Delhi High Court
M/S Garg Builders vs Hindustan Prefab Limited & Anr. & ... on 5 May, 2022
$~102 to 104
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of decision: 05.05.2022
+ FAO(OS) (COMM) 107/2022
FAO(OS) (COMM) 108/2022
FAO(OS) (COMM) 109/2022
M/S GARG BUILDERS ..... Appellant
Through: Mr. Rajshekhar Rao, Learned Sr.Adv.
along with Mr. Rahul Malhotra, Mr.
Anshul Gupta, Advs.
versus
HINDUSTAN PREFAB LIMITED & ANR. ..... Respondents
Through: Mr. Varun Nischal, Mr. Vaibhav
Mishra, Advs. for R-1 along with Mr.
Mukesh Kumar, Legal Officer (HPL)
Mr. Ateev Mathur and Mr. Amol
Sharma, Advs. for R-2.
CORAM:
HON'BLE MR JUSTICE RAJIV SHAKDHER
HON'BLE MS JUSTICE POONAM A. BAMBA
[Physical Hearing/Hybrid Hearing (as per request)]
RAJIV SHAKDHER, J.: (ORAL)
CM APPL. 21579/2022 in FAO(OS) (COMM) 107/2022
CM APPL. 21581/2022 in FAO(OS) (COMM) 108/2022
CM APPL. 21585/2022 in FAO(OS) (COMM) 109/2022
1. Allowed, subject to just exceptions.
FAO(OS) (COMM) 107/2022 & CM APPL. 21578/2022 [Application
filed on behalf of the appellant for interim relief]
FAO(OS) (COMM) 108/2022 & CM APPL. 21580/2022 [Application
filed on behalf of the appellant for interim relief]
FAO(OS) (COMM) 109/2022 & CM APPL. 21584/2022[Application filed
Signature Not Verified
Signing Date:09.05.2022
12:34:46
on behalf of the appellant for interim relief]
2. The above-captioned appeals assail a common judgment dated
02.05.2022, rendered by the learned single judge.
3. Mr Rajshekhar Rao, learned senior counsel, who appears for the
appellant, says that the learned single judge has not taken into account the
financial state of respondent no. 1.
3.1. In sum, according to Mr Rao, this was a case wherein stay against
encashment of the subject bank guarantees ought to have been granted, as
they fell into the category of the third exception, which is, irretrievable harm
and special equities.
4. Mr Varun Nischal, who appears on behalf of respondent no.1,
contends to the contrary.
4.1. Mr Nischal says that the latest financials would show that respondent
no.1 has, in fact, won several new projects and that the position, which
obtained in the financial years [in short "FYs"] 2018-2019 and 2019-2020,
does not subsist any longer.
5. According to Mr. Nischal, respondent no. 1 has earned profits in the
FY 2020-2021.
5.1. To be noted, the financials and profit/loss account for FY 2021-2022
are not on record, as the petitions under Section 9 of the Arbitration and
Conciliation Act, 1996 [hereinafter referred to as "the Act"] were filed by
the appellant in July 2021.
6. Be that as it may, after having heard the matter for some time, we put
to the learned counsel for the appellant and respondent no.1, as to whether
the following pro tem arrangement would work in the present matter.
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Signing Date:09.05.2022
12:34:46
6.1. The learned counsels for the appellant and respondent no.1 have
obtained instructions and have agreed to the directions set forth below, for
the purpose of disposal of the above-captioned appeals:
(i) The appellant will permit respondent no. 2/bank to remit the monies
concerning the following 09 bank guarantees, the details of which are
extracted hereafter:
BG No. Dated Amount(₹) Purpose
003GT0216 17.12.16 3243000/- Security Deposit
3520012
003GT0219 11.09.19 2974000/- Security Deposit
2540009
003GT0218 06.10.18 7500000/- Security Deposit
2790007
003GT0217 30.10.17 3243000/- Security Deposit
3030030
003GT0218 07.08.18 28773504/- Performance
2190021
003GT0216 16.03.16 15172278/- --
0760022
003GT0217 16.06.17 2000000/- --
1670016
003GT0219 16.09.19 3500000/- --
2590021
003GT0218 08.10.18 2500000/- --
2810026
Total amount 6,89,05,782/-
(ii) Insofar as the 10th bank guarantee is concerned i.e., BG No.
003GT02170190002 amounting to Rs.2,19,59,310/-, the same will be
returned by respondent no. 2/bank to the appellant as, concededly, the
validity period of the same has expired.
(iii) Since the appellant's petition under Section 11 of the Act is pending
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Signing Date:09.05.2022
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adjudication before the learned single judge, which is resisted by respondent
no. 1; and therefore at this juncture, one cannot hazard a guess as to the
adjudicatory forum before which, ultimately, the disputes obtaining between
the parties will be placed and dealt with. Given this position, the money that
respondent no.1 will obtain against the aforementioned 09 bank guarantees
[as referred in paragraph 6.1(i) above] will be kept aside by respondent no.1
(iv) Furthermore, the parties will abide by the decision of the concerned
adjudicatory forum to which the parties may take recourse to i.e., either an
arbitral tribunal or this court.
(v) The money, which will be obtained by respondent no. 1, against the
aforementioned bank guarantees, will earn interest at the rate of 6 % p.a.
(vi) The principal amount, as reflected by the aforementioned bank
guarantees, and the interest component, as indicated in paragraph 6.1(v)
above, will enure to the benefit of the party, which succeeds in the
adjudication.
(vii) Insofar as the claims lodged herein by the parties are concerned, the
parties would be free to press for a higher rate of interest, vis-à-vis claims
other than the amounts reflected in the aforementioned bank guarantees.
(viii) The parties will also be at liberty to approach the concerned
adjudicatory forum for modification, variation or even for vacating the pro
tem measure put in place by us.
6.2. The impugned judgement is modified, to the aforesaid extent.
7. Needless to add, the aforementioned directions will not prejudice the
stand of either party, with regard to the merits of the disputes.
8. The above-captioned appeals are disposed of in the aforesaid terms.
Signature Not Verified
Signing Date:09.05.2022
12:34:46
9. Consequently, pending applications shall stand closed.
(RAJIV SHAKDHER)
JUDGE
(POONAM A. BAMBA)
JUDGE
MAY 5, 2022
manju
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Signature Not Verified
Signing Date:09.05.2022
12:34:46
