LexMEENAKSHI SAXENA & ANR. versus ECGC LTD. (FORMERLY KNOWN AS EXPORT CREDIT GUARANTEE CORPORATION OF INDIA LTD.) AND ANR.
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MEENAKSHI SAXENA & ANR.
v.
ECGC LTD. (FORMERLY KNOWN AS EXPORT CREDIT
GUARANTEE CORPORATION OF INDIA LTD.) AND ANR.
(Civil Appeal No. 5681 of 2018)
MAY 18, 2018
[N. V. RAMANA AND S. ABDUL NAZEER, JJ.]
Consumer Protection Act, 1986:
ss. 25 and 27 – Execution of decree – Decree against insurer
holding it liable to pay the insurance amount as agreed – Execution
petition – During pendency of the petition, the insurer (judgment
debtor) paid the decreed amount – Insured (decree holder) disputed
the payment on the ground that value of the foreign currency payable
should have been calculated on the conversion rate applicable on
the date of payment – District Forum as well as State Commission
held that foreign currency conversion rate has to be calculated as
on the date of payment – However, National Consumer Commission
held that conversion rate has to be as on the date of subject shipment
– On appeal, held: Interpretation of decree in a manner which may
amount to substitution of a new decree is not countenanced under
law – The court has to determine the relevant date for conversion
of currency, in accordance with terms and conditions of contract –
As per insurance contract in the present case, the insurer was
required to pay the insurance claim in accordance with the
conversion rate of the invoiced foreign currency on the date of
subject shipment for which the invoice was issued – The
interpretation given by District Forum and State Commission to the
decree in question, is contrary to the terms of the contract and
amounts to drawing a new decree which is not permissible – The
payment already made by the insurer was as per the terms of the
contract and thus the insurer has complied with the decree.
ss. 25 and 27 – Execution proceedings – Power of execution
court – Scope of – Held: Executing court while executing a decree
cannot go beyond the decree and has to take the judgment on its
face value – When decree is ambiguous, it becomes the bounden
[2018] 5 S.C.R. 421
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SUPREME COURT REPORTS
[2018] 5 S.C.R.
duty of the executing court to interpret the decree – However, the
court has to be very cautious in supplementing its interpretation
and conscious of the fact that it cannot draw a new decree.
Dismissing the appeal, the Court
HELD: 1. The whole purpose of Execution proceedings is
to enforce the verdict of the court. Executing court while
executing the decree is only concerned with the execution part
of it but nothing else. The court has to take the judgment in its
face value. Executing court cannot go beyond the decree. But
the difficulty arises when there is ambiguity in the decree with
regard to the material aspects. Then it becomes the bounden
duty of the court to interpret the decree in the process of giving
a true effect to the decree. At that juncture, the executing court
has to be very cautious in supplementing its interpretation and
conscious of the fact that it cannot draw a new decree. The
executing court shall strike a fine balance between the two, while
exercising this jurisdiction in the process of giving effect to the
decree. [Para 18] [429-C-E]
2. Admittedly, during the pendency of the execution
proceedings an amount of Rs. 4,86,953 as 90% value of 11,875.75
Euros as on 24.4.2002 and interest thereon of Rs. 6,33,653 as
directed by the court were paid by the respondent. Both the State
Commission and District Commission interpreted the order dt
12.10.2006 observing that Euro conversion rate has to be
calculated as on the date of payment and hence the respondent
company has to pay the remaining amount. However the NCDRC
has taken a different view while interpreting clause 17 of the
agreement and concluded that conversion rate has to be as on
the date of subject shipment for which the invoice was issued
and as the full amount with the same calculation is paid by the
respondent, NCDRC has dismissed the revision petition. [Para
20] [429-G-H; 430-A-B]
3. For determining the relevant date for conversion of
currency, the first procedure to be adopted by the court is to
decide the same in accordance with terms of the contract and if
such a clause is not available in the agreement then the courts
have to determine the best possible date. In the present facts,
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there is a specific clause in the agreement i.e clause 17 which
deals with rate of interest. The clause clearly says that currency
should be converted intExcerpt shown. Read the full judgment & AI analysis in Lexace.