ARBP1296-10 1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION ARBITRATION PETITION NO.1296 OF 2010 Citicorp Finance (India) Ltd. .. Petitioner Versus Mohammed Haif Sayed and Anr. .. Respondents Ms.S.I.Joshi i/b. M/s.S.I.Joshi & Co. for petitioner Mr.Sayed Zia for respondents CORAM : S.C.DHARMADHIKARI, J. DATE : 11th January 2011 P.C.: 1] This petition was argued on 5th January 2011 and was placed for orders today only to satisfy this Court as to whether the figures mentioned in the affidavit in rejoinder of the petitioner are disputed and whether if the amounts claimed are already paid and disbursed and proof thereof was produced. 2] Despite this opportunity being given to the respondent's Advocate, he has only handed across the bar a statement of account and according to him, the entire sum as claimed by the petitioners ARBP1296-10 2 under the subject facility has been paid. In any event, only a sum of Rs.16,870/- has been outstanding and the respondents are ready and willing to pay that sum. 3] Mrs.Joshi appearing for petitioner invited my attention to the affidavit in rejoinder and submitted that even in particulars of claim and in the rejoinder it has been pointed out as to how credit has been given so also adjustments made for payment received and after giving credit and adjusting the payments made, as on 8th September 2010 the sum as claimed under the head principal amount in the statement of claim page 45 of the paperbook, is due and payable. She submits that this is in accordance with the statements, copies of which are produced and annexed to the affidavit in rejoinder. She submits that the respondents have 16 accounts with the petitioners and in respect of other accounts also proceedings had to be initiated. She further submits that the modus operandi adopted is that in some of the petitions that are filed under section 9 of the Arbitration Act, the respondents do not appear in this Court but appeared before the ARBP1296-10 3 learned Arbitrator whereas in this petition they appear before this Court and when the statements made by them in their affidavit in reply are shown to be false, now technical defences are being raised. 4] Learned Advocate for respondents states that the respondents did not have enough opportunity to deal with the petition filed and, therefore, some more time may be given to make good their submissions. 5] Having perused the petition and the annexures thereto, prima facie, there does not appear to be any dispute with regard to the sanction and disbursement of loan. The loan has been sanctioned and disbursed as per the terms and conditions of the loan cum hypothecation agreement. There are three contracts, details of which are given in para 4 of the petition. First respondent is borrower and the second respondent is guarantor, whereas the petitioner is termed as Lender. The loan amount was payable with interest at 10.5 % p.a. to be computed with monthly rests and the instalments have also been ARBP1296-10 4 stipulated. According to the petitioner, entire loan should have been cleared by 27th December 2009 but since that has not been done and since there are defaults committed they had to invoke arbitration. Having invoked the same and since vehicles in question are being plied by respondents without making any payment Mrs.Joshi submits that it is just and convenient that the Court Receiver, High Court, Bombay be appointed Receiver. She relies upon the orders dated 15th May 2008 and 19th December 2008 in Arbitration Petition Lod.No. 322 of 2008 and Arbitration Petition No.600 of 2008. 6] On the other hand, learned Counsel appearing for respondents relies upon affidavit in reply and submits that the statement of account would show that entire sum has been repaid. 7] Having heard learned Counsel for parties at some length and with their assistance perusing the petition and the annexures so also affidavit on record, I am of the opinion that as far as correctness of the entries of the statement of account is concerned, that is a matter which ARBP1296-10 5 must be agitated before the Arbitral Tribunal, that is on merits of the claim. Presently, the petitioners have prima facie shown to the Court that there is a default committed and the amounts which were to be paid by 27th December 2009 have not been paid. The claim as on 8th September 2010 has been crystalised and in the affidavit in rejoinder there are supporting documents produced as well. In these circumstances, the respondents by merely on the strength of the statements made in the affidavit in reply and on the basis of the entries in the statement of account maintained in their books, copies of which are tendered only across the bar, cannot be held to have repaid the entire amount under the three contracts. In such circumstances and bearing in mind totality of the facts, following order would serve ends of justice. 8] The respondents should furnish security to the satisfaction of the Prothonotary & Senior Master/ Registrar (OS) of this Court in the sum of Rs.9 lakhs within eight weeks from today. In default, the Court Receiver, High Court, Bombay shall stand appointed as ARBP1296-10 6 Receiver of the vehicles which are more particularly described at Exh.E to the petition. The Court Receiver shall upon taking possession of the vehicles appoint respondent No.1 as his agent on such terms and conditions, including payment of royalty/ compensation, which shall be determined after taking into consideration the terms and conditions of the agreement. Petition is accordingly disposed of. (S.C.DHARMADHIKARI, J)