The Andhra Pradesh High Court held that a second execution Petition may be maintainable if the first was dismissed in default, but not when the dismissal was on merits.
The Court dismissed a Revision Petition filed under Article 227 of the Constitution by M/s. Real Fab India Pvt. Ltd. (Petitioner) to set aside the Order of the Trial Court and to restore the Petition before the Trial Court with effect from the date it was presented for enforcement.
A Single Bench of Justice Ravi Nath Tilhari held, “So, if the first execution petition is dismissed in default, the second execution petition would be maintainable, if it is filed within the period of limitation and in accordance with law. In the present case, the dismissal of the E.A.No.11 of 2019, in the previously instituted execution case on 05.08.2024 was not for default. Such dismissal was on the merits observing that, the award was not executable. We have referred to the aforesaid judgment in Shivashankar Prasad Shah (supra) to state the legal position that it is in case of dismissal of execution case in default that the second Execution Petition may be maintainable, but not where the Order is on merits.”
Senior Advocate Gopal S. Hegde appeared for the Petitioner.
Brief Facts
The AP Micro and Small Enterprises Facilitation Council had issued an arbitral award, which was challenged by the Respondent under Section 34 of the Arbitration and Conciliation Act, 1996 (the Act), arguing that the contract was a works contract and not eligible for MSMED Act benefits.
The Petitioner filed an execution Petition to enforce the Award, but the Special Court stayed proceedings pending the decision which sought to set aside the Award. After the Petition to set aside the Award was dismissed on technical grounds, the Petitioner attempted to revive the execution proceedings by filing a fresh application, arguing that a signed copy of the award had since been submitted. However, the Court dismissed the execution petition again.
Court’s Reasoning
The High Court noted, “In the present case, the Special Court in CAOP.No.16 of 2019 clearly recorded that the Council had no jurisdiction to adjudicate the disputes and that the contract in question was a works contract and therefore, the benefits under the MSMED Act were not available. In view of those findings it was on the face of the award, that the award was held without jurisdiction. So was held in the previous execution proceedings vide Order dated 05.08.2024. The Executing Court, in the present proceedings could not ignore that the award was without jurisdiction, not capable of execution by the Executing Court nor the Order.”
The Court referred to the decision in Shivashankar Prasad Shah v. Baikunth Nath Singh (1969) wherein the Supreme Court held that “an execution petition which has been dismissed for the default of the decree holder, though by the time the petition came to be dismissed, the judgment debtor had resisted the execution on one or more grounds, did not bar the further execution of the decree in pursuance of fresh execution petitions filed in accordance with law.”
Consequently, the Court held, “Consequently, in view of the Order dated 05.08.2024 in E.A.No.11 of 2024, the second application for execution of the same award was not maintainable…If the application for setting aside the award filed under Section 34, the Special Judge had not found any of the illegalities in making the award liable to be set aside under Section 34 and had rejected those grounds, the contention of the petitioner’s counsel could have some force that after signed copy of the award was placed for execution, it was liable to be executed, as previously no ground was found to set aside the award under Section 34. Similarly, if there was no previous rejection of EA No.11 of 2019 on 05.08.2024, the contention of the petitioner’s counsel could have some force.”
Accordingly, the High Court dismissed the Appeal.
Cause Title: M/s. Real Fab India Pvt. Ltd. v. M/s. Rashtriya Ispath Nigam Limited (CIVIL REVISION PETITION No.2936 of 2024)
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