M/S Misra And Co vs Damodar Valley Corporation

REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.10502 OF 2017 (ARISING OUT OF SLP(C) NO. 30084 OF 2016)

M/S MISRA AND CO. … APPELLANT

VERSUS

DAMODAR VALLEY CORPORATION … RESPONDENT

O R D E R

ASHOK BHUSHAN, J.

1. This appeal has been filed against the

judgment of the Calcutta High Court dated

09.08.2016 by which the application under

Article 227 filed by appellant, challenging the

order and judgment dated 06.07.2015 of the Civil

Judge (Senior Division), Durgapur has been

Signature Not Verified dismissed. The appellant is a decree holder Digitally signed by NIDHI AHUJA Date: 2017.08.16

whose application to execute the decree has been 17:09:42 IST Reason: 2

rejected as barred by time which order has been

affirmed by the High Court by the above

mentioned judgment. Aggrieved by the judgment of

the High Court, the appellant has come up in

this appeal. The respondent to the appeal is a

public sector corporation, namely, Damodar

Valley Corporation(hereinafter referred to as

'Corporation').

2. The present is a classic example of ill

effects of prolonging litigation by parties and

specially, when one of the party is a public

sector corporation. The brief facts necessary to

be noted for deciding this appeal are:

3. The appellant was given a contract for

construction of a new administrative building

for the Corporation in the year 1983. The

disputes and differences arose between the

parties. The appellant requested for appointment

of an arbitrator, which was not acceeded to by 3

the Corporation, an arbitrator was appointed by

the Civil Court who gave an award dated

24.05.1988, awarding a sum of Rs.5,78,873/­. The

award was filed in the Civil Court and various

objections were raised by the Corporation in the

Court. The Civil Court vide its order dated

16.03.1991 after rejecting the objections of the

Corporation accepted the award dated 24.05.1988

and decree was passed in terms of the award with

interest at the rate of 10 per cent per annum.

Neither any payment was made by the Corporation,

after the award nor any appeal was filed against

the order of the Court dated 16.03.1991.

4. An application was filed by appellant on

19.07.2000, stating that even after the award

having been accepted by the Court on 16.03.1991

payment has not been made. The application

stated that amount payable up to 30.06.2000

including interest is Rs.16,39,063/­. The 4

appellant prayed that the order be passed

drawing up a formal decree in the light of and

as consequences of the final order dated

16.03.1991, so that decree can be put into

execution for realization of outstanding dues as

on 30.06.2000, amounting to Rs. 16,39,063/­. The

above application filed by appellant dated

19.07.2000 was objected by the Corporation.

Although, in the application dated 19.07.2000

the Corporation appeared on 12.09.2000 but took

several adjournments thereafter. As per the

provisions of C.P.C. Order XX Rule 6A, the

decree was to be drawn within fifteen days, but

due to objections and adjournments taken by the

respondent, the Court could direct for

preparation of the decree only on 21.02.2003.

5. The appellant filed an application for

execution of decree on 30.06.2006. An objection

was filed by the respondent to the execution 5

application. The Executing Court transfered the

decree to the Court of Civil Judge (Senior

Division) Durgapur, District Bardwan by the

order dated 09.06.2008. Before the transferee

court an objection under Section 47 C.P.C. read

with Section 151 C.P.C. was filed by the

Corporation raising various objections. One of

the objections raised was that execution

application has been filed after more than

fifteen yeras from the date of judgment & decree

i.e. 16.03.1991 hence, the execution is barred

by limitation.

6. The appellant filed reply to the objection

of the respondent and submitted that execution

is not barred by limitation. One of the

submissions made was that, decree was finally

prepared only on 21.02.2003 hence, execution

application is not barred by time. The trial

court after hearing the parties held that the 6

decree was enforceable on 16.03.1991 and money

execution case having been filed on 30.06.2006,

which is beyond the prescribed time limit of

twelve years hence, the execution is barred by

time. Against the aforesaid order of the trial

court dated 06.07.2015, an application under

Article 227 was filed in the Civil Revisional

Jurisdiction of the Calcutta High Court by the

appellant which has been dismissed by the High

Court against which present appeal has been

filed.

7. Learned counsel for the parties raised

various submissions in support of their

respective cases. On the one hand learned

counsel for the appellant submits that the

respondent had not filed an appeal and was

raising objection at every stage from the stage

of appointment of arbitrator against the

application for drawing a formal decree and 7

lastly filed an objection under Section 47

C.P.C. after execution was transferred. On the

other hand, learned counsel for the respondent

submits that the time taken for preparation of

final decree cannot be excluded for computing

the limitation as provided under Article 136 of

the Limitation Act, 1963. Learned counsel for

the respondent submits that case is fully

covered by judgment of this Court reported in

West Bengal Essential Commodities Supply

Corporation versus Swadesh Agro Farming and

Storage Pvt. Ltd. and others, 1999 (8) SCC 315

where it was held that limitation period of

twelve years starts from the date of the

pronouncement of the judgment and not from the

date of the signing and drawing up of the

decree.

8. We have considered the submissions of the

parties and perused the record. Before, we enter 8

into the merits of this case and the legal

contention raised by parties, it is pertinant to

notice certain features of the case. The present

is a case which arose out of arbitration

proceedings under the Arbitration Act, 1940. The

Arbitration Act, 1940 was enacted with the

object of speedy adjudication of disputes

arising out of contractual obligation of the

parties providing a speedy mechanism for

resolving the dispute by arbitration. The

application was filed by appellant on 23.06.1986

for appointment of an arbitrator which was

allowed on 10.01.1987. The appointment of

arbitrator was modified on 31.08.1987,

thereafter, award was given on 24.05.1988 which

was submitted to the Court on 28.08.1988.

Various objections were filed by the Corporation

to the award and ultimatlely on 16.03.1991, the

award was made rule of the Court. The operative

portion of the order dated 16.03.1991 is as 9

follows:

“ ORDERED That the objection of D.V.C. against the award submitted by the Ld. Arbitrator S.N. Chanda is rejected on contest. The said award dated 24.05.1988 by Sri. S. N. Chanda be accepted and decreed accordingly in terms of laid down by the Ld. Arbitrator. The D.V.C. is to comply with the decree as per award. The decree shall carry interest @10% per annum till full realization.

Sd/­ Illegible Asstt. Dist. Judge.”

9. Although, the Court made the award rule of

the Court and decreed with interest at the rate

of 10 per cent per annum, neither the

respondent, public sector corporation complied

with the judgment and decree nor chose to file

an appeal. When the appellant filed an

application on 19.07.2000 for preparation of

final decree so that appellant could realise the

amount of Rs. 16,39,063/­ as on 30.06.2000 10

alongwith future interest, the said application

was objected by the Corporation.

10. Order XX Rule 6A C.P.C. provides for

preparation of decree which is to the following

effect: ­

“6A. Preparation of decree.­(1) Every endeavour shall be made to ensure that the decree is drawn up as expeditiously as possible and, in any case, within fifteen days from the date on which the judgment is pronounced.

(2) An appeal may be preferred against the decree without filing a copy of the decree and in such a case the copy made available to the party by the court shall for the purposes of rule 1 of Order XLI be treated as the decree. But as soon as the decree is drawn, the judgment shall cease to have the effect of a decree for the purposes of execution or for any other purpose.”

11. The provision thus provides for preparation

of decree within fifteen days from the date on

which the judgment is pronounced. In the present 11

case, due to several objections raised by

respondent No.1, the decree could be directed to

be prepared only on 21.02.2003. When the

execution application was filed, the objection

was filed that the decree is barred by time on

30.06.2006. The respondent public sector

corporation by raising various objections at

every stage which were rejected at different

stages successfully precluded the appellant from

taking fruits of decree up to now. Obections

raised by the Corporation that execution is

barred by time found favour by executing Court

as well as by the High Court. Whether the public

sector corporation when party to a litigation

which involves a money decree can be allowed to

prolong the litigation which may cause hardship

to both the parties is one of the issues which

has cropped up for consideration. We are

reminded of weighty observations made by V.R.

Krishna Iyer,J. in Municipal Corporation of 12

Delhi versus Rasal Singh and others, (1976) 2

SCC 179 where following was stated:

“....Poor reflection on 'principles' prompting public sector undertakings and on prudence in litigation policy and outlay and the scant regard for the Supreme Court being approached on supreme issues. These observations are an expression of this Court's allergy to the frequency with which, in the name of 'principle', the State and public sector institutions spiral up the litigation ladder and spend considerable sums of public money in cases which should have been adjusted by imaginative, conciliatory and wise attitudes, while professing profound concern for the welfare of Labour. An aware employer should be the last litigant, costs in Court being unproductive and even counter­productive.”

12. This Court has time and again emphasised

that public sector institutions should not enter

into prolonged litigtion and spend considerable

sums of public money in cases which should have

been adjusted by conciliatory and wise 13

attitudes. The present is a case where

arbitration award was made rule of the Court on

16.03.1991 and the Court also passed an order

for payment of interest at the rate of 10 per

cent per annum. The Corporation neither filed an

appeal nor obeyed the decree and even on the

application for preparation of decree which was

filed on 19.11.2000 raised various objections

and in preparation of decree more than two and

half years time was elapsed whereas Order XX

Rule 6A C.P.C. provides for preparation of

decree in any case within fifteen days from the

pronouncement of judgment. On the date when

application was filed by appellant for

preparation of the decree, the due amount as on

30.06.2000 was to the sum of Rs. 16,39,063/­.

Even according to the case of the respondent

time period of twelve years had not run out from

16.03.1991 by that time. Even according to the

case of the respondent, the time ran out 14

thereafter.

13. Whether in the facts of the present case we

should not ask the respondent to compensate the

appellant, is the question which comes to our

mind? Whether the Corporation when it did not

file an appeal challenging order dated

16.03.1991 by which, award was made rule of the

Court with interest at the rate of 10 per cent

per annum, should not have complied the decree

to save the Corporation from future interest

liability which was reckoning from day to day?

Should Corporation be allowed to take benefit of

prolonging of the litigation by various

frivilous objections taken from time to time at

every stage?

14. We are thus of the view that in facts of the

present case, Corporation be called upon to

come up with conciliatory proposal as has been

observed by this Court in Municipal Corporation 15

of Delhi (supra). We thus before proceeding

further in the matter call upon to Corporation

to adopt the conciliatory method and come up

with a proposal to compensate the appellant in

facts of the present case.

15. Let this appeal be listed after six weeks to

enable the Corporation to file an affidavit in

the light of the observations, as made above.

List after six weeks for further hearing.

...............................J. ( A.K. SIKRI )

...............................J. ( ASHOK BHUSHAN )

NEW DELHI, AUGUST 16, 2017.

16

ITEM NO.1501 COURT NO.7 SECTION XVI (For Judgment)

S U P R E M E C O U R T O F I N D I A RECORD OF PROCEEDINGS

Civil Appeal No. 10502/2017

M/S MISRA AND CO. Appellant(s)

VERSUS

DAMODAR VALLEY CORPORATION Respondent(s)

Date : 16-08-2017 This appeal was called on for pronouncement of order today.

For Appellant(s) Appellant-in-person

For Respondent(s) Mr. Siddhartha Chowdhury, AOR

Hon'ble Mr. Justice Ashok Bhushan pronounced the order of the Bench comprising

Hon'ble Mr. Justice A. K. Sikri and His Lordship.

Let this appeal be listed after six weeks to enable the Corporation to file an affidavit in the light of the observations, as made in the signed reportable order. List after six weeks for further hearing.

(NIDHI AHUJA) (MALA KUMARI SHARMA) COURT MASTER COURT MASTER

[Signed reportable order is placed on the file.]