IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE K.M.JOSEPH & THE HONOURABLE MR. JUSTICE M.L.JOSEPH FRANCIS WEDNESDAY, THE 26TH AUGUST 2009 / 4TH BHADRA 1931 Arb.A.No. 27 of 2009() ------------------------------ ( OPARB.167/2008 of DISTRICT COURT, KOLLAM ) .................... APPELLANT/PETITIONER: ------------------------------------- M/S.QUALITY CONSTRUCTIONS, SREERANGAM BUILDINGS, PUTHENCHANTHA P.O., CHAVARA, KARUNAGAPPALLY, KOLLAM, REPRESENTED BY ITS MANAGING PARTNER RADHAKRISHNA PILLAI. BY ADV. SRI.P.B.SURESH KUMAR SRI.LEO GEORGE SRI.K.P.SUJESH KUMAR SRI.K.N.SASIDHARAN NAIR SMT.SANDHYA RADHAKRISHNAN SMT.M.SRUTHY RESPONDENT(S)/RESPONDENTS: ------------------------------------------------ 1. VICE PRESIDENT (PROJECTS), KERALA PROJECT ENGINEERING CORPORATION LTD., PRESENTLY KNOWN AS PROJECT ENGINEERING CORPORATION LTD., 31/1271, PALEPARAMBIL ROAD, ELAMAKKARA, KOCHI-682 026 AND NOW HAVING OFFICE AT 901, PIONEER TOWERS, MARINE DRIVE, COCHIN. *2. RAKSHIT DOSHI, DIRECTOR, DOSHION LIMITED, PLOT NO.24, PHASE-II, GIDC ESTATE, VATVA, AHEMADABAD, GUJARATH- 382 445.(DELETED) 3. THE GENERAL MANAGER (PROJECTS), KERALA MINERALS AND METALS LTD., CHAVARA, KOLLAM. 4. MANAGER,ING VYSYA BANK LTD., KOLLAM BRANCH, KOLLAM. (* The name of the 2nd respondent is deleted ) R1 BY ADV. SRI.N.N.SUGUNAPALAN, SENIOR ADVOCATE & SRI.S.SUJIN R3 BY ADV. SRI.K.ANAND (A.201) & SMT.LATHA KRISHNAN R4 BY ADV. SRI.K.K.JOHN. THIS ARBITRATION APPEAL HAVING BEEN FINALLY HEARD ON 26/08/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: K.M.JOSEPH & M.L.JOSEPH FRANCIS, JJ. ------------------------------------------------------ Arbitration Appeal No.27 of 2009 ---------------------------------------------- Dated, this the 26th day of August, 2009 J U D G M E N T K.M.Joseph, J. Appellant challenges the order passed under Section 9 of the Arbitration and Conciliation Act, 1996 (herein after referred to as 'the Act'). The order of the District Judge would show that the appellant sought injunction against respondents 1 and 2 from encashing the bank guarantee which expired on 30.6.2009. The District Court proceeded to note that the prayer of the petitioner is for injunction till settlement of disputes by the Arbitrator or till award. It is further stated that unless there is no arbitration there cannot be any settlement or award. Stating that the prayer is misconceived it is disallowed. Petitioner raised other reliefs in the Section 9 petition. That is postponed for further enquiry. Learned counsel for the appellant would submit that the order cannot be sustained. According to him, it is settled law that the petition under Section 9 can be filed even before initiation ARBA 27/2009 -2- of arbitration proceedings. It is contended that there is an arbitration agreement between the appellant and the Ist respondent. Learned counsel submits that there is no agreement between the appellant and the 2nd respondent and no relief is sought against the 2nd respondent. 2. We heard learned counsel for the petitioner, learned senior counsel for the Ist respondent besides the learned counsel for the 4th respondent. Learned counsel for the 4th respondent submits that the Ist respondent has invoked bank guarantee given on behalf of the appellant to the Ist respondent within the time but it has not been encashed. He would further submit that in view of the fact that bank guarantee has been invoked within time the bank will honour bank guarantee and allow encashment in terms of the bank guarantee. 3. Learned senior counsel for the Ist respondent would submit that in view of this submission, the Ist respondent will not actually encash the bank guarantee for some time. Learned counsel for the appellant submits that the appellant will move for appointment of Arbitrator within a period of one month from today. ARBA 27/2009 -3- In the light of the above submissions made at the Bar we feel that in the interest of justice the impugned order is to be set aside and the matter to be reconsidered. Accordingly, the impugned order is set aside. The District Court, Kollam will consider the application for injunction and pass appropriate orders within a period of three months and till such time the orders are passed the bank guarantee which has already been invoked by the Ist respondent will not be encashed. In the light of the endorsement made by the learned counsel for the appellant, the 2nd respondent will stand deleted from this appeal. I.A.No.2175/2009 is closed. (K.M.JOSEPH) JUDGE. (M.L.JOSEPH FRANCIS) JUDGE. MS