Madras High Court
Pers Enterprises Private Limited vs Aavanor Systems Private Limited on 24 September, 2021
OSA (CAD) Nos.75 and 76 of 2021
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 24.09.2021
CORAM :
THE HON'BLE MR.SANJIB BANERJEE, CHIEF JUSTICE
AND
THE HON'BLE MR.JUSTICE P.D.AUDIKESAVALU
OSA (CAD) Nos.75 and 76 of 2019
and
CMP Nos.14634 of 2021 and 14637 of 2021
PERS Enterprises Private Limited,
Represented by its Authorised Signatory B.Anandakrishnan,
Having office at No.3, Veerasamy Street,
West Mambalam,
Chennai – 600 033. .. Appellant in
both OSAs
Vs.
Aavanor Systems Private Limited,
Represented by its Managing Director M.Vennimalai,
S-60, 20th Street, Anna Nagar,
Chennai – 600 040. .. Respondent
in both OSAs
Prayer: Appeals filed under Section 13 of the Commercial Courts Act,
2015 read with Section 37 of the Arbitration and Conciliation Act, 1996
against the order dated 12.08.2021 passed in A.Nos.2640 and 2641 of
2021 in A.No.1414 of 2021 in C.S.No.128 of 2021.
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OSA (CAD) Nos.75 and 76 of 2021
For the Appellant : Mr.Satish Parasaran
Senior Advocate
for Mr.S.Vijayan
For the Respondent : Mr.H.Karthick Seshadri
COMMON JUDGMENT
(Delivered by the Hon'ble Chief Justice)
These appeals are directed against an order for furnishing
security.
2. An initial order was made on June 30, 2021 at the ex parte
stage requiring security to be furnished in the sum of Rs.1,04,52,423/-
on or before July 23, 2021. The order also indicated that an
attachment could be issued, if the security was not furnished within
the relevant time.
3. When the matter was taken up next on July 23, 2021, the
defendant was represented. However, the trial court noticed that the
security had not been furnished and, as such, passed an order in the
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OSA (CAD) Nos.75 and 76 of 2021
nature of attachment. The matter was next taken up on August 12,
2021 and the present appellant's prayer for lifting the order of
attachment was declined.
4. The principal contention of the appellant is that an order of
attachment or even for furnishing security, for that matter, should not
be lightly passed and the court should first ascertain the nature of the
claim and the material in support thereof before passing a tall order as
an attachment.
5. Ordinarily, an order requiring security to be furnished or an
order of attachment may not be made unless the court examines the
claim and finds all or a substantial part thereof to be unimpeachable.
The court has next to consider whether it is necessary to make an
order in the nature of attachment upon noticing the conduct of the
defendant.
6. Merely because a money claim has been filed would not imply
that an order for security would be made or an order of attachment
would follow. However, when the claim is found to be unimpeachable,
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OSA (CAD) Nos.75 and 76 of 2021
an order for security or in the nature of attachment may be passed.
7. There is a dispute between the parties as to the quantum
payable by the appellant to the respondent on account of the software
produced by the respondent at the behest of the appellant. Though
the plaintiff submits that its claim is as per the bills submitted and
there has been no demur or protest despite receipt of such bills, the
defendant-appellant says that it has instituted a previous suit,
suggesting thereby that the plaintiff was not entitled to the sum that
the plaintiff had claimed.
8. The initial order of the trial court required security to be
furnished to the extent of Rs.1.04 crore. The order dated August 12,
2021 requires security to the tune of Rs.51.50 lakh to be furnished,
covering approximately 50 per cent of the suit claim. It would sub-
serve the ends of justice if a sum of Rs.25 lakh be furnished by way of
security by the appellant within a week from date. The money should
be deposited in any nationalised bank having its branch within the
vicinity of this court in the name of the Registrar-General of this court
in a short term auto-renewable fixed deposit. A copy of the receipt of
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OSA (CAD) Nos.75 and 76 of 2021
the deposit should be made over to advocate for the plaintiff
simultaneously with the original receipt being handed over to the
Registrar-General. The order dated August 12, 2021 is modified to
such extent. The matter will appear before the trial court for a fresh
consideration on the application for attachment before judgment. The
parties may approach the trial court for inclusion of the matter in its
list by citing this order.
9. OSA (CAD) Nos.75 and 76 of 2021 are disposed of without
any order as to costs. CMP Nos.14634 and 14637 of 2021 are closed.
(S.B., CJ.) (P.D.A., J.)
24.09.2021
Index : No
bbr/drm
To:
The Sub Assistant Registrar
Original Side
High Court, Madras.
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OSA (CAD) Nos.75 and 76 of 2021
THE HON'BLE CHIEF JUSTICE
AND
P.D.AUDIKESAVALU, J.
bbr/drm
OSA (CAD) Nos. 75 and 76 of 2021
24.09.2021
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