REPORTABLE

THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

Civil Appeal No.5681/2018 (Arising out of SLP (C) No. 6286 of 2017)

Meenakshi Saxena & Anr. …Appellant (s)

Versus

ECGC Ltd. (Formerly known as Export  Credit Guarantee Corporation of India Ltd.)  and Anr.

…Respondent (s)

JUDGMENT    

N.V. RAMANA, J.    

1. Leave granted.

2. This case arises out of the impugned order dated

20.10.2016, in Revision Petition No. 614 of 2015, passed by

the National Consumer Disputes Redressal Commission

[hereinafter referred as  ‘NCDRC’  for  brevity] wherein the

NCDRC has allowed the Revision and set aside the order of

the District Forum which was confirmed by the State

Commission.

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3. A brief reference to the facts of the case necessary for the

disposal of this case are that, the appellant had purchased

an insurance policy  No. SCR0000093, dated 27.07.2000,

from respondent no. 1 against any loss suffered due to the

reason of risks involved in the export of goods from India.

Under Clause 13 of the contract, the respondent had agreed

to pay 90% of the accrued loss, in the following manner­

Clause 13­ Percentage of loss payable:  The portion of the amount of loss which the Corporation hereby agrees to pay shall be 90%.

4. It would be necessary to note that the parties had explicitly

included a clause concerning the rate of currency exchange

in the following manner­

Clause  17 ­  Rate of  Exchange: All payments under this policy shall be in Indian Rupee at the head office of the Corporation and, for the purpose of payment of premiums and losses, the gross invoice value of the shipments invoiced in a foreign currency  shall  be  converted  into Indian Rupee at the  Bank buying  rate  of  exchange at Mumbai on the date of the relative shipment PROVIDED THAT, devaluation of the currency in which the buyer has to pay takes place before the claim is paid, the amount claimed in Indian currency shall be based on the devalued rate.

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5. Coming back  to the  narration of the facts,  appellant  had

sent  a  consignment  of the  goods  by invoice  no.  1,  dated

01.04.2002, to M/s.  Parveena Enterprises  (NF) France  for

value  of  11875.75 Euro vide  bill  of  Lading  No.  PONLDEL

27008966 dated 24.04.2002. Even though the purchaser of

the goods accepted the delivery, but failed to make payments

to the appellant [seller].  After considering the claim of the

appellant, respondent no. 1 offered to pay a compensation

amounting to 79.5% of the loss, instead of 90% of the loss.

6. Aggrieved by the same, appellant filed a complaint before the

District forum against the respondents, alleging deficiency in

service on the part of the respondent.

7. The District Forum by order dated 12.10.2006, allowed the

complaint  and directed the respondent  herein  (Insurer) to

pay as under­

We accept  the present complaint  and direct the Ops to pay the 90% of the value of 11875.75 Euro (goods exported by the petitioner vide Lading No. PONLDEL 27008966 dated 24.04.2002) together with interest at rate of 12% per annum from 24.7.2002 (because three months time was sufficient for the OPs to settle the claim) till the realization together  with  Rs. 3300/­ as litigation expenses within a period of

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30 days from the date of receipt of copy of this order.

(emphasis provided)

8. Even the appeal before the State Commission and a further

revision before the NCDRC  were ended up in dismissal,

therefore, the order passed by the District Forum with

regard to the liability of the respondent/insurance company

has attained finality.

9. Despite the order dated 12.10.2006, passed by Ld. District

Forum, when the respondent no. 1 failed to make the

payment to the petitioner­complainant as per the terms set­

out therein, the  appellant  preferred an Execution Petition

No. 34 of 2013 before the District Forum, Panipat. During

the pendency of the execution petition, the respondent paid

a sum of Rs. 11,23,906/­ to the appellant/decree holders

calculated on the basis of conversion rate of 11,875.75

Euros as on 24.04.2002 and the interest calculated thereon.

The appellant/decree holders while accepting the said

payment disputed that the payment satisfied the decree,

mainly on the plea that value of the Euros payable should

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have been calculated on the conversion rate applicable on

the date of payment. 10. The District Forum taking into consideration all these

aspects, has allowed the Execution Petition with the

following observations:

“After  hearing counsel for  both the parties and after perusal of the order of this forum it is very clear that this forum has passed an order to pay 90% of value of 11,875.75 Euro. As such, the OP was to pay the amount in Indian currency whichever was the value of Euro. Specifically, when court  is  passing an order  for  payment of amount as value of Euro the OP is bound to pay the value of Euro when he is making the payment. Order of this forum was passed in 2006 but till 2013 ECGC has not paid the amount to the complainant in compliance of the order. Now at this stage it is well settled law that executing court cannot go behind the decree under execution. In view of the order of this Forum, the ECGC has to pay the value of Euro when he is paying the amount.  Amount is to be paid in value of Euro whichever value exists at the time of payment, in compliance with the order of this Forum. In view of the above discussion, certainly ECGC has not paid the complete amount as per order passed by this Forum. Hence ECGC is further directed to pay the amount    (sic)

(emphasis supplied)

11. Respondent/insurance company being aggrieved by the

aforesaid order of the Executing Court approached the State

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Commission of Haryana in Revision Petition No. 66 of 2014.

The State Commission of Haryana did not find any merit in

the petition and dismissed the same. Again, the respondent

approached the NCDRC in revision being Revision Petition

No. 614 of 2015. Interestingly, the NCDRC, by order dated

24.03.2015,  dismissed the revision  petition  as  withdrawn

with a liberty to the Respondents to approach the

appropriate forum.

12. However, thereafter, respondents approached this court by

filing a special leave petition being SLP (C) No. 21085­

86/2015 (later converted into Civil Appeal No. 6108­6109 of

2016). This Court by order dated 11.07.2016, while allowing

the  appeal, remanded  the  matter  back  to the  NCDRC  for

consideration on merits under the revisional jurisdiction in

the following manner­ We have heard learned counsel for the parties at some length.  Our attention has been drawn by learned counsel for two parties to an order dated 9th January, 2015 passed by a Full Bench of the National Commission in Revision Petition No. 1792 of 2012 whereby the National Commission has  taken  the  view  that  although no appeal is maintainable against the order passed by the State Commission in exercise of its appellate jurisdiction, any order passed by the State Commission in exercise of its appellate or revisional jurisdiction  can  be challenged  before

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the National Commission by way of revision under 21(b) of the Consumer Protection Act. Learned counsel for the appellant submits  that the appellant is ready to take resort to the revisional jurisdiction of the National Commission in the light of the Full Bench decision of the National Commission, mentioned above, and that the matter could for that purpose be remitted back to the National Commission.

We accordingly allow these appeals but only to the extent that order dated 24   th    march, 2015 passed by the National Commission dismissing the revision petition filed by the appellant shall stand set aside, Revision Petition No. 614 of 2015 restored and remitted  back to the  National  Commission for the disposal in accordance with the law in the light of the Full Bench decision of the National Commission, referred to earlier.

(emphasis supplied)

13. On remand NCDRC, by order dated 20.10.2016,  which  is

impugned before us has allowed the revision of the

respondent on the ground that the Clause 17 of the Contract

had explicitly provided for the rule for calculating the rate of

conversion in the following manner­

11.  On bare reading of the above, it is clear that as per the insurance contract, the opposite party insurer was required to pay the insurance claim as per the conversion rate of the invoiced foreign currency in Indian rupee as per the bank buying rate of interest at Mumbai on the date of subject

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shipment for which the invoice was issued. Undisputedly, sum of Rs. 11,23,906 paid by the judgment debtor was calculated on the basis of conversion rate applicable at the time of shipment of invoiced value and the interest awarded by the consumer forum. Therefore, it cannot be said that any further amount  is due from the opposite party under the decree. Both the fora below have passed the impugned order in utter disregard of the expressed term no. 17 of the insurance contract.  The order thus  suffers from material irregularity and cannot be sustained.

14. Aggrieved by the order of  the NCDRC, the petitioner  is  in

appeal before this Court by a special leave petition.

15. Heard counsel appearing on behalf of both parties and

perused the material available on record.

16. Before we dwell on to the merits of this case, we would like

to note certain aspects of execution of a decree. Section 25

and 27 of the Consumer Protection Act, 1986, provides for

execution of awards. It would be relevant to note that the

‘execution’ means­

The word ‘execution’ in its widest sense signifies the enforcement of or giving effect to the judgments or orders of the court of justice. In a narrower sense, it means the enforcement of those judgments or orders by a public officer under the writs of fierifacias, possession, delivery,

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sequestration, fierifacias de bonisecclesiaticis, etc.

17. The amended Section 25 of the Consumer protection Act,

which is effective from  15.3.2003  may  be relevant to be

noted ­  

"25. Enforcement of orders of the District Forum, the State Commission or the National Commission­  

(1) Where an interim order  made under this Act, is not complied with, the District Forum or the State Commission or the National Commission, as the case may be, may order the property of the person, not complying with such order to be attached.  

(2) No attachment made under sub­section (1) shall remain in force for more than three months at the end of which, if the non­compliance continues, the property attached maybe sold and out of the proceeds thereof, the District Forum or the State Commission or the National Commission may award such damages as it thinks fit to the complainant and shall  pay the balance, if any, to the party entitled thereto.  

(3) Where any amount is due from any person under an order  made by a District Forum, State Commission or the National Commission, as the case may be, the person entitled to the amount may make an application to  the District  Forum, the State Commission or  the National  Commission,  as the case may be, and such district Forum or the State  Commission  or the  National  Commission may issue a certificate for the said amount to the

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Collector of the district (by whatever name called) and the  Collector shall proceed to recover the amount in the same manner as arrears of land revenue."

(emphasis supplied)

18. 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. It is settled law that 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.

19. In the facts and circumstances of the case there is no

dispute about the  fact  that the liability  of the respondent

company to a tune of  90% value of  11875.75 Euros with

interest at the rate of 12%  from 24.7.2002  has attained

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finality.   As per the calculation memo filed by the

appellant in execution proceedings she claimed total amount

of Rs. 25,76,883.00 i.e  principal amount of Rs. 7,61,105.00

calculated @ Rs 71.21 per Euro as on 17.4.2013 being 90%

value of 11,875.75 Euros. Further  interest granted by the

court from 24.7.2002 to 24.4.2013 to a tune of Rs.

18,12,478.00.

20. 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 herein. 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.

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21. In the light of the above findings of the forums, in the light of

the arguments advanced, we have to examine whether the

interpretation adopted is in the process of giving a true effect

to the decree or they have gone beyond the decree by

drawing a new decree. We are compelled to observe that an

order which  is passed  in the year 2006  is still  subject  to

litigation till date for the simple reason minimum care is not

taken by the forum to clarify the reckoning date for

conversion rate of currency.

22. In a contractual  matter, when the decree is silent with

regard to the reckoning date of conversion of foreign

currency in to Indian rupees, what would be the

methodology to  be  followed by  the executing court   is  no

more res integra, as this court has an occasion to deal with

elaborately in the   case of  Forasol v. ONGC, 1984 (Supp.)

SCC 263, the facts of that case revolved around a contract

entered into  between  ONGC and  Forasol for carrying  out

structural drilling in relation to the exploration of oil in the

Jaisalmer area. The contract mandated a part payment in

the foreign currency i.e., French francs. Due to belligerent

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situation prevalent between India and Pakistan in 1965, the

contract was suspended. In the meanwhile the Indian

currency was devalued resulting in Forasol claiming higher

conversion rate. As the dispute was not settled, the matter

was referred to an arbitration. For the present, it is sufficient

to note that by the award of the arbitrator/Umpire

mandated conversion at the rate of FF 1000 equal to

1517.80 instead of exchange rate of FF 1.033 equal to Re.

1.000. The aforesaid award was filed before the Delhi High

Court, which accordingly passed the decree on 07.05.1975

without any objections from the parties as to the form.  

23. Thereafter, the Forasol filed an application for execution of

the award being Execution No. 77 of 1976. ONGC objected

to the aforesaid execution by contending that the rate

specified in the award  was to be limited to the interest

granted thereon and the same does not affect the  main

contractual amount. The learned single Judge negatived all

the contentions of  ONGC.  On  appeal before the  Division

Bench, the High Court accepted the contention of ONGC and

therefore, Forasol appealed before this court. The question

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before the court was concerning choosing the best date for

the rate of conversion was expressed as under­

23.  The question  which  now remains to be considered in Forasol’s appeal is the date to be selected by the Court for converting into Indian Rupees the French Franc part of  the said award in respect of which no rate of exchange  has been fixed either by the said contract or the said award.

(emphasis supplied)

24. This Court recognized the principle that a determination of

relevant date for conversion of currency  would first take

place in accordance with the contractual provision and

thereafter, if such explicit determination is  not available,

then the court would have to determine the best possible

date.

25. Further this court recognized the discretion of the Court to

select the relevant dates and pointed out some of them in

the following manner­

24.  In an action to recover an amount payable in a foreign currency, five dates compete for selection by the Court as the proper date for fixing the rate of exchange at which the foreign currency amount has to be converted into the currency of the country in

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which the action  has been  commenced and decided. These dates are:

(1) the date when the amount became due and payable;

(2)  the  date  of the commencement  of the action;

(3)  the date of the decree;

(4) the date when the Court orders execution to issue; and

(5) the  date  when the  decretal amount is paid or realised.

25.  In a case where a decree has been passed by  the  Court in terms of  an award made  in a foreign currency a sixth date also enters, the competition, namely, the date of the award. The case before us is one in which a decree in terms of such an award has been passed by the Court.

(emphasis supplied)

26. Ultimately this  Court  on an extensive analysis  came  to  a

conclusion in the following manner­

70.  It would be convenient if we now set out the practice, which according to us, ought to be followed in suits in which a sum of money expressed in a foreign currency can legitimately be  claimed by the  plaintiff  and decreed by the court. It is unnecessary for us to categorize the cases in which such a claim can be made and decreed. They have been sufficiently indicated in

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the  English  decisions referred to  by  us above. Such instances can, however, never, be exhausted because  the  law cannot afford  to be static but must constantly develop and progress as the society to  which it applies, changes its complexion and old ideologies and concepts are discarded and replaced by new. Suffice it to say that the case with which we are concerned was one which fell in this category. In such a suit, the plaintiff, who has not received the amount due to him in a foreign currency, and, therefore, desires to seek the assistance of the court to recover that amount,  has two courses open to him. He can either  claim  the  amount  due to  him  in Indian currency or  in the  foreign currency in which it was payable. If he chooses the first alternative, he can only sue for that amount as converted into Indian rupees and his prayer  in the plaint can only be  for a sum in Indian currency. For this purpose, the plaintiff would have to convert the foreign currency amount due to him into Indian rupees. He can do so either at the rate of exchange prevailing on the date when the amount  became payable for  he  was  entitled to receive the amount on that date or, at his option, at the rate of exchange prevailing on the date of the filing of the suit because that is the date on which he is seeking the assistance of the court for recovering the amount due to him. In either event, the valuation of the suit for the purposes of court fees and the pecuniary limit of the jurisdiction of the  court  will  be the  amount in Indian currency claimed in the suit. The plaintiff may, however, choose the second course open to him and claim  in  foreign currency the  amount due to him. In such a suit, the proper prayer for the plaintiff to make in his plaint would be for a decree that the defendant do pay to him the

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foreign currency sum claimed in the plaint subject to the permission of the concerned authorities under the Foreign Exchange Regulation Act, 1973, being granted and that in the event of the foreign exchange authorities not granting the requisite permission or the defendant not wanting to make payment in foreign currency even though such permission has been granted or the defendant not  making payment in foreign currency or in Indian rupees, whether such permission  has been granted or not, the defendant do pay to the plaintiff the rupee equivalent of the foreign currency sum claimed at the rate of exchange prevailing on the date of the judgment. For the purposes of court fees and jurisdiction the plaintiff should, however, value his claim in the suit by converting the foreign currency sum claimed  by  him into Indian rupees at the rate of exchange prevailing on the date of the filing of the suit or the date nearest or most nearly preceding such date, stating in his plaint what such rate of exchange is. He should further give an undertaking in the plaint that he would make good the deficiency in the court­fees, if any, if at the date of the judgment, at the rate of exchange then prevailing, the rupee equivalent of the foreign currency sum decreed is higher than that  mentioned in the plaint for the purposes of court­fees and jurisdiction. At the hearing of such a suit, before passing  the  decree, the court  should call  upon the plaintiff to prove the rate of exchange prevailing on the date of the judgment or on the date nearest or most nearly preceding the date of the judgment. If necessary, after delivering judgment on all other issues, the court may stand over the rest of the judgment and the passing of the decree and adjourn the matter to

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enable the plaintiff to prove such rate of exchange. The decree to be passed by the court should be one which orders the defendant to pay to the plaintiff the foreign currency sum adjudged by the court subject to the requisite permission of the concerned authorities under the Foreign Exchange  Regulation  Act,  1973,  being  granted, and in the event of the foreign exchange authorities not granting the requisite permission or the defendant not wanting to make payment in foreign currency even though such permission has been granted or the defendant not  making payment in foreign currency or in Indian rupees, whether such permission  has been granted or not, the equivalent of such foreign currency sum converted into Indian rupees at the rate of exchange proved before the court as aforesaid. In the event of the decree being challenged in appeal or  other  proceedings  and such appeal  or  other proceedings being decided in whole or in part in favour of the plaintiff, the appellate court or the court hearing the application in the other proceedings challenging the decree should follow the same procedure as the trial court for the purpose of ascertaining the rate of exchange prevailing on the date of its appellate decree or of its order on such application or on the date nearest or most nearly preceding the date of such decree or order. If such rate of exchange is different  from the rate  in the decree which has been challenged, the court should make the necessary modification with respect to the rate of exchange by its appellate decree or final order. In all such cases, execution can only issue for the rupee equivalent specified in the decree, appellate decree or final order, as the case may be. These questions, of course, would not arise if pending appeal or other proceedings adopted by the

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defendant the decree has been executed or the money thereunder received by the plaintiff.

27. In the light of the ratio laid down by this court in

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, if  such a

clause is not available in the agreement then the courts have

to  determine the best  possible  date, then this  court  went

ahead and dealt with the procedure to be adopted. But in

the present facts that exercise is not relevant as 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 into rupees at the bank buying rate of

exchange at  Mumbai  on the date of relevant shipment.  A

close look at the relevant order dt. 12.10.2006 also discloses

that the district forum has granted interest on the amount

from 24.7.2002 which  can be  construed that the  District

Forum though has not  mentioned about clause 17 of the

agreement but taking in to consideration the very same

clause has given interest from that day. The interpretation

given by District Forum as well as the State Commission to

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the order  dt.  12.10.2006 is contrary to the terms  of the

agreement and amounts to drawing a new decree which is

not permissible.

28. We are unable to agree with the contentions of the learned

counsel for the appellant that the NCDRC has gone beyond

the  decree and the  NCDRC ought  not to  have gone into

clause  17  are  meritless  hence rejected. In  a case  of this

nature the only remedy available to the court  is  either to

look at the terms of the contract or in the absence of the

same to follow the procedure laid down by this court in the

above stated judgment. The order passed by NCDRC is

strictly in accordance with the settled legal position and we

do not find any infirmity with the order.

29. In conclusion, reading the judgment as  a  whole,  without

undertaking a piece  meal approach as suggested by the

appellant herein, interpreting the decree in a manner which

may amount to substitution of a new decree is not

countenanced under law. Therefore,  it is clear that as per

the insurance contract, the respondent insurer was required

to pay the insurance claim in accordance with the

conversion rate of the  invoiced  foreign currency  in  Indian

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rupee as per the bank buying rate of interest at Mumbai on

the date of subject shipment for which the invoice was

issued.  We  are  apprised  of the fact that the respondent­

judgment debtor has paid an amount of Rs. 11,23,906/­ to

the petitioner during the pendency of execution proceedings.

The aforesaid payment was calculated on the basis of

conversion rate applicable at the time of shipment of

invoiced value and the  interest  awarded by the consumer

forum. In  view of the  same  the  respondent  has  complied

with the order of the forum by paying full and final amount

in terms of the order.

30. Hence, we find no grounds to interfere with the order of the

NCDRC which is based on sound principles of law.

Accordingly, this appeal is dismissed.

……………………………..J.                (N. V. RAMANA)

  ………………………………J.                                                          (S. ABDUL NAZEER)

NEW DELHI, MAY  18, 2018.

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