Ravi Verma vs Hdfc Bank Ltd. & Anr.
2016 Latest Caselaw 2817 Del

*                    HIGH COURT OF DELHI AT NEW DELHI

+                     F.A.O. No.161/2016 & C.M. No.13652/2016

                                      Decided on : 18th April, 2016

RAVI VERMA                                          ...... Appellant
                       Through:    Mr. S.P. Upadhyaya, Advocate.


                          Versus


HDFC BANK LTD. & ANR.                               ...... Respondents


CORAM:
HON'BLE MR. JUSTICE V.K. SHALI

V.K. SHALI, J. (ORAL)

1. This is an appeal under Section 37 of the Arbitration and Conciliation Act, 1996 against the order dated 25.1.2016 passed by the learned Additional District Judge-02, South-East, Saket Courts, New Delhi.

2. I have heard the learned counsel for the appellant and have also gone through the record. The learned counsel has not been able to point out any illegality in the order passed by the learned ADJ rejecting the objections filed by the appellant nor has he been able to show to this court that the award passed by the arbitrator is against the public policy or that he was not served. However, before closing the case, it may be pertinent here to mention that a loan of Rs.1,89,941/- was sanctioned to the appellant vide agreement dated 31.7.2007 which was to be repaid in 60

equal monthly installments of Rs.6,009/- each. The present appellant had executed necessary documents for repayment of the loan including a document of hypothecation and a promissory note. Since the appellant failed to adhere to the financial discipline, consequently, the predecessor- in-interest of the respondent herein issued a legal notice and thereafter initiated arbitration proceedings in Mumbai. It may be pertinent here to mention that according to the Clause 14.6 of the agreement between the parties, the arbitration proceedings could be either initiated at Delhi or at Mumbai. The notices issued at the address given by appellant in the agreement, that is, 1462/13, Govind Puri, Kalkaji, New Delhi-110019 were duly served as they were not received back. The notices were issued to the appellant recalling the loan amount and claiming an outstanding amount of Rs.4,86,941.03P to be repaid to the respondent bank within a period of seven days from the date of delivery of the speed post. Since no response was made by the appellant the arbitrator proceeded with passing of the award dated 28.01.2012 after setting the present appellant ex parte.

3. The appellant's case is that he was not served and he learnt for the first time about the award dated 28.1.2012 only on 14.1.2014 through his family members when the officials of respondent No.1 along with bailiff came to execute the ex parte award against him. Accordingly, he filed objections before the Delhi court. One of the objection before the Delhi court was that the loan which was taken by him was from the Centurian Bank of Punjab Ltd. while as the respondent was the HDFC Bank with whom the Centurian Bank of Punjab Ltd. was stated to have been merged and therefore, it was sought to be urged that there was no privity of

contract between the appellant and the respondent. The second objection was that the appellant had not been served and therefore, the award which was passed against the appellant was liable to be set aside. The third point was that holding of the arbitration proceedings at Mumbai were totally illegal inasmuch as the proceedings ought to have been conducted in Delhi because the loan was taken in Delhi. The learned ADJ has rightly rejected all the three objections raised by the appellant. So far as the merger of Centurian Bank of Punjab Ltd. is concerned, that is done pursuant to RBI scheme of Amalgamation passed under Section 44A of the Banking Regulation Act, 1949. This fact is taken judicial notice of. Therefore, this plea that Centurian Bank of Punjab Ltd. was the bank which had given the loan while as it is sought to be realized by HDFC Bank is of no merit. It is invariably the case wherever one bank is merged with the other bank, the transferee bank with which the merger takes place, takes over all the rights and liabilities of the bank which is sought to be merged. Similarly, in the instant case, all the rights and liabilities which a party had qua the Centurian Bank of Punjab Ltd. came to be acquired by the HDFC Bank and therefore, it had every right to recover the amount which is given by way of loan to the appellant. In any case, this is a public money which cannot be frittered on this clumsy pretext as raised by the appellant because he has not denied the factum of having taken the loan.

4. So far as the question of jurisdiction is concerned, the court below has rightly rejected the plea of lack of jurisdiction on the ground that under the terms and conditions of the loan agreement, the place of arbitration is either Delhi or Mumbai. Therefore, in case the arbitrator

has been appointed by respondent No.1 at Mumbai, it is well within its right to do so and a fault cannot be found in this. As regards the third issue with regard to the non-service of the appellant, it may be stated that the address which has been given by the appellant in the loan agreement and other documents is 1462/13, Govind Puri, Kalkaji, New Delhi- 110019 at which notices have been issued by the respondent bank as well as by the arbitrator through speed post. None of these notices have been received back. It is not the case of the appellant that the address on which notices have been sent, is not the correct address. Therefore, once it is shown that the address of the appellant is correct and there is a letter which has been dispatched on the said address to the addressee, the presumption can be drawn that the letter has been delivered to the addressee. This onus of non-service has to be then established by the appellant himself which he, in my view, has failed to do. This is only a ploy to prolong the matter and avoid his liability nor has the appellant been able to show that there was any sufficient cause for setting aside the ex parte decree which was passed against him.

5. All these three objections are, therefore, untenable and have been rightly rejected by the trial court as well as are being rejected by the present court as not falling in any of the parameters set by the courts for interfering with the award. Accordingly, the appeal is without any merit and the same is dismissed.

V.K. SHALI, J.

APRIL 18, 2016 'AA'