Petitioner – IPL

A. NCLT WAS WRONG IN PASSING THE STAY ON ARMORICA EP BY WAY

OF AN INTERIM ORDER.

1. NCLT does not have the power to pass interim orders after CIRP is initiated. And
passing the same is totally an act not vested in its capabilities.

2. NCLT does not have the powers to stay the orders of a foreign court.

The counsel humbly submits that the phrase ‘foreign court’ means “A
governmental body of another country or jurisdiction consisting of one or more
judges who sit to adjudicate disputes and administer justice” 1 as inferred by
definitions stated in Black’s Law Dictionary. The act of NCLT of passing an
interim order of staying of Armorica EP was not correct as NCLT was acting out
of its capabilities, as in the judgement of Usha Holdings LL.C. & Anr. v Francorp
Advisors Pvt Ltd.2 NCLAT held that NCLT cannot decide whether a foreign
judgement or a decree is legal or even check its enforceability in India while
admitting or rejecting a claim as a debt under the Insolvency and Bankruptcy
Code, 2016. So in our case on an application filed by LeT in NCLT, the tribunal
passed an interim order to stay the ‘Armorica EP’ which here falls under the ambit
of a foreign judgement.
To enforce a foreign judgement in India, firstly it should be checked whether it is
from a reciprocating territory or a non-reciprocating territory, ten there are
different methods in enforcing and executing the judgement in India, Section 13 3
of CPC is a prerequisite to check the legality and enforceability of the judgement
but in the case law mentioned above the NCLAT stated that even if the foreign
judgement or decree is not in accordance with the provisions of CPC, then too

1
Blacks law dictionary 20th ed. Pg.1068, 1916
2
Usha Holdings LL.C. & Anr v Francorp Advisors Pvt Ltd
3
Section 13 cpc
 NCLT does not have any authority to decide the legality of the foreign decree or
judgement.
NCLAT also relied its judgement on the judgement of Binani Industries Limited v
Bank of Baroda & Anr.4

In the case of Lalji Raja & Sons v. Firm Hansraj Nathuram 74, the Supreme Court
held that just because the suit was decreed ex-parte, although the defendants
were served with the summons, does not mean that the judgment was opposed
to natural justice.

4
Binani Industries Limited v Bank of Baroda & Anr 
 Respondent – LET

A. NCLT WAS RIGHT IN PASSING THE STAY ON ARMORICA EP BY WAY

OF AN INTERIM ORDER.

1. NCLT has the power to pass interim orders. And passing the same is in totally
under its capacity.

The counsel humbly submits that as NCLT passed an interim order for staying the
order of court of Armorica i.e. Armorica EP, here the interim order passed by
NCLT was totally correct as firstly I would like to state the definition of ‘interim’
which means “Done, made, or occurring for an intervening time; temporary or
provisional”5 and would also like to state the definition of ‘order’ which is “A
written direction or command delivered by a court or judge.”6 so in our case the
order passed by NCLT to stay the Armorica EP will be termed as “interim order”
which in turn means “a temporary or provisional written direction or command
delivered by a court or judge” as inferred from the two definitions stated above
and state in the definition of ‘interim order’7.

To add on more to this NCLT surely has the power to pass an interim order as in
the case of NUI Pulp and Paper Industries Pvt. Ltd. Vs. Ms. Roxcel Trading
GMBH8, NCLT is empowered to pass an ad-interim order as in accordance with
Rule 11 of NCLT Rules 2016 which states: -
“11. Inherent Power: - Nothing in these rules shall be deemed to limit or
otherwise affect the inherent powers of the Tribunal to make such orders as may
be necessary for meeting the ends of justice or to prevent abuse of the process of
the Tribunal.”9

5
Blacks law dictionary 20th ed. Pg 2382
6
Blacks Law dictionary 20th ed. Pg 3477
7
Blacks Law dictionary 20th ed. Pg 2383
8
NUI Pulp and Paper Industries Pvt. Ltd. Vs. Ms. Roxcel Trading GMBH para 9 nclat judgement
9
Rule 11 nclt 2016
 As Rule 11 talks about the inherent power of NCLT to pass ad-interim order as in
this case, NCLT passed an interim order against the corporate debtor restraining
him from alienating or creating any third-party interest in the assets of the
Company till the case is completely closed. NCLAT mentioned the same in its
judgement. By this, it is evident that NCLT holds the capacity to pass ‘interim
orders’.

Supreme court in the landmark judgement of Swiss Ribbons (P.) Ltd. v. Union of
India10 that NCLT can invoke Rule 11 of NCLT Rules, 2016 in IBC proceedings.

2. NCLT has the powers to stay the orders of a foreign court.

To enforce a foreign judgement or decree in India one has to move in accord with
laws of Section 44A11 of Civil code of Procedure 1908 if the judgement is from a
reciprocating territory. As per the defined in Black’s Law dictionary a ‘foreign
judgment’ means “. A court's final determination of the rights and obligations of
the parties in a case. Where the court is of another country.” 12 And as per the Civil
code of Procedure 1908, it means “judgment of a foreign Court”.13
So as per the definition stated above Armorica EP will be considered as a ‘foreign
judgement’ as it is passed from the trial court of Armorica which is a ‘foreign
court’ as defined in CPC “a Court situated outside India and not established or
continued by the authority of the Central Government”14. Now as we know
Armorica is a non-reciprocating territory, so instead of walking on the steps of
Section 44A, IPL needs to file a fresh suit in India on the basis of the judgement
and the decree will only be treated as a piece of evidence in that fresh suit.
So as in our case, IPL was not moving in accordance with laws laid down by Civil
code of Procedure 1908, therefore NCLT just passed an interim order which

10
Swiss Ribbons (P.) Ltd. v. Union of India
11
S44a 1908
12
Blacks law dictionary 1916, 2463
13
S2(6) cpc 1908.
14
S2(5) cpc1908
 means that it did not adjudicate over the legality or enforceability of the foreign
decree it just stayed the decree until the whole of the case is sorted.

NCLT by passing the interim order just protected the provisions of the code as
Section 14(1)(a) of the Insolvency and Bankruptcy code 2016 reads: -

“14. Moratorium. - (1) Subject to provisions of sub-sections (2) and (3), on the
insolvency commencement date, the Adjudicating Authority shall by order declare
moratorium for prohibiting all of the following, namely: -
(a) the institution of suits or continuation of pending suits or proceedings against
the corporate debtor including execution of any judgement, decree or order in
any court of law, tribunal, arbitration panel or other authority.”15

This means that on 17th November the CIRP has been initiated against LeT which
means the moratorium period came into effect as soon as CIRP initiated. And if an
interim order would not have been passed by NCLT it would have defeated the
provision of the code, plus NCLT did not challenge the legality or enforceability
of the judgement it just passed an interim order which halted its execution for time
being. By passing the interim order NCLT just protected the constitutionality and
provisions of IBC.

3. Armorica EP is not conclusive and enforceable in Narnia.

The counsel humbly submits that even if IPL would have walked on the correct
steps as specified by law in Civil code of Procedure and had initiated a suit based
on the Armorica EP, then too they would have not yielded any result as Section 13
of Civil code of Procedure 1908 reads: -
“S13 - When foreign judgment not conclusive— A foreign judgment shall be
conclusive as to any matter thereby directly adjudicated upon between the same
parties or between parties under whom they or any of them claim litigating under
the same title except—
(a) where it has not been pronounced by a Court of competent jurisdiction;
15
S14(1)(a) IBC 2016.
 (b) where it has not been given on the merits of the case;
(c) where it appears on the face of the proceedings to be founded on an incorrect
view of international law or a refusal to recognise the law of India in cases in
which such law is applicable;
(d) where the proceedings in which the judgment was obtained are opposed to
natural justice;
(e) where it has been obtained by fraud;
(f) where it sustains a claim founded on a breach of any law in force in India.”16

This implies that the burden to prove that that the judgement is conclusive in India
is on IPL and it has to show that none of the reasons mentioned in clauses (a) to
(f) of Section 13 of CPC render the foreign judgement not conclusive in India but
according to the case of Gurdas Mann v. Mohinder Singh Brar17, the Punjab and
Haryana High court held that “A judgment or decree passed by a Foreign Court
against an Indian defendant, who has remain ex-parte, may not be enforceable
against him.”18
Which implies that any ex-parte judgement by a foreign court is not enforceable in
India rendering it inconclusive as it comes under the ambit of Section 13(2) of
CPC 1908.
Also considering the judgement of Supreme court in the case of International
Woolen Mills v Standard Wool (UK) Ltd19 where the Hon’ble held that “a decree,
whether from a reciprocating or a non-reciprocating territory, that follows a
judgment that is not on merits cannot be enforced in India.”
On the basis of the first case we can conclude that a case decided ex parte is not
on its merits and on the basis of second case law it can concluded that a case not
decided on merits is unenforceable in India, As in our case it is evident that
Armorica EP was an ex-parte default judgement by a foreign court which makes
Armorica EP a case decided not on its merits, which then makes it unenforceable
and inconclusive in Narnia as it comes under the ambit of Section 13(2) of CPC.

16
S13 cpc 1908
17
Gurdas Mann v. Mohinder Singh Brar
18
Ibid.
19
International Woolen Mills v Standard Wool (UK) Ltd
 Also in the case of Moloji Nar Singh Rao v. Shankar Saran 20 the apex court
decided that an ex-parte decree passed against the defendants who did not appear
in spite of receipt of summons is unenforceable in India, so in our case as the
court of Armorica passed an ex-parte judgement in favour of IPL, where LeT was
not present so it renders the Armorica EP unenforceable in India on the basis of
the above mentioned case law.
In the case of R.M.V. Vellachi Achi v. R.M.A. Ramanathan Chettiar 21, the Madras
High Court held that if the foreign judgment is not based upon the merits of the
case, whatever the procedure might be in the foreign country in passing
judgments, those judgments will not be conclusive in India.
In the case of B. Nemichand Sowcar v. Y.V. Rao22, in this case a suit was instituted
in the foreign Court where the defendant entered appearance and filed his written
statement. On the day of the hearing the defendant remained absent, the court
passed a decree without hearing any evidence. The Madras High Court held that
the decree was not passed on the merits of the case and hence inconclusive within
the meaning of S. 13(b) of CPC. This same thing happened with my client where
LeT just filed a written defence by engaging a legal counsel in court of Armorica
and did not attended the other summons of the court,
 https://blog.ipleaders.in/decrees-judgments-enforcement/
 https://www.google.com/search?q=ex+parte+foreign+judgement+
%22Section+13%22&rlz=1C1CHBF_enIN858IN858&oq=ex+parte+forei
gn+judgement+
%22Section+13%22&aqs=chrome..69i57j33.15697j0j7&sourceid=chrome
&ie=UTF-8
 http://www.mondaq.com/india/x/9180/Antitrust+Competition/Executabilit
y+Enforceability+Of+Foreign+Judgments+And+Decrees+In+India+Judici
al+Trends+Part+1
 http://www.legaleraonline.com/articles/enforcement-of-foreign-
judgements-and-awards-in-india
 https://gettingthedealthrough.com/area/46/jurisdiction/13/enforcement-
foreign-judgments-india/

20
Moloji Nar Singh Rao v. Shankar Saran [AIR 1962 SC 1737]
21
R.M.V. Vellachi Achi v. R.M.A. Ramanathan Chettiar
22
B. Nemichand Sowcar v. Y.V. Rao
 https://uk.practicallaw.thomsonreuters.com/9-619-4568?
transitionType=Default&contextData=(sc.Default)&firstPage=true&bhcp=
1
 http://madaan.com/enforcingjudgment.html
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+reciprocating+territory+can+be+executed+in+india&rlz=1C1CHBF_enI
N858IN858&oq=A+foreign+decree+from+a+non-
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4186j0j7&sourceid=chrome&ie=UTF-8
 http://www.nishithdesai.com/information/research-and-articles/nda-
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regarding-execution-of-a-foreign-decree-and-bankruptcy-
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LAT+Rules+That+The+Adjudicating+Authority+Has+No+Jurisdiction+T
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