Brother J.A. Patil, J., in 2002(4) Mh.L.J. 281 would, in my opinion, require reconsideration. The Registrar is accordingly directed to place the papers before the Hon'ble the Chief justice so that His Lordship may, if he so considers it appropriate, place the matter before an appropriate Bench. -----