Calcutta High Court
Orissa Steel Expressway Pvt Ltd vs Prathyusha Amr Jv on 25 June, 2025
Author: Shampa Sarkar
Bench: Shampa Sarkar
OCD 1
ORDER SHEET
AO-COM/10/2025
IA NO: GA-COM/1/2025
IN THE HIGH COURT AT CALCUTTA
ORDINARY ORIGINAL CIVIL JURISDICTION
COMMERCIAL DIVISION
ORISSA STEEL EXPRESSWAY PVT LTD
VS
PRATHYUSHA AMR JV
BEFORE:
The Hon'ble JUSTICE SHAMPA SARKAR
Date: 25th June, 2025.
Appearance:
Mr. Jishnu Chowdhury, Sr. Adv.
Mr. Samriddha Sen, Adv.
Ms. Iram Hassan, Adv.
. . .for the petitioner.
Mr.Ranjan Bachawat, Sr. Adv.
Mr. Sourojit Dasgupta, Adv.
Mr.Shourojyo Mukherjee, Adv.
Mr. Vishwarup Acharyya, Adv.
. . .for the respondent.
The Court:
1. By an order dated April 22, 2025, this Court had refused the prayer for
stay of the order dated December 12, 2024, passed by the learned
Arbitrator under Section 17 of the Arbitration and Conciliation Act,
1996 (hereinafter referred to as the said Act).
2. The application for stay was disposed of and the appeal was kept
pending. By the order impugned, the learned Arbitrator had directed the
petitioner to deposit a sum of Rs.76.32 crores in its own name in a
short term fixed deposit/term deposit account, in a nationalized bank,
after realization/withdrawal of the award deposited with the Delhi High
Court by the National Highway Authority of India [NHAI], in terms of an
award passed in an arbitral proceeding between the petitioner and
NHAI.
3. Mr. Chowdhury, learned senior advocate had assailed the order on
various grounds. Those grounds have been enumerated in paragraph 3
of the order dated April 22, 2025, which are set out hereunder for
convenience:-
"(a) Un-liquidated claim for damages cannot be secured and the
order passed by the learned arbitrator amounted to an order of
attachment.
(b) Payments of the bills and invoices raised by the respondent
were made. The remaining claim of Rs.76.32 crores was only in
the form of damages and unless a breach was proved, the claim
for damages was illusive and imaginary. The quantification of
the sum was made without any basis.
(c) The respondent would have to prove that it had sustained loss
on account of some breach committed by the petitioner before
the learned arbitrator could secure the amount.
(d) The learned arbitrator erred in holding that only because the
petitioner had asked the respondent to submit its claim against
the petitioner, which the petitioner proposed to pass through in
the arbitral proceeding between the petitioner and NHAI, the
same was an admission of the dues payable by the petitioner to
the respondent.
(e) The finding of admission was contrary to the settled principles
of law with regard to claims for damages and the learned
arbitrator had also made up his mind with regard to the liability
of the petitioner to pay money to the claimant even before the
arbitration proceeding had been concluded.
(f) The learned arbitrator was proceeding with a closed mind and
the petitioner apprehends that the issues which have been
raised by the petitioner with regard to admissibility of the claims
of the respondent will not be adjudicated in the property
manner."
4. Mr. Chowdhury relied on various decisions of the Hon'ble Apex Court
and also of this Court in support of the contention that claim for
unliquidated damages could not be secured by an interim order of
attachment before judgment and/or by an order of injunction, unless
the alleged breach was proved in the arbitral proceedings. Mr.
Chowdhury contended that the finding of the Arbitrator that the
amount was "admittedly due" was erroneous and based on surmise and
conjecture. The learned Arbitrator had made up his mind.
5. Mr. Bachawat opposed the stay application and submitted that the
petitioner had admittedly awarded a substantial sum in an arbitral
proceeding between the petitioner and NHAI. The sum was deposited in
the Delhi High Court. The petitioner had asked the respondent to
inform the petitioner about its claim against the petitioner. The
petitioner included the said amount in the statement of claim filed in
the arbitral proceeding with the NHAI, as a pass through claim. Thus,
the money payable to the respondent could no longer be unliquidated
claim for damages. Had the claim been allowed, the debt would
crystallize.
6. It was apprehended that, the petitioner, which was a joint venture and a
special purpose vehicle would stand dissolved as soon as the proceeding
with the NHAI was over. It was an accepted position that the petitioner
and NHAI had settled all their disputes. The respondent would not have
any other way of securing the said amount, if the money was paid and
the petitioner was dissolved.
7. Upon hearing the learned advocates for the respective parties, this
Court was of the view that the learned Arbitrator had passed the order,
requiring the petitioner to secure the sum of Rs.76.32 crores, in the
event the petitioner withdrew the money from the Delhi High Court or
the NHAI paid the awarded sum to the petitioner.
8. It is Mr. Chowdhury's specific instruction that the money has not yet
been received by the petitioner. Thus, there is no question of investing
the same. This Court finds that at this stage, the petitioner cannot be
aggrieved by the order. It is also informed that the arbitral proceedings
are near conclusion. This court does not find any illegality in the order
of the learned arbitrator.
9. Under such circumstances, the appeal is disposed of with a request to
the learned Arbitrator to conclude the proceedings expeditiously.
10. However, as one of the issues before the learned Arbitrator is with
regard to the admissibility of the claim of the petitioner, the
observations made by the learned Arbitrator in the order impugned,
shall be tentative and prima facie. Such observation shall not influence
the learned Arbitrator in deciding the dispute finally.
11. In my opinion, the findings of the learned Arbitrator were reasons
assigned, prima facie, to justify such order.
12. The Court has complete faith that the learned Arbitrator will decide
the dispute independently on the basis of the records and the
submissions made by the parties, without being influenced by the
interim order that was passed.
13. AO-COM 10 of 2025 is, accordingly, disposed of.
(SHAMPA SARKAR, J.)
Sp/
