[Cites 4, Cited by 0]
Calcutta High Court
M/S Electronica Finance Ltd vs Golden Industries And Ors on 26 February, 2026
Author: Shampa Sarkar
Bench: Shampa Sarkar
OCD 6
ORDER SHEET
AP-COM/964/2025
IN THE HIGH COURT AT CALCUTTA
COMMERCIAL DIVISION
ORIGINAL SIDE
M/S ELECTRONICA FINANCE LTD
VS
GOLDEN INDUSTRIES AND ORS.
BEFORE:
The Hon'ble JUSTICE SHAMPA SARKAR
Date: 26th February, 2026.
Appearance:
Ms. Sormi Dutta, Adv.
Mr. S. Chowdhury, Adv.
Mr. Sayan Ganguly, Adv.
Mr. S. Biswas, Adv.
. . .for the petitioner.
The Court:
1. Affidavit of service filed in Court is taken on record.
2. By the order dated February 3, 2026, this Court had directed that a
notice be served upon the respondents along with the copy of the order
dated February 3, 2026, indicating that the matter will be taken up on
26th February, 2026 and if the respondents failed to appear, the matter
would proceed.
3. Such notice along with the copy of the order has been duly served.
None appears despite service.
4. The petitioner is a non-banking financial company. The petitioner prays
for appointment of an Arbitrator to arbitrate upon the disputes arising
out of the term loan cum hypothecation agreement dated 16 th
December, 2022. The case run by the petitioner is that the respondents
approached the petitioner for a loan, for the expansion of the business
of the respondent no.1. The respondents nos. 2, 3 and 5 agreed to
stand as a guarantors. The petitioner agreed to provide loan for an
amount of Rs.44,36,800/- and a Term Loan-cum-Hypothecation
Agreement was entered into between the parties. For the purpose of
securing the loan, the machines were hypothecated to the petitioner.
The said machines were installed at the premises of the respondent no.1
at Rajkot, Gujarat. The loan was to be liquidated in 60 monthly
instalments, but the respondent had paid the 1 st to 14th instalment and
thereafter failed to pay the remaining instalments. The last payment
was made on May 5, 2024.
5. On February 24, 2025 the petitioner issued a demand notice to the
respondents calling upon the respondents to pay up the remaining
amount. The notice was issued from the office of the petitioner situated
within the jurisdiction of this Court. The payment was to be received by
the petitioner within the jurisdiction of this Court.
6. The petitioner filed an application under Section 9 of the Arbitration and
Conciliation Act, 1996 before the Chief Judge, City Civil Court at
Calcutta for appointment of a Receiver to take possession of the
machines. The Receiver was appointed. However, the Receiver could
not find the machines at the address. The petitioners have a claim of
more than Rs. 41 lakhs.
7. A notice invoking arbitration was issued on July 1, 2025 under Section
21 of the Arbitration and Conciliation Act, 1996. The loan was recalled
and the agreement was terminated. The petitioner has specifically
pleaded how this Court has jurisdiction to entertain the application.
8. The petitioner suggested names of three Arbitrators. The petitioner also
indicated that the place of arbitration shall be Kolkata. By the said
letter, the petitioner also invited objections, if any, from the respondents
with regard to the choice of Arbitrator and the venue. Clause 11.4 of
the said agreement contains an Arbitration Clause. In this case, venue
cannot be read as a seat because there is a contrary indication that the
lender could also choose another venue for the purpose of holding the
arbitration.
9. The Clause is quoted below:-
"11.4 ARBITRATION AND JURISDICTION
Any disputes or differences arising between the Parties hereto as to the
interpretation of this Agreement or in connection with this Agreement or
any covenants or conditions thereof or as to the rights, duties, of
liabilities of any Party hereunder or as to any act, performance or non-
performance of any act. deed or thing as agreed under this Agreement
or matter or thing arising out of or relating to or under this Agreement
(even though the Agreement may have been terminated,) the same shall
be referred to a sole Arbitrator to be appointed by the Lender, according
to the provisions of Arbitration and Conciliation Act 1996, and rules
there under and any amendment thereto from time to time.
The Language of arbitration shall be English. All cost of arbitration
including the arbitrator's fees, advocate fees, travailing cost other
miscellaneous expenses shall be borne equally by the Parties hereto.
The award of the arbitrator shall be a speaking award and shall be final,
conclusive and binding on all the Parties whether on question of law or
of fact. In the event of death, refusal, negligence, inability, incapability
of the persons so appointed to act as a sole arbitrator, a new arbitrator
shall be appointed by the Lender. The venue of arbitration shall be Pune
or such other place that the Lender may in the sole discretion determine
and Courts in Pune or such other place shall have exclusive
jurisdiction.
This Agreement shall be governed by and construed in all respects with
Indian laws and the Parties hereto agree that any matter or issues
arising hereunder or any disputes hereunder shall, at the discretion of
the Lender be subject to the exclusive jurisdiction of the courts of the
city of Pune or such other place as the Lender may deem fit. This shall
not however limit the rights of the Lender to take proceedings in any
other Court of competent jurisdictions."
10. Part of the cause of action took place within Kolkata, as pleaded in
the application.
11. There is sufficient indication that the exclusivity of Pune as the
venue has been taken away by a further provision that the lender may
in its sole discretion choose a place/venue. Thus, the venue cannot be
read as a seat and Pune cannot have exclusive jurisdiction to entertain
the application for appointment of an arbitrator. Moreover, nothing
appears to have happened in Pune. The respondents did not object to
the selection of venue/place as Kolkata, which is a waiver.
12. Under such circumstances, this Court allows the application by
appointing Mr. Abhidipto Tarafder, learned Advocate, [Mobile No.
8697194588], Bar Library Club (Junior), as the learned Arbitrator, to
adjudicate the disputes between the parties. This appointment is
subject to compliance of Section 12 of the Arbitration and Conciliation
Act, 1996.
13. The learned Arbitrator shall fix his remuneration as per the Schedule
of the Act.
14. All objections with regard to jurisdiction, arbitrability, admissibility
and limitation etc, are left open.
15. The application is, accordingly, disposed of.
(SHAMPA SARKAR, J.)
SP/
