Arbitral Award – Inadequately stamped – Cannot be enforced
Arbitral Award dated 31.3.2017 in favour of the Respondent-Bank was passed for recovery of Rs.2,03,600/- against the petitioner.
The Bank filed Execution Petition under Order 21 Rule 11 (2) of CPC and Section 36 of the Arbitration and Conciliation Act, 1996.
The petition filed objection under Section 37 of CPC and Section 35 of the Indian Stamp Act, 1899. It was contended that the Award was not adequately stamped and that the learned trial Judge had not mentioned in the award that the stamp duty was paid by the Bank for enforcement of award. It was contended that the Arbitrator was unilaterally appointed.
Section 17 of the Indian Stamp Act says that all instrument chargeable with duty and executed by any person shall be stamped before or at the time of execution.
Section 36 of the AA held that the parties can raise objection on account of non-registration and non-stamping under Section 17(e) of the Registration Act at the stage of execution of the award.
The order of the trial Court does not disclose payment of stamp duty, the award lacks proper stamping for enforcement and that the objection of the judgment debtor cannot be decided by the Executing Court.
The Award must be stamped before or at the time of execution and absence of adequate stamping invalidates the execution.
