M/s Standard Electronics Instrument Corporation vs Uttarakhand Renewable Energy Development Agency (UREDA), Vikas Bhawan, Pauri Garhwal & others

SUDHANSHU DHULIA, J. (ORAL)

According to the petitioner, he had done some work on the basis of the contract executed between the petitioner and Uttarakhand Renewable

Energy Development Agency (UREDA). Thereafter, certain disputes arose between the parties as to the payment of money and since the contract

has an arbitration clause, the matter was referred to arbitration wherein an award was passed by the Arbitrator against the petitioner.

The award has now admittedly being challenged by the petitioner before the Principal Civil Court at Dehradun under Section 34 of the Arbitration

and Conciliation Act, 1996 in which the respondents have also filed their counter-claim. During the pendency of the aforesaid application, according to

the petitioner, a recovery is being initiated against the petitioner, which relates to the payment of arbitral award of Rs.7,14,000/-(Rupees Seven Lakh

Fourteen Thousand Only). Aggrieved, the petitioner has filed the present writ petition.

The prayer as sought by the petitioner cannot be granted by this Court in view of clear provisions contained in sub-section (2) of Section 36 of the

Arbitration and Conciliation Act, 1996 which clearly says that mere filing of an application itself will not render the award unenforceable, unless there

is a stay of the court. Section 36 of the Arbitration and Conciliation Act, 1996 reads as under:-

“36. Enforcement.â€"(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 sub-section (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 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).â€​

(emphasis provided)

(4). In view of the above position, no relief can be granted to the petitioner in a writ petition. Consequently, the writ petition stands dismissed in limine.

(5). However, it is made clear that the petitioner would always be at liberty to move an application for stay of recovery before the court below, which

shall be considered in accordance with law.