J - 2019 - SCC - OnLine - Bom - 1521 - Kakade Construction

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2019 SCC OnLine Bom 1521 : (2019) 6 Bom CR 805 : (2020) 2

Arb LR 10
In the High Court of Bombay
Distinguished in Amazon.Com NV Investment Holdings LLC v.

Future Retail Ltd., (2022) 1 SCC 209
(BEFORE PRADEEP NANDRAJOG, C.J. AND NITIN JAMDAR, J.)
Commercial Appeal No. 401 of 2019

In
Chamber Summons (L) No. 911 of 2018
With
Notice of Motion (L) No. 238 of 2019
Kakade Construction Company Ltd. Through its
Director Ashok Yadav … Appellant;
Versus
Vistra ITCL (India) Ltd., Through its Investment
manager IL&FS Investment Managers Ltd. and
Others … Respondents.
With
Commercial Appeal (L) No. 109 of 2019
In
With
Sanjay Kakade … Appellant;
Versus
Vistra ITCL (India) Ltd. through its Investment
manager IL&FS) Investment Managers Ltd. and
With
Commercial Appeal (L) No. 111 of 2019
In
With
Usha Kakade … Appellant;
Versus
Vistra ITCL (India) Ltd., Through its Investment
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manager IL&FS Investment Managers Ltd. and

Commercial Appeal No. 401 of 2019, Chamber Summons (L) No.
911 of 2018, Notice of Motion (L) No. 238 of 2019, Commercial
Appeal (L) No. 109 of 2019, Notice of Motion (L) No. 243 of 2019,
Commercial Appeal (L) No. 111 of 2019 and Notice of Motion (L)
No. 244 of 2019
Decided on August 9, 2019, [Reserved on : 6 August, 2019]
Advocates who appeared in this case:
Mr. Shivam Bhagwati a/w Shahzad Khajotia I/by Y.R. Shah,
Advocates for the Appellant in Comm. Appeal No. 401 of 2019.
Mr. Rohit Kapadia, Senior Advocate I/by Kaustubh Thipsay & Rahul
Soman, Advocate for the Appellant in Comm. Appeal (L) No. 109 of
2019.
Mr. G.S. Godbole I/by Ketki Gadkari & Aditya P. Shirke, Advocates
for the Appellant in Comm. Appeal (L) No. 111 of 2019.
Mr. Aspi Chinoy, Senior Advocate & Mr. Gaurav Joshi, Senior
Advocate a/w Mr. Jatin Pore & Ms. Ankita Agrawal I/by DSK Legal,
Advocates for Respondent in all Appeals.
The Judgment of the Court was delivered by
NITIN JAMDAR, J.:— These three Commercial Appeals challenge the
order passed by the learned Single Judge dated 24 August 2018
appointing court receiver on the properties. The impugned order was
passed in a chamber summons taken out by the Respondents to
execute a consent arbitral award. When the Appeals came up for
admission, a preliminary objection was raised by the Respondents to
the maintainability of the Appeals. By this judgment, we decide the
preliminary objection raised by the Respondents. The narration of facts
is thus limited to decide the maintainability of the Appeals.
2. Commercial Appeal No. 401 of 2019 is filed by Kakade
Construction Company Ltd.; Commercial Appeal (Lodg.) No. 109 of
2019 is filed by Mr. Sanjay Kakade; and Commercial Appeal (Lodg.) No.
111 of 2019 is filed by Mrs. Usha Kakade. Mr. Sanjay Kakade and Ms.
Usha Kakade are the Directors of Kakade Construction Company Ltd.
3. There were certain financial transactions between Kakade
Constructions and the Respondents - Vistra ITCL and IIRF Holdings
(referred to as the Respondents). A default was committed by Kakade
Constructions. Arbitration proceedings ensued. The parties arrived at a
settlement. Under the consent terms, the Respondents agreed to
accept the reduced amount of Rs. 178 crores with interest at the
agreed rate as and by way of a concession. A consent award was
accordingly passed on 14 July 2014 in respect of arbitration between
Kakade constructions and the Respondents. The arbitration between the
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Respondents and the Directors of the Kakade Constructions that is,

Sanjay and Usha Kakade continued. On 25 July 2014, the first
instalment of Rs. 10 Crores as per the Consent Award was due and
payable by Kakade Constructions. Kakade Constructions did not pay the
instalments. Kakade Constructions sought to dispute the validity of the
Consent Award that it violated the Foreign Exchange Management Act,
1999 (FEMA) but stated to have withdrawn the objection.
4. The Respondents filed an execution application on 30 March 2017
for the sum of Rs. 276.73 crores, in this Court. By Chamber Summons
(L) No. 137 of 2017, the Respondents sought an appointment of court
receiver of the lands specified therein, under Order 21 Rule 22 of Civil
Procedure Code, 1908.
5. By filing an affidavit in reply on 31 July 2017, Appellants again
objected that the Consent Award is a violation of FEMA. On 19 January
2018, the learned Single Judge appointed court receiver regarding the
land and permitted the Respondents to request the Receiver to take
formal possession of the said 22.95 acres of land at Kothrud, Pune. The
Appellants filed Chamber Summons Nos. 160 of 2018 in the execution
proceedings and challenged the validity of the Consent Award on the
ground it violated the FDI policy and FEMA Regulations. The Appellants
also filed one more chamber summons, being Chamber Summons No.
161 of 2018 seeking a modification of the order dated 19 January 2018
passed by the Hon'ble Court.
6. In these execution proceeding parties again arrived at a
settlement. On 21 February 2018, parties tendered handwritten
consent terms. Formal consent terms were signed and executed and
were tendered before the Court on 22 February 2018. The Appellants
gave undertakings to withdraw the challenges to the consent award and
the order dated 22 February 2018, and it was so incorporated in
consent terms. It was agreed that that the Appellants would pay Rs.
260 crores to the Respondents in four tranches within a period of one
year in settlement of the dispute. It was provided that in default,
payment would be of the entire amount under consent award and
execution of the assets of the Appellants, including the Directors. On 27
February 2018, under the consent terms and the order dated 22
February, the court receiver took possession of, two immovable
properties at Pune. The Appellants filed their respective affidavits
disclosing their respective assets before this Court on 8 March 2018.
The Arbitral Tribunal terminated the pending arbitration proceedings
against the between Usha and Sanjay Kakade, and the Respondents on
14 March 2018.
7. The Appellants challenged the consent award. Sanjay Kakade filed
the Appeal (L) No. 234 of 2018 and Usha Kakade filed the Appeal (L)
No. 235 of 2018. Kakade Constructions filed Appeal (L) Nos. 237 of
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2018. The Division Bench (Coram : N.H. Patil and G.S. Kulkarni, JJ.)
admitted the appeal on the question of law regarding maintainability
and rejected the interim reliefs as prayed for.
8. The second instalment of Rs. 55 crores by the appellants as per
the consent terms dated 22 February 2018 was due on 21 June 2018.
The Appellants failed to make the payments. On 22 June 2018, the
Respondents sought to execute the order dated 22 February 2018
against the assets of Sanjay Kakade and Usha Kakade. The
Respondents moved a Chamber Summons bearing (Lodg.) No. 911 of
2018. The Respondents prayed for the following reliefs:—
(a) That pending the hearing and final disposal of the present
Execution Application, this Hon'ble Court be pleased to appoint
Court Receiver, High Court, Bombay, with all powers under Order
XL of the Code of Civil Procedure, 1908, as receiver in respect of
the properties mentioned in Annexure B, Annexure C and
Annexure D to the Affidavit in Support of this Chamber
Summons;
(b) That pending the hearing and final disposal of the present
Execution Application, this Hon'ble Court be pleased to pass an
order and injunction restraining the Respondents by themselves,
their servants and agents, and/or any person acting through
and/or under them, from directly or indirectly dealing with in any
manner/parting possession with/disposing of/creating third party
interest/rights, in any manner of the properties mentioned in
Annexure B, Annexure C and Annexure D to the Affidavit in
Support of this Chamber Summons.
9. Sanjay Kakade, by filing an affidavit in reply to the execution
application, took an objection to the territorial jurisdiction since all the
assets were in Pune. The ground of violation of FEMA was once again
taken up. Kakade Constructions also sought to question the lack of
territorial jurisdiction of the executing court.
10. The chamber summons was argued at length before the learned
Single Judge as can be noticed from the impugned order. The question
that was debated before the learned Single Judge was as to whether
the Court can appoint a receiver in execution only in respect of property
within the territorial jurisdiction of the executing Court. This issue arose
because the properties on which receiver was sought to be appointed
were situated at Pune. The learned Single Judge, after having
considered the law on subject, held that it was open to the Court to
appoint a receiver in respect of properties situated outside its
jurisdiction. The learned Single Judge also commented on the conduct
of the Appellants of having agreed under the consent terms and
thereafter not honoring the same. By order dated 24 August 2018, the
learned Single Judge allowed the chamber summons in terms of prayer
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clause (a) in respect of the properties specified at Annexure ‘B’, ‘C’ and
‘D’ to the affidavit in support of the chamber summons. The court
receiver was appointed in all powers including the power of sale. The
learned Single Judge directed that the court receiver before effects any
sale, to seek necessary permission. The learned Single Judge also
issued an injunction. This order is challenged in these Appeals.
11. We have heard Mr. Rohit Kapadia, Senior Advocate for the
Appellant in Comm. Appeal (L) No. 109 of 2019, Mr. G.S. Godbole for
the Appellant in Comm. Appeal (L) No. 111 of 2019 and Mr. Aspi
Chinoy & Mr. Gaurav Joshi, Senior Advocates for the Respondents. The
learned Counsel for the parties have referred to various decisions;
however, we will refer to those decisions directly relevant to the issue
at hand.
12. The Appeals are filed as Commercial Court appeals. The
Respondents have taken an objection that the appeals are not
maintainable since the impugned order is passed in execution of the
arbitral award. It is contended that the proceeding being under the
Arbitration and Conciliation Act, 1996, only those appeals fall in the
categories enumerated under Section 37 of the Act 1996 are
maintainable, and the present appeals do not fall in any of the
categories.
13. The Appellants in their appeal memo aver that the appeals are
filed under Section 13(1) of the Commercial Courts and Commercial
Appellate Division of the High Courts Act, 2015 r/w. Clause 15 of the
Letters Patent Appeal. Section 13 of the Commercial Courts and
Commercial Appellate Division of the High Courts Act, 2015 reads thus:
—
13. Appeals from decrees of Commercial Courts and Commercial
Divisions : - (1) Any person aggrieved by the judgment or order of a
Commercial Court below the level of a District Judge may appeal to
the Commercial Appellate Court within a period of sixty days from
the date of judgment or order.
(1A) Any person aggrieved by the judgment or order of a
Commercial Court at the level of District Judge exercising original
civil jurisdiction or, as the case may be, Commercial Division of a
High Court may appeal to the Commercial Appellate Division of that
High Court within a period of sixty days from the date of the
judgment or order:
Provided that an appeal shall lie from such orders passed by a
Commercial Division or a Commercial Court that are specifically
enumerated under Order XLIII of the Code of Civil Procedure,
1908 (5 of 1908) as amended by this Act and section 37 of the
Arbitration and Conciliation Act, 1996 (26 of 1996).]
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(2) Notwithstanding anything contained in any other law for the

time being in force or Letters Patent of a High Court, no appeal shall
lie from any order or decree of a Commercial Division or Commercial
Court otherwise than in accordance with the provisions of this Act.
14. It is stated in the appeal memos that appeal is maintainable in
respect of the orders enumerated in Order XLIII of the Code of Civil
Procedure as expressly provided under Section 13 of the Act of 2015.
The Appellants contend that the order of appointment of receiver under
Order XL Rule 1 of the Code is made appealable by virtue of Order XLIII
Rule 1(s) and therefore appeals are maintainable. Appellants also
contend that a receiver can also be appointed in execution proceedings
under section 51(d) of the Code and if section 13 of the Act of 2015 is
meaningfully read, the scope of appeals is not restricted only to the
Section 37 of the Act 1996 and Order XLIII.
15. The first aspect that we will consider is whether the impugned
order is under the Code of Civil Procedure to make it appealable, or it is
under the Act of 1996. If the order is under the Act of 1996, then the
next question would be whether the order is appealable under that Act.
Fortunately, there is sufficient guidance in the decisions already holding
the field.
16. To take up the first point, that is whether the impugned order
can be said to have been passed under the Code to make it appealable.
The impugned order is passed in execution of an arbitral award. The
execution of the award is governed by Section 36 of the Arbitration Act.
According to the Appellants, Section 36 of the Arbitration Act stipulates
that the award is to be executed as if it is a decree of the civil court and
that being the position, the proceedings for execution of the arbitral
award will be governed by the Code of Civil Procedure. Since the
argument centres on Section 36 of the Act of 1996, it will be fruitful to
reproduce the same. Section 36 of the Arbitration Act reads as under:—
36. Enforcement.—(1) Where the time for making an application
to set aside the arbitral award under section 34 has expired, then,
subject to the provisions of subsection (2), such award shall be
enforced in accordance with the provisions of the Code of Civil
Procedure, 1908 (5 of 1908), in the same manner as if it were a
decree of the Court.
(2) Where an application to set aside the arbitral award has been
filed in the Court under section 34, the filing of such an application
shall not by itself render that award unenforceable, unless the Court
grants an order of stay of the operation of the said arbitral award in
accordance with the provisions of sub-section (3), on a separate
application made for that purpose.
(3) Upon filing of an application under sub-section (2) for stay of
the operation of the arbitral award, the Court may, subject to such
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conditions as it may deem fit, grant stay of the operation of such

award for reasons to be recorded in writing:
Provided that the Court shall, while considering the application
for grant of stay in the case of an arbitral award for payment of
money, have due regard to the provisions for grant of stay of a
money decree under the provisions of the Code of Civil Procedure,
1908 (5 of 1908).
17. Thus Section 36 of the Act of 1996 states that award shall be
enforced in accordance with the provisions of the Code of Civil
Procedure, 1908 in the same manner as if it were a decree of the Court.
18. The ambit of Section 36 of the Act of 1996 came up for
consideration of the Division Bench of this Court in the case of Jet
Airways (India) Ltd. v. Subrata Roy Sahara1 . An appeal was filed
challenging the order passed by the learned Single Judge in the
execution application regarding an arbitral award. When the appeal
came up for consideration, an objection was taken by the Respondents
as regards the maintainability. The Appeal was admitted, and the
question of maintainability was kept open. At the hearing of the appeal,
the Division Bench went into the question of maintainability of the
appeals. The applicability of Clause 15 of the Letters Patent Appeal of
High Court, Bombay was also considered. The Court framed a question
as to whether the order passed by the learned Single Judge in respect
of the execution of the award was under Section 36 of the Act of 1996
or it was an order passed in the proceedings under the Code of Civil
Procedure.
19. The Division Bench in Jet Airways examined the provisions of the
Act of 1996 and the Code of Civil Procedure including Section 37 of the
Act of 1996. The Court framed three questions for its consideration.
One of which, as stated above, was whether proceedings under Section
36 of the Act of 1996 are proceedings under the Code of Civil
Procedure. The Division Bench referred to the decision of the Supreme
Court in Paramjeet Singh Patheja v. ICDS Ltd.2 where it was stated that
an award is not a decree and this legal fiction ought not to be extended
beyond its legitimate field. The Division Bench held that the
proceedings before the learned Single Judge for the execution of the
award were proceedings under the Act of 1996 and not proceedings
under the Code of Civil Procedure. It was further observed that if the
interpretation sought to be put by the appellant therein is accepted
(that it is under the Code); it will lead to an incongruous result which
will defeat the intention of the legislature to provide a quick and
effective remedy, and of providing appeals only against certain
specified orders. It was thus held that there is no appeal provided
against the adjudication under section 36 of the Act of 1996 and the
proceedings under section 36 cannot be held to be proceedings of
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execution under the Code of Civil Procedure.

20. The Appellants have sought to get over this position by
contending firstly that what was under consideration in the case of Jet
Airways, was the final order passed in the execution proceedings which
is not the case in the present Appeals. They contend that the impugned
order appoints a receiver which is not a final order in the execution
proceedings. We do not find this distinction material for the position of
law regarding Section 36 of the Act of 1996. The Division Bench has
categorically held that adjudication of the proceedings under Section 36
is under the Act of 1996 and not under the Code of Civil Procedure.
There is thus no warrant to distinguish between interim orders and final
orders passed in the execution of the arbitral award.
21. The second argument of the Appellants is based on the decision
of the Supreme Court in the case of Sundaram Finance Ltd. v. Abdul
Samad3 . The decision in the case of Sundaram Finance was rendered on
15 February 2018 after the decision of the Division Bench in the case of
Jet Airways which was on 17 October 2011. According to the
Appellants, the Supreme Court has held that the proceedings under
Section 36 of the Act of 1996 are to be construed as proceedings under
the Code of Civil Procedure, and therefore the decision in Jet Airways is
no longer a good law.
22. In the case of Sundaram Finance, the appellant before the
Supreme Court had granted a loan to the respondent. A dispute arose
over the defaults committed, and an arbitrator was appointed. The
execution proceedings were filed in the jurisdiction of the Courts of
Morena, Madhya Pradesh under Section 47 r/w. Section 151 and Order
XXI Rule 27 of the Code of Civil Procedure. It was the case of the
appellant that the award being enforceable as a decree under Section
36 of the Act of 1996, the execution proceedings had to be filed in the
Civil Court. The Civil Court held that it lacked jurisdiction and the
execution proceedings ought to have been first filed before the Court of
competent jurisdiction in Tamil Nadu, the Court in Tamil Nadu ought to
have transferred the decree, and then only proceedings could be filed in
Morena. The Trial Court followed the decisions rendered by Madhya
Pradesh High Court and Karnataka High Court. The appellant
approached the Supreme Court directly since a view on law was taken
by the Madhya Pradesh High Court, and there were conflicting views of
the other High Courts. Two conflicting views were under consideration
of the Supreme Court. Madhya Pradesh High Court and Himachal
Pradesh High Court opined that for the transfer of a decree, leave
should be first obtained before filing the execution proceedings before
the courts where the assets are located. The Delhi High Court, Kerala
High Court, Madras High Court, Rajasthan High Court, Allahabad High
Court, Punjab and Haryana High Court and Karnataka High Court had
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taken a view that the award is to be enforced under the Code as if it

were the decree of the Court does not mean that the award is a decree
of that court, and only a legal fiction is created. The Courts held that
therefore the Award could be filed for execution directly before the
Court where the assets of the judgment debtor are located. After
noticing the diversions of opinion amongst the High Courts, the
Supreme Court considered the provisions of Section 38, Section 39,
Section 46 of the Act of 1996 and Order XXI of the Code of Civil
Procedure. Then the Supreme Court analyzed the fiction created under
Section 36 of the Act of 1996 and held that Section 36 is only an
enforcement mechanism akin to the enforcement of a decree, but the
Arbitral Award itself is not a decree of the Civil Court, and no decree is
passed by the Civil Court.
23. Section 36 of the Act of 1996 creates a legal fiction which is
limited only to provide an enforcement mechanism. Without such an
enforcement mechanism, the arbitral award cannot be executed. This
legal fiction that the award is to be treated as the decree is thus for a
limited purpose and cannot be stretched to include an appeal The
decision of the Supreme Court in Sundaram Finance has not set aside
or diluted the ratio in Jet Airways. The view taken by the Division Bench
of this court in Jet Airways is after following the decisions of the
Supreme court and in tune with the legislative policy. We do not find
any reason to deviate from the same. Therefore, we proceed further on
the premise that the impugned orders cannot be considered as having
been passed under Code of Civil Procedure to make it appealable.
24. Now to consider whether the impugned order being under the
act 1996 is appealable under that Act. An important decision on this
issue is of the Supreme Court in the case of Kandla Export Corporation
v. OCI Corporation4 rendered on 7 February 2018. In this case, an
execution petition in respect of foreign award was filed under Section
48 of the Act of 1996 by the respondents before the District Court,
Gandhidham, Kutch. The appellants filed their objection to the petition.
The High Court transferred the execution petition to the Commercial
Division of High Court of Gujarat. The High Court of Gujarat dismissed
the objections and allowed the execution petition. When the appeal was
filed, the Commercial Appellate Division dismissed the appeal holding
that no appeal was provided under the Act of 2015. In this factual
backdrop, the Supreme Court analysed the provisions of the Act of
2015 and the Act of 1996. The Supreme Court emphasized on the
proviso to section 13(1) of the Act of 2011 and held that primary
purpose of the proviso was to clarify the main part by providing an
exception. The Supreme Court explained the ambit of the proviso to
Section 13(1) of the Commercial Courts Act. Two paragraphs from this
decision need to be reproduced, These are paragraphs 14 and 15 as
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under:—
“14. The proviso goes on to state that an appeal shall lie from
such orders passed by the Commercial Division of the High Court
that are specifically enumerated under Order 43 of the Code of Civil
Procedure Code, 1908, and Section 37 of the Arbitration Act. It will
at once be noticed that orders that are not specifically enumerated
under Order 43 CPC would, therefore, not be appealable, and appeals
that are mentioned in Section 37 of the Arbitration Act alone are
appeals that can be made to the Commercial Appellate Division of a
High Court.
15. Thus, an order which refers parties to arbitration under
Section 8, not being appealable under Section 37(1)(a), would not
be appealable under Section 13(1) of the Commercial Courts Act.
Similarly, an appeal rejecting a plea referred to in sub-Sections (2)
and (3) of Section 16 of the Arbitration Act would equally not be
appealable under Section 37(2)(a) and, therefore, under Section 13
(1) of the Commercial Courts Act.”
(emphasis supplied)
25. The Supreme Court thus has clarified that in respect of the
orders under the Act of 1996, only those appeals mentioned in Section
37 of the Act of 1996 are maintainable before Commercial Appellate
Division. The Supreme Court held that the Act of 1996 is a self-
contained code on the matters pertaining to arbitration, and which is
exhaustive. The Supreme Court then adverted to the foundational logic
of making the Arbitration Act a self-contained code. It was held that
the Act of 2015 provided no additional right of appeal otherwise than
the appeals under the Act of 1996. Though this case arose before the
Supreme Court in a foreign award and under Section 50, the underlying
principle equally applies to the Section 37 of the Act of 1996. The dicta
in Kandla Export is clear that in respect of the orders arising from the
Act of 1996; an appeal will lie only to the extent provided under
Section 37 of the Act of 1996.
26. The Appellants sought to rely on the decision of the Supreme
Court in the case of ITI Ltd. v. Siemens Public Communication Network
Ltd.5 . In this case, an issue as regards maintainability of a revision to
the High Court against the order of the Civil Court under Section 37 of
the Act of 1996 came up for consideration. The Supreme Court held
that there is no specific exclusion of the Code in the Act of 1996 and
when there was no expressed exclusion, it could not be held by
inference that the Code of Civil Procedure is not applicable. This
discussion however was in the context of a revision as the Supreme
Court explained that the power of revision under Section 115 is a
different power than an appellate power. The power of revision is in
nature of superintendence to keep subordinate courts within the
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bounds of their jurisdiction. The Supreme Court held that the approach
of the revisional court under Section 115 of the Code is not the same as
an appeal. The Supreme Court held that the right of a second appeal to
the High Court has been expressly taken away by Section 37(3) of the
Act of 1996, but the power of revision having been given for a different
purpose and not specifically excluded would be available. This decision
does not assist the Appellants.
27. The learned Single Judge by the impugned order has allowed the
chamber summons filed by the Respondents - Claimants and has
appointed receiver regarding the properties specified in the order. This
order has been passed while exercising power under Section 36 of the
Act of 1996 being an executory mechanism. This order not being under
the Code of Civil Procedure, the only other category enumerated in
Section 13 of the Commercial Courts Act, 2015 is Section 37 of the
Arbitration Act, 1996. Section 37 of the Act of 1996 provides appeal
only in limited cases. These are orders : refusing to refer the parties to
arbitration under section 8; granting or refusing to grant any measure
under Section 9; setting aside or refusing to set aside an arbitral award
under Section 34. An appeal shall also lie to a Court from an order of
the arbitral tribunal accepting the plea referred in sub-section (2) or
sub-section (3) of Section 16; or granting or refusing to grant an
interim measure under Section 17. These are the only orders that have
been made appealable.
28. An argument was sought to be advanced by the Appellants that
since the appointment of the receiver is an order under Section 9(1)(d)
of the Act of 1996, an appeal is maintainable under Section 37 of the
Act of 1996. There is no merit in this submission. Section 9 permits a
party before or during arbitral proceedings or at any time after the
making of the arbitral award but before it is enforced in accordance
with section 36, to apply for the appointment of a receiver. In this case,
that stage has long past gone.
29. The Appellant - Mrs. Usha Kakade in Appeal (Lodg.) No. 111 of
2019 sought to argue that the Appellant not being party to the Award,
it cannot be said that the order passed against her is under the
Arbitration Act, and therefore, as for her case, it would be governed by
Order 43 of the Code of Civil Procedure and thus, the Appeal would be
maintainable under Section 13 of the Act of 1996. There is no merit in
this submission. Arbitration proceedings were also pending against
Usha Kakade and Sanjay Kakade before the same Arbitral Tribunal. The
Arbitration Petition between the Respondents and Kakade Construction
Company concluded in a consent award, and the arbitration between
the Respondents and Sanjay Kakade and Usha Kakade remained
pending. When the consent terms were executed on 22 February 2018
in execution, they provided that both Sanjay Kakade and Usha Kakade
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for themselves and on behalf of the Kakade Construction Company

would be jointly and severally liable to make payment under the
consent award, and the order and the consent award regarding the
Respondents and the Kakade Construction Company would also be
executable against Sanjay Kakade and Usha Kakade. Noting these
consent terms dated 22 February 2018, the Arbitration proceedings
were terminated by the Tribunal on 14 March 2018. Because of this
position, there is no merit in the contention raised by the Appellant -
Usha Kakade in Appeal (Lodg.) No. 111 of 2019 that her case be
separately treated.
30. The Respondents have placed before us order passed by the
Division Bench of this Court in the case of Vikram V. Vyas v.
Madhusudan G. Vyas6 Following the decision in the case of Jet Airways,
the Division Bench passed an order on 26 October 2016 in an appeal
challenging the order passed in execution of an arbitral award, holding
the same to be not maintainable. We have not been shown any contrary
order or decision. Now the Supreme Court, in the case of Kandla Export,
has clarified the position further.
31. The Counsel for the Appellants have sought to project before us
various situations that may arise during the execution of an award. For
instance, it was sought to be contended that a right of Appeal cannot
be taken away from those who are not a party to the award or arbitral
proceeding. We do not intend to enter into an analysis of hypothetical
fact situations. A preliminary objection has been raised before us that
the present Appeals are not maintainable. The Appellants are a party to
the arbitral proceedings.
32. The Act of 2015 and the Act of 1996 reflect the legislative intent
of time-bound resolution of commercial disputes. It cannot be the
legislative intent to provide a speedy remedy of arbitration only till the
award is passed, with no priority when the award is to be put to
execution. The purpose of the arbitral process is not only to expedite
the declaration of an award on paper but the actual receipt of the claim.
33. Thus we hold that the impugned order dated 24 August 2018
passed by the learned Single Judge of this Court being neither under
Order XLIII of the Code of Civil Procedure nor appealable under Section
37 of the Act of 1996, these appeals are not maintainable.
34. The Commercial Appeals are dismissed as not maintainable. In
view of the dismissal of the Appeals, the Notice of Motions do not
survive and are disposed of.
———
1 2012 (2) AIR Bom 855
2 (2006) 13 SCC 322

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3
(2018) 3 SCC 622
4 (2018) 14 SCC 715
5 (2002) 5 SCC 510
6
2016 SCC OnLine Bom 12709
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J - 2019 - SCC - OnLine - Bom - 1521 - Kakade Construction

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SCC Online Web Edition, © 2024 EBC Publishing Pvt. Ltd.

Page 1 Tuesday, May 07, 2024

2019 SCC OnLine Bom 1521 : (2019) 6 Bom CR 805 : (2020) 2

In the High Court of Bombay

Distinguished in Amazon.Com NV Investment Holdings LLC v.

Commercial Appeal No. 401 of 2019

manager IL&FS Investment Managers Ltd. and

Respondents and the Directors of the Kakade Constructions that is,

(2) Notwithstanding anything contained in any other law for the

conditions as it may deem fit, grant stay of the operation of such

execution under the Code of Civil Procedure.

taken a view that the award is to be enforced under the Code as if it

for themselves and on behalf of the Kakade Construction Company

2 (2006) 13 SCC 322

4 (2018) 14 SCC 715

5 (2002) 5 SCC 510

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