AI Structured Summary
Not yet generated for this judgment
Judgment
Vinod K. Sharma, J.—This order shall dispose of A. Nos. 246 and 247 of 2013 as the common question of fact and law are involved in
these applications.
A. No. 246 of 2013:
This application has been filed by the applicant to direct the respondent to furnish security to the extent of the claim of Rs. 1,60,67,407/- (Rupees
One Crore sixty lakhs sixty seven thousand four hundred and seven only) within a stipulated time as fixed by this Court, failing which this Court
may pass an order of attachment before the Judgment of the property detailed in the schedule to the Judges Summons.
A. No. 247 of 2013:
This application has been filed by the applicant to direct the respondent to deposit the amounts due payable at Rs. 1,60,67,407/- (Rupees One
Crore sixty lakhs sixty seven thousand four hundred and seven only) in Court within a stipulated time as fixed by this Court. It is pleaded case of
the applicant that the applicant is in the business of construction of buildings and factory and in the regular course of business, the applicant was
awarded contract by the respondent for construction of Gents Hostel and additional floors at the academic building vide agreement dated
25.8.2011. The total value of the contract was Rs. 15,30,00,000/- (Rupees Fifteen Crores and thirty lakhs only).
That the applicant had undertaken the project believing that the respondent will honour its commitments as per the contract. It is pleaded the
delay in execution of the work occurred due to the lapse on the part of the respondent in not submitting the drawings in time.
That the work was not started for the reasons attributable to the respondent, therefore, on account of the reduction of work, the applicant
suffered loss to the tune of Rs. 38,50,000/- (Rupees thirty eight lakhs and fifty thousand only).
The case of the applicant is that the applicant had executed the work for a total gross value of Rs. 6,85,43,226/- (Rupees Six Crores eighty five
lakhs forty three thousand two hundred and twenty six only) and net value of Rs. 6,04,45,630/- (Rupees Six Crores four lakhs forty five thousand
six hundred and thirty only) excluding the retention amount of Rs. 15,82,236/- (Rupees fifteen lakhs eighty two thousand two hundred and thirty six
only) paid as security.
As against the total work done, the respondent paid only a sum of Rs. 4,27,32,825/- (Rupees Four Crores twenty seven lakhs thirty two
thousand eight hundred and twenty five only) thus, leaving a balance of Rs. 1,77,12,805/- (Rupees One Crore seventy seven lakhs twelve
thousand eight hundred and five only). That the respondent unilaterally sent a cheque for Rs. 16,45,398/- (Rupees sixteen lakhs forty five thousand
three hundred and ninety eight only) to be the full and final settlement which applicant encashed under protest.
The applicant raised a dispute before the Arbitrator by moving an application u/s 11 of the Arbitration and Conciliation Act. Pending arbitration
proceedings, these two applications have been filed.
The learned counsel for the applicant vehemently contended that the respondent is trying to sell their properties and secret the monies with the
intent to defeat and delay the payment due payable to the applicant and is also trying to leave the jurisdiction of this Court. Nothing has been
placed on record in support of these allegations, furthermore, averments lack material particulars. It is not disputed that respondent is running a
college.
On the basis of the vague averments in the affidavit, prayer has been made to direct the respondent to deposit the amount or in the alternative,
furnish security or attach the properties belonging to the respondent.
On consideration, I find this application is totally misconceived. Though this Court in exercise of power u/s 9 of the Arbitration and Conciliation
Act, can pass interim order to protect the rights of the parties in the arbitration, but the exercise of jurisdiction has to be based on sound principle.
In this case, there is a dispute with regard to entitlement of applicant which is yet to be determined by the Arbitrator. The amount claimed is for
the construction of building which is very much in existence, where college is running.
The respondent in the counter has denied that any amount is due to the applicant. A positive stand taken is that College is running in the
building, and respondents have no intention to dispose of the properties as alleged in the affidavit filed in support of the application. It is well settled
law that by way of interim measure, unsecured claim cannot be converted as secured claim. There is no material placed on record showing any
overact on the part of the respondent which may lead to conclusion that attempt is made to defeat the right of the applicant in award to be passed.
Both the applications are totally misconceived. No case is made out to pass an order directing the respondent to deposit money or furnish security
or to attach the properties belonging to the respondent.
Consequently, both the applications are ordered to be dismissed. No costs.