Full Judgment Text
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 9439 OF 2010
[Arising out of SLP(C) Nos.9724 of 2010]
STATE OF ORISSA .......APPELLANT
Versus
DURGA CHARAN ROUTRAY .....RESPONDENT
O R D E R
Leave granted. Heard.
2. The appellant entrusted the construction of
Earth Dam of Kuanaria Irrigation Project (balance work) to
the respondent. The contract was entered at Puri. The
work was executed in Puri District. Certain disputes arose
and they were referred to arbitration. The Arbitrator made
an Award dated 7.3.2003 for Rs.34.81 lakhs and interest.
3. The appellant filed an application under
Section 34 of the Arbitration & Conciliation Act, 1996,
('Act' for short) on 25.6.2003 in the Court of District
Judge, Khurda at Bhubaneswar. Learned District Judge, by
order dated 21.6.2004, held that the Court at Khurda
District did not have jurisdiction and directed the return
of the application to the appellant for being presented to
proper Court. The appellant filed an appeal against the
said order dated 21.6.2004.
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4. In the meanwhile, the respondent had levied
execution in respect of the award. In the said execution
proceedings, the executing Court made an order dated
3.4.2004 directing the appellant to deposit the award
amount and permitted the respondent to withdraw the amount
by furnishing security. That order was also challenged by
the appellant by filing an appeal.
5. Both the appeals, that is appeal against
order dated 21.6.2004 passed by the District Judge, Khurda
and the appeal against the order dated 3.4.2004 passed by
the Executing Court, were heard and dismissed by a common
order dated 23.12.2009 by the Orissa High Court which is
under challenge in this appeal by special leave.
6. Having regard to Section 36 of the Act, the
respondent ought not to have made an application for
execution before the expiry of the time for making an
application to set aside the arbitral award under Section
34 of the Act. Therefore, we are of the view that the
Executing Court ought not to have directed the award amount
to be deposited by the appellant or permitted it to be
withdrawn by the respondent against security. On the facts
and circumstances, we are of the view that interest of
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justice would be served if the said order is amended by
directing the appellant to deposit the said amount in the
District Court, Puri. The direction for withdrawal by the
respondent is set aside.
7. The direction for return of the application
under Section 34 of the Act, for presentation to the proper
Court, does not suffer from any infirmity, as the appellant
is not in a position to show that any part of the cause of
action arose within the jurisdiction of District Judge,
Khurda.
8. We, therefore dispose of the appeal as
follows:
(i) We dismiss the appeal arising from the order dated
21.6.2004. and permit the appellant to take back the
application from the District Court, Khurda and re-present
the application under Section 34 of the Act, before the
District Court, Puri within two weeks from today;
(ii) We set aside the order of the High Court affirming
the order dated 3.4.2004 of the Executing Court. We, however,
direct the entire amount to be deposited in the District
Court, Puri which shall be kept in fixed deposit with a
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nationalised Bank pending hearing of the application under
Section 34 of the Act;
(iii) We request the District Judge, Puri to decide the
application under Section 34 of the Act expeditiously.
......................J.
( R.V.
RAVEENDRAN )
New Delhi; ......................J.
October 25, 2010. ( A.K. PATNAIK )