Delhi High Court
M.G.F. (India) Ltd. vs Dr. Ashok Bhatia And Another on 20 August, 1997
Author: K Gupta
Bench: K Gupta
JUDGMENT
K.S. Gupta, J.
1. In this petition filed under Section 20 of the Arbitration Act, it is alleged that the petitioner-company is carrying on business of hire purchase of motor vehicles at its registered Office 17-B, Asaf Ali Road, New Delhi amongst other places. Petitioner hired out Maruti Car bearing engine No. 278152, chassis No. 205761, registration No. DD 7947 to respondent No. 1 under a hire purchase agreement dated February 16, 1988, on the terms and conditions mentioned therein. Respondent No. 1 signed the agreement as the hirer while respondent No. 2 signed it as a guarantor for and on behalf of respondent No. 1. Therefore, the liability of both the respondents is joint and several. Vide Clause VI(a) of the aforesaid agreement petitioner and the respondents agreed that all disputes and differences and/or claims arising out of the hire purchase agreement shall be referred to arbitration in accordance with the provisions of Indian Arbitration Act. They further agreed to appoint Sh. Shashi Vansh Bahadur, Advocate, as their sole arbitrator and in case of his death, refusal, neglect, inability or incapability to act as an arbitrator, then to the sole arbitrator to Shri Inderjit Gulati, Advocate, Delhi. It is, alleged that aforesaid hire purchase agreement was executed for a total sum of Rs. 89,300/- which was to be paid in monthly hires of 29 x Rs. 3,000 and 1 x Rs. 2,300 besides compensation and incidental charges which may fall due under the agreement. Hire installments were to be paid on 25th of each English calendar month. It is, further alleged that since the respondents made default in payment of hire instalments the petitioner after terminating the hiring retook possession of the vehicle which was not in the same order and condition in which it was hired to respondent No. 1. A total sum of Rs. 1,18,599/- details whereof are noted in para 6 of the petition, became, due from respondent No. 1 which he has failed to pay despite notice dated May 10, 1990 lastly served on him. It is prayed that the hire-purchase agreement dated February 26, 1988, containing the arbitration clause be ordered to be filed in court and the disputes and the differences arising out of and in connection with the aforesaid agreement be referred to the sole arbitration of Shri Shashi Vansh Bahadur, Advocate.
2. Both the respondents were proceeded ex parte by the order dated March 6, 1997.
3. In support of the averment made in the petition the petitioner-company filed affidavit of Rajiv Gupta, Director Incharge and Constituted Attorney of the company, on April, 4, 1997. From this affidavit it is proved that the hire-purchase agreement dated February 26, 1988 Ex. P-1 was entered into between the parties and a sum of Rs. 1,18,599/- details whereof are given in para 6 of the affidavit, was due on the date of filing of the petition which the respondent failed to pay despite the service of the notice on May, 10, 1990. Clause VI(c) of the aforementioned agreement Ex. P-1, which is relevant, provides as under :
"All disputes, differences and/or claims arising out of hire-purchase agreement shall be settled by arbitration in accordance with the provisions of Indian Arbitration Act, 1940 or any statutory amendments thereof and shall be referred to the sole arbitration of Shri Shashi Vansh Bahadur, Advocate. Delhi, or in case of his death, refusal, neglect or inability to act as an arbitrator to the sole arbitration of Shri Inderjit Gulati, Advocate, Delhi. The reference to the arbitrators shall be within the Clauses, Terms and Conditions of this agreement. The award given by the arbitrator shall be final and binding on all the Parties concerned."
4. Since the claim for the aforementioned amount made by the petitioner-company arises out of the agreement Ex. P-1, the same is liable to the referred to the sole arbitration of Sh. Shashi Vansh Bahadur, Advocate, under above Clause VI(c).
5. Petition is allowed and the claim made by the petitioner-company is referred to the sole arbitration of Shri Shashi Vansh Bahadur, Advocate, for adjudication. It would be open for the respondents to make claim or counter-claim before him. Arbitrator will enter upon the reference and make and Publish the award with the time prescribed by law.
