Sriniwas Ramchandra Deo vs Religare Finvest Ltd
2012 Latest Caselaw 3558 Del

*       IN THE HIGH COURT OF DELHI AT NEW DELHI

+       FAO 232/2012

%                                       Judgment delivered on: 28.05.2012


SRINIWAS RAMCHANDRA DEO                     ..... Appellant
                Through : Mr Ajay Kumar, Adv.

                     versus

RELIGARE FINVEST LTD                                          ..... Respondent
                 Through :               Nemo

CORAM:
HON'BLE MS. JUSTICE VEENA BIRBAL


VEENA BIRBAL, J.

*

1. Present is an appeal under Section 37 of the Arbitration and

Conciliation Act (hereinafter referred to as 'the Act') for setting aside the

impugned order dated 17.01.2012 passed by the learned ADJ, Tis Hazari

Court, Delhi wherein objections filed by the appellant under Section 34 of

the Act have been dismissed.

2. Briefly, the facts relevant for the disposal of the present appeal are as

under:-

The appellant had approached respondent-company for the grant of

loan. After considering the loan application, the respondent-company

granted a loan of Rs. 10 lakhs to the appellant and a loan agreement was

entered into between the parties. The said amount was to be repaid with

interest in 48 equal monthly instalments of Rs.30032/- each. After availing

the loan from the respondent company, the appellant had failed to adhere to

the terms of repayment of loan and committed repeated defaults. The

respondent company requested the appellant to pay the monthly instalments

in respect of the loan agreement including interest. A legal notice was also

issued to the appellant on 19.06.2009. However, no response was given by

the appellant to the notice. As per the loan agreement, it was agreed between

the parties that in case of any dispute between them, the matter will be

settled by the Sole Arbitrator as per the provisions of the Act. Accordingly,

the matter was referred to the Sole Arbitrator i.e. Sh. Satish Kumar.

3. On entering the reference of the dispute, the Arbitrator gave a notice

of appearance dated 11.07.2009 to the parties for appearing before him on

07.08.2009. The appellant did not appear. Thereafter, another notice dated

13.08.2009 was sent to him by registered AD post for appearing before the

Arbitrator on 11.09.2009. Despite that, the appellant did not appear. The

Arbitrator proceeded ex parte against the appellant. The respondent had

filed the claim before the Arbitrator along with the documents. Thereafter,

evidence of respondent/claimant was recorded and finally ex parte award

dated 10.03.2010 was passed against the appellant. The appellant

challenged the said ex parte award before the learned ADJ by filing a

petition under Section 34 of the Act. The said petition was also dismissed.

4. Aggrieved with the same, the present appeal has been filed.

5. Learned counsel for appellant has contended that the appellant had

informed his inability to attend the proceedings due to ailment vide letters

dated 30.07.2009 and 05.09.2009 respectively as such the Arbitrator ought

not have proceeded in the matter in the absence of the appellant. It is

contended that the award passed in the matter is against the principles of

natural justice as the appellant had not been heard in the matter, as such the

same is liable to be set aside.

6. Learned counsel for appellant has further contended that appellant had

given some payment to the respondent for which the Arbitrator has not given

any adjustment. However, on being asked as to whether he had filed any

statement of accounts before the learned ADJ or before this court showing

the payments made, as is alleged, the counsel for appellant has replied in the

negative.

7. Perusal of record shows that the learned Arbitrator after entering the

appearance had issued notices dated 11.07.2009 and 13.08.2009 to the

appellant to appear before him on 07.08.2009 and 11.09.2009 respectively,

either in person or through counsel engaged by him. Despite service of

arbitral notices, appellant had not appeared before the Arbitrator and as such,

was proceeded ex parte. There is no denial by the appellant that he did not

enter into any loan agreement with the respondent. There is no denial that

default occurred in the repayment. The parties have agreed in the loan

agreement that in case of any dispute or claim arising out of the agreement,

the same would be settled by the Sole Arbitrator as per the provisions of the

Act. The place of arbitration has also agreed to be New Delhi. Twice

notices of appearance have been sent to him. The letters sent by the

appellant to the Arbitrator are dated 30.07.2009 and 05.09.2009 seeking

adjournment in the matter. The ld. Arbitrator has passed the award on

10.03.2010. There is nothing on record to show from 05.09.2009 to

10.03.2010 as to what efforts were made by the appellant for pursuing the

proceedings before the Arbitrator. The appellant ought to have pursued the

matter before the Arbitrator once it was in his knowledge that the Arbitrator

has been appointed and the proceedings have commenced against him.

8. The ld Arbitrator has adjudicated the claim on merits. Appellant had

been given ample opportunity to defend his case. The Arbitrator has

considered the relevant documents including the loan agreement,

ledger/statement of account while passing the award. In these

circumstances, it cannot be said that the principles of natural justice have not

been complied with. It is the appellant who has not availed the opportunity.

In view of above discussion, no illegality is seen in the impugned

order which calls for interference of this court.

The appeal stands dismissed.

CM No. 9865/2012 (stay)

In view of the order on the main appeal, no further orders are required

on the present application.

The same stands disposed of.

VEENA BIRBAL, J MAY 28, 2012 kks