Partly allowed

Uttareshwar G Kshirsagar and Bhamabai G Kshirsagar v. Mahindra and Mahindra Financial Services Ltd. and Anr.

Bombay HC11 Jul 2014ARBP/208/2014

Case brief

AI extract

What is this about?

The Bombay High Court entertains a petition challenging an arbitral award for denial of reasonable opportunity. The court finds the petitioners disentitled by absence and imposes a deposit condition to restore their right to a hearing on merits.

What did the court decide?

Petition dismissed unless the petitioner deposits Rs.7,45,493.06 within 4 weeks, in which case the arbitration proceeds.

Uttareshwar G Kshirsagar and Bhamabai G Kshirsagar Vs Mahindra… — Arbitration | Bombay HC (2014)

ARBP No.208_2014

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

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ARBITRATION PETITION NO.208 OF 2014

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Uttareshwar Ganpat Kshirsagar & Ors. … Vs.

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Petitioners

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Mahindra & Mahindra Financial Services Ltd. & Ors.

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… Respondents

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Mr. R.S. Alange, Adv. for the petitioners. Ms. Priya Crasto, Adv. for respondent No.1.

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CORAM : MRS. ROSHAN DALVI, J. DATE : 11th July, 2014.

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P.C. :

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The petitioners availed finance from the respondents and purchased a jeep. The petitioners paid certain loan installments. The petitioners claimed to have paid loan installments until November, 2005. Thereafter there were defaults. The respondents claimed that the petitioners were irregular in payment of installments. The respondents made a claim for the balance amount and invoked the arbitration.

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On 3^rd January, 2013 the learned arbitrator issued notice upon the petitioners for preliminary hearing fixed on 16^th January, 2013 in which she was to pass directions with respect to pleadings, hearings, filings and evidences. A copy of the statement of claim is stated to have been enclosed with the notice. The statement of claim shows inter-alia the facts of the case which has certain annexures. The petitioners claim that annexures were not annexed to the notice of preliminary hearing.

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It would be for the petitioners to attend preliminary hearing on 16^th January, 2013 as directed and inform the learned arbitrator that the documents were not given. Since that notice was for the preliminary meeting with respect to pleadings, hearings, filings and evidences the documentary evidence contained in those

ARBP No.208_2014

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documents would have been considered.

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The petitioners failed to appear as directed on 16^th January, 2013. The learned arbitrator gave one more notice for final hearing of the arbitration proceeding. It stated that the hearing was fixed on 16^th January, 2013. It fixed the further date of hearing on 15^th February, 2013 and directed the petitioners to appear before the arbitrator.

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The petitioners claim to have sent their reply to the arbitrator. The reply is stated to have been sent by courier on 14^th February, 2014, a day prior to the final hearing and 4 weeks after the receipt of the 1^st notice. The courier receipt does not show the acknowledgment of the arbitrator. The learned arbitrator has not considered the reply. The petitioners make a grievance that it is not considered. It appears that the arbitrator has not received it. She could not received it on the very next day. It is not shown to be received by the learned arbitrator. The petitioners have not substantiated that the reply was sent.

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After fixing two dates of hearing the award has been passed. The petitioners have challenged the award on the ground that the reasonable opportunity has not been given to them. The petitioners relied upon the judgment in the case of Sohan Lal Gupta (Dead) thru LRs. & Ors. Vs. Asha Devi Gupta & Ors., (2003) 7 Supreme Court Cases 492 which lays down in paragraph 23 what kind of opportunity must be given. The learned arbitrator has issued notice. Paragraph 23(1) is complied. The notice has been received by the petitioners. Paragraph 23(2) is also complied. The petitioners failed to attend and hence further opportunities could not be given to the petitioners because petitioners disentitled themselves.

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Even if the reply was sent to the notice of the arbitrator in advance of at least the last date of hearing and was received by the

ARBP No.208_2014

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arbitrator, the learned arbitrator would have considered reply but that could not be considered.

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The very first notice of preliminary hearing is dated 3^rd January, 2013. The preliminary hearing is fixed on 16^th January, 2013. The final notice is issued on 16^th January, 2013. The final hearing is fixed on 15^th February, 2013. The petitioners claim to have sent reply on 14^th February, 2013. It is understandable that it was not received by the learned arbitrator on 15^th February, 2013. The acknowledgment of the learned arbitrator is not produced.

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Sufficient opportunity was given to the petitioners. The petitioners have not availed of the opportunities. 10. Counsel on behalf of the petitioner states that the award may be set aside and remanded to the same arbitrator.

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It is seen that the petitioners have only sought to delay the passing of the award. The reply of the petitioners show that the petitioners have sold out the hypothecated vehicle to another person without the consent of the respondents though the loan was not paid. The petitioners are seen to be defaulters. They have not shown their case on merits. The total claim of the respondents is Rs.7,45,493.06 before learned arbitrator. Upon the petitioners depositing in this Court Rs.7,45,493.06 within 4 weeks from today, the petitioners would be entitled to further opportunities for hearing as per paragraph 23(2), (3), (4) & (6) of the aforesaid judgment before the learned arbitrator. If the amount is deposited, the petitioners shall give notice to the respondents and the respondents shall then fix up further meeting before learned arbitrator. The arbitration may then proceed. If the amount is not deposited this Arbitration Petition shall stand dismissed.

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( ROSHAN DALVI, J. )

Uttareshwar G Kshirsagar and Bhamabai G Kshirsagar v. Mahindra and Mahindra Financial Services Ltd. and Anr.

Case brief

What is this about?

What did the court decide?

Uttareshwar G Kshirsagar and Bhamabai G Kshirsagar v. Mahindra and Mahindra Financial Services Ltd. and Anr.

Case brief

What is this about?

What did the court decide?

What the court decided

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