ANGERLEHNER MICHEL CONSTRUCTION PVT LTD Vs. SHRIMOULI BUILDERS

JUDGEMENT

(1.) The Applicant in the aforesaid Judges Order has obtained a Recovery Certificate for Rs.40979406 against the first Respondent s in the Arbitration Petitions in which the Judges Order is taken out against the Respondent s therein. The claimant s in the aforesaid Chamber Summons have obtained an Arbitration Award for Rs.9161727.42ps. In Arbitration Petition in which the Chamber Summons is taken out against the Respondent s therein. The first Respondent s in both of the aforesaid Arbitration Petitions are one Shreemauli Builders represented by their Proprietor Mr. K.P.Reddy. Arbitration Petition Nos.242 of 2005 and 66 of 2005 are pending. By an interim order passed in this Arbitration Petition Nos.242 and 66 of 2005 one Bangalore Water Supply has been directed to deposit Rs.2.12 Crores. That amount is stated to have been deposited in this Court to the credit of those Arbitration Petitions. The Applicant in the Judges Order desires to attach and take the amount so deposited in satisfaction of the Recovery Certificate issued by the Recovery Officer of the Co-operative Court. Similarly the claimant s in the Chamber Summons who are the Plaintiffs /Petitioners in the Arbitration Petition No.162 of 2002 who have obtained an Award seek to attach and take the amount s for which the Award is obtained by them from the amount so deposited. The Petitioners in Arbitration Petitions 242 of 2005 and 66 of 2005, who are the 3rd Respondent s in Chamber Summons Nos.530 of 2005 and 124 of 2007, have shown cause against the applications of both of these parties for satisfying their respective claims under the Recovery Certificate or the Arbitration Award.

(2.) Each party claims priority in the payment s of the amount under the Arbitral Award, Recovery Certificate or the amount s deposited in the Arbitration Petitions 242 of 2005 and 66 of 2005. Each party also claims to exclude all other parties entirely from any rateble distribution of the said amount. It will, therefore, have to be seen as to whether all the aforesaid parties or some or one of them are / i s entitled to the said sum of Rs.2.12 Crores.

(3.) Mr. Tulzapurpar on behalf of the Petitioners in Arbitration Petitions 242 of 2005 and 66 of 2005 contended that upon an application made under Section 9(b) of the Arbitration and Conciliation Act, 1996 read with Order 38 Rule 5 of the CPC for attachment before judgment of the dues payable to the Defendant /Re spondent Shreemauli Builders in their Petition Bangalore Water Supply (now made Garnishee in the aforesaid Chamber Summons) was directed to deposit Rs.2.12 Crores to the credit of those Petitions. The amount deposited by the Garnishee was therefore, an attachment made by the Petitioners in those Petitions before an Award in those Petitions came to be filed. At the highest, therefore, this was the movable property which was attached before judgment under Order 38 Rule 5 of the CPC. Mr. Tulzapurkar contends that this amount is earmarked for the Petitioners' benefit. It is made to secure the claim of the Petitioners unless no Award came to be passed in favour of the Petitioners. The Petitioners in those Petitions would therefore have priority over the other creditors for whom such amount was not secured. What is missed in this argument is that the amount secured even as an attachment before judgment under Order 38 Rule 5 of the CPC is subject to the rights of other Decree Holders under Order 38 Rule 10 of the CPC. The said Rule runs thus :