AI Structured Summary
Not yet generated for this judgment
Judgment
M. Jaichandren, J.—This Original Side Appeal has been filed against the order of the learned single Judge, dated 16.10.2012, made in
Application No. 2122 of 2012, rejecting the request of the appellant herein, to direct the respondent to furnish security, in any form, equivalent to a
sum of Rs. 56,05,716.61, with further interest from 31.3.2012, as awarded by the Arbitrator, vide order dated 2.11.2011. The learned single
Judge, by an order, dated 16.10.2012, had rejected the request of the appellant herein stating that no interim orders can be passed, after the
award of the Arbitral Tribunal, dated 2.11.2011, in O.P. No. 642 of 2012, had been challenged u/s 34 of the Arbitration and Conciliation Act,
1996. The learned single Judge had also held that Order XXXVIII Rule 5 of the Code of Civil Procedure, 1908, would be applicable in full force
and therefore, there is no necessity to for passing the interim order to furnish security, as prayed for by the appellant.
At this stage of the hearing of the Original Side Appeal, an affidavit had been filed on behalf of the respondent, wherein, the respondent had
undertaken that the respondent would not alienate or encumber the properties mentioned in the said affidavit, till the disposal of the O.P. No. 642
of 2012. The affidavit, dated 6.3.2013, filed by the respondent is as follows:
I, Sinju A. Kharim, son of M.A. Kharim aged about 43 years, having office at F8, SIPCOT Industrial Park, Sunguvarchatram, Sriperumpudur-
6020 016, do hereby solemnly affirm and sincerely state as follows:
I am one of the Managing Director of the respondent company herein and as such I am well acquainted with the facts and circumstances of this
case.
I state that the appellant and the respondent herein had filed claim and counter claim before the sole Arbitrator with regard to a recovery of
amount in respect of a work contract. The Arbitrator has awarded a sum of Rs. 57,72,667/- to the appellant with interest and awarded a sum of
Rs. 16,28,148/- with interest towards counter claim to the respondent herein. The respondent herein has preferred an O.P. No. 642 of 2012
before the Hon''ble High Court to set-aside the award passed by the sole arbitrator and the same is pending.
I state that the respondent company has its factory property bearing No. F8, SIPCOT Industrial Park, Mambakkam, Sunguvarchatram,
Sriperumbudur. The company has availed term loans from Small Industries Development Bank of India (SIDBI), Chennai, and working capital
facilities from Union Bank of India. The company has secured the facilities availed from SIDBI by mortgaging its factory fixed assets in favour of
SIDBI. The company has secured the facility availed from Union of India by hypothecating the current assets. Further, the company has been
regularly paying the dues payable to them and there is no default till date. The outstanding amount payable to SIDBI as on 28.2.2013 is Rs.
5,50,00,000/- and the outstanding amount payable to Union Bank of India as on 28.2.2013 is Rs. 2,50,00,000/-.
I state that the book value of the fixed assets as on 31.3.2012 is given below:
I state that without prejudice to our rights in the above O.S.A. and OP No. 642 of 2012 pending before the High Court of Madras, the
respondent herein undertakes that it will not alienate or transfer the above mentioned properties till the disposal of the O.P. No. 642 of 2012 filed
by the respondent.
I state that the above undertaking may be recorded in the above O.S.A. and pass such further or other orders as the Hon''ble Court may deem
fit in the circumstances of this case and thus render justice.
In view of the affidavit filed by the respondent, dated 6.3.2013, we are of the considered view that no further orders are necessary in the present
Original Side Appeal. We are also of the opinion that the other issues raised by the appellant in the present Original Side Appeal need not be gone
into at this stage. As such, the Original Side Appeal stands closed.