TaxTMI 
TaxTMI 
2013 (2) TMI 839
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...., same were heard together and are being disposed of by a common order. Some of the facts emerge from the pleadings filed in ARBP No. 1321/12 are as under. By orders dated 24th February 2012 and 12th March 2012, this Court accorded sanction to the scheme of arrangement filed by Tata Capital Limited (TCL) and Tata Capital Financial Services Limited (TCFSL) by virtue of which, the securities and/or benefits, rights and obligations under any security arrangements, collaterals, agreements, instruments of whatsoever nature in connection with or pertaining to or relatable to the transferred financial services activity of TCL stood transferred to TCFSL. 2. On 13th April 2011, the petitioner sanctioned grant of working capital term loan facility in favour of respondent No. 1 for meeting the working capital requirement of the company of an amount of Rs. 100,00,00,000/- (100 crores) on the terms and conditions recorded therein. The respondents executed various documents in favour of the petitioner to secure the repayment of loan amount. By letter dated 5th April 2012, the petitioner communicated about the amended fixed rate of interest to the respondents. By letter dated 15th April 2011, ....
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....n, the respondents, through their Advocate's reply dated 22nd August 2012 (received by petitioner's Advocate on 31st August 2012), informed the petitioner that they were in the process of a strategic transaction which shall significantly mitigate the present risk profile of the first respondent and any precipitative action at that stage, would be value destroyer for one and all. The petitioner was informed that the respondents were nearing a permanent resolution along with the prospective investor which shall give detailed presentation to the CEOs of all their key lenders within the next 15 days including the petitioners. The respondents informed that due to global recession and economic slowdown, the inflow of commercial advertisement revenue got hampered and the revenues fell drastically which was a temporary phenomena. The respondents alleged that temporary slack of business resulted in downgrading by CARE. The market share and the reputation of respondents' clients was still intact and the respondents' clients would strictly adhere to its commitments and assured the petitioner of its amounts as per the agreed terms. The respondents alleged that they had not defa....
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....as reflected in the Net Worth Certificate at page 98 of the petition till next of hearing. The second respondent was directed to maintain status quo in respect of the investments in other entities reflected at page 98 of the petition and continued the ad interim order passed by this Court earlier. This Court also directed the respondents to comply with ad interim order earlier passed and to file affidavit disclosing the assets within two weeks from the date of the said order. The matter was adjourned to 21st November 2012 for hearing and final disposal. 9. The respondents have filed affidavit opposing the reliefs claimed by the petitioner however, without disclosing assets and properties owned by the respondents on oath though directed by this Court. FACTS OF ARBP No. 1095 OF 2012: 10. On 13th May 2011, the petitioner and the first respondent executed facility agreement by which the petitioner advanced a term loan facility to the tune of Rs. 25,00,00,000/- (25 crores) repayable with interest @ 12% per annum within the period of two years from the date of execution of the said agreement. On 13th May 2011, the first respondent executed Demand Promissory Note in favour of the....
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....rved that there was huge claim made by the petitioner in both these matters and the securities in favour of the petitioner were inadequate and therefore, with a view to protect such huge claims, directed the respondents to maintain status quo in respect of investments in other entities as reflected in Net Worth Certificate at page No. 98 of ARBP No. 1321/12 and continued the ad interim order passed by this Court earlier. According to the petitioner, they have to recover Rs. 25,02,61,350/- with further interest @ 15% per annum on the said amount from 21st July 2012 till payment in this petition. 13. Mr. Gaurav Joshi, the learned counsel appearing for the respondents in ARBP No. 1321/12 submits that the petitioners in the said petition are seeking interim orders in respect to the immovable properties purportedly mortgaged in its favour by the respondents. It is submitted that enforcement of mortgage of immovable property is a claim which is not arbitrable in nature. It is submitted that petitioner cannot invoke arbitration agreement for enforcement of mortgage. The learned counsel placed reliance upon the provisions of Transfer of Property Act read with Order 34 of the Civil Proce....
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....arily to decide whether, in fact, there is in existence a valid arbitration agreement and whether the dispute that is sought to be raised before it, is covered by the arbitration clause. It is difficult to contemplate that the judicial authority has also to act mechanically or has merely to see the original arbitration agreement produced before it, and mechanically refer the parties to an arbitration. Similarly, Section 9 enables a Court, obviously, as defined in the Act, when approached by a party before the commencement of an arbitral proceeding, to grant interim relief as contemplated by the Section. When a party seeks an interim relief asserting that there was a dispute liable to be arbitrated upon in terms of the Act, and the opposite party disputes the existence of an arbitration agreement as defined in the Act or raises a plea that the dispute involved was not covered by the arbitration clause, or that the Court which was approached had no jurisdiction to pass any order in terms of Section 9 of the Act, that Court has necessarily to decide whether it has jurisdiction, whether there is an arbitration agreement which is valid in law and whether the dispute sought to be raised ....
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....r the relief claimed can only be granted by a special court or Tribunal. 34. The term 'arbitrability' has different meanings in different contexts. The three facets of arbitrability, relating to the jurisdiction of the arbitral tribunal, are as under: (i) whether the disputes are capable of adjudication and settlement by arbitration? That is, whether the disputes, having regard to their nature, could be resolved by a private forum chosen by the parties (the arbitral tribunal) or whether they would exclusively fall within the domain of public fora (courts). (ii) Whether the disputes are covered by the arbitration agreement? That is, whether the disputes are enumerated or described in the arbitration agreement as matters to be decided by arbitration or whether the disputes fall under the 'excepted matters' excluded from the purview of the arbitration agreement. (iii) Whether the parties have referred the disputes to arbitration? That is, whether the disputes fall under the scope of the submiss....
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.... cases referred to above relate to actions in rem. A right in rem is a right exercisable against the world at large, as contrasted from a right in personam which is an interest protected solely against specific individuals. Actions in personam refer to actions determining the rights and interests of the parties themselves in the subject matter of the case, whereas actions in rem refer to actions determining the title to property and the rights of the parties, not merely among themselves but also against all persons at any time claiming an interest in that property. Correspondingly, judgment in personam refers to a judgment against a person as distinguished from a judgment against a thing, right or status and judgment in rem refers to a judgment that determines the status or condition of property which operates directly on the property itself. (Vide: Black's Law Dictionary). 38. Generally and traditionally all disputes relating to rights in personam are considered to be amenable to arbitration; and all disputes relating to rights in rem are required to be adjudicated by courts and public tribunals, being unsuited for private arbitration. This is not however....
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.... (Emphasis supplied) Mustill and Boyd in their 2001 Companion Volume to the 2nd Edition of commercial Arbitration, observe thus (page 73): Many commentaries treat it as axiomatic that 'real' rights, that is rights which are valid as against the whole world, cannot be the subject of private arbitration, although some acknowledge that subordinate rights in personam derived from the real rights may be ruled upon by arbitrators. The conventional view is thus that, for example, rights under a patent licence may be arbitrated, but the validity of the underlying patent may not.... An arbitrator whose powers are derived from a private agreement between A and B plainly has no jurisdiction to bind anyone else by a decision on whether a patent is valid, for no-one else has mandated him to make such a decision, and a decision which attempted to do so would be useless. (Emphasis supplied) 45. In Chiranjilal Shrilal Goenka v. Jasjit Singh and Ors. 1993 (2) SCC 507 this Court held that grant of probate is ....
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....ties to any suit relating to mortgage, whether they are parties to the mortgage or not. The object of this rule is to avoid multiplicity of suits and enable all interested persons, to raise their defences or claims, so that they could also be taken note of, while dealing with the claim in the mortgage suit and passing a preliminary decree. A person who has an interest in the mortgage security or right or redemption can therefore make an application for being impleaded in a mortgage suit, and is entitled to be made a party. But if a mortgage suit is referred to arbitration, a person who is not a party to the arbitration agreement, but having an interest in the mortgaged property or right of redemption, can not get himself impleaded as a party to the arbitration proceedings, nor get his claim dealt with in the arbitration proceedings relating to a dispute between the parties to the arbitration, thereby defeating the scheme relating to mortgages in the Transfer of Property Act and the Code. It will also lead to multiplicity of proceedings with likelihood of divergent results. 48.2. In passing a preliminary decree and final decree, the court adjudicates, adjusts a....
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.... declared due or the amount adjudged due in respect of subsequent costs, changes, expenses and interest, upon such terms as it deems fit. The Arbitral Tribunal will have no such power. 49. A decree for sale of a mortgaged property as in the case of a decree for order of winding up, requires the court to protect the interests of persons other than the parties to the suit/petition and empowers the court to entertain and adjudicate upon rights and liabilities of third parties (other than those who are parties to the arbitration agreement). Therefore, a suit for sale, foreclosure or redemption of a mortgaged property, should only be tried by a public forum, and not by an arbitral tribunal. Consequently, it follows that the court where the mortgage suit is pending, should not refer the parties to arbitration. 50. The Appellant contended that the suit ultimately raises the following core issues, which can be decided by a private forum: (i) Whether there is a valid mortgage or charge in favor of SBI? (ii) What is the amount due to SBI? and (iii) Whether SBI could seek eviction of Appellant from the flat, even if it is entitled to enforce the mor....
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....ch indication in the language, it follows that bifurcation of the subject matter of an action brought before a judicial authority is not allowed. 53. Having regard to our finding on question (iv) it has to be held that the suit being one for enforcement of a mortgage by sale, it should be tried by the court and not by an arbitral tribunal. Therefore we uphold the dismissal of the application under Section 8 of the Act, though for different reasons. 15. Relying upon the Judgment of Supreme Court in case of Booz Allen (2011) 5 SCC 532 (supra), the learned counsel for the respondent submits that reliefs claimed in the petition filed under Section 9 are for protection of mortgaged properties and thus, in view of the aforesaid Judgment, rights claimed by the petitioner are rights in rem which can be decided only by a Civil Court and not by an arbitral forum and thus, no relief under Section 9 of the Act can be granted by this Court. 16. Mr. Joshi, the learned counsel then submits that even notice of demand and invoking arbitration clause issued by the petitioner was also for enforcement of mortgage alongwith other claims. It is submitted that if part of the c....
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....e following matters: (a) the preservation, interim custody or sale of any goods which are the subject-matter of the arbitration agreement; (b) securing the amount in dispute in the arbitration; (c) the detention, preservation or inspection of any property or thing which is the subject-matter of the dispute in arbitration, or as to which any question may arise therein and authorising for any of the aforesaid purposes any person to enter upon any land or building in the possession of any party, or authorising any samples to be taken or any observation to be made, or experiment to be tried, which may be necessary or expedient for the purpose of obtaining full information or evidence; (d) interim injunction or the appointment of a receiver; (e) such other interim measure of protection as may appear to the Court to be just and convenient, and the Court shall have the same power for making orders as it has for the purpose of, and in....
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.... issue before the Court was whether the power exercisable by the Court under Section 9(ii)(b) of passing an interim measure for securing the amount in dispute in the arbitration was restricted by the conditions of attachment before judgment as prescribed under Order 38 Rule 5. Mr. Justice R.M. Lodha (as the Learned Judge then was) speaking for the Division Bench held that as a principle of law a special provision of the nature embodied in Section 9(ii)(b) cannot be restricted by importing the provisions of Order 38 Rule 5. The Division Bench held that though the power under Section 9(ii)(b) has not been made subject to the stringent provisions of Order 38 Rule 5, the exercise of the power is guided by the paramount consideration that the claimant who obtains an award in his favour before the arbitrator ultimately is able to derive the fruits of the adjudication in executing the award. The Division Bench held as follows: The order under section 9(ii)(b) is in the nature of interim protection order. In a special provision of the nature like section 9(ii)(b), we are afraid, exercise of power cannot be restricted by importing the prov....
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....d. The obstructive conduct of the opposite party may be one of the relevant considerations for the Court to consider the application under section 9(ii)(b). The party seeking protection order under section 9(ii)(b) ordinarily must place some material before the Court, besides the merits of the claim that order under section 9(ii)(b) is eminently needed to be passed as there is likelihood or an attempt to defeat the Award, though as indicated above, the provisions of Order 38, Rule 5 C.P.C. are not required to be satisfied. The statutory discretion given to the Court under section 9(ii)(b) must be exercised judicially in accordance with established legal principles and having regard only to relevant considerations. In our view, this is the proper approach for consideration of the application for interim relief under section 9(ii)(b) and we hold that the provisions of Order 38, Rule 5 of the Code of Civil Procedure cannot be read as it is and imported in section 9 of the Act of 1996. We also hod without hesitation that the Court is competent to pass an appropriate protection order of interim measure as provided under section 9(ii)(b) outside the provisions of Order 38, Rule 5 Code of....
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....be calculated in monetary terms and that in view of Section 14(3)(c) of the Specific Relief Act, an injunction could not be granted. In that view of the matter, the High Court did not consider it fit to enquire into the issue of the balance of convenience. Before the Supreme Court it was urged on behalf of the appellant that Section 9 was independent of Order 39 of the Code of Civil Procedure 1908 and the exercise of the power was not subject to the provisions contained in the Specific Relief Act. The Supreme Court dealt with the submission in the following terms: The grant of an interim prohibitory injunction or an interim mandatory injunction are governed by well known rules and it is difficult to imagine that the legislature while enacting Section 9 of the Act intended to make a provision which was de hors the accepted principles that governed the grant of an interim injunction. Same is the position regarding the appointment of a receiver since the Section itself brings in, the concept of 'just and convenient' while speaking of passing any interim measure of protection. The concluding words of the Section, "and the cour....
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....unction cannot be exercised independent of the principles which have been laid down to govern the grant of interim injunctions particularly in the context of the Special Relief Act 1963. The Court, consequently would be obligated to consider as to whether there exists a prima facie case, the balance of convenience and irreparable injury in deciding whether it would be just and convenient to grant an order of injunction. Section 9, specifically provides in sub-clause (d) of clause (ii) for the grant of an interim injunction or the appointment of a receiver. As regards sub-clause (b) of clause (ii) the interim measure of protection is to secure the amount in dispute in the arbitration. The underlying object of Order 38 Rule 5 is to confer upon the Court an enabling power to require a defendant to provide security of an extent and value as may be sufficient to satisfy the decree that may be passed in favour of the plaintiff. The exercise of the power to order that security should be furnished is, however, pre-conditioned by the requirement of the satisfaction of the Court that the defendant is about to alienate the property or remove it beyond the limits of the Court with an intent to....
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....India Ltd. v. AMCIPTY Ltd. O.M.P. 417/2011 decided on 1 September 2011, the judgment of the Division Bench of this Court in National Shipping Company was relied upon. The Delhi High Court observed that the provisions of Order 38, Rule 5 would serve as a guiding principle for the exercise of the jurisdiction while dealing with a petition under Section 9 requiring the respondent to furnish security and the basic consideration is that the Court should be satisfied that the furnishing of security is essential to safeguard the interest of the petitioner. 24. A close reading of the judgment of the Supreme Court in Adhunik Steels would indicate that while the Court held that the basic principles governing the grant of interim injunction would stand attracted to a petition under Section 9, the Court was of the view that the power under Section 9 is not totally independent of those principles. In other words, the power which is exercised by the Court under Section 9 is guided by the underlying principles which govern the exercise of an analogous power in the Code of Civil Procedure 1908. The exercise of the power under Section 9 cannot be totally independent of those p....
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....case, the court will not go to the next stage of examining whether the interest of the plaintiff should be protected by exercising power under Order 38 Rule 5 CPC. It is well-settled that merely having a just or valid claim or a prima facie case, will not entitle the plaintiff to an order of attachment before judgment, unless he also establishes that the defendant is attempting to remove or dispose of his assets with the intention of defeating the decree that may be passed. Equally well settled is the position that even where the defendant is removing or disposing his assets, an attachment before judgment will not be issued, if the plaintiff is not able to satisfy that he has a prima facie case. 5. The power under Order 38 Rule 5 CPC is a drastic and extraordinary power. Such power should not be exercised mechanically or merely for the asking. It should be used sparingly and strictly in accordance with the Rule. The purpose of Order 38 Rule 5 is not to convert an unsecured debt into a secured debt. Any attempt by a plaintiff to utilize the provisions of Order 38 Rule 5 as a leverage for coercing the defendant to settle the suit claim should be discouraged. Ins....
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....iced. According to the petitioner, as reflected in the petition, basis of the petition is a copy of the representation purported to have been received from one Ram Sarup which was addressed to the President of India with copies to the Chief Justice of India, Ministry of Law and Justice, Chief Justice of Punjab and Haryana High Court, Governor of Haryana and Bar Council of India wherein allegations were made against respondent No. 3. Only on the basis of what is stated therein of which apparently the petitioner himself cannot legitimately claim to have any personal knowledge the petitioner filed a writ petition before the Punjab and Haryana High Court which was dismissed. The petitioner makes a grievance that aforesaid Ram Sarup had received acknowledgement of the representation addressed to the President of India wherein it was also noted that the same had been forwarded to the Secretary to the Government of India, Ministry of Law, Justice and Company Affairs (Department of Legal Affairs) for appropriate action. But no action was taken to look into the allegations. It is not clear from the writ petition as to whether the petitioner had sent any representation ....
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....ion, has been annexed. The casual and cavalier fashion it appears to have been handled and of late attempted to be made ipse dixit, in a laconic and lackadaisical manner compels to draw the only inference that the petitioner is a busy body bent upon self publicity sans any sense of responsibility unmindful of the adverse impact, at times it may go to create at the expense of decency and dignity of constitutional offices and functionaries and there is no element or even trace of public interest involved in the petition. 21. Mr. Virag Tulzapurkar, the learned senior counsel appearing on behalf of the petitioner in ARBP No. 1321/12 submits that the present proceedings filed by the petitioner are for interim measures under Section 9 of the Act. Petitioner has not so far filed any statement of claim before the arbitral tribunal. The learned senior counsel submits that it is always open to the petitioner to make a claim either for enforcement of mortgage or for recovery of money simpliciter based on other securities furnished by the respondents. It is submitted that the respondents have presumed that the petitioner would file a claim for enforcement of mortgage before the arbitral tri....
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....ation; (e) that the second Defendant be ordered to vacate the suit premises and hand over possession thereof to the Plaintiff to enable the Plaintiff effectively to enforce and realize its security thereon. 22. The learned senior counsel submits that in the said suit, the plaintiff had asked for a declaration that the first defendant as mortgagor was liable to pay various amounts and had applied for a declaration that the said amount was secured by a valid and subsisting mortgage and the plaintiff had also applied for a direction against the defendant for redemption of the mortgage and for an order and direction to vacate the mortgaged premises and to hand over possession thereof to the plaintiff to enable the plaintiff to effectively enforce and realize its security thereon. The learned senior counsel placed reliance on paragraphs 33 to 38 of the said Judgment and submitted that when an application under Section 8 is made in a pending suit before the Court, such Court which is seized of the suit has to decide all aspects of arbitrability and the same cannot be left to the decision of the arbitrator. In that context, it has bee....
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....ch the Transfer of Property Act, 1882 (4 of 1882), has not been extended. 23. The learned senior counsel submits that there is no bar in filing money claim under Order 34 Rule 14 arising under mortgage. The only condition provided under Rule 14 is that the mortgagee shall not be entitled to bring the mortgaged property to sale otherwise than by instituting a suit for sale in enforcement of the mortgage, and he may institute such suit notwithstanding anything contained in Order II, rule 2. The learned senior counsel submits that only if money decree is not satisfied, petitioner cannot bring in the mortgaged property to sell otherwise than by instituting a suit for sale in enforcement of mortgage. 24. The learned senior counsel submits that under Order 21 of the CPC, execution can be against other properties. The learned senior counsel placed reliance upon paragraphs 34 and 36 of the Judgment in support of this submission. The learned senior counsel then submits that even if any claim is made by the claimant for enforcement of mortgage before the arbitral tribunal, it is always open to the claimant to withdraw that claim voluntarily or on an objection, if any, raised by the opp....
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....t of mortgage with leave of Court and may file a separate suit after obtaining such leave. This Court, therefore, cannot refuse to grant interim measures only on ground that petitioner has sought reliefs in respect of mortgaged properties in the present petition. It is submitted that relinquishment of claim is a choice of petitioner subject to provisions of Order 2 Rule 2 of CPC. It is submitted that notice of demand made by the petitioner calling upon the respondent to redeem the mortgage, cannot be considered as statement of claim before the Court. The petitioner may give up part of claim before the arbitrator. 28. Ms Shakuntala Joshi, the learned counsel appearing on behalf of the petitioner in ARBP No. 1095/12 adopts the legal submissions made by Mr. Tulzapurkar, the learned senior counsel appearing for the petitioner in ARBP No. 1321/12 and further submits that petitioner in that case also press for a money claim before the arbitral tribunal if so advised and would apply for appropriate amendment before the arbitral tribunal and thus, no interim measures can be refused by this Court based on the submissions made by the respondents that there could not be any split of claim ....
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.... agreement without recalling the loan facility and agreed to honour the commitments as agreed. The respondents though informed the petitioner that all outstanding amounts will be paid according to agreed terms, did not pay any amount. The learned senior counsel submits that in the said reply it was admitted that due to global recession and economic slowdown, the inflow of commercial advertisement revenue got hampered and the revenues fell drastically. It was the case of the respondents that the respondents had not defaulted to that extent which warranted for issuance of the subject notice. The respondents informed that they were in process of strategic transaction which shall significantly mitigate the present risk profile of the respondent and would get a permanent resolution and thus, petitioner shall not initiate precipitative action at that stage, which will be value destroyer for one and all. 31. The learned senior counsel invited my attention to the affidavit in reply filed by the respondents in which, respondents have simpliciter alleged that the claim amount of Rs. 101 crore was incorrect and such allegation was totally vague and false. It is also contended by the respon....
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....hich, there was no response from the respondents. The learned counsel also invited my attention to affidavit in reply dated 28th December 2012 filed by the respondents which does not raise any dispute in respect of the huge claim of the petitioner. It is submitted that this Court, after hearing both the parties, have granted ad interim reliefs in favour of the petitioner which are not challenged by the respondents. It is submitted that the petitioner, thus, deserves to be granted further reliefs as prayed for in the petition. REASONINGS: 33. Supreme Court in Booz Allen (2011) 5 SCC 532 (Supra) has held that when in an application filed under Section 8 of the Act, issue of arbitrability arises, all aspects of arbitrality has to be decided by the Court ceased of the suit, and cannot be left to the decision of the Arbitrator. The Supreme Court held that a mortgage is a transfer of a right in rem and a mortgage suit for sale of the mortgaged property is an action in rem for enforcement of a right in rem. It is also held that suit for mortgage is not a suit for money. As suit for enforcement of a mortgage being the enforcement of a right in rem, will have to be decided by courts o....
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....l. On perusal of the Supreme Court judgment in case of Booz Allen (2011) 5 SCC 532 (supra), in my view, it is clear that if the plaint and/or statement of claim before the arbitral tribunal is not before the Court while hearing application under Section 9 of the Act, Court cannot reject the application for interim measures on the ground that the petitioner may ultimately apply for enforcement of mortgage which would be beyond the jurisdiction of the arbitral tribunal. In my view, it is for the petitioner to decide what claims the petitioner would make before the arbitral tribunal. If the petitioner choses not to apply for enforcement of mortgage and files a simpliciter suit for recovery of money or for enforcement of any other properties which were not mortgaged by the respondents in favour of the petitioners, such proceedings would be the proceedings in personam and not in rem which obviously would be within the jurisdiction of the arbitral tribunal to adjudicate upon. In my view, even if any such relief by way of enforcement of mortgage is claimed before the arbitral tribunal, petitioner would always have liberty to decide whether to withdraw such claims and/or seek amendment for....
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....the notice of demand issued by the petitioners, there was demand for enforcement of mortgage properties or that there were various averments in the application, which indicate that the petitioner had proposed to apply for enforcement of mortgage before the arbitral tribunal and thus, no interim measures can be granted by this Court under Section 9. In my view, a party, who is praying for larger relief, can withdraw such relief and/or mould it and apply for smaller reliefs. Even Court can mould and/or grant smaller relief though larger reliefs are claimed by a party before it. In my view, Court or arbitrator, cannot reject the entire petition merely because part of the larger relief claimed by the petitioner cannot be granted for want of jurisdiction, when other part is not outside the jurisdiction of the Court or arbitrator. 38. The next question raised by the respondents is about territorial jurisdiction of this Court to entertain the present petition on the ground that mortgaged properties are situated outside the territorial jurisdiction of this Court and as claim for enforcement for mortgage is not pressed by the petitioner, and the fact that the respondents are carrying on ....
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....interim measures can be granted under section 9 by this Court for recovery of money claim simpliciter. 41. The Division Bench of this Court in the case of Nimbus Communications 2012(5) Bom.C.R. 114 (supra) after adverting to the Judgments of the Supreme Court and the Judgment of the Division Bench of this Court, has held that the principles laid down in the Code of Civil Procedure, 1908 for grant of interlocutory remedies must, furnish guide to the Court when it determines the application under section 9 of the Arbitration & Conciliation Act, 1996 and underlying basis of order 38 rule 5 thereof has to be borne in mind while deciding application under section 9(ii)(b). 42. The question that arises for the consideration of this Court in these petitions is whether the petitioners have made out a case for appointment of the Court Receiver and in any event, for attachment before Judgment, applying the principles of Order 38 rule 5 of the Code of Civil Procedure. 43. As far as ARBP No. 1321 of 2012 is concerned, the record produced by both the parties indicates that in view of the default committed by the respondents, notice dated 3rd August, 2012 was issued by the petitioner ca....
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.... disputed by the respondents in the affidavit in reply. The petitioners have also pleaded that there are several proceedings pending, including winding up proceedings against the respondents. Perusal of record, thus, indicates that the respondents were about to alienate its properties which are required to be protected. In my view, the petitioner has made out a case for attachment before judgment and satisfies the principles of order 38 rule 5 in this case and deserve to be granted interim measures. 44. As far as ARBP No. 1095 of 2012 is concerned, the respondents have not replied to the legal notice issued by the petitioner. Even in the affidavit in reply, there is vague denial of the claim. This Court has already appointed ad interim Receiver in respect of the assets of the respondents. Perusal of paragraphs 11 to 18, 20, 23 and 25 of the petition, in my view, makes out the case for attachment before the Judgment and for grant of interim measures. The respondents have not disputed the huge claim of the petitioner against the respondent. Considering this fact, this court has already granted ad interim relief which has not been impugned by the respondents by filing any appeal. I....