Disputes over loan repayments are subject to arbitration under the agreement, and mere participation in court does not waive the right to invoke arbitration if a formal written statement hasn't been submitted.

ORDER :

G. ILANGOVAN, J.

1. This revision is filed seeking to set aside the fair and decreetal orders passed in IA No.1 of 2023 in OS No.15 of 2022 by the District Munsif Court, Madurai Taluk, Madurai District, dated 17/07/2023.

2. The facts in brief:-

The plaintiff filed a suit in OS No.12 of 2022 seeking the relief of permanent injunction restraining the petitioner and his men not to dispossess him in respect of the vehicle bearing registration Nos.TN-64-B-4051 and TN-45-AS-0753, otherwise than under due process of law. Pending further process before filing the written statement, the petitioner filed a petition under section 7 of the Arbitration and Conciliation Act to refer the issue to the arbitration. That was dismissed by the trial court.

3. Against which, this civil revision petition is preferred.

4. The brief averments stated in the plaint are that he approached the respondent Financial Corporation for financial assistance in respect of the above said two vehicles. In respect of TN-45-AS-0753, he obtained Rs.7,00,000/- and the installment period ends on 15/07/2025. In respect of TN-64-B-4051, he availed Rs.7,00,000/- and the installments ends on 05/08/2025. He was repaying the loan amount for both the loans and later, could not continue the same due to some financial difficulties and pandemic situation. But however, the petitioner and their men are frequently disturbing the possession of the vehicles and try to take away them illegally. Hence, the suit.

5. The petitioner straight away would rely the Arbitration Clause in the agreement.

6. Article 22 reads as follows:-

“22(a) All disputes, differences, and/or claim arising out of or in connection with this Agreement whether during its subsistence or thereafter shall be settled by arbitration in accordance with the provision of the Arbitration and Conciliation Act, 1996, or any statutory amendments thereof and shall be referred to the sole arbitration of an Arbitrator nominated by the Lender. The award given by such an Arbitrator shall be final and binding on the parties to this Agreement.

(b) The venue of arbitration proceedings shall be at .... The language of arbitration shall be English.

(c) The arbitrator so appointed herein above, shall also be entitled to pass an Award on the hypothecated asset and also on any other securities furnished by or on behalf of the Borrower.”

7. By relying this agreement, the learned counsel appearing for the petitioner would submit that the issue involves the repayment of installment amount. So, this is in connection with the agreement and so the matter must be referred to the mediation process before invoking the jurisdiction of the civil court.

8. But the trial court was of the view that the grounds raised in the plaint is not with reference to the dispute over the terms of the agreement and the attempt on the part of the petitioner to dispossess him. So it will not come under the issue to be resolved by way of arbitration.

9. During the course of argument, another contention that raised by the respondent is that the petitioner appeared in-person on summon and has not chosen to file a petition to refer the matter to the arbitration before the time expired for filing written statement. So, this was the main argument advanced by the respondent herein.

10. Per contra, the learned counsel appearing for the petitioner would submit that even though, he appeared before the trial court, the time was extended periodically for filing the written statement. Since the time is not expired, he is entitled to invoke the jurisdiction of the court under section 8 of the Act.

11. Regarding the first issue, I am convinced that the i