Arbitral Award in the nature of money decree – Stay – Interplay of Sections 36(3) and 37 of the Arbitration Act and guiding principles
Application under Section 36(3) of the AA for grant of stay to the impugned Arbitral Award. The petitioner had given bank guarantee in the execution petition pending before the Calcutta High Court and prayed for stay to the arbitral award challenged in the Bombay High Court.
HELD that the provisions of the Arbitration Act are essentially to be first applied, whereas, the provisions of CPC are to be followed as guidance. CPC will apply only if it is not inconsistent with the spirit and the provisions of the Arbitration Act. Once an Award is passed by the Arbitrator till it is stayed the Award is in the form of the decree and can be executed in that from by the Executing Court. The decision of the Calcutta High Court in Kolkata Metropolitan Development Authority case (IA GA 1 of 2020 and A.P. No.351 of 2020) is distinguished that the principles of grant of stay under Section 37 are not attracted to the stay under Section 36(3) since the Court is still considering challenge to the Award under Section 34, whereas, it is a challenge to the decree under Section 37. Thus, whether section 34 petition has been dismissed or pending consideration, the same parameters would apply for stay of the Award. As a result, stay to the execution, operation and effect of the impugned Award dated 5.7.2018 was granted subject to deposit of awarded amount with interest.
Order dated 1.3.2024 in Interim Application (L) No.779 of 2024 in Commercial Arbitration Petition No.1131 of 2018 of M/s. Balmer Lawrie & Co. Ltd Vs. M/s. Shilpi Engineering Pvt Ltd.
