Allowed¶34

M/s Shriram Finance Ltd. v. S Rajasekaran S/O.Somasundaram

Madras HC9 Jan 2025Arb O.P(COM.DIV.)/459/2024

Case brief

AI extract

What is this about?

Section 11(4) Arbitration and Conciliation Act 1996; appointment of sole arbitrator; unilateral appointment objection; earlier Section 11 petitions withdrawn; vehicle loan-cum-hypothecation agreement default; XUV 500 TN09BT5096; Volvo S60 TN07BR-1805; Section 21 notice 14.09.2023; respondents ex parte despite service; Shriram Finance Limited; Madras High Court; Arb.O.P.(COM.DIV.) Nos.459 & 461 of 2024; Schedule-IV arbitrator fees; six-month disposal timeline; P.B. Balaji J.

What did the court decide?

Appointment of Mr.T.Sai Krishnan, Advocate, as Sole Arbitrator to adjudicate the disputes between the parties; Arbitrator to fix fees per Schedule-IV to the Act and to endeavour to decide the dispute within six months of entering into reference. ¶34

M/s Shriram Finance Ltd. Vs S Rajasekaran S/O.Somasundaram — Arbitration | Madras HC (2025)

What the court decided

AI extract

Outcome

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Issue for consideration

Whether the petitioner is entitled to appointment of a sole Arbitrator under Section 11(4) of the Arbitration and Conciliation Act, 1996.

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Court's answer

On going through the averments in the Section 11 Petition, the Court is satisfied that the petitioner is entitled to seek appointment of a sole Arbitrator.

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Ratio / Principle

Mr.T.SAI KRISHNAN, Advocate (No.48, II Floor, Vanguard House, Moore Street, Chennai - 600 001) is appointed as the Sole Arbitrator.

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Key takeaways

The sole Arbitrator is directed to issue notice to the respondent and thereafter decide the disputes and adjudicate the differences between the parties in accordance with law.ratio¶32
The learned Arbitrator is entitled to fix his fees as per Schedule-IV to the Act.ratio¶33
The Court requested the learned Arbitrator to endeavour to decide the dispute expeditiously, and not later than six (6) months from the date of his entering into reference.

Detailed headnote1 paragraphs

Madras High Court (P.B. Balaji, J.), by common order dated 09.01.2025, allowed Arb.O.P.(Com.Div.) Nos.459 & 461 of 2024 under Section 11(4) of the Arbitration and Conciliation Act, 1996 filed by M/s.Shriram Finance Limited (formerly M/s.Shriram Transport Finance Co. Ltd.) seeking appointment of a sole arbitrator against respondents S.Rajasekaran and A.R.Ram. The disputes arose out of two vehicle loan-cum-hypothecation agreements dated 06.08.2018 and 10.09.2018, under which Rs.8,00,000/- and Rs.14,00,000/- were advanced for purchase of an XUV 500 (TN09BT5096) and a Volvo S60 (TN07BR-1805); the respondents allegedly paid only Rs.1,95,576/- and Rs.9,89,182/-, leaving outstandings of Rs.2,96,619/- and Rs.14,64,936.77. An earlier round of arbitration (Arb.O.P.(Com.Div) Nos.17 and 55 of 2023) was withdrawn on the respondents' objection of unilateral appointment, after which the petitioner moved under Section 11(4); a Section 21 notice had been issued on 14.09.2023. Respondents, though served by Court notice and private notice and listed in the daily cause-list, did not appear and were set ex parte. The Court appointed Mr.T.Sai Krishnan, Advocate, as Sole Arbitrator, directed him to issue notice and adjudicate the disputes in accordance with law, permitted him to fix fees as per Schedule-IV to the Act, and requested completion within six months from entering into reference.

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Arb O.P(COM.DIV.) Nos.459 & 461 of 2024

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IN THE HIGH COURT OF JUDICATURE AT MADRAS

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DATED: 09.01.2025

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CORAM

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THE HONOURABLE MR JUSTICE P.B. BALAJI

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Arb.O.P (COM.DIV.) Nos.459 & 461 of 2024

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M/s.Shriram Finance Limited, Formerly as M/s.Shriram Transport Finance Co. Ltd., Rep. By its Power of Attorney/Authroized Officer, Mr.V.Saravanan, having registered office at, No.14A, South Phase, Industrial Estate, Guindy, Chennai.

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...Petitioner in both Arb. O.Ps.

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1.S.Rajasekaran 2.A.R.Ram ...Respondents in Arb.O.P.(Com.Div.) No.459 of 2024 1.A.R.Ram 2.S.Rajasekaran

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...Respondents in Arb.O.P.(Com.Div.) No.461 of 2024

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COMMON PRAYER: The Arbitration Original Petition is filed under Section 11(4) of the Arbitration and Conciliation Act, 1996 to appoint a Sole Arbitrator.

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For Petitioner : Mr.M.Peer Mohamed in both Arb.O.Ps. For Respondents : No Appearance in both Arb.O.Ps

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1/5

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https://www.mhc.tn.gov.in/judis

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Arb O.P(COM.DIV.) Nos.459 & 461 of 2024

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COMMON ORDER

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This Arbitration Original Petitions have been filed under Section 11(4) of the Arbitration and Conciliation Act, 1996 to appoint a sole Arbitrator.

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Heard Mr.M.Peer Mohamed, learned counsel for the Petitioner in

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both Arbitration Original Petitions. There is no appearance on the side of the respondents. Though Court notice and private notice are served on the respondents and the names of the respondents have also been printed in the High Court daily cause-list today i.e., on 09.01.2025, there is no appearance on the side of the respondents. Therefore, the respondents are called and set exparte.

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The case of the petitioner is that the respondents have approached

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the petitioner Company for loan to purchase the vehicles viz., XUV 500 W8FWD Diesel 7 Seater Model 2013 bearing Registration No.TN09BT5096 and VOLVO S60 2.4 L D5 Diesel 5 Seater bearing Registration No.TN07BR-1805. In furtherance of the same, the Loan-cum-

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2/5

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https://www.mhc.tn.gov.in/judis

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Arb O.P(COM.DIV.) Nos.459 & 461 of 2024 Hypothecation Agreement was entered into on 06.08.2018 & 10.09.2018 and the petitioner Company advanced a sum of Rs.8,00,000/- & Rs.14,00,000/- respectively. The grievance of the petitioner is that, the respondents have committed default and has been highly irregular in making payment of monthly installments and in all, have paid only Rs.1,95,576/- & Rs.9,89,182/- respectively, leaving an outstanding of Rs.2,96,619/- from 09.10.2020 & Rs.14,64,936.77 as on 29.10.2021.

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The petitioner has also invoked Section 21 of the Arbitration and Conciliation Act and issued a notice under Section 21 on 14.09.2023. It is also seen that the petitioner earlier initiated the arbitration proceedings in Arb.O.P.(Com.Div) Nos.17 and 55 of 2023, however the same were withdrawn in view of the objections taken by the respondents that it was a case of unilateral appointment. Subsequently, the present Arbitration Original Petitions have been filed under Section 11 (4) of the Act.

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I have gone through the averments made in the Section 11 Petition and I am satisfied that the petitioner is entitled to seek appointment of a sole

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3/5

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https://www.mhc.tn.gov.in/judis

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Arb O.P(COM.DIV.) Nos.459 & 461 of 2024

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Arbitrator,

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Arbitrator, Mr.T.SAI KRISHNAN, Advocate, having address at No.48, II Floor, Vanguard House, Moore Street, Chennai -600 001, Cell : 98402 29542, E.Mail: [email protected] is appointed as the Sole Arbitrator. The sole Arbitrator is directed to issue notice to the respondent and thereafter, decide the disputes and adjudicate the differences between the parties, in accordance with law.

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The learned Arbitrator is entitled to fix his fees as per the Schedule-IV to the Act. This Court further requests the learned Arbitrator to endeavor to decide the dispute as expeditiously as possible, however, not later than six (6) months from the date of his entering into reference.

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