Bombay High Court

4 Mr. Kailas K. Kamthe vs L & T Finance Ltd on 17 December, 2012

Bench: Anoop V.Mohta

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              IN THE HIGH COURT OF JUDICATURE AT BOMBAY                          




                                                                         
                 ORDINARY ORIGINAL CIVIL JURISDICTION




                                                 
                 ARBITRATION PETITION NO. 783 OF 2011

     1       M/s. Sahyadri Earthmovers,




                                                
             Having office at Post Chambli,
             Taluka Purandar,
             Dist. Pune-412301




                                    
     2       Mr. Suresh Sitaram Kamthe,
             Partner of M/s. Sahyadri Earthmovers,
                         
             At Post Chambli, Taluka Purandar,
             Dist. Pune-412 301.
                        
     3       Mr. Nandkumar Dhulaji Jadhav,
             Partner of M/s. Sahyadri Earthmovers,
             At Post Chambli, Taluka Purandar,
             Dist. Pune-412 301.
      


     4       Mr. Kailas K. Kamthe,
   



             At Post Khalad, Taluka Purandar,
             Dist. Pune-412 301.                          .....Petitioners. 





                                              
                  V/s.


     L & T Finance Ltd.,





     A company registered and incorporated
     under the Companies Act, 1956,
     having its registered office at
     L & T House, Ballard Estate,
     Mumbai-400 001.                                      ....Respondent.




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                                   WITH




                                                                       
                ARBITRATION PETITION NO. 347 OF 2012




                                               
     L & T Finance Limited,
     A company incorporated
     under the provisions of 
     The Companies Act, 1956,




                                              
     having its Registered Office at
     L & T House, Ballard Estate,
     Mumbai-400 001 and Corporate Office
     at 3B, Laxmi Towers, C-25,




                                   
     "G" Block, Bandra Kurla Complex,
     Bandra (East), Mumbai-400 051.
                        ig                              ....Petitioner.

                 Vs.
                      
     1     Sahyadri Earthmovers,
           (Borrower), a Partnership Firm,
           having its registered office address
           at AtPost Chambli,
      


           Taluka Purandar,
           Dist. Pune.
   



     2     Mr. Suresh Sitaram Kamthe,
           Partner of Respondent No.1.-





           Sahyadri Earthmovers, 
           having his address 
           At Post Chambli, Taluka Purandar,
           Dist. Pune.





     3     Mr. Nandkumar Dhulaji Jadhav,
           Partner of Respondent No.1
           Sahyadri Earthmovers,
           having his address at
           At Post Chambli, Taluka Purandar,
           Dist. Pune.




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     4     Mr. Kailas K. Kamthe,
           (Guarantor) having his address at




                                                                            
           At Post Khalad, Taluka Purandar,
           Dist. Pune.




                                                    
     Mr. Sachin Punde for the Petitioners in Arbitration Petition No. 
     783 of 2011 and for the Respondents in Arbitration Petition No. 




                                                   
     347 of 2012.
     Mr. Anand Poojari a/w Ms. Shakuntala Joshi i/by M/s. S.I. Joshi 
     and  Co.for   the   Respondent  in  Arbitration  Petition  No.  783 of 
     2011 and for the Petitioner in Arbitration Petition No. 347 of 




                                       
     2012.
                        ig                
                                      CORAM :  ANOOP V. MOHTA, J.

DATE : 17 DECEMBER 2012.

ORAL JUDGMENT :-

The Petitioners have challenged award dated 6 May 2011

under Section 34 of the Arbitration and Conciliation Act, 1996

(for short, the Arbitration Act).

2 Petitioner No.1 is a partnership firm, Petitioner Nos. 2 and

3 are the partners of the firm. Respondent No.4 is a guarantor.

(The borrower). All of them have challenged even the

validity, including the existence of Loan-Cum-Hypothecation

Agreement dated 7 June 2007 (for short, "the loan

ssm 4 arbp783.11gp

agreement"), deed of guarantee for the vehicle/equipment and

all actions arising out of the same. The Respondent/claimant

(the financer) has invoked Section 9 of the Arbitration Act for

protective and injunctive reliefs.

3 The Vehicles/Equipments which have been in their

possession since 2007, stated to have been purchased by them

by their own funds. The submission is made on behalf of

Respondent No. 4 that there exists no loan and Arbitration

agreement and therefore there was no question of passing

award against him. This was also on the ground that the loan

agreement in question was not signed by Petitioner No.4.

4 The case of the financer, Petitioner in Arbitration Petition

No. 347 of 2012, based upon the admitted documents on

record is as under:-

"On 7 June 2007, Respondent No.1 through Respondent

Nos. 2 and 3 (the borrowers) approached the Petitioner (the

financer) with a request for loan facility to the extent of

Rs.54,70,000/- for the purchase of 1 No. of Volvo EC 210 BLC

ssm 5 arbp783.11gp

Hydraulic Excavator bearing Serial No. 18388 and Engine No.

10240298 along with 1 No. of Fine 22X Hydraulic Rock Breaker

with standard Accessories bearing Serial No. 22/F-22 A-65,

more particularly described in Exhibit "F" to the Petition, on

loan-cum-hypothecation basis and the Petitioner accorded their

consent to the said request and agreed to grant the loan of

Rs.54,70,000/- i.e. Rs. 44,21,000/- towards Equipments and

Rs.10,49,000/- towards Rock Breaker. Accordingly, a loan

agreement was entered into on 7 June 2007 between the

Petitioner as "the lender" and Respondent No.1 as "the

borrower" through Respondent Nos. 2 and 3 on the terms and

conditions as more particularly described under the said

agreement. Under the said agreement, the Petitioner advanced

said loan to Respondent No.1 and Respondent No.1 agreed and

undertook to repay the said loan with interest @ 8.43% p.a.

totalling Rs.72,21,084/- in 48 and 36 equated Monthly

Installments (EMI) respectively comprising of a sum of

Rs.1,23,170/- each commencing from 25 August 2007 till 25

July 2011 towards the Excavator and Rs.36,359/- each

commencing from 25 August 2007 till 25 July 2011 towards the

ssm 6 arbp783.11gp

Rock Breaker, more particularly mentioned in the schedules

attached with the said agreement. Respondent No.1 agreed

that, in case of delay in payment of the installments,

Respondent No.1 shall pay delayed payment charges @ 35%

p.a. as per clause No. 3.5 of the agreement. On 7 June 2007, in

consideration to the loan granted by the Petitioner to

Respondent No.1 executed Demand Promissory Note, inter-alia,

agreed to repay the said loan with interest at the rate of 8.43%

p.a.."

5 "On 12 June 2007, pursuant to the loan granted by the

Petitioner to Respondent No.1, Respondent No.4 executed a

Deed of Guarantee in favour of the Petitioner, inter-alia,

guaranteeing the due performance and observances of the terms

and conditions of the said agreement by Respondent No.1.

Respondent No.4 further agreed and undertook that in case

Respondent No.1 failed to pay the outstanding loan amount or

any other amount due under the said agreement, Respondent

No.4 shall pay the same without any demur or protest.

Respondent No. 1 was in arrears in payment of loan

ssm 7 arbp783.11gp

installments. Inspite of repeated reminders and requests,

Respondent No. 1 failed and neglected to pay the outstanding

loan amount. The Petitioner by its various letters called upon

Respondent No.1 to pay over due loan installments, however,

Respondent No. 1 failed to comply with the same and therefore,

event of default has occurred as per term 12 of the said

agreement."

6 "On 19 May 2009, consequently the Petitioner has issued

advocate's notice and thereby terminating the said agreement

and calling upon the Respondents jointly and severally to pay to

the Petitioner a sum of Rs.51,09,481/- comprising overdue loan

installments of Rs.9,52,022/- delayed payment charges of

Rs.2,76,484/- as of 5 May 2009 and unmatured loan

installments of Rs.38,70,975/- with further compensation of

36% p.a. from 6 May 2009 till payment and/or realisation. The

Petitioner had made it clear in the said notice that in failure to

make the repayment of the outstanding loan amount, the

Petitioner shall entitle forthwith to the repossession of the said

Equipments and further that in failure to comply with the

ssm 8 arbp783.11gp

requisitions in the said notice, the Petitioner would be

constrained to take legal proceedings against the Respondents

including referring the disputes, differences and claims under

the said agreement to the sole arbitrator Shri Bharat B. Jain,

Advocate High Court as per the terms of the said agreement.

The Petitioner had duly served the said notice upon the

Respondents by way of RPAD, however, till the date the

Petitioner has neither received any returned packet from the

postal authority nor reply from the Respondents. The

Respondents have breached the terms and conditions of the said

agreement by not making the payment of outstanding loan

amount, as agreed in the said agreement. Therefore, the

dispute and differences arose between the parties."

7 "On 10 June 2009, pending the arbitration proceedings,

the Petitioner filed Arbitration Petition under Section 9 of the

Arbitration Act, inter-alia praying for the reliefs. On 25

October 2010, the Petitioner learnt that the arbitration

proceedings was not closed for an award, therefore filed

another petition under Section 9 of the Arbitration Act.

ssm 9 arbp783.11gp

However, the same was dismissed by the Court."

8 "On 24 April 2012, an award came to be passed in favour

of the Petitioner and the learned Arbitrator inter-alia granted

possession of the Equipments along with the claim as more

specifically mentioned in the award.

At present the said Equipments are lying with the

Respondents and they are illegally enjoying the fruits of the said

Equipments which are hypothecated in favour of the Petitioner

and inspite of the termination of the loan agreement and award,

the Respondents have failed to repay the loan installments to

the Petitioner. The Respondents owed a huge amount under the

loan agreement, therefore, filed Petition under Section 9 of the

Arbitration Act."

9 By order dated 18 November 2011, this Court (Coram-

S.J. Kathawalla, J), by keeping Section 34 Petition pending,

directed the Arbitrator to comply with the order passed by this

Court (Coram- Anoop V. Mohta, J.) in Sahyadri Earthmovers

ssm 10 arbp783.11gp

Vs. L & T Finance Ltd. 1 .

10 The learned Arbitrator, in pursuance to the order, has

passed the award in question. Both the parties, therefore, by

amending their respective Petitions placed those subsequent

events and award on record. As already ordered, both these

Petitions (Arbitration Petition No. 783 of 2011 filed by the

Borrowers under Section 34 and another Petition No. 347 2012

filed by the Financer [Claimant] under Section 9 of the

Arbitration Act) tagged together and heard finally accordingly.

11 The learned Arbitrator read, referred and relied upon the

documents and the evidence laid down by the respective parties

and by detail reasoned order has passed the award in favour of

the financer.

"96. I therefore, make and pass the Award in favour of

the Claimants as under:

           a)    Respondents   do   jointly   and   severally   pay   to   the 


     1      2011(4) Mh.L.J. 200





      ssm                                 11                            arbp783.11gp

Claimants a sum of Rs.45,72,904/- (Rupees Forty Five

Lacs Seventy Two Thousand Nine Hundred & Four Only),

consisting of overdue installment amounts, future loan

installments, overdue compensation etc., as on

05.05.2009;

b) further, the Respondents do pay interest @ 36%

p.a. on said sum of Rs.45,72,904/- from 06.05.2009 to

29.05.2009 and @ 24% p.a. from 30.05.2009 till

payment and/or realisation;

c) The Claimants are entitle to possession of the

agreement Equipments being, Volvo EC 210 BLC

Hydraulic Excavator bearing Serial No. 18388 and

Engine No. 10240298 with 1 No. Fine 22X Hydraulic

Rock Breaker with Standard Accessories bearing Serial

No.22/F-22A-65. The Respondents do forthwith

surrender possession of the said Equipments to the

Claimants. The Claimants are permitted to dispose off

the said Equipments for recovery of their dues under this

Award and the Claimants do credit the net sale proceeds

thereof in the accounts of Respondents, after deducting

ssm 12 arbp783.11gp

the expenses incurred to affect the said sale. If the

amounts so recovered after the said sale of the

Equipments is more than the amounts recoverable from

the Respondents under this Award, the Claimants do

refund the excess amount to the Respondents and if the

amounts recovered after said sale is less than the

Awarded amount, the Claimants are entitle to recover

balance from the Respondents;

d) Fees and costs of the Arbitration is calculated at a

sum of Rs.2,85,000/-. Both the parties are liable to bear

the said fees and costs equally. However, the Claimants

are directed to initially make payment of the said

Arbitration fees and costs and recover the 50% of the

said amount, being an amount of their share from

Respondents."

12 Following issues were framed by the learned Arbitrator:-

1. Whether the Claimants prove that they are

entitle to the amounts claimed from the

ssm 13 arbp783.11gp

Respondents?

2. Whether the Claimants prove that they are

entitle to the repossession of the

Hypothecated equipments?

3. Whether the Respondents prove that they had

not executed the loan Cum Hypothecation

Agreement and other documents relied upon

by the Claimants?

4. Whether the Respondents prove that the

Arbitral Tribunal has jurisdiction to entertain

the Counter Claim?

5. Whether the Respondent No.1 proves that the

amount paid by them to the Claimants was

not in payment of the agreed agreement

installment but otherwise?

6. For costs?

7. What Award."

13 The burden to prove issue Nos. 1 and 2 was of the

Financer/Claimants; and other issues Nos. 3, 4 and 5 was of the

ssm 14 arbp783.11gp

borrowers/guarantor. The Borrowers led oral evidence of one

partner. The Financer led evidence of an authorized person of

the company.

14 The agreement, alleged to have been signed by the

borrowers and the Financer's authorized signatory. A

summary schedule to the agreement shows the date, place

and the period and number of the Agreement; the

borrowers' and guarantor's name and the amount with

agreed interest rate of 8.43% flat and the delayed payment

charges @ 36% p.a.. The reference is also made to

valuation dated 31 May 2007. Every page of this agreement

has been signed by the borrowers. This loan agreement was

for 36 months, expired on 25 June 2011. The agreement

provides the details of suppliers name and the address. It

provides the asset type and its description. Demand

promissory note dated 7 June 2007 is also part of the record,

signed by the concerned parties. The deed of guarantee

admittedly not signed by the partners being the borrowers

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but only signed by the guarantor-Respondent No. 4. This deed

of guarantee is in reference and pertains to the loan agreement

and for its debt.

15 Admittedly, there is no specific Arbitration clause in this

deed of guarantee. The Arbitration clause is provided in the

loan agreement which is as under:-

"17 Arbitration

17.1 Any question dispute or difference that arises

between parties or any of them touching or

concerning this agreement or any condition herein

contained or as to the rights, duties or liabilities of

parties hereto or any of them either during the

continuance of the agreement or after termination

or purported termination hereof shall be referred to

the sole Arbitrator to be appointed by the Lender,

according to the provisions of Arbitration &

Conciliation Act, 1996 and rules thereunder and

any amendment thereto from time to time shall

apply.

ssm 16 arbp783.11gp

17.2 The award of the arbitrator shall be final,

conclusive and binding on all the parties, and all

the parties undertake to carry out the award

immediately without any delay. The venue of the

arbitration shall be Mumbai."

16 It is clear from this deed of guarantee that the loan

agreement and its terms and conditions are the part and parcel

of deed of guarantee. It cannot be dissected and read in

isolation. No guarantor would like to sign the deed of

guarantee without understanding the basic loan agreement

and/or agreement between the borrowers and the financer. The

purpose of deed of guarantee itself means there exists finance

agreement and/or loan agreement between the parties and to

secure the amount, the guarantor volunteered and guaranteed

the same by signing the deed. It is inter-linked and inter-

connected.

17 There is a specific defence raised even with regard to

the signing of these documents by the borrowers, as well

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as, the guarantor. After going through the material placed on

record, as well as, those specific defences so raised, I am

inclined to observe that there is no contra evidence on record to

justify that they never signed these documents. No further steps

and or proceedings were initiated and/or moved by the

Petitioners- borrowers or the guarantor to challenge the

signature part. Mere denial to the existence of signature itself is

not sufficient.

18 Strikingly, the documents so referred and relied by the

financer, which are part of the record including the invoices,

provides the name of the supplier of the Equipments with

detailed description including the amount. There is no dispute

that those Vehicles/Equipments have been in possession of the

borrowers since the date of delivery as per these invoices.

There was no question of party in possession of the Vehicles

and/or Equipments, unless authorized and permitted and/or the

requested amount is paid by the parties or it's financer.

The submission that they made the payment of their own

though raised, but could not be substantiated by any

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documentary or oral evidence on record, though the basic

burden upon them is to prove the same, specifically when

the financer has placed on record these documents, which

proved that they provided finance to the borrowers, who in turn

able to take possession of the Vehicles/ Equipments. Their

obligation was now to make the monthly payment to the

financer, as the financer subject to the terms and conditions

already made payment to the supplier of the Vehicles/

Equipments. There are documents/ disbursement advices on

record referring to the agreement, amount referring to the

borrowers. The documents clearly show the amount financed

was Rs. 54,70000/-.

19 Admittedly, the borrowers made the part payment by

respective installments to the extent of Rs. 29,00,000/-. There

was no question of making any payment in such fashion, if the

borrowers/guarantor were stranger to the agreement and the

documents. This part payment itself shows that both the parties

in fact acted upon and proceeded further. There was no

question of taking possession of the Vehicles/Equipments but for

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the signed agreements and the finance so made by the financer.

There was no occasion/reason even to issue 36 post dated

cheques by letter dated 31 May 2007. The contents of the letter

itself goes against all these contentions raised to claim

damages/counter claim.

20 The contention was raised and therefore the issue was

also framed, but the Petitioners-borrower No.1 in fact, failed to

prove that the amount paid by them was not towards the agreed

installments as per the agreement. It was specifically contended

that the amount was paid by mistake. The learned counsel

appearing for the Respondent-Claimant has also cited a

Judgment, Sri Sri Shiba Prasad Singh Vs. Maharaja Srish

Chandra Nandi & Anr. 2 , referring to Section 72 of the Contract

Act and further contended that if the money was paid by

mistake and as was not due by any contract or otherwise

therefore, must be repaid. The counter-claim was also raised

based upon this for the refund of the said money. The

proposition of law is quite well settled and needs no further

2 A.I.R. (36) 1949 Privy Council 297

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discussion. What is required to see is the facts and

circumstances read with the agreement between the parties. In

the present case, as recorded above, I am inclined to observe

that both the parties acted upon the agreement and in fact the

payments were made towards the agreed installments. There is

no contra material placed and brought on record to prove

otherwise. Mere allegations and/or averments itself are not

sufficient to overlook the written documents on record. There

is no justification whatsoever placed on record to show how and

in what circumstances they have been in possession of the

Vehicles/Equipments since the date of the agreement. The

aspect of self finance, if any, as contended, to purchase vehicles,

is also nowhere proved by the oral, as well as, the written

documents. This is also not a case that the agreement in

question can be stated to be illegal and/or contrary to the law.

The learned Arbitrator, therefore, has rightly decided these

issues against the borrowers/guarantor by providing detailed

reasons. The rejection of the counter-claim therefore, cannot be

stated to be incorrect and/or wrong. It is well within the

framework of law and the record available. The learned

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Arbitrator has rightly observed that the borrowers/guarantor

failed to prove that the payments were made by mistake; and

under pressure. The findings therefore so given that the

Respondents-borrowers were failed to establish their case in all

counts, need no interference.

21 In view of above itself, it is clear that the possession of the

Vehicles/Equipments has been only because of the agreement

between the parties and as there are consistent defaults in

payment, the financer is entitled to take steps to recover the

possession of the Vehicles/Equipments by following the due

procedure of law. The proceedings, therefore, so initiated is

well within the framework of law and the record. The learned

Arbitrator, considering the facts and circumstances and the

material placed on record, right in ordering and permitting the

financer to take possession of those Vehicles/Equipments. The

borrowers/guarantor, in view of the reasons so recorded and/or

otherwise and even on the basis of the reasonings, are entitled

to get the possession of the vehicles as they failed to perform

their obligations and defaulted in making payment. The

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financer, therefore, is entitled to take all necessary steps to take

possession and to dispose of the said Equipments and/or

machinery in accordance with law and the agreement.

22 The learned Arbitrator has also dealt with the contention

that there was no sanction and/or disbursement of payment

made at any point of time to the borrowers or the guarantor.

This contention is unacceptable. Even otherwise, considering

the terms and nature of the agreement between the parties,

they never contended that the amount and the payment should

have been made directly to the borrowers and/or the guarantor.

There is ample material on record to show that the financer has

made requisite payment, which is clear even from the tax

invoices placed on record. The requisite amount was paid to

the supplier of the Vehicles/Equipments directly based upon

which the borrowers able to take possession of the Vehicles/

Equipments. The obligation of making monthly installments by

the borrowers/guarantor has not fulfilled, therefore this action.



     23     The submission was also made on behalf of Respondent 





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No. 4 guarantor to say that there was no Arbitration agreement

and therefore, there was no question of initiation of any such

Arbitration proceedings including the award. Following

judgments were cited to show that there exists no Arbitration

agreement in view of Section 7 of the Arbitration Act. The

provisions, as well as, the law so settled need no discussion.

Indowind Energy Limited Vs. Wescare (India)

Limited & Anr. 3

ii) S.N. Prasad, Hitek Industries (Bihar) Limited

Vs. Monnet Finance Limited & Ors. 4

24 As recorded above, having once signed the deed of

guarantee which provides and specifically mentioned and

referred the loan agreement between the parties and as the loan

agreement contains the Arbitration agreement, this itself in my

view sufficient to reject the contention so raised as it is

permissible and recognized mode to enter into such Arbitration

agreement to settle the dispute. There is nothing to point out

3 (2010) 5 SCC 306 4 (2011) 1 S.C.C. 320

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that the deed of guarantee itself can be read in isolation and/or

is independent document. This being commercial document

and as those documents are part of the record and as borrowers

acted upon the same by making the part payment to the extent

of Rs.29,00,000/- and having taking possession of the vehicles

based upon the same, now to deny the existence of Arbitration

agreement by only Respondent No.4 guarantor, is unacceptable.

The borrowers have nowhere denied the existence of such

Arbitration agreement to settle their dispute arising out of the

same, therefore also the guarantor just cannot take shelter of

non-mentioning of specific Arbitration clause in the deed of

guarantee to say that there exists no specific Arbitration

agreement between the parties. I am inclined to observe that

there exists Arbitration clause in the agreement between the

parties which covers to settle the dispute between the financer

and the borrowers and the guarantor, as all these documents are

interlinked and interconnected.

25 Taking over all view of the matter including the well

reasoned award so passed by the learned Arbitrator providing

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reasons for every aspects, in my view, need no interference.

There is no perversity in the order. The award is well within

the framework of law and the record. Even otherwise, the

Court under Section 34 would not like to interfere with the

reasoned award by re-appreciating and/or reassessing the

evidence and material placed on record and as applied.

[P.R.Shah, Shares & Stock Broker (P) Ltd. Vs. M/s. B.H.H.

Securities (P) Ltd. & Ors.] 5 , [Indian Oil Corporation Ltd.,

Mumbai Vs. Kadbrotee Engineering Industries, Navi

Mumbai] 6 and Sahyadri Earthmovers (Supra).

26 Accordingly, Petition No. 783 of 2011 is dismissed. There

shall be no order as to costs.

27 So far as Arbitration Petition No. 347 of 2012, is

concerned, in view of the reasonings so given while dismissing

Section 34 Petition whereby award dated 6 May 2011 passed

by the Arbitrator arising out of the contract in question between

the parties have been upheld, I am inclined to dispose of

5 2011(6) R.A.J. 27 (SC) 6 2011(2) Mh.L.J. 659

ssm 26 arbp783.11gp

Section 9 Petition for same reasons.

28 The contention was raised by the learned counsel

appearing for the borrowers- guarantor that as the Arbitrator

has passed the award in favour of the financer, the remedy is to

put the award in execution and therefore there is no question of

passing and/or granting any order in Section 9 Petition. To this,

a submission is made by the learned counsel appearing for the

financer that the Arbitration Act provides and permits to protect

and at least ask for security and/or to secure the amount in

view of the award so already passed and therefore, pending the

execution, it is permissible to grant protective and security

order.

29 Considering the scope of Section 9 read with the above

facts on record and also the fact that the Arbitrator has passed

the reasoned order, the protection as sought needs to be

granted to avoid further complications. This is also for the

reason that the borrowers guarantor has been enjoying the

possession of the Vehicles/Equipments since 2007 by making

ssm 27 arbp783.11gp

only part payment. The contract/agreement in question even

otherwise expired on 25 June 2011. Therefore, the retention of

the vehicles in such circumstances itself sufficient reason to pass

order of security and the protection under Section 9 of the

Arbitration Act.

30 The learned counsel appearing for the borrowers read and

refer again the provisions of Section 9 and 36 of the Arbitration

Act and contended that, as this Court has confirmed the award

for the first time, the remedy to the financer is to execute the

award in accordance with law and therefore, there is no

question of passing any further order in Section 9 Petition. The

learned counsel appearing for the financer has pointed out the

judgment of the Division Bench of this Court Nimbus

Communications Ltd. & Anr. Vs. Board of Control for Cricket

in India & Anr. 7, whereby this Court has considered the various

facet of Section 9 of the Arbitration Act read with O-38 of the

Code of Civil Procedure (for short, CPC) and thereby granted

interim protection, pending the Arbitration proceedings and

7 2012(5) Bom. C.R. 114

ssm 28 arbp783.11gp

also directed to furnish solvent security to the satisfaction of the

Prothonotary and Senior Master.

31 Taking over all view of the matter and in view of the

above reasonings, I am inclined to observe that the financer has

made out the prima facie case and balance of convenience and

equity also lies in their favour, so also the borrower's conduct.

The submission to secure the decretal amount in the present

facts and circumstances, cannot be denied.

32 This Court by order dated 21 April 2010 in Arbitration

Petition No. 457 of 2009 (Coram:- R.Y. Ganoo, J.) has granted

interim protection in terms of prayer clause (d), pending the

Arbitration Proceedings, thereby restrained the borrowers

guarantor from dealing with and/or parting with possession

and/or creating third party rights or encumbering with the said

Equipments described in Exhibit "F" to the Petition. Those are

the Equipments and the machineries in question. This order has

been in force till this date.

      ssm                                   29                            arbp783.11gp

     33    In   the   present   Arbitration   Petition   No.   347   of   2012

(lodging No. 1051 of 2011), on 3 October 2011 this Court,

(Coram:-S.J. Vazifdar, J.), pending the disposal of the Petition

ad-interim relief in terms of prayer clause (c) and (e), except

the bracketed portion marked in red ink, have been granted.

Prayer clauses (c) and (e) read as under:-

"(c) Pending the execution of the Award dated

24.4.2012 or the said award is enforced in

accordance with Section 36 of the Arbitration and

Conciliation Act, 1996, this Hon'ble Court be

pleased to direct the Respondents to disclose the

location of the said Equipments on oath to enable

the Court Receiver to take possession of the said

Equipments;

(e) Pending the execution of the Award dated

24.4.2012 or the execution of the said Award is

enforced in accordance with Section 36 of the

Arbitration and Conciliation Act 1996, the

Respondents and their respective servants and

agents be restrained by and order and injunction

ssm 30 arbp783.11gp

of this Hon'ble Court in any manner (dealing with

and/or) parting with possession and/or creating

third party rights and/or alienating and/or

encumbering with the properties described in

Exhibit "J" to the Petition";