High Courts with original civil jurisdiction may also enforce foreign decrees under Section 44A CPC: Supreme Court

The Supreme Court has ruled that a Delhi High Court, having original civil jurisdiction, can hear a petition for enforcement of a monetary decree (over Rs.20 lakhs) from a foreign court which is notified as Superior Court of the reciprocal territory under Article 44A of the Code of Civil Procedure.

The term “district court” in Code Section 44A refers to local limits of jurisdiction of a primary civil court of original jurisdiction and includes local limits of ordinary original civil jurisdiction of a High Court.

A bench comprising Judges Ajay Rastogi and Abhay S. Oka allowed an appeal against the order of the Bench Division of the Delhi High Court, which ruled that the High Courts have no jurisdiction to enforce foreign decrees under Section 44A, even when within pecuniary jurisdiction of the High Court, as Section 44A is an independent provision separate from the enforcement of domestic decrees.

The judgment written by Justice Rastogi, while quashing the judgment of the Bench Division of the High Court, said:

“The Division Bench proceeded on the basis of the term ‘district court’ as referred to in Section 44A of the Code, but did not consider the other relevant provisions to which we have refers in coming to the conclusion that the term “district” as defined in article 2, paragraph 4, of the code only sets the limits of the jurisdiction of the main civil court of first instance and which includes the ordinary civil jurisdiction Court of First Instance of the High Court and once pecuniary jurisdiction exceeds jurisdiction as notified under the relevant statute, jurisdiction shall rest exclusively with the High Court as the original ordinary civil court for enforcement of a foreign decree under Section 44A subject to such just objections as are available to the parties/judgment debtor as provided in Section 13 of the Code”.

Factual background

The appellant brought proceedings in the High Court of Justice, Queen’s Bench Division, Commercial Court, United Kingdom, which is notified as a superior court of a reciprocal territory by the Central Government under section 44A of the Code of Civil Procedure, 1908 (“CPC”).

Section 44A(1) reads as follows –

“44A. Enforcement of Orders of the Courts of the Reciprocal Territory.–(1) Where a certified copy of an order of any superior court of any reciprocal territory has been filed in a district courtthe decree can be executed in India as if it had been passed by the District court.

Finally, a financial decree in the amount of US$5,824,567.74 was adopted in favor of the appellant. After the decree became final, a petition for enforcement was filed in the Delhi High Court in 2006 as the decree amount exceeded Rs. 20 lakh which was then the pecuniary limits of the original civil jurisdiction of the High Court from Delhi. The jurisdiction of the High Court was challenged under section 44A. Given the pecuniary limit, the single judge ruled that the High Court had jurisdiction, but on appeal that decision was overturned by the Bench Division.

Grounds raised by the appellant

Senior Attorney, Dr. Abhishek Manu Singhvi appearing on behalf of the appellant argued that the value of the monetary decree exceeded the pecuniary limits at the time of the Delhi High Court as notified under section 5(2) of the Delhi High Court (“1966 Act”). He further argued that in cities like Delhi, Kolkata, Chennai and Mumbai where there is shared jurisdiction based on pecuniary value and where the High Courts in the exercise of their original ordinary civil jurisdiction also have jurisdiction over enforce decrees, enforcement under Section 44A may be effected by the Tribunal de Grande Instance.

Arguments raised by the respondent

Senior Counsel, Mr. Rakesh Dwivedi appearing on behalf of the appellant argued that Section 44A is an independent right conferred on a foreign decree holder for enforcement in India which is distinct from domestic enforcement as elucidated in Section 39 (3). Under Section 38 a decree can be executed by the court that issued the decree or the competent court to which it is transferred for execution. It has also been asserted that where Section 44A categorically identifies the “district court” as the court for the enforcement of foreign judgments, pecuniary jurisdiction would not be relevant. Furthermore, it was pointed out that in section 5(2) of the 1996 Act which stated, the Delhi High Court shall also have in respect of the said territories original ordinary civil jurisdiction in any suit the value of which exceeds rupees twenty lakhs, the term “trial” does not include enforcement proceedings.

Analysis by the Supreme Court

The Court referred to the definition of “district” provided in Article 2(4) of the CPC, which reads as follows –

“district” means the local limits of the jurisdiction of a primary civil trial court (hereinafter referred to as a “district court”), and includes the local limits of the original ordinary civil jurisdiction of a High Court ; »

Reading Sections 2(4) and 44A together, the Court noted that it includes the local limits of the original ordinary civil jurisdiction of a High Court. Although not all High Courts have original ordinary civil jurisdiction, the Court held that those which do have jurisdiction to exercise the power to enforce decrees, including foreign decrees under Article 44A. The Court pointed out that enforcement which would otherwise fall within the jurisdiction of the High Court on the basis of the pecuniary limit notified under section 5(2), cannot be enforced by a civil court simply because the section 44A refers to the “district court”.

Case name: M/s. Griesheim GmbH (now called Air Liquide Deutschland GmbH v. Goyal MG Gases Pvt. Ltd.

Reference: 2022 LiveLaw (SC) 95

Case No. and Date: Civil Appeal No. 521 of 2022 | Jan 28, 2022

Corum: judges Ajay Rastogi and Abhay S. Oka

Counsel for the Appellant: Lead Counsel, Dr. AM Singhvi, Counsel of Record, Ms. Mohna M. Lal.

Counsel for the Respondent: Lead Counsel Mr. Rakesh Dwivedi, Counsel of Record Ms. Aruna Gupta.

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