Foreign judgment — Decision on merits would be conclusive — Hence enforceable in India — CPC, section 13(b).
[Karnail Singh Sandhar v. M/s. Sandhar and Kang Ltd., AIR 2011 (NOC) 69 (P & H)]
The petitioner filed a claim against Sandhar & Kang Ltd. & Ors. in the High Court of Justice, Chancery Division, UK. The petitioner and defendant had establish a business partnership for trading in food retails. In or about 1986, the petitioner and defendants fell out, the petitioner resigned as a director and shareholder of the company and was paid £350,000 for his shareholding in the company. However, the petitioner remained registered as a holder of the legal estate in the property and the Chester Road property with defendants in equal shares. After his resignation, the petitioner left UK and settled at Canada and obtained Canadian citizenship. Without the knowledge and consent of the petitioner, the defendants sold the property. The petitioner returned to the UK and discovered the aforesaid transfers. The petitioner filed necessary proceeding against the defendants in respect of the property.
On 3-5-2007, the High Court of Justice issued a judgment by way of a minute of order whereby the petitioner was directed to pay the costs. On 14-2-2008, the Appellate Court dismissed the appeal by way of an order and directed the petitioner to pay costs incurred by the defendants in relation to the Court of Appeal proceedings related to the Court of Appeal order. That after the aforesaid orders passed by the Courts at UK, the respondent/decree-holder filed an execution in the Court at Ontario, Canada as the petitioner was a citizen of Canada. The said execution was pending but no recovery could be effected. Nothing could be recovered from the petitioner even in UK.
Litigation between the parties on execution in India.
On 11- 6-2008, the respondent filed an execution in the Court of learned District Judge, Sangrur for execution of the decrees to recover costs of £ 50,000 as the property of the petitioner is situated at Sangrur. The learned District Judge, Sangrur, vide its impugned order dated 26-2-2010 rejected the plea raised by the petitioner and held that the application for execution of the foreign judgments is maintainable.
The petitioner invoked the revisional jurisdiction of the Court under Article 227 of the Constitution of India to challenge the impugned order dated 6-2-2010 upholding the maintainability of the execution application filed by the respondent who had sought to execute foreign judgments at Sangrur in India.
The Court held that section 13(b) of the Civil Procedure Code (CPC) provides that a foreign judgment shall be conclusive as to any matter thereby directly decided between the parties, but there are certain exceptions which are provided in clause (a) to (f) in which clause (b) provides that a judgment shall not be conclusive if it is not rendered on the merits of the case.
It was held that the judgment passed by the High Court of Justice and the Court of Appeal of the U.K., which were sought to be executed in the present case, were judgments on merits and it is also held that in order to decide a case on merits in a case which is decided under a summary procedure after considering the evidence available on record led by the parties, it would be a decision on merits to be covered u/s.13(b) of the CPC.
Hence, in view of it was held that costs order imposing costs a foreign Court was a decree which could be executed in the Court in India u/s.44-A of the CPC. Simultaneous execution petition in India and Foreign Court not barred specially when decree holder has stated that nothing has been recovered from execution filed in other Court.
