IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE THOTTATHIL B.RADHAKRISHNAN TUESDAY, THE 10TH FEBRUARY 2009 / 21ST MAGHA 1930 WP(C).No. 37301 of 2008(N) -------------------------- PETITIONER(S): --------------- THE M/S.SRI SAI ENTERPRISES REPRESENTED BY ITS MANAGING PARTNER, K.N.BALAKRISHNAN PILLAI, AGED 74 YEARS, PRASANTHIM III/48, KALAVARA THARAYIL BUILDINGS, THUMPAMON P.O. ADOOR TALUK, PATHANAMTHITTA DISTRICT. BY ADV. SRI.C.RAJENDRAN RESPONDENT(S): --------------- 1. THE MANAGING DIRECTOR, KERALA STATE RUBBER CO-OPERATIVE LTD.,(RUBCO),4TH FLOOR, K.V.R. TOWER, SOUTH BAZAR, KANNUR. 2. THE BRANCH MANAGER, STATE BANK OF TRAVANCORE, THUMPAMON BRANCH, PATHANAMTHITTA DIST. 3. THE AUTHORIZED OFFICER, (THE CHIEF MANAGER ADV) STATE BANK OF TRAVANCORE, RAGION IV ZONAL OFFICE, KOTTAYAM. 4. T.N.THRIDEEP, ADVOCATE COMMISSIONER, ADVOCATE, PATHANAMTHITTA DISTRICT. R1 BY ADV. SRI.C.P.MOHAMMED NIAS R2, R3 BY SRI.M.PATHROSE MATTHAI, SENIOR ADVOCATE SRI.SAJI VARGHESE THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 10/02/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: APPENDIX IN WPC.37301/08 PETITIONER'S EXHIBITS: EXT.P1: A TRUE PHOTOCOPY OF THE AGREEMENT DATED 24.10.2005. EXT.P2: A TRUE PHOTOCOPY OF THE RECEIPT AS D.D.NO.684054 DATED 23.2.2005. EXT.P3: A TRUE PHOTOCOPY OF THE LETTER FROM R1 DATED 9.12.2005. EXT.P4: A TRUE PHOTOCOPY OF THE LETTER FROM R1 DATED 20.7.2006. EXT.P5: THE TRUE PHOTOCOPY OF THE AGREEMENT DATED 14.3.2007. EXT.P6: THE TRUE PHOTOCOPY OF THE LETTER DATED 10.4.2008. EXT.P7: A TRUE PHOTOCOPY OF THE ADVOCATE NOTICE. EXT.P8: A TRUE PHOTOCOPY OF THE REPLY DATED 31.7.2008. EXT.P9: THE TRUE PHOTOCOPY OF THE PROCEEDINGS OF THE MEETING ON 19.9.2008. EXT.P10: THE TRUE PHOTOCOPY OF THE SAID ORDER DATED 27.11.2008. EXT.P11: A TRUE PHOTOCOPY OF THE NOTICE DATED 15.7.2008. EXT.P12: A TRUE PHOTOCOPY OF THE NOTICE DATED 2.12.2008. RESPONDENT'S EXHIBITS: EXT.R1(a): TRUE COPY OF THE HIGH SEAS SALE AGREEMENT DATED 1.9.2005 EXECUTED BETWEEN PETITIONER AND RUBCO. EXT.R1(b): TRUE COPY OF THE LETTER DATED 4.12.06 SENT BY RUBCO TO THE PETITIONER. EXT.R1(c): TRUE COPY OF THE LETTER DATED 23.6.06 SENT BY RUBCO TO THE PETITIONER. EXT.R1(d): TRUE COPY OF THE EMAIL MESSAGE RECEIVED IN THE OFFICE OF RUBCO AND FORWARDED TO THE PETITIONER. /TRUE COPY/ THOTTATHIL B.RADHAKRISHNAN, J. ------------------------------------------- W.P(C).No.37301 OF 2008 ------------------------------------------- Dated this the 10th day of February, 2009 JUDGMENT 1. The petitioner availed a loan from the second respondent. On default in repayment, the bank initiated proceedings under the SARFAESI Act. As of now, Section 14 order has been issued and a Commissioner is appointed. The petitioner contends that the loan was availed for the purpose of installing certain machinery as agreed by the first respondent RUBCO, however, that they do not discharge the obligation under the agreement and hence, the transaction between the petitioner and the first respondent clogged, resulting in the situation in hand. The first respondent, in turn, would accuse the petitioner of not having discharged his obligations under the contract in as much as the petitioner is accused of not even providing necessary pre-requisite materials to process the supply of the equipments and for clearing the goods for the establishment in question. It is also pointed out that in the agreement between the petitioner and the first respondent, WPC.37301/08 Page numbers there is an arbitration clause. Disputes between the petitioner and the first respondent cannot and should not deter the action taken by the bank since it has to necessarily re-coup the amounts due to it. Under such circumstances, this writ petition is dismissed without prejudice to the rights of the petitioner and the first respondent to go for arbitration. Sd/- THOTTATHIL B.RADHAKRISHNAN, Judge. kkb.11/2.