[Cites 4, Cited by 0]
Punjab-Haryana High Court
Scm Xpress Private Limited vs Haryana State Warehousing Corporation on 30 April, 2026
FAO-CARB-41-2023 (O&M) 1
23+1
IN THE HIGH COURT OF PUNJAB & HARYANA
AT CHANDIGARH
FAO-CARB-41-2023 (O&M)
Date of decision: 30.04.2026
SCM XPRESS PRIVATE LIMITED
....Appellant
Versus
HARYANA STATE WAREHOUSING CORPORATION
...Respondent
CORAM: HON'BLE MR. JUSTICE ASHWANI KUMAR MISHRA
HON'BLE MR. JUSTICE ROHIT KAPOOR
*****
Present: Mr. Shikhar Sarin, Advocate
for the appellant.
Mr. Aman Bahri, Sr. Advocate with
Mr. Shubham Pathania, Advocate
for the respondent.
*****
ASHWANI KUMAR MISHRA, J. (Oral)
CM-56-FCARB-2026
Application for placing on record documents Annexure R-10 to R-
12 on behalf of respondent is allowed.
Registry to place the same at appropriate place.
Main case
1. This appeal has been filed under Section 37 of the Arbitration and
Conciliation Act, 1996 (for short 'the Act') assailing the order passed by the
Additional District Judge, Panchkula dated 25.09.2023, declining to grant any
injunction in favour of the appellant under section 9 of the Act.
2. It transpires that on 16.09.2020, the respondent floated a tender for
appointment of Strategic Alliance Management Operator for the Inland
Container Deport-cum-Container Freight Station, Rewari. The appellant applied
for the said tender and was informed on 30.09.2020 that it was selected as a
bidder. The appellant was asked to deposit a sum of Rs.30 lacs towards bank
guarantee. An agreement was also signed between the parties on 11.11.2020. A
communication was also issued on 02.12.2020 instructing the appellant to take
over the facility at Rewari with effect from 31.12.2020. The intent was to allow
the operations to be started from 01.01.2021. The appellant however did not start
the operations allegedly on the ground that various codes were in the name of
previous partner and were not available to be utilized by the present appellant.
3. Ultimately, the contract came to be cancelled by the respondent on
the alleged plea of violation of the terms of agreement. It is thereafter that the
application under section 9 of the Act came to be filed by the appellant, which
has been rejected by the Court.
4. Various contentions have been advanced in support of the appeal, in
order to state that there was no conscious violation of the terms of the contract
by the appellant, and that it intended to continue with the contract itself. While
entertaining the present appeal, following orders were passed on 28.09.2023:-
"The present appeal has been filed against the order dated
25.09.2023 passed by the Additional District & Sessions Judge,
Panchkula whereby, the petition filed under Section 9 of the
Arbitration & Conciliation Act, 1996, has been dismissed.
The reason which weighed with the Court was that the
appellant was neither paying requisite fees nor vacating the
premises and therefore, it was minting money by using facility of
the Inland Container Depot-cum-Container Freight Station of the
respondent-Corporation at Rewari without payment of requisite
fees. The issue of the rail siding being not made operational in spite
of letter written on 03.01.2023 by Hon'ble the Chief Minister of
Haryana to Hon'ble the Minister of Railways, Government of India,
did not weigh with the Court, on the ground that there was an
agreement dated 11.11.2020 (Annexure A-2) between the parties
which was to be taken into account. Therefore, the Court has
observed that in order to get the relief of injunction, the applicant
has to prove co-existence of prime facie case, balance of
convenience and likelihood of irreparable loss being caused to the
applicant, if the injunction is not granted. Thus, the Court came to
the conclusion that it was a large set up and merely because, the
rail siding had not been made operational thus, it could not be
made a basis of stoppage of payment
We have gone through the record and it would be apparent
that a show cause notice was issued on 17.04.2023 (Annexure A-
29), which showed an outstanding amount of Rs.2,53,79,708/- and
the notice showed that the site had been visited before submitting
tender on "as is where is basis".
The reply filed on 30.05.2023 (Annexure A-30) showed that
the 24 acres site had a rail line/siding, possession of which had
been discontinued and there were outstanding from the CONCOR
and restoration was not being done. A reference was also made to
the letter written by Hon'ble the Chief Minister, Haryana, dated
03.01.2023 (Annexure A-23) regarding the fact that due to non-
operation, importers/exporters of Haryana was being deprived of
using this Government facility and action was sought to facilitate
importers/exporters of the region as also for the convenience of
residents of Rewari city by moving of goods shed to Anaj Mandi
Station at ICD Rewari. The termination order was then passed on
22.06.2023 (Annexure P-31), wherein a sum of Rs.4,05,25,355/-
was claimed including Quarterly Cost Recovery Charges payable
to the Custom Department and on other accounts of variable costs,
penalty etc. for the outstanding dues upto 30.05.2023. The
appellant's representative submits that the monthly out lay as such
is approximately Rs.10 lacs per month. It is not disputed that there
is an arbitration clause and the Corporation, as such, has
requested for appointment of an Arbitrator under clause 13 of the
agreement as per request dated 18.07.2023 (Annmexure A38) which
was declined on 21.07.2023 (Annexure A-39) with an offer that the
Arbitrator should be appointed from this Court.
The petition under Section 9 had been filed on 06.07.2023
(Annexure A-35) before Court and an interim order was passed on
07.07.2023 (Annexure A-36) wherein the appellant was protected
subject to certain conditions including the deposit of Rs.1 crore by
19.07.2023 and also for invoking the arbitration clause which as
noticed above has not been accorded to. It is the case of the
appellant that the sum of Rs.1 crore was deposited by way of
demand drafts dated 04.07.2023 and 14.07.2023 while referring to
Annexure A-38. It is also brought to our notice that the a petition
under Section 11 of the Act had been filed before this Court but the
same has not been listed on account of objections being raised by
the office.
Notice of motion for 11.10.2023.
Keeping in view the above and the fact that it is brought to
our notice that there are 400-500 containers lying at the venue and
the value of goods is substantial about Rs. 500 crores and it is not
possible to shift out such containers instantly. Then, we are of the
opinion that prima facie a case is made out in favour of the
appellant since arbitration proceedings are to be undertaken are
the ambit of providing the interim relief would then be in the hands
of the Arbitrator and the Corporation has not agreed to at this
stage, to the proposed person.
Accordingly, we direct the appellant to produce a demand
draft of Rs.50 lacs in favour of the Corporation on the next date of
hearing and as undertaken, he will also pay an another sum of
Rs.50 lacs after 05 weeks, thereafter and it is also continue to
paying the monthly rent regularly, thereafter, so that he can utilize
the facilities of the warehousing etc. which are attached alongwith
the siding.
Resultantly, we direct that the possession of the appellant
shall not be disturbed till the next date of hearing.
Needless to say that if the demand draft would not be
produced on the next date of hearing, the stay shall automatically
stand vacated."
5. Application has been filed by the respondent to vacate the aforesaid
interim order on the ground that even the terms of aforesaid interim order have
not been complied with.
6. On the last date of hearing, the Court was informed that an
Arbitrator has already been appointed under section 11 of the Act. Since the
appellant was continuing with the contract under the interim orders of this Court,
we thought it appropriate to pass following orders on 17.03.2026:-
"On joint request of learned counsel for the parties,
adjourned to 30.04.2026.
In the meantime, it shall be open for the appellant to
approach the Arbitrator for appropriate relief in terms of Section
17 of the Arbitration and Conciliation Act, 1996, which shall be
dealt with on its own merits, without being influenced by the orders
impugned or the order passed in present appeal."
7. When the matter is taken up today, we are apprised that no
application for interim injunction under section 17 of the Act has been filed
before the Arbitrator. On behalf of the appellant, it is stated that there were
unavoidable circumstances, on account of which the application could not be
filed earlier, and that such application shall be filed positively within three days
from today.
8. Mr. Aman Bahri, learned senior counsel for the respondent fairly
states that the interim arrangement continuing under the previous orders of this
Court can be allowed to be continued till the next date fixed before the
Arbitrator, so that the application for interim injunction is considered in
accordance with law.
9. In that view of the matter, with the consent of counsels for the
parties, we dispose of this appeal with the observation that the appellant shall be
at liberty to file an application under section 17 of the Act for grant of interim
injunction before the Arbitrator within three days from today. It shall be open for
the respondent to file objection to such application by the next date fixed before
the Arbitrator, i.e. 11.05.2026.
10. We request the learned Arbitrator to consider the interim injunction
application as per his earliest convenience. Till the next date fixed in the matter,
status quo as is continuing on date shall be allowed to continue with regard to
performance to be undertaken by the appellant pursuant to the contract. We also
provide that the learned Arbitrator will consider the application for grant of
interim injunction without being influenced in any manner with the observations
and findings contained in the order of the Additional District Judge, Panchkula
dated 25.09.2023 or any observations made by this Court in the present case.
11. Appeal stands disposed of accordingly.
12. Pending applications, if any, shall stand disposed of.
(ASHWANI KUMAR MISHRA)
JUDGE
(ROHIT KAPOOR)
APRIL 30, 2026 JUDGE
mohit goyal
Whether speaking/reasoned : Yes / No
Whether reportable : Yes / No
