ARTICLES

Enforcing of Decree or Judgment from a Foreign Court

In India, Code of Civil Procedure, 1908 governs the execution of decrees, be it from an Indian or a Foreign Court. At times a Decree-holder may not be able to seek the desired relief in the event of there being any conditions laid down in the laws of a country for the execution and/ or enforcement of. any judgement or decree passed by a foreign court

A foreign Court is defined as a court situate outside India and not established or continued by the authority of the Central Government. And a Foreign Judgment means a judgment of a foreign court. Sections 13 and 14 of C.P.C legislate a rule of res judicata in case of foreign judgments. These provisions embody the principle of private international law that a judgment delivered by a foreign court of competent jurisdiction can be enforced by an Indian court and will operate as res judicata between the parties thereto except in the cases mentioned in Section 13.

The Civil Procedure Code, 1908 provides two modes of enforcing a foreign judgement/decree in India. Where reciprocity exist between India and a Foreign country, judgments of such foreign country may be enforced by proceedings in execution in India or by filing a suit in India upon such Foreign judgment.

In other words, if the foreign court whose judgement/decree is sought to be enforced in India, is of any reciprocating country, then by filing an Execution petition under section 44 of CPC. However if the foreign court whose decree/judgement is sought to be enforced in India, is not of any reciprocating country(s), then the remedy available to the decree holder is to file a fresh suit based upon such decree.

Section 44 A reads as follows:

44A. Execution of decrees passed by Courts in reciprocating territory -- (1) Where a certified copy of decree of any of the superior Courts of any reciprocating territory has been filed in a District Court, the decree may be executed in India as if it had been passed by the District Court.

(2) Together with the certified copy of the decree shall be filed a certificate from such superior Court stating the extent, if any, to which the decree has been satisfied or adjusted and such certificate shall, for the purposes of proceedings under this section, be conclusive proof of the extent of such satisfaction or adjustment.

(3) The provisions of section 47 shall as from the filing of the certified copy of the decree apply to the proceedings of a District Court executing a decree under this section, and the District Court shall refuse execution of any such decree, if it is shown to the satisfaction of the Court that the decree falls within any of the exceptions specified in clauses (a) to (f) of section 13.

Explanation 1 - "Reciprocating territory" means any country or territory outside India which the Central Government may, by notification in the Official Gazette, declare to be a reciprocating territory for the purposes of this section; and "superior Courts", with reference to any such territory, means such Courts as may be specified in the said notification.

Explanation 2 - "Decree" with reference to a superior Court means any decree or judgment of such Court under which a sum of money is payable, not being a sum payable in respect of taxes or other charges of a like nature or in respect to a fine or other penalty, but shall in no case include an arbitration award, even if such an award is enforceable as a decree or judgment.

The following countries have been declared as reciprocating territories by the Indian Government.

By whatever mode the decree is sought to be enforced, be it under section 44A C.P.C or by filing of suit, it has to clear the inquest as provided in section 13 of C.P.C, which provides exceptions as to when a foreign judgment is not conclusive.

Foreign judgments are conclusive in Indian Courts regarding any matter directly adjudicated upon between the same parties. A judgment of a foreign court is rendered inconclusive and resultantly unenforceable / unexecutable in India, in the following cases.

A Brief about the Judgement of foreign courts rendered inconclusive or uneforceable in India have been dealt, in the following paragrahps.

1. Court not having Jurisdiction - sub - clause (a) of S. 13 C.P.C

In case of S. Gurdial Singh Vs. Maharaja of Faridkot (1894) L.R. 21 I.A. 171 while dealing with the question of Jurisidiction of a foreign court. the Privy Council held as under :

"In a personal action to which none of these causes of jurisdiction previously discussed apply, a decree pronounced in absentem by a foreign Court to the jurisdiction of which the defendant has not in any way submitted himself is by international law an absolute nullity. He is under no obligation of any kind to obey it, and it must be regarded as a mere nullity, by the Courts or every nation except (when authorized by special local legislation) in the country of the forum by which it was pronounced".

In the Case of Y. Narasimha Rao And Others, Appellants V. Y. Venkata Lakshmi And Another, Respondents. 1991-(003)-SCC -0451 -SC it was held that Clause (a) of Section 13 states that a foreign judgment shall not be recognised if it has not been pronounced by a court of competent jurisdiction. We are of the view that this clause should be interpreted to mean that only that court will be a court of competent jurisdiction which the Act or the law under which the parties are married recognises as a court of competent jurisdiction to entertain the matrimonial dispute. Any other court should be held a court without jurisdiction unless both parties voluntarily and unconditionally subject themselves to the jurisdiction of that court. The expression "competent court" in Section 41 of the Indian Evidence Act has also to be construed likewise.

The following circumstances would give jurisdiction to foreign courts:

2. Judgement not on Merit - sub - clause (b) of S. 13 C.P.C

In the following are the cases the Courts held that the judgments were not based on the merits of the case and hence were inconclusive.

The primal source of all decisions under this category is the decision of the Privy Council in the case of D.T. Keymer Vs. P. Viswanatham, AIR 1916 PC 121.

In this case, a suit for money was brought in the English Courts against the defendant as partner of a certain firm, wherein the latter denied that he was a partner and also that any money was due. Thereupon the defendant was served with certain interrogatories to be answered. On his omission to answer them his defence was struck off and judgment entered for the plaintiff. When the judgment was sought to be enforced in India, the defendant raised the objection that the judgment had not been rendered on the merits of the case and hence was not conclusive under the meaning of S. 13(b) of CPC. The matter reached the Privy Council, where the Court held that since the defendant's defence was struck down and it was treated as if the defendant had not defended the claim and the claim of the plaintiff was not investigated into, the decision was not conclusive in the meaning of S. 13(b) and therefore, could not be enforced in India.

The Punjab & Harayana High Court in the case of Gurdas Mann Vs. Mohinder Singh Brar AIR 1993 P & H 92 held that an exparte judgment and decree which did not show that the plaintiff had led evidence to prove his claim before the Court, was not executable under S. 13(b) of the CPC since it was not passed on the merits of the claim.

The Hon'ble Supreme Court while interpreting S. 13(b) of CPC in the case of Y. Narsimha Rao Vs. Y. Venkata Lakshmi 1991 (3) SCC 451, held (a) that the decision of the foreign court should be on a ground available under the law under which the parties are married, and (b) that the decision should be a result of the contest between the parties. It was observed that the latter requirement is fulfilled only when the respondent is duly served and voluntarily and unconditionally submits himself/herself to the jurisdiction of the court and contests the claim, or agrees to the pas sing of the decree with or without appearance. It was held that a mere filing of the reply to the claim under protest and without submitting to the jurisdiction of the court, or an appearance in the Court either in person or through a representative for objecting to the jurisdiction of the Court, should not be considered as a decision on the merits of the case.

In the case of in Mohd. Sheriff and Co. v. Abdul Jabbar (ILR (1966) 1 Mad 18) the Court had to deal with a problem arising out of a foreign judgment rendered by the Supreme Court of Singapore on default of appearance of the defendant. Veeraswami, J., (as he then was), delivering the judgment on behalf of the Bench, pointed out that the decree that followed as a matter of course solely on account of the default of the defendant's appearance could not be a judgment on merits, as no evidence was adduced and there was no judicial consideration of the tenability or justness of the claim

A judgment on the merits of the claim and what such requirements are, have been explained in Abdul Rahman v. Mohd. Ali Rowther (AIR 1928 Rang 319 : ILR 6 Rang 552) in the following terms :

'A decision on the merits involves the application of the mind of the Court to the truth or falsity of the plaintiff's case and therefore though a judgment passed after a judicial consideration of the matter by taking evidence may be a decision on the merits even though passed ex parte, a decision passed without evidence of any kind but passed only on his pleadings cannot be held to be a decision on the merits.'

In the case of Algemene Bank Nederland NV v. Satish Dayalal Choksi AIR 1990 Bom 170 a summary suit had been filed in Hong Kong. In that suit leave to defend was granted to the defence. Thus the High Court had prima facie considered the merits of the matter and had granted unconditional leave. Thereafter the defendant filed a written statement. It appears that the defendant applied to Reserve Bank of India for foreign exchange in order to engage a lawyer in Hong Kong and his application was not granted by the Reserve Bank of India. As a result the defendant could not appear at the trial and an ex parte decree came to be passed against the defendant. The question which arose before the court was whether such a decree could be said to be a decree on merits. A large number of authorities were cited before that court and it was ultimately held as follows : (AIR pp. 177-78, paras 28-29)

"28. In the light of these authorities I have to see whether in the present case the Hong Kong court gave its decision on the merits of the controversy. The Hong Kong court had before it the defence which was filed by the present defendant. The defence questioned the execution of the guarantee to repay the debts of Madhusudan & Co. Ltd. The entry of 7-4-1985 in the register of guarantees was also questioned by the defendant. In the absence of the defendant, these contentions raised by him could not have been considered. The judgment which is before me does not indicate whether actually any evidence was led before the Hong Kong court and whether the court went into the merits of the case. The judgment merely sets out that 'on the defendant's failure to appear and upon proof of plaintiff's claim', the judgment is entered for the plaintiff. The plaintiff Bank has emphasised the words 'upon proof of plaintiff's claim'. They have also produced the original guarantee which bears in one corner a sticker showing that it was exhibited before the Hong Kong court. The plaintiff Bank has not said in its affidavit that the documents which were tendered before the court were properly proved or that anybody on behalf of the bank had given evidence to establish the plaintiff's claim. This becomes relevant because it is the contention of the defendant that the guarantee which he had given was a blank and undated guarantee. It had been misused by the plaintiff Bank in the present case. The defendant has also relied upon alterations and erasures in the plaintiff Bank's register of guarantees to show that this undated guarantee was subsequently entered in the register by altering another entry to indicate that it was given around 7th April, 1985. There is no material to show that these aspects of the dispute were ever examined by the Hong Kong court. The court seems to have proceeded to pronounce the judgment in view of the defendant's failure to appear at the hearing of the case to defend the claim on merits and is therefore not a Judgement on Merit.

In the case of Trilochan Choudhury v. Dayanidhi Patra AIR 1961 Ori 158 : ILR 1961 Cut 15o it was held that under Section 13 even an ex parte judgment in favour of the plaintiff may be deemed to be a judgment given on merits if some evidence is adduced on behalf of the plaintiff and the judgment, however brief, is based on a consideration of that evidence. Where, however, no evidence is adduced on the plaintiff's side and his suit is decreed merely because of the absence of the defendant either by way of penalty or in a formal manner, the judgment may not be one based on the merits of the case.

The minimum requirements of a judgment on the merits of the claim. have been explained in Abdul Rahman v. Mohd. Ali Rowther (AIR 1928 Rang 319 : ILR 6 Rang 552) in the following terms :

'A decision on the merits involves the application of the mind of the Court to the truth or falsity of the plaintiff's case and therefore though a judgment passed after a judicial consideration of the matter by taking evidence may be a decision on the merits even though passed ex parte, a decision passed without evidence of any kind but passed only on his pleadings cannot be held to be a decision on the merits.'

Similar view was taken by the Patna High Court also in Wazir Sahu v. Munshi Das AIR 1941 Pat 109 : ILR 20 Pat 144 where the question when an ex parte decision can be said to be on the merits, was answered as follows :

'An ex parte decision may or may not be on the merits. The mere fact of its being ex parte will not in itself justify a finding that the decision was not on the merits. That is not the real test. The real test is not whether the decision was or was not ex parte, but whether it was merely formally passed as a matter of course or by way of penalty or it was based on the consideration of the truth or otherwise of the plaintiff's claim.'

In Mohd. Sheriff and Co. v. Abdul Jabbar (ILR (1966) 1 Mad 18) in which a Bench of the Hon'ble Court had to deal with a foreign judgment rendered by the Supreme Court of Singapore on default of appearance of the defendant. Veeraswami, J., (as he then was), delivering the judgment on behalf of the Bench, after referring to the relevant decisions, has followed and applied the principle enunciated by the Full Bench.

The learned Judge pointed out that the decree that followed as a matter of course solely on account of the default of the defendant's appearance could not be a judgment on merits, as no evidence was adduced and there was no judicial consideration of the tenability or justness of the claim.

3. Judgment founded on incorrect view of International Law and/or failure to recognize the Indian Law - sub - clause (c) of S. 13 C.P.C.

The issue which fell for the Courts consideration in the case of Panchapakesa Iyer Vs. K.N. Hussain Muhammad Rowther AIR 1934 MAD 145, was that whether the foreign Court had decreed the suit (wherein the court granted the probate of Will, wherein some of the property was in India) on an incorrect view of International Law. In this regard the Court held that the foreign Court had adopted an incorrect view of International Law, since a foreign Court does not have jurisdiction over the immovable property situated in the other Country's Courts Jurisdiction. Therefore the judgment was declared to be inconclusive and unenforceable in India.

4. Where proceedings in the foreign Court on which the Foreign Judgment is based were contrary to natural justice - sub - clause (d) of S. 13 C.P.C.

The foreign Court did not appoint any person as a guardian of the minor defendant. The Honble Court in the case of Hari Singh Vs. Muhammad Said AIR 192& Lah 200 court held that proceedings could not have proceeded ex-parte against the minor. The Court correspondingly held that the minor defendant did not have any knowledge of the suit being pending against him even after he became a major which was before the judgment was passed. On that footing the court concluded that the judgment passed against the minor was opposed to natural justice within the meaning S. 13(d) of CPC. The Court also held that since the legal representatives of one of the defendants were also not brought on record, this also amounted to denial of natural justice. Therefore the judgment was held to be inconclusive qua these defendants.

In Sankaran Govindan, Appellant V. Lakshmi Bharathi And Others, Respondents. 1974-(061)-AIR -1764 - “SC, the Hon'ble Supreme Court held : It is extremely difficult to fix with precision the exact cases in which the contravention of any rule of procedure is sufficiently serious to justify a refusal of recognition or enforcement of a foreign judgment. It is difficult to trace the delicate gradations of injustice so as to reach a definite point at which it deserves to be called the negation of natural justice. The expression "contrary to natural justice" has figured so prominently in judicial statements that it is essential to fix its exact scope and meaning. When applied to foreign judgments, it merely relates to the alleged irregularities in procedure adopted by the adjudicating Court and has nothing to do with the merits of the case. If the proceedings be in accordance with the practice of the foreign Court but that practice is not in accordance with natural justice. This Court will not allow it to be concluded by them. In other words, the Courts are vigilant to see that the defendant had not been deprived of an opportunity to present his side of the case.

5. Where Foreign Judgment was obtained by fraud, and - sub - clause (e) of S. 13 C.P.C.

The Hon'ble Court in the matter titled M. C. Patel Vs.. Maniben AIR 1985 Guj 197 held that since the plaintiff had misled the court regarding his residence (domicile), the decree having been obtained by making false representation as to the jurisdictional facts, the decree was obtained by fraud and hence was inconclusive

The Hon'ble Supreme Court in the case of Smt. Satya v. Teja Singh ((1975) 1 SCC 120 : 1975 SCC (Cri) 50 : (1975) 2 SCR 197 : AIR 1975 SC 105) held that the appellant played a fraud on the foreign court representing to it incorrect jurisdictional facts. For, as held in that case, residence does not mean a temporary residence for the purpose of obtaining a divorce but habitual residence or residence which is intended to be permanent for future as well. It was further held it must be understood that the fraud need not be only in relation to the merits of the matter but may also be in relation to jurisdictional facts.

In Untermann v. Untermann (19 NJ 507), a divorce decree obtained by a husband in Mexico after one day's residence therein, was held invalid. A foreign decree of divorce is subject to collateral attack for fraud or for want of jurisdiction either of the subject-matter or of the parties provided that the attacking party is not estopped from doing so (Cohen v Randall, 88 L ED., 480). A foreign decree of divorce obtained by fraud is void. Fraudulent simulation of domicile is impermissible. A spouse who goes to a State or country other than that of the matrimonial domicile for the sole purpose of obtaining a divorce perpetrates a fraud, and the judgment is not binding on the courts of other States .

In R. Viswanathan v. Rukn-ul-Mulk Syed Abdul Majid 193) 3 SCR 22, 42 : AIR 1963 SC 1 the Hon'ble Supreme Court held that :

A judgment of a foreign court to be conclusive between the parties must be a judgment pronounced by a court of competent jurisdiction and competence contemplated by Section 13 of the code of Civil Procedure is in an international sense and not merely by the law of foreign State in which the court delivering judgment functions. In fact Section 44 of the Evidence Act gives to any party to a suit or proceeding the right to show that the judgment which is relevant under Section 41 "was delivered by a court not competent to deliver it, or was obtained by fraud or collusion". It is therefore wrong to think that judgment in rem are inviolable. Fraud, in any save bearing on jurisdictional facts, vitiates all judicial acts whether in rem or in personam.

6. Judgment founded on breach of any law in force in India - sub - clause (f) of S. 13 C.P.C.

In the Case of Y. Narasimha Rao And Others, Appellants V. Y. Venkata Lakshmi And Another, Respondents. 1991-(003)-SCC -0451 -SC the Hon'ble Supreme Court held where the judgment is founded on a refusal to recognise the law of this country in cases in which such law is applicable, the judgment will not be recognised by the courts in this country. The marriages which take place in this country can only be under either the customary or the statutory law in force in this country. Hence, the only law that can be applicable to the matrimonial disputes is the one under which the parties are married, and no other law. When, therefore, a foreign judgment is founded on a jurisdiction or on a ground not recognised by such law, it is a judgment which is in defiance of the law. Hence, it is not conclusive of the matters adjudicated therein and, therefore, unenforceable in this country. For the same reason, such a judgment will also be unenforceable under clause (f) of Section 13, since such a judgment would obviously be in breach of the matrimonial law in force in this country.

CONCLUSION :

To conclude, it can be safely inferred that a Judgement/decree from a foreign court might not be enforceable in terms of Section 44-A & by virtue of sub-section (3) the court shall refuse execution if it is shown to the satisfaction of the court that the decree falls within any of the exceptions in clauses (a) to (f) of Section 13.

In the light of discussion above what emanates is that if any legal action is proposed to be taken against a party in India the best course of action would be to initiate the same in Indian Courts rather than running a risk of refusal of acceptance of a decree obtained from foreign court,

 

Mr. Pankaj Kapoor

 

Beta
Beta