JUDGMENT

G S Patel, J. - The Petition is under Section 9 of the Arbitration and Conciliation Act 1996. The present application is for urgent adinterim reliefs after notice. The Respondents have been served. There is an Afdavit in Reply of the 1st Respondent to the Arbitration Petition.

2. The Petitioner ("IREP") is a NBFC. The 1st Respondent ("Tapaswi") does business as a general merchant, trader and dealer in various types of commodities and is part of the Essel Group. This is a conglomerate with business and commercial interests in various sectors. The 2nd Respondent ("Essel Infra") is also a company from the Essel Group. It is an infrastructure development company.

3. The relevant facts run like this. Tapaswi approached IREP for a loan of Rs. 15 crores as working capital. IREP and both Tapaswi and Essel Infra executed a loan agreement dated 14th May 2019, a copy of which is at Exhibit "A" to the Petition. While I will be returning to some of the relevant clauses, I will note at the forefront that arbitration clause 7.2.1 reads thus:

"7.2.1. Dispute Resolution and Governing Law

This Agreement shall be governed by the laws of India.

Any and all disputes arising out of or in connection with this Agreement and or the performance of this Agreement shall be governed by the laws of India and settled by arbitration to be referred to an arbitrator to be appointed by the Lender and the award thereupon shall be binding upon the parties to this Agreement. The place of arbitration shall be Mumbai, in accordance with the provisions of Arbitration and Conciliation Act, 1996 and any statutory amendments thereof."

4. In view of the recent decisions of the Supreme Court, [1] this clause may not be available in the sense that IREP will not have the unilateral right to appoint an Arbitrator but I will presently leave this contention open for an appropriate proceeding. It has little or no bearing on this Section 9 Petition, especially at the ad interim stage.

5. The loan document sets out a schedule of repayment in clause 2.10. There is a tabulation that shows that the loan was to be repaid in fve equal quarterly instalments on the 15th day of the respective months mentioned in the table after the date of initial distribution. The frst tranche of Rs 3 crores was payable on the 15th of the 12th month from the disbursement date, the second on the 15th day of the 15th month and so on, thus providing for an overall two-year repayment period. About this there can be no dispute at all. The contract also had a provision for appropriation, which we fnd in clause 2.13. It sets out the priority or order in which IREP could appropriate payments due to it. The repayment schedule does not include interest and other charges. Interest is separately provisioned in clause 2.4, and there are additional fees as well under Article 2.

6. Essel Infra executed a document styled as an undertaking on the same date 14th May 2019 in favour of IREP but said to be on behalf of the Tapaswi. Whatever be the nomenclature attached to this document, it is nothing but a guarantee and that is abundantly clear from the terms of the document itself. Clauses 3, 4 and 5 of this undertaking at page 141 read thus:

"3. The Confrming Party hereby irrevocably and unconditionally assures and undertakes tot he Lender, the due payment/repayment of the Secured Obligations, to the satisfaction of the Lender, in the event of failure on the part of Borrower in paying/repaying the same to the Lender or otherwise upon occurrence of an Event of Default in respect of the Loan or under the Finance Documents.

4. The obligations of the Confrming Party hereunder are independent of the obligations of the Borrower or any other security provider. The Confrming Party agrees and acknowledges that it is a primary obligor and principal debtor to the Lender, and not merely a surety.

5. Upon happening of an Event of Default, the Confrming Party shall forthwith pay to the Lender the whole of Secured Obligations an