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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
R.D. DHANUKA, J.
Aidek Tourism Services Private Limited & Ors. - Petitioners
Versus
Aditya Birla Nuvo Ltd. - Respondent
ARBITRATION PETITION NO.630 OF 2009
Decided On : 24-08-2016
The Court dismissed the petition filed under Section 34 of the Arbitration and Conciliation Act, 1996, challenging the arbitral award. The Court held that the findings of fact recorded by the learned arbitrator were not perverse and could not be interfered with by the Court. The Court also held that the learned arbitrator had rightly rejected the plea of limitation raised by the petitioners.
Fact of the Case:
The petitioners, a company and its directors, entered into a hire purchase agreement with the respondent, a financial institution, for the purchase of 8 Honda cars. The petitioners defaulted in making payments under the agreement, and the respondent repossessed the cars. The petitioners filed a complaint against the respondent with the police, alleging that the cars were repossessed illegally. The respondent filed an arbitration petition against the petitioners, claiming payment of the outstanding amount under the hire purchase agreement. The petitioners challenged the arbitral award, arguing that the hire purchase agreement was forged and fabricated, that the learned arbitrator had erred in taking photocopy of the agreement in evidence without production of the original, and that the learned arbitrator had applied different yardsticks in taking photocopy of the documents produced by the respondent on record in evidence and marking them as exhibits and refusing to take photocopy of the criminal proceedings on record in evidence.
Finding of the Court:
The Court held that the findings of fact recorded by the learned arbitrator were not perverse and could not be interfered with by the Court. The Court also held that the learned arbitrator had rightly rejected the plea of limitation raised by the petitioners.
Issues: 1. Whether the hire purchase agreement was forged and fabricated? 2. Whether the learned arbitrator erred in taking photocopy of the agreement in evidence without production of the original? 3. Whether the learned arbitrator applied different yardsticks in taking photocopy of the documents produced by the respondent on record in evidence and marking them as exhibits and refusing to take photocopy of the criminal proceedings on record in evidence? 4. Whether the learned arbitrator rightly rejected the plea of limitation raised by the petitioners?
Ratio Decidendi: 1. The Court held that the findings of fact recorded by the learned arbitrator were not perverse and could not be interfered with by the Court. The Court relied on the judgment of the Supreme Court in the case of Oil and Natural Gas Corporation Limited vs. Western Geco International Limited, wherein the Supreme Court held that the findings of fact recorded by the learned arbitrator are not perverse and cannot be interfered with by the Court. 2. The Court held that the learned arbitrator had rightly rejected the plea of limitation raised by the petitioners. The Court relied on the judgment of the Supreme Court in the case of Sardar Trilok Singh & Ors. vs. Satya Deo Tripathi, wherein the Supreme Court held that the plea of limitation raised by the petitioners was rightly rejected by the learned arbitrator.
Final Decision: The Court dismissed the petition filed under Section 34 of the Arbitration and Conciliation Act, 1996, challenging the arbitral award.
By this petition filed under Section 34 of the Arbitration and Conciliation Act, 1996 (for short “the Arbitration Act”), the petitioners have impugned the arbitral award dated 23rd March 2009 as modified by an order dated 22nd May 2009, the order dated 1st August 2007 and additional award dated 30th November 2013 as corrected by an order/award dated 9th January 2014 under Section 33 of the Arbitration Act. Some of the relevant facts for the purpose of deciding this petition are as under :-
2. The petitioner no.1 was formerly known as “Ramniranjan Kedia Tourism Services Pvt. Ltd.” The name of the petitioner no.1 was changed to “Aidek Tourism Services Private Limited” with effect from 1st December 2010. The petitioner nos.2 and 3 are the Directors of the petitioner no.1.
3. It was the case of the respondent in the arbitral proceedings that on 24th April 1995, the parties entered into a Hire Purchase Agreement in respect of 8 Honda Accords Cars i.e. MH-06-3401, MH-06-3402, MH-06-3403, MH-06-3404, MH-06-4063, MH-06-4064, MH-06-4065 and MH-06-4062. The total agreement value was Rs.84,27,600/- including interest which was to be paid in monthly installments of Rs.1,40,460/- for a period of 60 months from 13th July 1995 to 13th March 2000. It was the case of the respondent that the parties had also entered into a separate Loan Agreement dated 13th June 1995 for an amount of Rs.54,91,000/- advanced as a loan by the respondent to the petitioner no.1 for import of the said vehicles. According to the respondent, the petitioner no.1 committed default in making payment under the said hire purchase agreement dated 24th April 1995.
4. The petitioner nos.2 and 3 were parties to the said hire purchase agreement as Guarantors. It was the case of the respondent that since the petitioner no.1 was in default of its payment obligation under the said agreement, the said hire purchase agreement was terminated by the respondent. It was also the case of the respondent that in exercise of their rights under the said hire purchase agreement, the respondent repossessed 4 vehicles out of the said 8 vehicles bearing nos.MH-06-3401, MH-06-3403, MH-06-4064 in Delhi on 25th May 2000 and MH-06-3404 in Mumbai on 19th June 2000 and sold the same and gave credit of sale proceeds thereof to the petitioner no.1.
5. The petitioner no.1 filed criminal complaints against the respondent with various police authorities in respect of the vehicles repossessed by the respondent and raised debit notes on the respondent on account of higher charges due and payable on the repossessed vehicles.
6. On 28th July 2000, the respondent vide its advocate's letter terminated the said agreement. In the said letter, it was stated that all hire purchase agreements in respect of 31 vehicles were dated 24th April 1994.
7. On or about 19th March 2000, the respondent advertised for sale of repossessed vehicles. The petitioner no.1 vide its advocate's letter dated 27th September 2000 objected to the said advertisement issued by the respondent. The respondent sold above referred 4 vehicles for Rs.4,50,000/-, Rs.4,25,000/-, Rs.4,25,000/- and Rs.4,25,000/- respectively.
8. On 28th June 2001, Bandra Police Station registered MECR No.5/2001 pursuant to the directions of 12th Metropolitan Magistrate Court vide order dated 15th March 2001 under Section 156(3) of the Code of Criminal Procedure, 1973 for various offences against Birla Global Finance Limited.
9. On 29th March 2001, Birla Global Asset Finance Company Limited entered into an agreement with the Birla Global Finance Limited for acquisition of the entire business of retail finance, hire purchase and consumer durable finance including existing contracts, assets, liabilities and employees related to the retail finance division of every description of Birla Global Finance Limited as a going concern on lump sump sale basis. The name of the Birla Global Asset Finance Company Limited was changed to Birla Global Finance Limited and further change
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