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Bombay High CourtARBP/1710/2014disposed off

L And T Finance Limited v. M/S. Dharmendra Singh Rajawat (Borrower) And ANR

2015-01-27Hon'Ble Shri Justice S.J. Kathawalla5 pages

IN THE HIGH COURT OF JUDICATURE AT BOMBAY

ORDINARY ORIGINAL CIVIL JURISDICTION ARBITRATION PETITION NO. 1710 OF 2014 L & T Finance Limited .....Petitioner

Versus

M/s. Dharmendra Singh Rajawat & Anr.

....Respondents Mr. Sandesh Godse, i/by M/s.Vivek Patil & Associates., for Petitioner. None for Respondents.

CORAM: S.J.KATHAWALLA, J.

DATE: 27th January, 2015 P . C.

1. This Petition is filed by the Petitioner under Section 9 of the Arbitration and Conciliation Act, 1996 seeking reliefs as prayed against the Respondents. The Arbitration Petition is served on the Respondent No.1 and as regards service on the Respondent No. 2 (Guarantor), the Petitioner neither received acknowledgement card nor the packet containing a copy of the above Petition returned back till date. However, no relief is pressed against the Respondent No. 2 at this stage and liberty is sought to take out fresh Petition seeking relief against Respondent No. 2. The Petition is today taken up for final hearing. None appear for the Respondents.

2. By an Agreement dated 28th February, 2013, the Petitioner had provided a loan of Rs. 41,40,000/ to the Respondent No.1 for purchase of commercial vehicle being Model No. HYUNDAI R220LC and having Serial No. N602D00745 more particularly described in Exhibit - F to the Petition ("Said Commercial Vehicle"). By a deed of Hypothecation dated 28.02.2013 the said commercial vehicle was hypothecated with the petitioner by the Respondent No. 1.

3.

The Loan amount of Rs. 41,40,000/- was repayable by the Respondents to the petitioner with interest @ 4.85% per annum in monthly installments commencing from 15.04.2013 and ending on 15.02.2017. Therefore, the aggregate amount payable by the Respondents to the petitioner under the loan agreement was Rs. 49,83,178/-.

4.

Clause 12 of the agreement provides for the events of default; and Clause 17 provides for arbitration. There has been a default on the part of the Respondents. In view thereof both the Respondents became liable to pay to the Petitioner a sum of Rs. 32,03,823/-. The Petitioner therefore invoked the arbitration clause in the Agreement dated 28.02.2013.

5.

In the present Petition, the Petitioner has sought appointment of the Court Receiver, High Court Bombay as Receiver of

the said commercial vehicle more particularly described in Exhibit - F to the Petition. In absence of any defense or contest by the Respondents, the averments contained in Petition have remained uncontroverted. I see no reason why the statement/submissions made by the Petitioner in the Petition should not be accepted. Since Respondents have defaulted in repayment of the outstanding dues, it is necessary to safeguard the interest of the Petitioner by appointing the Court Receiver as Receiver of the said commercial vehicle. The appointment of the Receiver is necessary in order to ensure that the said commercial vehicle is not wasted or alienated, thereby defeating the rights of the Petitioner. Section 9 empowers the Court to pass an interim measure of protection.

Hence the following order: (i) Pending the hearing and final disposal of the arbitration proceedings, the Court Receiver is appointed as Receiver in respect of said commercial vehicle namely Model No. HYUNDAI R220LC and having Serial No.

(ii) The Court Receiver shall within a period of two weeks after taking possession, give an option to the Respondent in writing to

act as agent of the Receiver in respect of the said commercial vehicle described in Exhibit-F to the Petition. The respondents shall be given two weeks time by the Court Receiver from the date of receipt of the Court Receiver's communication/letter to exercise such option. In the event of the respondent/s being desirous of acting as agent of the Receiver, they shall be appointed as agent of the Receiver, subject to security and royalty. The Receiver shall determine the quantum of security and royalty having regard to the terms and conditions contained in the Agreement For Commercial Vehicle Loan. (Exhibit A to the Petition);

(iii) In the event that the Respondents fails to communicate their willingness to the Receiver to act as agent of the Court Receiver within a period of two weeks from the date of receipt of the communication from the Court Receiver, it would be open to the Petitioner to apply to the Court for further orders including sale of the said commercial vehicles more particularly described in Exhibit-F to the Petition by private treaty;

(iv) There shall be an interim injunction restraining the Respondents from alienating, encumbering, parting with possession or creating any third party rights in respect of the said commercial vehicle

namely Model No. HYUNDAI R220LC and having Serial No. N602D00745 more particularly described in Exhibit F to the Petition.

6. The Arbitration Petition is accordingly disposed of and liberty is granted to the Petitioner to take out a fresh Petition seeking relief against the Respondent No.2. A Copy of this order shall be served on the Respondent No.2 by hand delivery.

( S.J.KATHAWALLA, J.)