Case: FIRM RAJASTHAN UDYOG &amp; ORS.  Vs. HINDUSTAN ENGINEERING AND INDUSTRIES LTD

3. Briefly stated, the facts of this case are that the appellant no.1 is a partnership firm and other appellants are its partners. The appellant firm is owner of 249.60 Bighas (approximately 100 acres) of land, which was purchased by the appellant in the year 1966. The dispute in the present appeal relates to a period spreading over four decades. The said land was subject matter of acquisition, for which a Notification dated 13.03.1973 under Section 4 of the Rajasthan Land Acquisition Act, 1953 (for short, Act of 1953), was issued by the State of Rajasthan, which acquisition was for the benefit of the respondent- industry. The said notification was challenged by the appellant before the Rajasthan High Court in Writ Petition no.389 of 1974, which was dismissed by a learned Single Judge of the High Court vide judgment dated 23.07.1974. Challenging the same, the appellant filed Special Appeal No.448 of 1974 before the Division Bench of the High Court, during the pendency of which a declaration under Section 6, read with Section 17 of the Act of 1953, was issued by the State of Rajasthan on 13.09.1975. The Special Appeal challenging the said acquisition was allowed by the Division Bench of the Rajasthan High Court, vide its judgment dated 05.10.1976 and the acquisition proceedings were thus quashed. Challenging the said decision of the Rajasthan High Court, respondent-Hindustan Engineering & Industries Limited, as well as the State of Rajasthan, filed separate Special Leave Petitions (No. 4199 of 1977 and 1060 of 1978, respectively), which petitions were dismissed by this Court by order dated 29.3.19944. During the pendency of the said Special Leave Petitions, on the intervention of the then Chief Minister-cum-Minister of Industries of the State of Rajasthan, an agreement was arrived at between the parties herein, as well as the State of Rajasthan, which was recorded in the Minutes of the meeting dated 27.11.1978, which was to the effect that out of the 249.60 bighas of land belonging to the appellant firm, approximately 104 bighas would be retained by the appellant and the remaining about 145 bighas would be sold to the respondent-Company, subject to the fixation of price of land, construction etc. to be finalised through Arbitration5. Pursuant thereto, an Agreement dated 16.02.1979 was entered into between the appellant-firm and the respondent- Company. The said Agreement dated 16.02.1979 was superseded by another Agreement dated 01.02.1980 executed between the parties6. The matter of determination of price of the land to be sold by the appellant to the respondent-Company, was decided by the sole Arbitrator, Justice Chandra Bhan Bhargav (Retired), vide his Award dated 09.06.1985. In the said Award, the Arbitrator mentioned that the parties had referred their dispute regarding determination of compensation of land to me as Sole Arbitrator. The salient feature decided in the said Award was that the market value of the land to be transferred in favour of the respondent-Company would be determined as on 27.11.1978, which was the date on which the parties agreed to transfer the land. In pursuance thereof, the total compensation amount for the land in question was determined by the Arbitrator as Rs.12,18,700/-. The said Award was filed before the Additional District Judge-1, Bharatpur on 10.06.1985. After the Award was passed, the respondent- Company, vide its communication dated 15.07.1985 conveyed its acceptance of the Award to the appellant by registered post. The same was also conveyed to the Arbitrator vide communication dated 18.07.19857. The appellant then filed its objections to the Award before the Additional District Judge-1, Bharatpur and vide order dated 22.11.1988, the objections were allowed and the matter was remanded back to the Sole Arbitrator. Challenging the said order dated 22.11.1988, the respondent-Company filed Civil Revision Petition No. 163 of 1990 before the Rajasthan High Court, which Revision Petition was allowed on 01.12.1993 and the Award dated 09.06.1985 passed by the Arbitrator was affirmed and made Rule of the Court. Challenging the said order of the Rajasthan High Court, the appellant had filed the Special Leave Petition No.3684 of 1994, which was dismissed by this Court on 29.03.1994. The Award thus attained finality8. It was thereafter that on 16.05.1994, the respondent- Company filed an application for execution of the Award. In the said application, it was stated that according to the directions contained in the Award of the Arbitrator, the petitioner Hindustan Corporation Limited, is required to furnish stamp paper to the respondent for execution of the sale deed _ _ _ _. The prayer made in the said application was that the appellants herein be directed to take steps and execute the sale deed on the stamp papers filed by the respondent herein and thereafter produce the sale deed before the Sub Registrar for its registration. In the alternative, it was prayed that if the appellants herein failed to execute the sale deed, the same may be executed by the Court. In response to the same, the appellants filed its reply on 19.7.1994 opposing the execution application and specially denied that any such direction for the execution of the sale deed, as has been made in the prayer of the application by the respondent herein, was made in the Award of the Arbitrator9. By judgment and order dated 05.01.1995, the Additional District Judge-I, Bharatpur, exercising its power under Section 17 of the Arbitration Act, 1940, allowed the application of the respondent herein and directed the appellants to execute and register the sale deed and hand over possession of the land in question to the respondent herein. Aggrieved by the judgment of the Additional District Judge-I, Bharatpur, dated 05.01.1995, the appellants filed Civil Revision Petition No. 81 of 1995 before the Rajasthan High Court10. During the pendency of the Civil Revision Petition filed by the appellants, the respondent-Company filed Civil Suit No. 60 of 1996 against the appellants seeking specific performance of the Agreement dated 01.02.1980 between the parties i.e., the appellants and the respondent- Company. The Civil Revision Petition No. 81 of 1995 filed by the appellants remained pending before the Rajasthan High Court, when the respondent-Company had filed the Civil Suit No. 60 of 1996. Even when the Civil Suit of the appellants was not decided, the respondent - Company sought to withdraw the Civil Suit No. 60 of 1996 vide its application dated 06.02.2006. Pursuant thereto, the Civil Suit No. 60 of 1996 seeking specific performance of the Agreement dated 01.02.1980 was permitted to be unconditionally withdrawn by the respondent- Company vide order dated 13.02.2006 passed by the Trial Court11. It was then, after more than a decade of withdrawal of the suit by the respondent – Company, that the Civil Revision Petition 81 of 1995, challenging the order of the Additional District Judge-I dated 05.01.1995 was dismissed by the Rajasthan High Court by a detailed order dated 04.07.2016. The High Court opined that the Civil Suit No. 60 of 1996 was filed by the respondent– Company as a matter of abundant precaution but was later withdrawn and mere filing of the Civil Suit would not amount to admission by the respondent-Company that the Award and subsequent order based on it, were not suitable and enforceable. Upholding the order of the Additional District Judge-I dated 05.01.1995, the Civil Revision Petition was dismissed by the Rajasthan High Court. Aggrieved by the said judgment dated 04.07.2016, this appeal has been filed by way of Special Leave Petition.

Court's reasoning:
21. The anchor sheet of the case of the respondent is the Agreement dated 01.02.1980 between the parties (i.e. appellant and respondent) as well as the Arbitration award dated 09.06.198527. In our considered opinion, in the facts of the present case, the answer to the same would be an emphatic no28. There cannot be any doubt that in terms of the Agreement dated 01.02.1980, the Arbitrator was authorized to only fix the price of the land which was to be sold by the appellant to the respondent as per the aforesaid agreement. In the said Agreement dated 01.02.1980, there was an option given to the respondent to either accept the price fixed by the Arbitrator and go ahead with the sale deed, or to refuse to get the sale deed executed at the price fixed by the Arbitrator. Thus, there was no certainty that the sale was to be executed at the price fixed by the Arbitrator. As such, it was the Agreement dated 01.02.1980 alone which could have been executed at the price fixed by the Arbitrator, in case the respondent agreed to the same29. After the passing of the Award by the Arbitrator dated 09.06.1985, which was later confirmed and made Rule of the Court by the Rajasthan High Court on 01.12.1993 and the Special Leave Petition filed by the appellant against the said order was dismissed on 29.03.1994 and the Award had attained finality, the respondent filed a Civil Suit No.60 of 1996 for specific performance of the Agreement dated 01.02.1980. It was this suit for specific performance of agreement under which a direction could have been issued for execution of the sale deed in terms of the Agreement dated 01.02.1980. However, the same was unconditionally withdrawn on 13.02.2006, on an application filed by the respondent on 06.02.2006. With the withdrawal of such suit for specific performance, the matter with regard to the execution of the sale deed in terms of the Agreement dated 01.02.1980 came to an end. The effect of withdrawing Civil Suit No. 60 of 1996 would be that the plaintiff therein (respondent herein) had abandoned its claim of execution of the sale deed in terms of the Agreement dated 01.02.1980, which would be clear from the provisions of Rule 1(4) of Order XXIII CPC30. From the facts of this case, it is clear that the Award passed by the Arbitrator could not be independently executed, as the same was only for fixation of price of land and not for enforcement of the Agreement. The Award was only declaratory of the price of the land. As per the agreement, if the respondent agreed to the price so fixed, it could then get the sale deed executed in terms of the Agreement dated 01.02.1980 as it had the option of either accepting the price and getting the sale deed executed, or not accepting the price and thus not getting the sale deed executed. This would clearly mean that the Award was merely for the declaration of the price of the land, which would be subject to the agreement and it was not necessary for the respondent to get the sale deed executed at the price so determined by the Arbitrator. What was thus executable was the agreement, and not the Award. The relief granted by the Court below for execution of the sale deed in terms of the Award, is thus outside the realm of law, as the Award did not contemplate the transfer of land in favour of the respondent, but only determined the price of land31. It is also noteworthy that the application for execution of Award filed on 16.05.1994 before the Additional District Judge-I, Bharatpur did not provide for any provision of law under which the same was filed. Though, in paragraph 2 of the said application, it was mentioned that the Award of the Arbitrator contained a direction for execution of the Award, but in fact there was no such direction issued in the Award, in which the Arbitrator had only fixed the price of the land and nothing more32. In our view, once the respondent had given up its claim of execution of sale deed in terms of the Agreement dated 01.02.1980 by withdrawing the suit for specific performance of the agreement (Civil Suit No. 60 of 1996), which was permitted to be withdrawn unconditionally on 13.02.2006, the appellant had abandoned its claim for execution of the sale deed. Thus, in our opinion, the respondent could not be permitted to achieve the goal of execution of sale deed by indirectly claiming for execution of Award, when the direct claim for execution of sale deed of the Agreement dated 01.02.1980 had been abandoned by the respondent33. At the cost of repetition, it may be mentioned that the specific performance could only be of the Agreement dated 01.02.1980 and not of the Award dated 09.06.1985. Even the operative portion of the Award also does not give any direction for execution of the sale deed. It was after the passing of the Award that the respondent could have fallen back on the agreement for execution of the sale deed, which respondent did by filing the suit for specific performance, but abandoned such claim by withdrawing the suit unconditionally34. The submission of the learned Senior Counsel for the respondent that substantial justice has been done by the Court by directing execution of the sale deed, is not worthy of acceptance. In a Civil Case, the Courts have to follow the law in letter and spirit, which has not been done in the present case, as in law the sale deed could have been directed to be executed in execution of the Agreement dated 01.02.1980 and not the Award, which was only a declaration, fixing the price of landIt is thus clear that execution of an award can be only to the extent what has been awarded/decreed and not beyond the same. In the present case, the Arbitrator in its Award had only declared the price of land and nothing more. Thus, the question of execution of a sale deed of the land at the price so declared by the Arbitrator in its Award, could not be directed39. Even otherwise, there cannot be any equity in favour of the respondent, as neither any amount was paid nor deposited by the respondent. No earnest money was also paid by the respondent. It was only the stamp paper worth Rs.1,21,870/-, which was deposited by the respondent along with a deposit of Rs.5,500/- in Court at the time of filing of the application on 16.05.1994 for execution of the Award40. It is also noteworthy that neither the Agreement dated 01.02.1980 nor the Award dated 09.06.1985 had been registered under the Registration Act, 190841. Although, in the present case, the Award did not relate to right, title or interest in an immovable property and was only for determination of the price of land, yet if the execution court was to treat the same for execution of sale deed of land (immovable property), it ought to have considered the impact of non-registration of such Award, which has not been done in the present caseThe question in the present case is different, which is as to whether the execution of an award could have been directed in the absence of there being any direction in the Award for execution of the sale deed, which direction could have been given only in the case of execution of the Agreement dated 01.02.1980. The question under consideration in the aforesaid case was that of a decree which was under execution, whereas there was no such decree passed by any Court which was to be executed in the present case. The facts of the present case are thus distinguishable from those in the aforesaid case43. Learned Senior Counsel for the respondent has also relied on the decisions of this Court rendered in Meenakshi Saxena vs ECGC Limited (2018) 7 SCC 479  as well as Topanmal Chhotamal vs Kundomal Gangaram AIR 1960 SC 388 ,which in our opinion are both distinguishable on factsIn the present case, the Court is concerned about execution of the Award and not the Agreement. In the Award passed by the Arbitrator, the price of land was fixed, which was to be executed in terms of the Agreement dated 01.02.1980, and that too at the option of the respondent. Thus, there could be no direction to execute the sale deed at the price fixed in the Award, that too in a petition for execution of the Award, without there being any prayer for execution of the Agreement dated 01.02.198044. Going behind the decree for doing complete justice would not mean that the entire nature of the case could be changed, and what was not awarded in favour of the respondent, could be granted by the executing court. It was only after the respondent had exercised its right to purchase the land at the price fixed by the Arbitrator that a right to enforce the Agreement could have arisen in favour of the respondent. The Award of the Arbitrator, in the present case, in itself was not a conclusive contract between the parties, which could be executed.