J U D G M E N T

NEENA BANSAL KRISHNA, J.

I.A. 22291/2023 (Exemption)

1. Exemption allowed, subject to all just exceptions.

2. The application stands disposed of. I.A.22292/2023 (Condonation of delay)

3. The application has been filed on behalf of the petitioner seeking condonation of delay of 37 days in refiling the accompanying Petition.

4. For the reasons stated and in the interest of justice, the delay of 37 days‟ in re-filing the accompanying Petition is condoned. The application is accordingly allowed.

O.M.P. 1/2023

5. The Petition under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as ‘the Act’), has been filed by the petitioner, (who was the respondent No.1 in the Arbitral proceedings, hereinafter referred to as the ‘petitioner’) to set-aside the Award dated 02.05.2023, passed by the learned Sole Arbitrator.

6. Briefly stated, the petitioner/Shutham Electric Ltd., and its sister concerns had secured advances/loans from the Greater Bombay Co- operative Bank Ltd. (“GBCB”) against the mortgage of two properties. One of the properties was a residential bungalow with a garage situated at Sub Plot No. 6, Galaxy Co-operative Housing Society Limited, Pune, which was owned by Gouri Samarendra Bose, mother of the Managing Director of Shutham Enterprises/petitioner.

7. The respondent No. 1/Vaibhav Raheja (who was the claimant before the learned Arbitrator, hereinafter referred to as ‘respondent No.1’) agreed to purchase this residential property from Gouri Samarendra Bose, for a consideration of Rs.6.5 Crores. There was an outstanding loan amount of Rs.8,93,50,000/- payable by the petitioner to GBCB and the property in question was under mortgage with the Bank. The respondent No.1 deposited Rs.6,43,50,000/- (after deducting TDS amounting to Rs.6,50,000/-) with GBCB as the Sale consideration. As there was a balance amount of approximately Rs. 2,380,000/- that till remained outstanding, the Petitioner and respondent no.1 claimant entered into the Loan Agreement dated

14.06.2013 whereby the Claimant agreed to give a loan of Rs.2.5 crores.

8. As per the terms of the Loan Agreement, it was agreed that a further sum of Rs.2.5 Crore shall be paid directly to GBCB for off-setting the loan of the petitioner. Consequently, the total amount of Rs.8.9 Crore was paid to GBCB in discharge of its loan liabilities of the petitioner,.

9. In the Loan Agreement, it was also agreed that the loan amount shall be secured by first and exclusive charge created over the Commercial Property, in accordance with the Deed of Mortgage. Consequently, the Deed of Mortgage was executed between respondent No.1, Mr. Vaibhav Raheja and respondent No. 2, Mr. Ramchandani Lachmandas.

10. Since the petitioner did not repay the loan amount, the respondent No. 1 gave Notice of invocation of Arbitration dated 18.11.2019 consequent to which, the learned Arbitrator was appointed. The respondent No. 1 filed its claim against the petitioner and also the respondent No. 2, (with whom the claimant had entered into the Mortgage Agreement) and sought Recovery of Rs.2.5 Crores along with interest @5% p.a. and the costs.

11. The petitioner herein contested the claim of the respondent No.1 by alleging that it was a time barred claim as the loan allegedly had been taken vide Loan Agreement dated 14.06.2013 while the Notice of invocation was given on 18.11.2019, which is way beyond the period of limitation.

12. It was also claimed that there was no Arbitration Clause in the Mortgage Agreement between the claimant and the respondent No. 2 and the alleged claim against the respondent No. 2 before the learned Arbitrator, was not maintainable.

13. Essentially, the plea that was taken by the petitioner was that no loan amount was disbursed to petitioner and respondent No. 1 had failed to show the disbursal of the amount of Rs.2.5 Crores in the bank account was on behalf of the petitioner.

14. Based on the Reply of the petitioner, respondent No.1 filed an application under