w w w . L a w y e r S e r v i c e s . i n



Oakwell Engineering Ltd. v/s Enernorth Industries Inc


Company & Directors' Information:- D P ENGINEERING INDUSTRIES LIMITED [Active] CIN = U27310DL2008PLC176856

Company & Directors' Information:- OAKWELL INDIA PRIVATE LIMITED [Active] CIN = U40102DL1996PTC079245

Company & Directors' Information:- A K ENGINEERING INDUSTRIES (INDIA) PRIVATE LIMITED [Active] CIN = U25206DL1997PTC085204

Company & Directors' Information:- G L ENGINEERING INDUSTRIES PRIVATE LIMITED [Active] CIN = U28920MH1981PTC023662

Company & Directors' Information:- B V M ENGINEERING INDUSTRIES LIMITED [Active] CIN = U28111DL1972PLC005983

Company & Directors' Information:- INC ENGINEERING PRIVATE LIMITED [Active] CIN = U50400DL2011FTC221929

Company & Directors' Information:- R R R ENGINEERING INDUSTRIES PRIVATE LIMITED [Strike Off] CIN = U74899DL1993PTC055069

Company & Directors' Information:- A. V. ENGINEERING INDUSTRIES PRIVATE LIMITED [Strike Off] CIN = U99999DL1974PTC007360

Company & Directors' Information:- G D R ENGINEERING INDUSTRIES PVT LTD [Strike Off] CIN = U27109UP1971PTC003388

Company & Directors' Information:- L S ENGINEERING INDUSTRIES PRIVATE LIMITED [Strike Off] CIN = U74899DL1977PTC008484

Company & Directors' Information:- I B I ENGINEERING INDUSTRIES PRIVATE LIMITED [Strike Off] CIN = U45202PB1974PTC003422

Company & Directors' Information:- A H B ENGINEERING INDUSTRIES PVT LTD [Strike Off] CIN = U35999WB1988PTC044786

Company & Directors' Information:- O K ENGINEERING INDUSTRIES PRIVATE LTD [Active] CIN = U74899DL1987PTC027660

Company & Directors' Information:- R P ENGINEERING INDUSTRIES PRIVATE LIMITED [Strike Off] CIN = U99999DL1973PTC006781

Company & Directors' Information:- S V ENGINEERING INDUSTRIES PVT LTD [Under Liquidation] CIN = U74210TG1981PTC003174

    E.A. No. 385 of 2005 in Ex.P. No. 22 of 2005

    Decided On, 29 August 2006

    At, High Court of Delhi

    By, THE HONOURABLE MS. JUSTICE MANJU GOEL

    For the Decree Holder: Vinay Bhasin, Sr. Advocate with Anil K. Kher, Advocate. For the Judgment Debtor: Manoj Goel, Prem Kumar, Advocates.



Judgment Text

Manju Goel, J.

1. The IA No. 385/2005 is filed by the judgment debtor claiming several reliefs. However, at the time of arguments the only prayer pressed is dismissal of the execution petition.

2. The basic facts relevant for the disposal of the application are as follows:

The decree holder obtained a decree on16.10.2003 from the High Court of the Republic of Singapore in Suit No. 997/2002/V titled Oakwell Engineering Limited v. Energy Power Systems Limited(now known as Ener North Industries Inc.-judgment debtor). The decretal amount, in terms of Indian Rupees, is Rs. 27,85,84,825/- (Rs. Twenty seven crores eighty five lacs eighty four thousand eight hundred twenty five only). In the execution petition he seeks execution of the decree of Singapore Court under Section 44A of the Civil Procedure Code. It is alleged by the decree holder that no amount has been received towards the satisfaction of the decree under execution. The appeal filed against the decree under execution has been dismissed by the Court of Appeal of the Republic of Singapore. The decree is sought to be executed by issuance of warrants of attachment against the movable and immovable properties of the judgment debtor situated in India as per details given in Annexure-'A'. The decree holder has disclosed that it is also seeking execution of the decree in Canada where the judgment debtor has assets. The judgment debtor has also raised objections to the execution petition filed in the court of Canada.

3. The judgment debtor has raised three objections to the maintainability of the execution petition namely (1) The execution petition is not maintainable; (2) The Court has no jurisdiction to entertain the execution petition; and (3) The execution petition is an abuse of the process of the Court.

4.MaintainabilityAn application for execution of a foreign decree, it is submitted, by the judgment debtor, can be filed under Section 44A of the CPC before a District Court and not before the High Court where the decree holder has presented its petition. Thus, under the head of maintainability, the judgment debtor has actually raised a question of forum. Section 44A of the CPC prescribes that the certified copy of a decree of a superior court of any reciprocating territory can be filed in a District Court and on this being done, the decree may be executed in India as if it has been passed by the District Court. District Court has been defined in Section 2(4) of the CPC as under:

"2(4) "district" means the local limits of the jurisdiction of a principal Civil Court of original jurisdiction (hereinafter called a "District Court"), and includes the local limits of the ordinary original civil jurisdiction of a High Court."

5. It is contended by the judgment debtor that as per this definition it is the District Court which is the principal Civil Court of original jurisdiction and the High Court cannot be treated as the principal Civil Court of original jurisdiction. At present the High Court of Delhi enjoys original jurisdiction for suits beyond the valuation of Rs. 20.00 lacs. It is contended by the judgment debtor that such original jurisdiction, however, will not convert the High Court into a District Court within the meaning of Section 44A of the CPC. Reference has been made by the judgment debtor to a judgment of the Supreme Court in the case ofM.V.AL. Quamar v. Tsavliris Salvage (International) Limited, 2000 (VI) AD (SC) 533 : AIR 2000 SC 2826. The decree holder, on the other hand, contends that in view of Section 5(2) of Delhi High Court Act, 1966, the Delhi High Court has to be treated to be the principal Civil Court of original jurisdiction so far as suits beyond the pecuniary value of Rs. 20.00 lacs is concerned. Section 5(2) of Delhi High Court Act, 1966, as amended from time to time, is as under:

"Notwithstanding anything contained in any law for the time being in force, the High Court of Delhi shall also have in respect of the said territories ordinary original civil jurisdiction in every suit the value of which exceeds Rs. 20.00 lacs."

6. It is pointed out by the decree holder that by the opening words, the non obstante clause, this Section overrides the provisions of Section 44A of the CPC and for all suits and decrees beyond the pecuniary value of Rs. 20.00 lacs the High Court will have to be treated as the principal Civil Court of original jurisdiction. The decree holder has placed reliance onJanardhan Mohandas Rajan Pillai and another v. Madhubhai Patel and others, AIR 2003 Bombay 490;Bank of India v. Harshadrai Odhavji, AIR 2002 Bombay 449;Bakshi Lochan Singh and others v. Jathedar Santokh Singh and others, AIR 1971 Delhi 277andR.P. Sachdeva (deceased by L.R.) and others v. The State, AIR 1986 Delhi 178.

7. I have carefully gone through the judgment of the Supreme Court in the case of M.B.A.L. Quamar (supra). I am unable to comprehend how this judgment can be of any assistance to the judgment debtor. The question before the Supreme Court in that case was not at all akin to the question before this Court. The foreign decree in that case was brought to the High Court of Andhra Pradesh for execution. It was found that the High Court of Andhra Pradesh in its admiralty jurisdiction could entertain the execution petition in respect of a foreign judgment which was passed by the High Court of Justice, Queen's Bench Division Admiralty Court of England. The question before this Court is whether in view of there being two courts of original civil jurisdiction namely the District Judge and the High Court for different pecuniary values the High Court can be the 'District Court' within Section 44A of the CPC for suits above the value of Rs. 20.00 lacs. In fact, this question has not been raised before this Court for the first time in this case. The question was addressed by this Court in the case of Bakshi Lochan Singh and Ors. (supra) and R.P. Sachdeva (deceased by L.R.) and others (supra). In the case of Bakshi Lochan Singh (supra) the suit was under Section 92 of the CPC which is required to be presented in the principal Civil Court of original jurisdiction. The High Court held that in view of Section 5(2) of the Delhi High Court Act which had the non obstante clause the suit under Section 92 of the CPC, if it exceeded the pecuniary jurisdiction of the District Judge, had to be filed in the High Court. The following portion of the judgment can be extracted with profit:

"The argument of Mr. Vohra is that there cannot be two principal Civil Courts of original jurisdiction within the meaning of Section 92 of the Code of Civil Procedure. It is difficult to accept this contention. After the coming into force of the Delhi High Court Act, 1966, as amended, this Court has become the principal Civil Court of original jurisdiction with respect to every suit the value of which exceeds fifty thousand rupees. In view of the non obstante clause contained in sub-section (2) of Section 5 of the Delhi High Court Act, 1966, the Court of the District Judge, Delhi, has ceased to remain the principal Civil Court of original jurisdiction with respect to any suit the value of which exceeds fifty thousand rupees. Full effect has to be given to the language employed in sub-section (2) of Section 5 "notwithstanding anything contained in any law for the time being in force" and that can be done only by saying that for purposes of Section 92 of the Code of Civil Procedure, the Court of the District Judge, Delhi, will be the principal Civil Court of original jurisdiction in every suit the value of which does not exceed fifty thousand rupees but in other suits the value of which exceeds fifty thousand rupees, this High Court will be the principal Civil Court of original jurisdiction. It cannot be disputed that if original jurisdiction had been completely taken away from the Court of the District Judge, Delhi, and conferred upon this High Court, then notwithstanding Section 24 of the Punjab Courts Act, this High Court will be the principal Civil Court of original jurisdiction irrespective of the valuation of the suit as in the case of what are called the Presidency High Courts. Reference in this connection may be made toAIR 1955 Bom 55 in re: Fazlehussein Haiderbhoy Busamusa v. Yusufally Adamjiwhere it has been held that the Bombay High Court in the City of Bombay is the principal Civil Court of original jurisdiction. The original jurisdiction of this High Court is in every suit the value of which exceeds fifty thousand rupees and therefore, this High Court is the principal Court of original civil jurisdiction in every such suit. A part of the ordinary original civil jurisdiction of the Court of the District Judge, Delhi has been conferred upon this High Court and, therefore, with respect to such part, this High Court will be the principal Court of ordinary original civil jurisdiction notwithstanding Section 24 of the Punjab Courts Act. We, therefore, agree with the learned Single Judge that for the purpose of this suit the value of which exceeds fifty thousand rupees, this High Court is the principal Civil Court of original jurisdiction as contemplated by Section 92 of the Code of Civil procedure."

8. This judgment was referred to in the subsequent judgment in the case of R.P. Sachdeva (supra). In the case of R.P.Sachdeva (supra) the distinction drawn was between suit and other proceeding. The subject matter in that case was grant of succession certificate. A petition for grant of succession certificate can be filed in the court of the District Judge. The High Court after examining the provisions of Section 24 of the Punjab Courts Act as well as Section 5 of the Delhi High Court Act came to the conclusion that the High Court was the principal court of original civil jurisdiction in every suit the value of which exceeded a particular limit but that for matters other than suits the District Judge continued to be the principal court of original civil jurisdiction. The conclusion of the court was summarised as under:

"The Delhi High Court has thus ordinary original civil jurisdiction in a suit the value of which exceeds rupees one lac. The present petition obviously does not fall under this category. Could it be said that the Delhi High Court has become the principal Civil Court of original jurisdiction because the Delhi High Court has ordinary original jurisdiction in every suit the value of which exceeds a particular limit? If the provisions of Section 24 of the Punjab Courts Act and Section 5(2) of the Delhi High Court Act are read, it is quite clear that a certain jurisdiction has been taken away from the District Court and conferred on the Delhi High Court and this jurisdiction is only in respect of suits the value of which exceeds rupees one lac. This would not, however, make the Delhi High Court a principal Civil Court of original jurisdiction in Delhi. Reference in this respect may be made to a Division Bench decision of this Court inBakshi Lochan Singh v. Jathadar Santokh Singh, ILR(1971) 1 Delhi 615 : (AIR 1971 Delhi 277). This was a suit under Section 92 of the Civil Procedure Code which was filed in the High Court. The question that was raised was that the High Court had no jurisdiction to entertain such a suit. It was argued that a suit as authorised by Section 92 of the Code had to be filed in the principal Civil Court of original jurisdiction which in Delhi was the Court of the District Judge by reason of Section 24 of the Punjab Courts Act. The Court observed as under(at p.280):-

"Full effect has to be given to the language employed in sub-section (2) of Section 5 notwithstanding anything contained in any law for the time being in force and that can be done only by saying that for purposes of Section 92 of the Civil Procedure Code the Court of District Judge, Delhi will be the principal Civil Court of original jurisdiction in every suit the value of which does not exceed fifty thousand rupees but in other suits the value of which exceeds fifty thousand rupees, this High Court will be the principal Civil Court of original jurisdiction. It cannot be disputed that if original jurisdiction had been completely taken away from the Court of the District Judge, Delhi, and conferred upon this High Court, then notwithstanding Section 24 of the Punjab Courts Act, this High Court will be the principal Civil Court of original jurisdiction irrespective of the valuation of the suit as in the case of what are called the Presidency High Courts. Reference in this connection may be made toAIR 1955 Bom 55 in re: Fazlehussein Haiderbhoy Buxamusa v. Yusufally Adamji, where it has been held that the Bombay High Court in the city of Bombay is the principal Civil Court of original jurisdiction. The original jurisdiction of this High Court is in every suit the value of which exceeds fifty thousand rupees and, therefore, this High Court is the principal Court of original civil jurisdiction in every such suit. A part of the ordinary original civil jurisdiction of the Court of the District Judge, Delhi has been conferred upon this High Court and, therefore, with respect to such part, this High Court will be the principal Court of ordinary original civil jurisdiction notwithstanding Section 24 of the Punjab Courts Act. We, therefore, agree with the learned Single Judge that for the purpose of this suit the value of which exceeds fifty thousand rupees, this High Court is the principal Civil Court of original jurisdiction as contemplated by Section 92 of the Code of Civil procedure."

9. There being such categorical pronouncements in respect of the meaning of the principal court of original civil jurisdiction or District Court in the context of Delhi, there is no necessity for agitating the question any further. Undoubtedly the decree that has been brought before this Court for execution is a money decree or, in other words, a decree which can be obtained in a suit. For the purpose of Section 44A of the CPC, this High Court is a District Court and, therefore, has the jurisdiction to entertain a petition under Section 44A of the CPC.

10.JurisdictionThe next question raised by the judgment debtor is regarding the territorial jurisdiction of this Court in entertaining the prayer for execution. It is contended by the judgment debtor that the judgment debtor has its registered office and business in Ontario, Canada and, thus, both the decree holder and judgment debtor are foreigners and, therefore, this Court will have no jurisdiction to execute the decree of the High Court of Republic at Singapore. The judgment relied upon by the judgment debtor namelyWorld Tanker Carrier Corporation v. SNP Shipping Services Pvt. Ltd. and Ors., (1998) 5 SCC 310, however, has no application to the present proceedings under Section 44A of the CPC. The subject matter for adjudication in the case of World Tanker (supra) was jurisdiction of the Bombay High Court in an admiralty suit. The question of jurisdiction came up in course of a trial and not in course of an execution and that too under Section 44A of the CPC. In that case the cause of action arose from a collision between two ships which had taken place in the high seas off the coast of Portugal. Neither of the vessels involved in collision was an Indian vessel. The owners of both these vessels were also foreigners. Only one of the managers of the two ships was an Indian company. The management had come into the hands of the Indian company subsequent to the collision. The Supreme Court held that the High Court of Bombay did not have any jurisdiction in handling the admiralty suit. The scheme of Section 44A of the CPC is entirely different. It makes no mention of jurisdiction to try. Only thing necessary is that the decree has been obtained from any superior court of any reciprocating territory. The decree holder is required to file a certified copy of the decree along with a certificate from such superior court stating the extent, if any, to which the decree has been satisfied. There is no requirement under Section 44A of the CPC that the District Court in which the foreign decree is presented for execution should be also a court which could have entertained the suit. The decree has to be executed in India as if it had been passed by the District Court in India. Since there is no requirement that the District Court to whom the decree is presented for execution should also have the jurisdiction to entertain the suit had it been presented before it, the point raised by the respondent particularly with reference to the judgment of World Tanker (supra) is entirely foreign to the context. It may be noted at this point that where a decree is transferred from the court which has passed the decree to another court for execution under Section 39 of the CPC, the transferee court would be the court of competent jurisdiction if such court has the jurisdiction to try the suit in which such decree was passed. The present proceedings are, however, not governed by Section 39 of the CPC. Section 44A of the CPC, in distinction with Section 39 of the CPC, makes no such demand on the District Court to which the decree is presented for execution. Hence, the objection to the jurisdiction of this Court on this score has also to be rejected.

11. It is then contended by the judgment debtor that the judgment debtor has its office at Ontario, Canada and has no business in India. It admits that Mr.R.K. Naroola, who is a Director of the judgment debtor company, has his residence at A-302, Rishi Apartment, Alaknanda, New Delhi-110 019, but says that by itself is not sufficient for this Court to assume jurisdiction in the matter. It is then said that the assets sought to be attached as per Annexure-'A' are not available in Delhi as the assets from which the recovery is sought to be made are lying in Bangalore, Karnataka. In response, the decree holder points out that KEOPL whose shares are sought to be attached has its registered office at 201, Golf Apartment, Sujan Singh Park South, Maharishi Raman Marg, Delhi. This address of the registered office can be seen on the letter head of KEOPL as available in Annexure 'S-28' to the application under consideration. The shares of Konaseema EPS Oakwell Power Limited (KEOPL) is owned by the judgment debtor in demat form. It is alleged that Mr. R.K. Naroola, Director of judgment debtor has been operating the company from his office at A-302, Rishi Apartments, Alaknanda, New Delhi-110 019. It is further pointed out that the execution petition filed by the judgment debtor against M/s VBC Ferro Alloys also 'gives' the address of judgment debtor as A-302, Rishi Apartments, Alaknanda, New Delhi-110 019, which is evinced by the documents filed by the judgment debtor along with E.A. No. 182/2005. Hence, I find no merit in the submission that this Court has no territorial jurisdiction in entertaining the execution petition of the decree holder.

12.Abuse of the process of the CourtComing to the last objection regarding the abuse of the process of the Court, it is submitted that the decree holder has already proceeded against the judgment debtor in the Court in Ontario and, therefore, proceeding against the judgment debtor in the High Court of Delhi is an abuse of the process of the Court. It is contended that the judgment debtor will be harassed if he has to simultaneously face execution proceedings in ten different countries and that this certainly was not the object of Section 44A of the Code. It is further contended that the decree holder obtained an interim relief from the superior court of Ontario on 20.1.2005 freezing the proceeds from the sale of M & M Engineering and thereafter on 28.1.2005 the decree holder and the judgment debtor entered into a settlement which was approved of by the court of Canada on 22.2.2005. According to the judgment debtor the decree holder having already obtained the interim relief and having entered into a settlement, cannot now approach this Court for execution of the same decree. The conspicuous fact in this connection is that the judgment debtor does not say that any part of the decree in execution before this Court has been realised by the decree holder. All that the judgment debtor has to say is that the decree holder has entered into some settlement with the judgment debtor. The settlement is at best something like a security. Some of the clauses of the settlement will bring out the nature of right created in the decree holder by the settlement. Clauses 1, 2, 5 and 8 of the settlement are as follows:

"1. Should Enernorth purchase from Assure Energy Inc. ("Assure") all of Assure's interest in the lands, wells, facilities, pipelines, equipment and related agreements in the Chestermere property, (Alberta) ("Chestermere Assets"), Enernorth shall provide Oakwell in a timely manner with the material terms of the agreement of purchase and sale.

2. Should Enernorth purchase the Chestermere Assets it shall provide FIVE (5) days notice before execution of any proposed transaction or series of related transactions to sell or otherwise dispose of more that $1.5 million of the Chestermere Assets, or to encumber those assets beyond $1.5 million in value.

5. Where Enernorth is required to provide notice of a transaction or series of related transactions pursuant to this agreement, it shall accompany such notice with the material particulars of the transaction or transactions. Should Oakwell not notify Enernorth of its intention to prohibit the transaction or transactions on or before the expiry of the FIVE (5) day period, then Enernorth is entitled to rely on the fact that Oakwell, based on the information then before it, is not challenging the transaction or transactions.

8. Enernorth agrees to provide Oakwell with FIVE (5) days notice before it pays any dividends that have been declared or makes other distributions of a material nature out of the ordinary course of Enernorth's business to non-arm's length parties."

13. The other clauses also are all related to requirement of giving notice and the right to the decree holder arising therefrom. The agreement has to remain in effect until co

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nclusion of the proceedings in the court of Ontario. 14. This agreement, at best, is in the nature of a security. It does not acknowledge realisation of a single penny. The mere fact that the judgment debtor has offered some security is not the same as realisation of any amount under the decree. It is pertinent to mention here that the settlement does not prevent the decree holder from proceeding an execution in any other court. 15. The Court should see that the decrees passed are actually translated into amounts realised. The duty of the Court is not over by merely passing a decree. Therefore, execution proceedings should get as much attention of the court as the suits do. InCholamandalam Investment & Finance Co. Ltd. v. CEC Ltd & Ars. 1996 II AD (Delhi) 517this Court specifically said that there is no provision in the Civil Procedure Code which prevents simultaneous execution of a decree by two courts. While coming to this conclusion, the Court examined various previous judgments on the question and took support from the judgment of the Supreme Court in the case ofPrem Lata Agarawal v. Lakshman Prasad Gupta & Ors., AIR 1970 SC 1525. 16. Last point left to be mentioned is the requirement of a certificate from the Court passing the decree stating the amount recovered, if any. Section 44A of the CPC says that a certificate from the Court passing the decree would be the conclusive proof of the amount recovered. The decree holder has not obtained any such certificate from the High Court of Republic at Singapore. Does it mean that this Court is precluded from executing the decree? The answer certainly is 'No'. Had a certificate been brought, that would have been the conclusive proof of the amount realised. That does not, however, mean that the decree holder cannot produce any other proof of the amount recovered or amount due. It is nobody's case that any amount under the decree has so far been recovered. The judgment debtor cannot dispute that the entire amount under the decree is still due. Judgment debtor, therefore, cannot contest the execution petition on the plea that the certificate of non-realisation has not been obtained from the High Court of Republic at Singapore. 17. In view of the above, it is clear that none of the objections to the execution petition has any merit. E.A. No. 385/2005 is dismissed with cost of Rs. 10,000/- Objection to execution petition dismissed.
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