Execution of foreign judgements/decrees in India is a grey area of law in which a lot more is needs to be done by legislation, executive and judicial branch of government. The emerging legal issues on jurisdiction as regards transactions over the internet can hardly ignore the legal aspects involved in the execution/enforcement of foreign decrees.

Even after exercise of jurisdiction, the Courts may be unable to help the plaintiff in getting relief in case the local laws of the country concerned have certain restrictions for the execution/enforcement of foreign judgements or decrees in the country.

Under Indian Law, execution of decrees, whether foreign or domestic, is governed by the provisions of the Code of Civil Procedure, 1908 (CPC) (as amended from time to time).

How Foreign Judgement/Decree Are Executed In India:

As per Civil Procedure Code, there are two ways of getting a foreign judgement enforced:

1. Firstly, by filing an Execution Petition under Section 44A of the CPC (in case the conditions specified under sec 13 of CPC are fulfilled).
2. Secondly by filing a suit upon the foreign judgement/decree.

The execution under section 44A is done only when the decree is passed by the superior court of reciprocating countries. Who are the reciprocating countries, shall be notified by government of India.( Presently United Kingdom, Singapore, Bangladesh, Malaysia, Trinidad andTobago, New Zealand, Cook Island, Trust Territories of Western Samoa, Hongkong, Papua New Guinea, Fiji, Aden and UAE are notified as Reciprocating territory) In case of reciprocating countries, the foreign decrees are passed as such without filing of any fresh suit in Indian court because such decrees are deemed to be passed by Indian courts of competent jurisdiction.

For non-reciprocating countries, the decree holder of foreign judgement will have to file the fresh suit in domestic court of India. The foreign judgement/decree passed thereby is used only as evidence in this fresh suit in India against the defendant. The foreign decree act as a conclusive evidence in the fresh suit in India except the scenario when any of the deficiencies as provided under section 13 of CPC is present.

It is pertinent to note that even if a decree is passed by a reciprocating country then such decree/judgement needs to pass the test of section 13 of CPC before its execution. The only benefit which the decree of a reciprocating country enjoy in India is that the plaintiff need not to file a fresh suit in domestic court rather the foreign decree as such is executed subject to the test of section 13.

Test of Section 13 of Code of Civil Procedure 1908:
Section13 of the Code of Civil Procedure, 1908 says that a foreign judgment becomes inconclusive and consequently unenforceable in the following circumstances:

1. where it has not been pronounced by a Court of competent jurisdiction;
2. where it has not been given on the merits of the case;
3. 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;
4. where the proceedings in which judgment was obtained are opposed to natural justice;
5. where it has been obtained by fraud;
6. where it sustains a claim founded on a breach of any law in force in India.

If any foreign decree passes these six grounds given in section 13 (a)-(f) then it shall be executed as such in India without further enquiry or fresh suit if the decree is from a superior court of reciprocating country. Even in the decree from non-reciprocating countries, such decree becomes conclusive evidence and it is converted in to decree of domestic court in India if they pass the test of section 13 of CPC.

Through this article, I would like to discuss with the help of judicial precedents, the grounds provided in Section 13 of CPC on the basis of which a foreign decree or judgements are challenged to proscribe its execution or to determine its conclusiveness.

13 (A): Not Pronounced By A Court Of Competent Jurisdiction:

The following are the cases in which the Courts have held that there is no jurisdiction with the foreign Court and hence the Judgment or decree is unenforceable due to violation of section 13(a).

In the case of Sirdar Gurdial Singh v. Maharaja of Faridkot[1], a Privy Council Judgment delivered by Lord Selbourne, where it was held that

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 Kukadap Krishna Murthy v. Godmatla Venkata Rao[2], while relying upon the case of Sirdar Gurdial Singh's it was held by a Full Bench of the Andhra Pradesh High Court that a decree passed in absentem was a total nullity as a foreign judgment, in other words, it is not a valid foreign judgment, the execution of which could be executed in Courts situated in a foreign territory but not in India.

Similarly the Madras High Court in the case of Ramanathan Chettiar v. Kalimuthu Pillai 3 which lays down the circumstances when the foreign courts would have jurisdiction under this Section.

The circumstances mentioned are as follows:

1. Where the person is a subject of the foreign country in which the judgment has been obtained against him on prior occasions.
2. Where he is a resident in foreign country when the action is commenced.
3. Where a person selects the foreign Court as the forum for taking action in the capacity of a plaintiff, in which forum he is sued later
4. Where the party on summons voluntarily appears
5. Where by an agreement a person has contracted to submit himself to the forum in which the judgment is obtained.

13(B): Where It Has Not Been Given On The Merits Of The Case:

The following are the cases in which the Courts have held that the judgments were not passed on the merits of the case and hence were inconclusive.

It is significant to mention the decision of the Privy Council in the case of D.T. Keymer v. P. Viswanatham 4. In which 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.

Thereafter, the defendant was served with certain interrogatories to be answered. On his omission to answer the interrogatories, 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 given 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.

In the case of Gurdas Mann v. Mohinder Singh Brar 5, the Punjab & Haryana High Court held that an exparte judgment and decree which did not show that the plaintiff was given a opportunity to 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.

In the case of K.M. Abdul Jabbar v. Indo Singapore Traders P. Ltd.6, the Madras High Court held that passing of a decree after refusing the leave to defend sought for by the defendant was not a conclusive judgment within the meaning of S. 13(b) of CPC.

13(C): Where The Judgment Is Passed Disregarding The Indian Law Or The International Law.

The case of Anoop Beniwal v. Jagbir Singh Beniwal 7 is about the matrimonial dispute between the parties. The facts of the case are that the plaintiff had filed a suit for divorce in England on the basis of the English Act, namely the Matrimonial Causes Act, 1973.

The particular ground under which the suit was filed was that the respondent has behaved in such a way that the petitioner cannot reasonably be expected to live with the respondent. This ground is covered by S. 1(1)(2)(b) of the Matrimonial Causes Act, 1973. The decree was obtained in England and came to India for enforcement. The respondent claimed that since the decree was based on the English Act, there was refusal by the English Court to recognise the Indian Law.

The Court held that under the Indian Hindu Marriage Act under S. 13(1)(ia), there is a similar ground which is cruelty on which the divorce may be granted. Therefore the English Act, only used a milder expression for the same ground and therefore there was no refusal to recognize the law of India. Thus the decree was enforceable in India and section 13(c) of code of civil procedure is no bar to its enforceability.

A catena of judgments on the subject has been given by different High Courts from which it can be proposed that:

1. A judgment or decree passed by a foreign Court upon a claim for immovable property which is situate in the Indian territory may not be enforceable since it offends International Law as prohibited under sec 13(c) of CPC.
    
2. A judgment or decree passed by the foreign Court before which a contrary Indian law had been shown, but the Court refused to recognise the law, then that Judgement or decree may not be enforceable. However if the proper law of contract is the foreign law then this may not be applicable.

13(D): Where The Proceedings In Which Judgment Was Obtained Are Opposed To Natural Justice

The Foreign Court which delivers the judgment or decree must be composed of impartial persons, must act fairly, without bias in good faith, and it must give reasonable notice to the parties to the dispute and afford each party adequate opportunity of presenting his case, in order to avoid any allegation of not fulfilling the principles of natural justice in case the judgment or decree comes to the Indian court for enforcement. Unless this is done the judgment or decree passed by a foreign Court may be opposed to Principles of Natural Justice.

In the case of Hari Singh v. Muhammad Sad 8 the Court found that the foreign Court did not appoint a person willing to act as a guardian ad litem of the minor defendant. The court also held that proceedings could not have proceeded ex-parte against the minor. The Court further 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 this basis the court held that the passing of the judgment against the minor was opposed to natural justice within the meaning S. 13(d) of CPC.

In the case of Lalji Raja & Sons v. Firm Hansraj Nathuram 9 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.

13(E): Where It Has Been Obtained By Fraud:

In case the plaintiff misleads or lies to the Foreign court and the judgment is obtained on that basis, the said Judgment may not be enforceable, however if there is a mistake in the judgment then the Indian courts will not sit as an appeal Court to rectify the mistake.The difference between bonafide mistake and fraud or misleading the court by misrepresentation are well recognized by domestic courts.

In the case of Satya v. Teja Singh10 the Supreme Court held that since the plaintiff had misled the foreign court as to its having jurisdiction over the matter, although it could not have had the jurisdiction, the judgment and decree was obtained by fraud and hence inconclusive.

In the case of Maganbhai Chhotubhai Patel v. Maniben11 the court held that since the plaintiff had misled the court regarding his place of residence , the decree having been obtained by making false representation as to the jurisdictional facts, the decree was obtained by fraud and hence was inconclusive.

13(F): Where It Sustains A Claim Founded On A Breach Of Any Law In Force In India

A judgment or a decree, passed by a foreign court, on a claim founded on a breach of any law in force in India may not be enforceable. However, in case it is based upon a contract having a different proper law of the contract then it may be enforced.

In the case of T. Sundaram Pillai v. Kandaswami Pillai 12, the plea of the defendant was that the judgment was obtained in breach of the Contract Act since the defendants at the relevant time were minors when the contract was entered into and since under the Contract Act they were not competent to enter into a contract, the claim was founded on the breach of the Indian Law.

The Court held as follows:
This claim is founded partly perhaps upon a breach of the contract Act, but also partly upon a claim under the Contract Act which in no way involves its breach. Whether that claim is a good one or a bad one is not for me now to decide. The District Munsif of Trivandrum has given a decree to the appellant and that decree sustains a claim which was not wholly founded upon a breach of the Contract Act. It seems to me therefore that the appellant cannot be prevented by clause (f) of S. 13 from executing his decree in British India.

In the case of I & G Investment Trust v. Raja of Khalikote 13, it was held as follows:
It is argued that the Orissa Money Lender's Act precludes a decree being passed for more than double the principal amount and in passing a decree, based on a claim which violates that rule, the English Court sustained a claim founded on the breach of a law in force in the State of Orissa. I am unable to accept the argument.

The claim was not based on the law as prevailing in India at all. Rightly or wrongly, the plaintiffs alleged that the parties were governed not by the Indian law but the English Law. The English Court accepted that plea and were consequently not sustaining a claim based on any violation of the law in India.

Suppose, that the defendant had submitted to the jurisdiction of the English Court and that Court passed a decree. Such a decree would by implication have decided that the defendant was bound by English Law and that the Orissa Money Lender's Act did not apply. Such a decision would be binding from the international point of view and the point could not be further agitated in these Courts.

Limitation Period Of Execution Of Foreign Decree In India:

The question of limitation for execution of foreign decrees in India was reiterated by honourable Supreme Court of India in Bank of Baroda Vs Kotak Mahindra Bank Limited (Civil Appeal No 2175 of 2020) and apex court held that limitation period of cause country shall be the limitation period for the purpose of execution of foreign decree in India.

Honourable court did not accept the contention that the limitation period starts when application under section 44 A is filed. Court held that execution of decree is controlled by section 47 and order 21 of code of civil procedure 1908. The view worldwide appears that the limitation law of cause country (Foreign court in this case) should be applied even in forum country (Indian courts in this case. Furthermore, we are of this opinion that in those cases where the remedy stands extinguished, the rights of the decree holder to execute the decree in forum country also dies.

Conclusion:
A judgment or a decree is passed by a foreign Court against an Indian defendant, the judgment or decree may not be enforceable against him due to the operation of S. 13 of CPC. The plaintiff has to come to the Indian courts to either get the foreign judgment executed under S. 44A or file a fresh suit upon the judgment for its enforcement.

Therefore by getting a decree in the foreign Court, the plaintiff only avoids the inconvenience of leading evidence in the Indian Courts but runs a much bigger risk under S. 13. Therefore it may advisable for a foreign plaintiff to institute claims in India itself in case the defendant is in India provided it is acceptable to him to go through the lengthy court procedures in civil cases.

References:

1. 21 Ind. App. 171
2. AIR 1962 A.P. 400.
3. AIR 1973 Mad. 141
4. AIR 1916 PC 121.
5. AIR 1993 P&H 92.
6. AIR 1981 Mad. 118
7. AIR 1990 Del. 305 at 311.
8. AIR 1927 Lah. 200
9. AIR 1971 SC 974 at p. 977
10. AIR 1975 SC 105 at p. 117 para 50
11. AIR 1985 Guj. 187
12. AIR 1941 Mad. 387.
13. AIR 1952 Cal. 508 at p. 525 para 46.

Written By: Hari Mudgil, is a Delhi Based Lawyer & Research Scholar.