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Patna High Court

The Managing Director, Bihar State Food and Civil Supplies Corporation Ltd.versusM/s Guptaji brothers Rice Mill Pvt.

Decided
Disposal
DISPOSED

Holding

The appeal is disposed of as there is no reason to proceed given the respondent’s undertaking not to pursue the execution case.

Summary

The appellants, the Managing Director and District Manager of the Bihar State Food and Civil Supplies Corporation, appealed against Guptaji Brothers Rice Mill Pvt. and the State of Bihar. After an arbitral award was made, the respondent (the corporation) entered into a settlement, deposited approximately Rs.78,00,000 with the appellants and obtained a no‑objection certificate to resume its business. The respondent indicated it would not press the pending execution suit (Execution Case No. 150 of 2023) and would await the decision on the Section 34 application filed by the appellants challenging the award. The appellants argued that the pending Section 34 application should be heard and that the respondent should not be deprived of tagging merely because of the execution proceedings. The court, considering the respondent’s undertaking not to proceed with the execution case, found no reason to continue the appeal and disposed of it.

Issues considered

  • Whether the appeal should proceed in view of the respondent’s settlement and undertaking not to pursue the execution case
  • Whether the pendency of the execution suit bars the respondent from being considered for tagging
  • Whether the Section 34 application under the Arbitration and Conciliation Act, 1996 should be heard before the execution proceedings

Legislation cited

Subjects

  • Arbitration
  • Section 34
  • Execution proceedings
  • Award enforcement
  • Settlement
  • No objection certificate
  • Commercial appeal

Judgment

          IN THE HIGH COURT OF JUDICATURE AT PATNA
                     COMMERCIAL APPEAL No.11 of 2024
     ======================================================
1.    The Managing Director, Bihar State Food and Civil Supplies Corporation
      Ltd. Khadya Bhawan, R. Block, Patna.
2.   The District Manager, The Bihar State of Food and Civil Supplies
     Corporation, District Rohtas.
                                                               ... ... Appellants
                                      Versus
1.   M/s Guptaji brothers Rice Mill Pvt. Registered Office at Bank, through its
     Director Sri Rajiv Ranjan Kumar, Son of Ganesh Prasad Gupta resident of
     New Sidhauli, Dalmianagar, District Rohtas.
2.   The State of Bihar through the Chief Secretary Government of Bihar, Patna.
3.   The District Collector, Rohtas at Sasaram.
                                               ... ... Respondents
     ======================================================
     Appearance :
     For the Appellants      :     Mr. Anjani Kumar, Senior Advocate
                                   Mr. Shailendra Kumar Singh, Advocate
     For the Respondent State:     Mr. S.Raza Ahmad, Senior Advocate, AAG-5
     For the Respondent No.1:      Mr. Jai Vardhan Narayan, Advocate
     ======================================================
     CORAM: HONOURABLE MR. JUSTICE RAJEEV RANJAN PRASAD
             and
             HONOURABLE MR. JUSTICE PRAVEEN KUMAR
     ORAL JUDGMENT
     (Per: HONOURABLE MR. JUSTICE RAJEEV RANJAN PRASAD)

      Date : 04-02-2026


                 Heard learned counsel for the parties.

                 2. The matter has been heard at length. There are some

     peculiar facts of the case. After passing of the award, which is

     under execution, the respondent No.1 has entered into a kind of

     settlement with the appellants. In this regard, the affidavits of the

     respondent No.1 have been placed before this Court. It has also

     been informed that the respondent No.1 had deposited a sum of

     Rs.78,00,000.00 approximately with the appellants and has
Patna High Court COMMERCIAL APP No.11 of 2024 dt.04-02-2026
                                          2/3




       obtained no objection certificate in order to restore its business

       with the appellants.

                   3.    Keeping     in    view    these      peculiar   facts   and

       circumstances, learned counsel for the respondent No.1 submits

       that for the present respondent No.1 would not press the execution

       case being Execution Case No. 150 of 2023 pending before the

       Court of learned Principal District and Sessions Judge, Rohtas at

       Sasaram, and shall await the decision of the competent court on

       the application under Section 34 of the Arbitration and

       Conciliation Act, 1996 (for short ‘the Act of 1996’) preferred by

       the appellants.

                   4. Mr. Anjani Kumar, learned Senior Counsel for the

       appellants, submits that the appellants have challenged the award

       before the competent court giving rise to Miscellaneous Case No.

       101 of 2019 pending in the Court of learned Civil Judge (Senior

       Division)-I, Civil Court, Patna. The next date fixed in the matter is

       21.02.2026. The respondent No.1 has already entered appearance

       in the said case, therefore, on the next date, he will make a request

       to the court to hear and dispose of the application under Section 34

       of the Act of 1996 at the earliest.

                   5. Mr. Jai Vardhan Narayan, learned counsel for

       respondent No.1, submits that he will cooperate in hearing of the

       matter before the court.
             Patna High Court COMMERCIAL APP No.11 of 2024 dt.04-02-2026
                                                      3/3




                                6. Mr. Jai Vardhan Narayan, Advocate, has brought to

                    the notice of this Court that only because the respondent No.1 has

                    filed the execution case, despite having a no objection certificate

                    in its hand, his firm is not being considered for tagging.

                                7.   Mr. Anjani        Kumar,      learned   Senior   Counsel

                    representing the appellants, submits on the instructions of Mr.

                    Shailendra Kumar Singh, Advocate, that if the respondent No.1 is

                    otherwise entitled to be considered, he shall not be deprived of the

                    tagging only for the reason of pendency of the proceeding of the

                    execution case.

                                8. In the aforesaid view of the undertaking given by the

                    respondent No.1 not to proceed with the execution case for the

                    present, we find no reason to proceed with the present appeal.

                                9. This appeal is disposed of.


                                           (Rajeev Ranjan Prasad, J)


                                                (Praveen Kumar, J)
Pawan/-
AFR/NAFR               NAFR
CAV DATE               N/A
Uploading Date         05.02.2026.
Transmission Date         N/A


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