Disposed

The Bombay Dyeing and Manufacturing Co.Ltd., v. Core Committee for Self Development of Sahakar Nagar - 1, and 26 Ors.

Bombay HC20 Jun 2011ARBP/1032/2010

Case brief

AI extract

What is this about?

In an arbitration petition for reference of disputes and specific performance, the court disposed of the matter by directing the escrow agent to repay the bid security to the petitioner contingent upon the withdrawal of claims, subject to notice being served on certain other respondents to prevent technical objections.

What did the court decide?

Directed escrow agent to repay bid security with interest to petitioner upon withdrawal of claims, subject to thirty-day notice period for remaining objects.

The Bombay Dyeing and Manufacturing Co.Ltd., Vs Core… — Specific Performance | Bombay HC (2011)

arbp1032-10

vai

IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION

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ARBITRATION PETITION NO.1032 OF 2010

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The Bombay Dyeing & Manufacturing Co. Ltd. ....Petitioner V/s. Core Committee For Self Development of Sahakari Nagar – 1 & Ors. ....Respondents

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Mr.Janak Dwarkadas, Senior Counsel with Mr.Gautam Ankad and Ms.Soniya Putta i/b M/s.Solomon & Co. for the Petitioner.

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Mr.Sharan Jagtiani with Mr.Ashok Paranjape, Ms.Leena Desai-Padhye and Mr.Samit Shukla i/b M.D.P. & Partners for Respondent Nos.1, 2, 6, 8, 9, 11-13, 15, 16, 18 to 23 and 27.

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Mr.Yatin Shah for Respondent No.5.

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Mr.Amol K. Tembe for Respondent No.7.

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Mr.V.R. Dhond with Mr.Simil Purohit, Mrs.Bhagwati Trivedi, Mr.Pranjal Dave and Mr.Bijal Trivedi i/b M/s.Bhagwati & Co. for the Intervenor.

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CORAM : S.J. VAZIFDAR, J. DATE : 20TH JUNE, 2011.

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P.C. :-

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This is a petition under section 9 of the Arbitration and Conciliation Act, 1996.

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The petitioner intended initiating arbitration proceedings for specific performance of a contract for redevelopment granted to it by a letter of award dated 25.4.2008. To protect its interests thereunder, the petitioner has sought interim orders in this petition.

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The erstwhile solicitors of respondent No.1 by a letter dated

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2.4.2010 addressed on behalf of respondent No.1 returned the bid security deposited by the petitioner along with interest aggregating to Rs. 1,10,03,963/- in escrow. The erstwhile solicitors also acted as the escrow agent in respect of the said amount. The petitioner at that stage refused to accept the same having decided to enforce its rights under the said alleged contract.

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The petitioner is now willing to withdraw its claim and consequently this petition in the event of it being repaid the said amount.

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Respondent No.1 is unincorporated and purports to be a group/association of twenty six societies who are all impleaded as respondents. Mr.Jagtiani on behalf of seventeen societies viz. respondent Nos.2, 6, 8, 9, 11 to 16, 18 to 22, 23 and 27 states that they are agreeable to the payment of the amount by the escrow agent to the petitioner in the event of the petitioner giving up its rights under the said contract and withdrawing this petition.

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Mr.Jagtiani, who also appears on behalf of respondent No.1 makes a statement that three other respondents viz. respondent Nos.3, 10, and 25 have also passed resolutions agreeing to the same. The resolutions are taken on record and marked “X-1”, “X-2” and “X-3” respectively.

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Mr.Jagtiani further states that respondent No.1 representing the twenty six societies has no objection to the above proposal either viz. the escrow agent returning the amount lying in escrow to the petitioner upon the petitioner withdrawing this petition and giving up its claim. Mr.Shah and and Mr.Tembe on behalf of respondent Nos.5 and 7 also

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agree to this arrangement.

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However, as respondent No.1 is not an independent legal entity, I intend passing the order with a view to leaving no scope for a technical objection or grievance by the four other respondents viz. Respondent Nos.4, 17, 24 and 26. I do so only out of abundant caution although it appears that respondent No.1 is a body consisting of the said twenty six societies including those who are not before me, as is evident inter-alia from a letter dated 18.2.2008 addressed by the erstwhile advocate of the respondents who stated that they were acting for and on behalf of the participating members. The request for proposal under a cover of the said letter referred to twenty six societies as participating societies (see clause 1(g) ).

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In the circumstances, the petition is disposed of by the following order :-

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i). The escrow agent viz. M/s.Wadia Ghandy & Co. shall repay the amount of Rs.1,10,03,963/- lying with it together with interest thereon to the petitioner but not before the expiry of thirty days from the date of the service of this order upon respondent Nos.4, 17, 24 and 26. The amount shall not be paid in the event of their or any of them raising any objection in writing addressed to the escrow agent. However, in that event the statement made by the petitioner regarding withdrawing this petition and abandoning its claim, shall also stand withdrawn.

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ii). Liberty to apply including in the event of respondent Nos.4, 17, 24 and 26 or any of them objecting to the payment.

The Bombay Dyeing and Manufacturing Co.Ltd., v. Core Committee for Self Development of Sahakar Nagar - 1, and 26 Ors.

Case brief

What is this about?

What did the court decide?

The Bombay Dyeing and Manufacturing Co.Ltd., v. Core Committee for Self Development of Sahakar Nagar - 1, and 26 Ors.

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

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