KIOCL FORMERLY KUDREMUKH IRON ORE COMPANY LIMITED BANGALORE Vs. UNITED PRECISION ENGINEERS PRIVATE LIMITED BANGALORE

JUDGEMENT

(1.) A contract was entered into between the parties on 6-3-1992 for executing certain construction in respect of relocation of Crusher Plant III at Kudremukh. However, the disputes arose between the parties. Ultimately, the matter was referred to arbitration by the parties as per the terms of the agreement. The Arbitral Tribunal passed an award under Arbitration Act, 1940 on 31-5-2007 as per Annexure-N. The operative portion of the award reads thus:

(2.) During the interregnum, the Petitioner herein filed an application under Section 151 of the Code of Civil Procedure, 1908 before the Court below to call for the original award which is kept in the safe custody of the Court and to peruse the same as to whether it is stamped or not, and if not, to proceed in accordance with law. The Respondent herein filed statement of objections to the said application. However, the Respondent herein filed another application under Section 151 of Code of Civil Procedure on 16-11-2007 as per Annexure-U (numbered as LA. 2) to return the original award dated 31-5-2007 for having it duly stamped and to represent the same after stamping it. The Petitioner herein has filed statement of objections to the said application. Thereafter, one more memo was filed by the Respondent herein praying for return of the original award copy for getting it stamped in the office of District Registrar after determination of stamp duty. It is mentioned in the said memo that the stamp duty was not paid on the strong belief that only on confirmation of award, the stamp duty has to be paid. However, the application and memo filed for return of Award for getting it stamped were withdrawn later. The Trial Court on hearing the application filed by the Petitioner, has passed the impugned order holding that it is not necessary to pay the stamp duty for the present and the stamp duty may be paid after the award gets converted itself into a judgment and decree.

(3.) The arbitral proceedings were under Arbitration Act, 1940. Thus, the new Arbitration Act is not applicable to the facts of this case. Under Section 17 of the Arbitration Act; 1940, the award has to be presented before the Court and after following the due procedure, the Court may proceed to pass the judgment in accordance with the award and upon such judgment, the decree will follow. Thus, it is clear that the award has to be presented before the Court for getting it self converted into a judgment and decree. Article 11 of the Karnataka Stamp Act, 1957, deals with the award. The said article will have to be read along with Section 33 of the Karnataka Stamp Act. If Article 11 is read with Section 33 of the Karnataka Stamp Act, it is clear that the award in question will have to be treated as an instrument and the same needs to be duly stamped. Therefore, it is incumbent on the Respondent to get the award duly stamped in accordance with law. In view of the said article, the Respondent himself had made an application before the Court below praying for return of the document for getting the award stamped. He had also filed a memo to that effect. However, subsequently they were withdrawn. The Court below should have directed the award to be duly stamped even prior to passing of the judgment in view of Section 33 of the Karnataka Stamp Act read with Article 11 of the Stamp Act. Even learned Arbitrator has suggested that the Petitioner should bear the stamp duty.