Allahabad High Court
Reeta Chaddha (Deceased) And 2 Others vs U.P. Jal Nigam And 9 Others on 3 July, 2025
HIGH COURT OF JUDICATURE AT ALLAHABAD Neutral Citation No. - 2025:AHC:103318-DB AFR Reserved Chief Justice's Court (1) Case :- COMMERCIAL APPEAL No. - 2 of 2025 Appellant :- Reeta Chaddha (Deceased) and 2 others Respondent :- U.P. Jal Nigam and 9 others Counsel for Appellant :- Daya Shankar, Mahendra Kumar Mishra Counsel for Respondent :- Suresh Singh, Vimlesh Kumar Rai (2) Case :- COMMERCIAL APPEAL No. - 4 of 2025 Appellant :- Reeta Chaddha (Deceased) and 2 others Respondent :- U.P. Jal Nigam and 9 others Counsel for Appellant :- Daya Shankar, Mahendra Kumar Mishra Counsel for Respondent :- Suresh Singh, Vimlesh Kumar Rai Hon'ble Arun Bhansali, Chief Justice Hon'ble Kshitij Shailendra, J.
(Per: Arun Bhansali, CJ)
1. These appeals under Section 13(1A) of the Commercial Courts Act, 2015 (for short ‘Act, 2015’) have been filed against the judgments/orders dated 05.09.2024 passed by Commercial Court, Prayagraj in Execution Case Nos. 33 of 2004 and 31 of 2004 arising out of arbitral awards dated 31.07.2002 passed by Sole Arbitrator, whereby the execution cases filed by the appellants have been rejected.
2. The facts indicated reveal that respondent-Jal Nigam invited tenders for reconstruction of RCC Overhead Tank, the contract bond was accepted and signed on 12.06.1972 by M/s Chaddha & Co. through Sri P.D. Chaddha, who later on died on 19.09.2017. After execution of the work, when outstanding bill was not cleared by the respondent, a dispute arose between the parties and proceedings were initiated for appointment of Arbitrator. The Arbitrator was appointed by order dated 13.11.2001 passed by Civil Judge (Senior Division), Allahabad. Ex-parte awards dated 31.07.2002 were passed by the Arbitrator. For execution of the awards dated 31.07.2002, execution applications were filed. The execution proceedings were contested.
3. On account of death of Mr. P.D. Chaddha, who had filed the proceedings on behalf of the firm, application under Section 146 C.P.C. was filed seeking the permission to pursue the execution cases by Mr. Piyush Chaddha, son of P.D. Chaddha, however, when Mr. Piyush Chaddha also died on 14.04.2021, the appellants moved applications seeking permission to conduct the pending execution cases. Thereafter respondents 4 to 6 also moved applications seeking permission to continue the proceedings, which were allowed.
4. The Commercial Court, by the orders impugned, framed points for determination pertaining to the maintainability of the proceedings at the instance of the applicants and came to the conclusion that succession certificate was not necessary, however, in view of the fact that two sets of claimants were seeking exclusive right to prosecute the applications, the Court came to the conclusion that none was able to establish such right and consequently dismissed the applications.
5. Feeling aggrieved, present appeals have been filed under the provisions of Section 13(1A) of the Act, 2015.
6. Learned counsel for the respondents raised preliminary objection about maintainability of the appeals. Submissions were made that under proviso to Section 13(1A) of the Act, 2015, appeal can lie only from such orders passed by Commercial Court that are specifically enumerated under Order XLIII C.P.C. and Section 37 of Arbitration and Conciliation Act, 1996 (for short ‘Act, 1996’) and as the orders impugned do not fall within either of the categories, the appeals deserve to be dismissed as not maintainable. Reliance was placed on Kandla Export Corporation and another Vs. OCI Corporation and another : (2018) 14 SCC 715. It was prayed that the appeals may be dismissed as not maintainable.
7. Counsel for the appellants vehemently opposed the submissions. It was submitted that the appeals are very much maintainable under the provisions of Section 13(1A) of the Act, 2015 and the objection raised in this regard has no substance. Submissions were made that the provisions of Section 13(1A) of the Act, 2015 provide for appeal against judgment/order of a Commercial Court to the Commercial Appellate Division of the High Court independent of the proviso under the said sub-section and, therefore, as the orders impugned have been passed by the Commercial Court, the appeals are maintainable. Reliance was placed on judgments in Kandla Export Corporation (supra) relied on by the counsel for the respondents and Tapesh Arora Vs. Mukesh Chand : CM(M) 1806 of 2023 decided by Delhi High Court on 16.11.2023.
8. We have considered the submissions made by counsel for the parties and have perused the material available on record and are of the considered view that the objection to the maintainability of the appeals has to be sustained in the light of the authoritative pronouncements of Hon’ble Supreme Court in the case of Kandla Export Corporation (supra) followed in BGS SGS SOMA JV Vs. NHPC Limited : (2020) 4 SCC 234.
9. In the case of Kandla Export Corporation (supra), the Supreme Court examined the statutory scheme of appeals under the Act, 1996 as also under Section 13 of the Act, 2015 and taking into consideration the ‘Statement of Objects and Reasons’ of the Act, 2015 and the various provisions contained in the said Act, it was laid down as under:
“13. Section 13(1) of the Commercial Courts Act, with which we are immediately concerned in these appeals, is in two parts. The main provision is, as has been correctly submitted by Shri Giri, a provision which provides for appeals from judgments, orders and decrees of the Commercial Division of the High Court. To this main provision, an exception is carved out by the proviso. The primary purpose of a proviso is to qualify the generality of the main part by providing an exception, which has been set out with great felicity in CIT v. Indo-Mercantile Bank Ltd., 1959 Supp (2) SCR 256 pp. 266-267 : AIR 1959 SC 713 pp. 717-18, thus:
“9. …. The proper function of a proviso is that it qualifies the generality of the main enactment by providing an exception and taking out as it were, from the main enactment, a portion which, but for the proviso would fall within the main enactment. Ordinarily it is foreign to the proper function of a proviso to read it as providing something by way of an addendum or dealing with a subject which is foreign to the main enactment.
‘8. It is a fundamental rule of construction that a proviso must be considered with relation to the principal matter to which it stands as a proviso.’
Therefore it is to be construed harmoniously with the main enactment. (Per Das, C.J. in Abdul Jabar Butt v. State of J&K (1957) SCR 51, p.59 : AIR 1957 SC 281 p. 284, para 8). Bhagwati, J., in Ram Narain Sons Ltd. v. CST (1955) 2 SCR 483 p.493: AIR 1955 SC 765 p. 769, para 10 said:
“10. It is a cardinal rule of interpretation that a proviso to a particular provision of a statute only embraces the field which is covered by the main provision. It carves out an exception to the main provision to which it has been enacted as a proviso and to no other.’
10. Lord Macmillan in Madras & Southern Maharatta Railway Co. v. Bezwada Municipality (1944) SCC OnLine PC 7 : (1943-44) 71 IA 113, p.122, laid down the sphere of a proviso as follows:
“…. The proper function of a proviso is to except and deal with a case which would otherwise fall within the general language of the main enactment, and its effect is confined to that case. Where, as in the present case, the language of the main enactment is clear and unambiguous, a proviso can have no repercussion on the interpretation of the main enactment, so as to exclude from it by implication what clearly falls within its express terms.”
The territory of a proviso therefore is to carve out an exception to the main enactment and exclude something which otherwise would have been within the section. It has to operate in the same field and if the language of the main enactment is clear it cannot be used for the purpose of interpreting the main enactment or to exclude by implication what the enactment clearly says unless the words of the proviso are such that that is its necessary effect. (Vide also Toronto Corpn. v. Attorney-General for Canada 1946 AC 32 (PC), p.37)”
14. The proviso goes on to state that an appeal shall lie from such orders passed by the Commercial Division of the High Court that are specifically enumerated under Order 43 of the Code of Civil Procedure Code, 1908, and Section 37 of the Arbitration Act. It will at once be noticed that orders that are not specifically enumerated under Order 43 of the CPC would, therefore, not be appealable, and appeals that are mentioned in Section 37 of the Arbitration Act alone are appeals that can be made to the Commercial Appellate Division of a High Court.
15. Thus, an order which refers parties to arbitration under Section 8, not being appealable under Section 37(1)(a), would not be appealable under Section 13(1) of the Commercial Courts Act. Similarly, an appeal rejecting a plea referred to in sub-sections (2) and (3) of Section 16 of the Arbitration Act would equally not be appealable under Section 37(2)(a) and, therefore, under Section 13(1) of the Commercial Courts Act.”
10. The Court clearly laid down that as per the then existing provisions of Section 37 of the Act, the orders under Section 8 and 16 of the Act, 1996 were not appealable, the appeal could not be filed/maintained under Section 13(1) of the Act, 2015.
11. After substitution of Section 13 of the Act and insertion of the sub-section (1A) in the said provision in the year 2018, the judgment in the case of Kandla Export Corporation (supra) was considered in the case of BGS SGS SOMA JV (supra) by Hon’ble Supreme Court wherein it was specifically laid down that there is no independent right of appeal under Section 13(1) of the Act, 2015 and that appeal could be filed in terms of proviso to Section 13(1A) of the Act, 2015. It was laid down as under:
“13. Given the fact that there is no independent right of appeal under Section 13(1) of the Commercial Courts Act, 2015, which merely provides the forum of filing appeals, it is the parameters of Section 37 of the Arbitration Act,1996 alone which have to be looked at in order to determine whether the present appeals were maintainable. Section 37(1) makes it clear that appeals shall only lie from the orders set out in sub-clauses (a), (b) and (c) and from no others. The pigeonhole that the High Court in the impugned judgement has chosen to say that the appeals in the present cases were maintainable is sub-clause (c). According to the High Court, even where a Section 34 application is ordered to be returned to the appropriate Court, such order would amount to an order “refusing to set aside an arbitral award under Section 34“.
14. Interestingly, under the proviso to Section 13(1-A) of the Commercial Courts Act, 2015, Order 43 CPC is also mentioned. Order 43 Rule(1)(a) reads as follows:
“1. Appeal from orders.- An appeal shall lie from the following orders under the provisions of Section 104, namely-
(a) an order under Rule 10 of Order 7 returning a plaint to be presented to the proper Court except where the procedure specified in Rule 10-A of Order 7 has been followed;”
This provision is conspicuous by its absence in Section 37 of the Arbitration Act, 1996, which alone can be looked at for the purpose of filing appeals against orders setting aside, or refusing to set aside awards under Section 34. Also, what is missed by the impugned judgment is the words “under Section 34“. Thus, the refusal to set aside an arbitral award must be under Section 34, i.e., after the grounds set out in Section 34 have been applied to the arbitral award in question, and after the Court has turned down such grounds. Admittedly, on the facts of these cases, there was no adjudication under Section 34 of the Arbitration Act, 1996 – all that was done was that the Special Commercial Court at Gurugram allowed an application filed under Section 151 read with Order 7 Rule 10 CPC, determining that the Special Commercial Court at Gurugram had no jurisdiction to proceed further with the Section 34 application, and therefore, such application would have to be returned to the competent court situate at New Delhi.”
12. The above pronouncements of Hon’ble Supreme Court leave no scope for further arguments inasmuch it has been categorically laid down that the remedy of appeal under the provisions of Act, 2015 is available against those orders which are specifically and exhaustively enumerated under Order XLIII C.P.C. and Section 37 of the Act, 1996 and from the orders which do not fall within the scope and ambit of the orders specified therein, no appeal shall lie.
13. So far as judgment in the case of Tapesh Arora (supra), reliedon by counsel for the appellants is concerned, order impugned in the said case was a decree of possession passed by the Commercial Court under Order XII Rule 6 C.P.C. qua which by way of an interlocutory order, it was observed that the appeal under the Act, 2015 would be maintainable, which judgment would have no application to the facts of the present case.
14. In the present case, by the orders impugned, the Commercial Court has dismissed the execution applications against which the appeal is not maintainable either under Order XLIII C.P.C. or Section 37 of the Act, 1996 and, as such, the present appeals arising from the orders passed in execution proceedings under the Act, 2015 would not be maintainable.
15. Similar view has been taken by Division Bench of Karnataka High Court in Sri Satyanarayana Muniyappa vs. Siemens Financial Services Pvt. Ltd. : Commercial Appeal No. 247 of 2023 decided on 04.07.2023.
16. Consequently, the appeals are dismissed as not maintainable, with liberty to the appellants to take recourse to such remedy, as may be available to them in law.
17. The certified copies of the impugned orders be returned to the counsel for the appellants on production of self attested copies of the orders impugned.
Order Date :- 03.07.2025.
P.Sri.
(Kshitij Shailendra, J) (Arun Bhansali, CJ)
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