Conflicting orders on securing the award amount and the applicability of Section 9 to restrain a non-party to the arbitration proceedings.

JUDGMENT

Rajiv Sahai Endlaw, J. - C.M. No. 14837/2021(for exemption)

1. Allowed, subject to just exceptions and as per extant rules.

2. The application is disposed of.

FAO(OS) (COMM) 67/2021 & C.M. No. 14838/2021(for ad-interim exparte stay)

3. This appeal, under Section 37 of the Arbitration and Conciliation Act, 1996, impugns the order dated 15th February, 2021 of dismissal of OMP(I)(COMM) No.143/2020 under Section 9 of the Arbitration Act preferred by the appellant.

4. It is the case of and the argument of the counsel for the appellant, (i) that the appellant had made monetary claims against the respondent no.1 Trade International, Sole Proprietorship of P.K. Handa and respondent no.2 Snowcross Healthcare Pvt. Ltd; (ii) that the said claims were subject matter of arbitral proceedings; (iii) that during the pendency of arbitral proceedings, on an application under Section 17 of the Act, the respondent P.K. Handa was restrained from alienating, selling, encumbering or transferring his residential property, being second floor of house No. C-8, East of Kailash, New Delhi; (iv) that the said monetary claims were allowed and an Arbitral Award for recovery of monies was passed in favour of the appellant and against the respondent no.1 Trade International, Sole Proprietorship of P.K. Handa; (v) that since the order under Section 17 of the Act had come to an end with the making of the Arbitral Award, the appellant filed the petition under Section 9 of the Act, from which this appeal arises, to restrain the said P.K. Handa from selling, alienating or encumbering the property aforesaid, namely second floor of House No.C-8, East of Kailash, New Delhi, which was the only known asset of the respondent P.K. Handa, who otherwise claims to be an indigent person; (vi) in the said Section 9 proceedings, it was informed that P.K. Handa, after making of Arbitral Award, had gifted the said property to his son Rajan Handa, respondent no.3 herein; (vii) that the appellant then applied for amendment of the Section 9 petition and to also implead respondent no. 3 Rajan Handa and which application was allowed and though initially respondent no. 3 Rajan Handa was also restrained from dealing with the property, but vide the impugned order, the petition under Section 9 has been dismissed because in petition under Section 34 of the Act preferred by the respondent P.K. Handa with respect to the Arbitral Award, execution had been stayed subject to deposit of 75% of the Award amount and which had been deposited; and, (viii) that since the appellant is not fully secured with respect to the Arbitral Award in its favour, the appellant is aggrieved from the order of dismissal of Section 9 petition and is, for recovery of the balance Award amount due, entitled to restrain respondent no.3 Rajan Handa from dealing with the property.

5. The counsel for the appellant has argued, that unless said protection is granted, the appellant, even on succeeding in Section 34 proceedings, will not be able to recover the entire awarded amount and would be entitled to only recover 75% thereof, which has been deposited in the Court.

6. We are unable to find any fault in the reasoning of the Single Judge, of the appellant being not entitled to take two proceedings for securing the award amount. Once the Court seized of the Section 34 proceedings with respect to the Arbitral Award has deemed it fit to grant stay of execution of the Arbitral Award subject to deposit only of 75% and not 100% of the Award Amount, if at the same time another Court, in Section 9 proceedings, comes to the conclusion that the entire Award Amount and not only 75% thereof, is required to be secured, the same would result in conflicting orders on the same matter and would not behove well for the principle of comity of different Benches of the same Court.

7. We have even otherwise enquired from the counsel for the appellant, the basis of the claim of the appellant against the respondent no.3 Rajan Handa, who is admit