OD-48 AP No.460 of 2015 IN THE HIGH COURT AT CALCUTTA Ordinary Original Civil Jurisdiction ORIGINAL SIDE SREI EQUIPMENT PVT.LTD.Versus MOHAMMAD ASIF HABIBI & ANR.
BEFORE: The Hon'ble JUSTICE SANJIB BANERJEE Date : 1st July, 2015.
Appearance: Mr.S.Banerjee, Adv.Mr.Arik Banerjee, Adv.The Court : This is a post-award petition under Section 9 of the Arbitration and Conciliation Act, 1996.
The award has been challenged by the borrower, primarily on the ground that the arbitral reference was held without notice to the borrower.
The parties have been before this Court on previous occasions.
Upon a previous petition under Section 9 of the said Act being disposed of to the dissatisfaction of the finance company, an appeal was carried from the relevant order.
Such appeal was disposed of on November 18, 2014 by the order impugned being substantially modified as follows: “We are, thus, left with the balance 15 excavators and/or tippers that are lying with the respondents.
Mr.Banerjee would contend, he is running the excavators and is entitled to do so as, according to him, in case the accounts are properly reconciled and the 12 assets are sold that would square off the liability of the respondent.
This question is to be decided at the appropriate stage.
We do not venture to do so particularly, when the application for setting aside of the award is awaiting disposal.
To strike a balance, we ask the Receiver to take symbolic possession of all the 15 assets.
The respondents are directed to render all necessary cooperation to the Receiver.
The Receiver would, however, permit the respondents to use those equipments under his direct supervision provided, the respondents would make further payment of Rs.5 lacs per month.
The instalments may be paid on the last day of each succeeding month starting from November, 2014.
This arrangement is temporary and would be reviewed by the learned Arbitration Judge after noticing the outcome of the sale of the tippers so directed by us in the foregoing order.
The Receiver may appoint agent for the purposing of handing over the vehicles.
The Receiver may be paid a further remuneration of Rs.20,000/- for the time being.
In default of payment of any of the instalments, the Receiver would take physical possession of all the said assets and would seek appropriate direction from the learned Arbitration Judge upon notice to the parties.
The order of learned Single Judge stands modified.” The appellate order of November 18, 2014 was carried by way of a special leave petition to the Supreme Court.
Such petition was disposed of by granting liberty to the respondents herein to apply “before the High Court within two weeks hence, with a prayer to the High Court to deal with the same as per law.” The respondents say that pursuant to such liberty, the respondents have applied before the Appellate Court, though the relevant appeal has already been disposed of.
The respondents say that no order should be passed on the present petition without the application being disposed of by the appellate Court.
The financier says that even if the award is disregarded at the moment and the claim under the original agreement taken up, it would be evident that a substantial amount is due from the respondents.
The finance company says that it was upon appreciation of such aspect of the matter that the appellate order of November 18, 2014 permitted the respondents to use the 15 assets in the usual couRs.of business, subject to payment of Rs.5 lakh per month.
The finance company says that such payment of Rs.5 lakh per month has not been forthcoming, despite the passage of nearly seven months from the appellate order.
The appellate order permitted the respondents herein to use the 15 assets referred to in its relevant order subject to a sum of Rs.5 lakh per month being paid.
Since it is evident that such payment has not been made, it is necessary that the receiver appointed earlier be directed to take possession of the 15 assets in terms of the appellate order and invite offers for sale thereof.
The bogey of the arbitral award that has been raised by the respondents herein is of no relevance in the context of the present order, since it is not the respondents’ case that the dues under the agreement have been discharged.
It will be apparent from the appellate order of November 18, 2014 that a substantial amount remained due from the respondents herein to the finance company under the agreement and on appreciation of such fact, the appellate order provided for the conditional use of the 15 remaining assets by the respondents subject to the payment of Rs.5 lakh being made per month.
Since a sum in excess of Rs.35 lakh has fallen due in terms of the appellate order, it is necessary that the assets be immediately taken possession of in terms of the default clause contained therein.
Accordingly, the receiver earlier appointed in the matter is directed to take possession of all the 15 remaining assets from the respondents.
The receiver will take no steps for a week from date.
If, within such time, the receiver is handed over a demand draft or pay order or like instrument, not being a personal cheque, made out in favour of the finance company for a sum of Rs.35 lakh by the respondents herein, the receiver will not proceed to take possession of any of remaining 15 assets.
If the payment is not tendered within the time permitted, the receiver will take possession of 15 assets, invite offers for sale thereof in such newspapers as the petitioner may suggest and present the offers in Court when the petition appears next six weeks hence.
If the receiver is required to undertake any travel in terms of this order, the receiver will be paid a further remuneration of 3000 GM and all expenses for the receiver’s travel, accommodation and the like will be borne by the petitioner and added to the claim in the possible execution proceedings or in the future arbitral reference, if the award is set aside.
This order does not affect the rights of the respondents in the petition for setting aside the award, since the dues claimed by the finance company have been reckoned on the basis of the original agreement and not on the basis of the arbitral award.
If the slightest of resistance is put up on behalf of the respondents to the receiver taking possession of the assets or any of them, the receiver will call upon the Superintendent of Police exercising jurisdiction over the area to render all assistance to the receiver for the purpose of implementation of this order.
The Superintendent will not insist on any more formal copy of this order than the certified website copy thereof and this Court’s official website may be referred to the Superintendent for his verification of the order, if necessary.
Urgent certified website copies of this order, if applied for, be supplied to the parties subject to compliance with all requisite formalities.
(SANJIB BANERJEE, J.) bp.