Point of Law: The principle of separability, clause pertaining to settlement of disputes by Arbitration contained in substantive agreement can be taken into consideration even to decide an application under Section 9 of Arbitration and Conciliation Act leaving it open to Arbitration Tribunal to record a finding, if any, on clause, its admissibility due to failure to pay stamp duty on substantive document.

JUDGMENT :

M. Satyanarayana Murthy, J.

1. Aggrieved by the order dated 28.01.2022 passed in ICOMAOA No.11 of 2021 by the learned single Judge, the present appeal is preferred under Section 37 of the Arbitration and Conciliation Act.

2. The parties to the appeal will hereinafter be referred as arrayed before the learned single Judge for the sake of convenience and to avoid confusion.

3. The petitioner (respondent herein) before the learned single Judge, filed an application under Section 9 of the Arbitration and Conciliation Act, 1996 seeking the following reliefs:

(a) pass an order of interim injunction in favour of the petitioner and against the respondent, restraining the respondent, from directly or indirectly through its nominees, agents, associates, affiliates, representatives or employees, in any manner, acquiring, selling, encumbering, alienating, transferring, issuing delivery orders getting possession or otherwise dealing with the cargo of 7,600 MTs out of the 32,770 MTs of coal discharged by the Vessel MV Port Tokyo and currently lying at the V.O. Chidambaranar Port at Tuticorin in the month of August 2021, till the disposal of the present petition;

(b) pass an order appointing a Receiver/Court Commissioner to take custody of the cargo of 7,600 MTs of coal currently lying at the V.O Chidambaranar Port at Tuticorin discharged from the vessel MV Port Tokyo;

(c) pass an order directing the respondent to offer security in the form of cash security or other security as this Hon‘ble Court deems fit for a sum of INR 4,86,97,180.40 ps. equivalent to USD 646,486.11 being the sum total of the principal claim of USD 566,486.11 in lieu of admitted pending dues of demurrage payable to the Petitioner and USD 80,000 towards legal costs.

(d) Pass an order directing the Respondent to bear all costs, charges, expenses, levies, of any kind whatsoever which may be incurred by the petitioner in exercise of its lien over the cargo of 7,600 MTs of coal, including storage and maintenance costs.

(e) pass an order permitting the Petitioner to sell the liened cargo of 7,600 MTs of coal in the event of non-payment of sums to the petitioner as set out in prayer clauses (c) above;

(f) for ad interim reliefs in terms of prayer (a) (b) (c) and (d) above.

4. It is alleged that the petitioner (respondent herein) is a company incorporated under the Companies Act, carrying on shipping business known as “Norvic Shipping Asia Pte. Limited, whereas the respondent (appellant herein) is another company carrying on its business in the name and style of “VR Commodities Private Limited. The petitioner and respondent entered into fixture note dated 16.07.2021, Charterparty dated 29.05.2021 and settlement agreement dated 06.09.2021 for transportation of coal from “Muara Bunyuasi to “Tuticorin and “New Mangalore, India. But there is a breach of agreement of Charter party allegedly and the petitioner sustained loss due to default of certain terms under the charterparty agreement, requiring the petitioner to have arbitral proceedings. To make good for the amount possibly to recover from the respondent, the petitioner sought various interim reliefs under Section 9 of the Arbitration and Conciliation Act.

5. Learned single Judge ordered ad-interim injunction on 22.10.2021 in favour of the petitioner against the respondent restraining the respondent, from directly or indirectly through its nominees, agents, associates, affiliates, representatives or employees, in any manner, acquiring, selling, encumbering, alienating, transferring, issuing delivery orders, getting possession or otherwise dealing with the cargo of 7,600 MTs out of the 32,770 MTs of coal discharged by the vessel MV Port Tokyo, which is currently lying at V.O.Chidambaranar Port at Tuticorin, in the event of the respondent failing to furnish security for US $ 646,500/- within 48 hours of service of notice as well as this order on the respondent.

6. After passing order dated 22.10.2021, final order dated 28.01.2022 w