Sharjah Court Order Enforceable in India, Rules Telangana High Court in Fraud Case

The Telangana High Court has ruled that a man who allegedly transferred company funds to his personal account in Sharjah cannot avoid a UAE court order simply because it was issued in his absence. The court confirmed that a money decree from the Federal Court of Sharjah is fully enforceable in India. The judgment debtor cannot claim he was not present in the foreign court to avoid payment.

The case involves a business partnership in Sharjah for a medical equipment company. The decree holder initially owned 90% of the company. After a share transfer, the other party fraudulently moved company funds to his personal account. An independent accounting expert found AED 1,079,000 was transferred. The Sharjah court ordered him to pay AED 971,000 with interest and legal costs.

The decree holder got permission to enforce the order outside the UAE and started proceedings in India to sell the man's property. The judgment debtor argued the Sharjah court lacked jurisdiction and that the ex parte decree was not on merits. Under Indian law, a foreign judgment is not binding if not passed on merits. The court rejected his arguments.

The division bench noted India recognizes the UAE as a reciprocating territory since 2020, allowing direct enforcement. The court clarified that an ex parte decree is still on merits if the foreign court examined evidence. The Sharjah court considered the expert report and contracts before deciding. The summons were properly served through multiple channels, and the accused never denied the email used was his.

The High Court upheld the Commercial Court's order to attach and sell the man's property. The ruling means an Indian doing business abroad and allegedly defrauding a partner cannot use Indian courts as a shield against a foreign judgment based on solid evidence from a recognized reciprocating territory.