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SANJEEV NARULA
Splendor Buildwell Pvt Ltd And Another – Appellant
Versus
Rajesh Kumar Pasricha – Respondent
JUDGMENT
Sanjeev Narula, J . - The appellant [being the Counter-Claimant in arbitration], is aggrieved with the Order dated 08th November, 2021 [hereinafter, 'Impugned Order'] passed by the Sole arbitrator, deciding the Respondent's [Claimant in arbitration] application under Section 17 of the arbitration and Conciliation act, 1996 [hereinafter, 'the act'], whereby, inter alia, directions have been passed to secure an amount of Rs. 1,42,35,279.50/- by way of fixed deposit receipts [hereinafter, 'FDR'] or an irrevocable bank guarantee.
BaCKGROUND:
2. Briefly stated, the facts giving rise to the instant appeal are as follows:
2.1. appellant No. 1 is a property developer and appellant No. 2 is the owner of the underlying land. The Respondent entered into two agreements with appellant No. 1, both dated 04th October, 2017, viz. a Space Buyer's agreement [hereinafter, 'SBa'] and a Memorandum of Understanding [hereinafter, 'MoU'] to purchase Units no. 601 to 606 (admeasuring a super area of 5385 Sq. Ft.), sixth floor, Tower D, Spectrum One, Sector-58, Village Behrampur, Tehsil Sohna, District Gurgaon, Haryana [hereinafter, 'Property'] for a total consideration of Rs. 1,61,55,000/-.
2.2. Claus
Section 17 relief under the Arbitration and Conciliation Act requires proof of both a prima facie case and potential asset dissipation, which was not adequately demonstrated.
The main legal point established in the judgment is that the order passed by the Arbitrator under section 17(1)(ii)(b) of the Arbitration and Conciliation Act, 1996 was a proper exercise of jurisdict....
An arbitral tribunal, while adjudicating an application for interim protection under Section 17, does not determine the lis between the parties.
The sufficiency of pleadings in a petition under section 9 of the Arbitration Act and the court's power to grant interim measures to secure a claim, considering the financial condition of the party a....
The court upheld an arbitrator's discretion under Section 17 for interim security but clarified the need to reconsider the amount based on specific claims presented.
The arbitral tribunal has broad powers to issue interim measures under the Arbitration and Conciliation Act, ensuring protection of claims during ongoing proceedings.
The Arbitrator's issuance of interim payment directions must not resemble a final resolution and should not exceed the scope of temporary measures permissible under Section 17 of the Arbitration Act.
The court clarified the rights and restrictions related to the mortgaged property and appointed an arbitrator to adjudicate the disputes.
The main legal point established in the judgment is that the arbitrator's decision must be in accordance with the terms of the agreement, and failure to do so can result in the decision being set asi....
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