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2018 DIGILAW 723 (KER)

Anzu K. H. v. Shakthi Finance Limited

2018-09-12

ANU SIVARAMAN

body2018
JUDGMENT : Anu Sivaraman, J. 1. This writ petition is filed by the petitioner seeking the following prayers: "1. Issue a writ of certiorari or appropriate writ order or direction to the respondents 1 and 2 to quash Ext.P2 order as it is illegal; 2. Issue a writ of mandamus or appropriate writ order or direction to the respondent 1 and 2 to declare that only Civil Courts are having the authority of enforcement of interim orders passed by the arbitrators; 3. Issue a writ of mandamus or appropriate writ order or direction to the respondent 3 and 4 not to enforce the Ext.P2 order without an order from any Civil Court." 2. Heard the learned counsel for the petitioner and the learned counsel appearing for the respondent. Learned counsel for the petitioner challenges Ext.P2 order of attachment issued by the arbitrator on the ground that the same is illegal in the sense that the attachment which is ordered as an interim measure could not have been recorded and intimated by the arbitrator, without recourse to the Civil Court. Relying on the decision of this Court in Pradeep v. Station House Office, 2016 (2) KHC 714 . it is contended that when an order is issued by the Arbitral Tribunal, the same can be enforced only through the Civil Court and that the arbitrator or the Arbitral Tribunal has no power to enforce its own order. 4. Construing the last sentence in Ext. P2 order which is as under: 'attach report and notice', the learned counsel appearing for the petitioner would contend that the direction to directly attach the property and report the same would amount to an enforcement of the order and would therefore require the function of the Civil Court in the matter. 5. The learned counsel appearing for the respondents, on the other hand, contended that the powers given to the arbitrator or the Arbitral Tribunal in terms of Section 17 of the Arbitration and Conciliation Act, 1996 (for short, 'the Act'), would specifically enable the arbitrator to issue an Interim measure as required in the facts of a case. It is stated that any measure necessary for securing the amount in dispute in arbitration, as also such other interim measure of protection as appears to the Arbitral Tribunal to be just can be passed by the arbitrator or the Arbitral Tribunal in terms of Section 17. It is stated that any measure necessary for securing the amount in dispute in arbitration, as also such other interim measure of protection as appears to the Arbitral Tribunal to be just can be passed by the arbitrator or the Arbitral Tribunal in terms of Section 17. 6. Relying on the decision of the Apex Court in Alka Chandewar v. shamshul Ishrar Khan 2017 KHC 6449 the learned counsel for the petitioner would contend that the efficacy of Section 17 would be completely compromised, if an interim measure of attachment would also requires recourse through Civil Court for its effectuation. It is submitted that the Apex Court in the above decision has considered the pre and post Amended provisions of the Act and has held that Section 17, after its amendment, enables the arbitrator or the Arbitral Tribunal to pass such interim measures as would be necessary in the facts and circumstances of the dispute referred. It is stated that all necessary steps for the proper adjudication of the issue can be passed as interim measures by the arbitrator or the Tribunal and any requirement that an order of attachment is to be routed through the Civil Court would only render the provisions of Section 17 completely ineffective. 7. I have considered the contentions of the learned counsel for the petitioner and the respondents. The learned counsel appearing for the petitioner would submit that even where an interim measure of attachment is ordered, in the absence of any provisions for the enforcement of an interim measure, the enforcement of such measure can only be by recourse to Civil Court, in accordance with the provisions of the Act. 8. On an examination of the provisions of Section 17 of the Act, I find that Section 17 provides for interim measures with regard to the securing of the amount in dispute in the arbitration and as also such other interim measure of protection as may appear to the Arbitral Tribunal to be just. Sub-section 2 of Section 17 of the Act provides that subject to any orders passed in an appeal under Section 37, any order issued by the Arbitral Tribunal under this section shall be deemed to be an order of the Court and shall be enforceable under the Code of Civil Procedure. 9. Sub-section 2 of Section 17 of the Act provides that subject to any orders passed in an appeal under Section 37, any order issued by the Arbitral Tribunal under this section shall be deemed to be an order of the Court and shall be enforceable under the Code of Civil Procedure. 9. The contention of the petitioner is that the direction to 'attach and report' amounts to an enforcement of an interim measure. I am unable to agree with this composition. The interim measure of attachment is a measure intended to secure the amount which is the subject matter of the arbitration. 10. In the above view of the matter, the contention that even an order of ad-interim attachment passed by an Arbitral Tribunal has to be reported to be enforced by recourse to the Civil Court, does not appear to be correct position of law. The contention to the effect that an attachment ordered by the Arbitral Tribunal also has to be enforced or executed through the Civil Court, does not find any support in the statutory scheme of the Arbitration and Conciliation Act and would amount to the derogation of the powers of the arbitrator or the Arbitral Tribunal to issue any meaningful proceedings. I am of the opinion that the direction to attach the property and to report cannot amount to an order of enforcement of an interim measure.