How to secure attachment of movables and reliefs without notice to the award debtor
The process of enforcement begins with the conclusion of arbitration proceedings and an award has been made in favour of either the claimant or the respondent (as the case may be). The party seeking to enforce the award is called the award-holder and the party against whom the award is enforced is called the award debtor. Any award passed by an arbitral tribunal will be enforced in accordance with Code of Civil Procedure, 1908 (“CPC”).1
The present chapter seeks to explain the process to expedite the process of execution/ enforcement proceedings in respect of arbitral awards.
It is quite often the case that the award debtor would seek to evade the notice of an execution proceeding in an attempt to frustrate the award-holder from realising the fruits of the arbitral proceedings. The award-holder in such cases would only be entitled to reliefs on paper without the ability to enforce the same against the award debtor.
It is in these circumstances that advocates practising arbitration can enforce an award against an award debtor without service of notice before a court by filing an application under Order 21 Rule 22 of the CPC seeking attachment of moveable property.
Scope and extent of Order 21 Rule 22
Order 21 Rule 22 of the CPC provides that if an application for execution is made in the following circumstances:
- a) more than two years after the date of the decree/ award, or
- b) against the legal representative of a party to the decree/ award, or where an
application is made for the execution of a decree/ award filed under the provisions of
Section 44A, or
- c) against the assignee or receiver in insolvency, where the party to the decree/ award
has been adjudged to be an insolvent,
the Court executing the award shall issue a notice to the person against whom execution is applied for requiring him to show cause, on a date to be fixed, why the decree/ award should not be executed against him.
The object of the rule of notice after 2 years is to prevent undue shock to the judgment debtors in case of the launching of execution proceedings after a lapse of two years, or to legal representatives and a receiver of assets for an insolvent debtor who might not be knowing about the decree/ award under execution.
As a necessary corollary, the courts have held that in the event that the decree/ award has been passed prior to 2 years, no notice is required to be served on the award debtor for the purpose of attachment of movable property. The basis is that:
- The award debtor was to be again given a notice in all execution cases, the fruits of the decree/ award cannot be realised by the award-holder.
- The court should not commit unreasonable delay in giving relief to the party, who has succeeded in a dispute.
This Article Does Not Intend To Hurt The Sentiments Of Any Individual Community, Sect, Or Religion Etcetera. This Article Is Based Purely On The Authors Personal Views And Opinions In The Exercise Of The Fundamental Right Guaranteed Under Article 19(1)(A) And Other Related Laws Being Force In India, For The Time Being.