$-2 * IN THE HIGH COURT OF DELHI AT NEW DELHI + ARB.P. 2110/2024 Date of Decision: 13.02.2025 IN THE MATTER OF:

CARS 24 FINANCIAL SERVICES PRIVATE LIMITED ..... PETITIONER Through: Mr. Rit Arora and Mr.Anurag Arora, Advocates..

Versus ANIL KUMAR & ANR. .... RESPONDENTS Through: None.

HON'BLE MR. JUSTICE PURUSHAINDRA KUMAR KAURAV

JUDGEMENT

PURUSHAINDRA KUMAR KAURAV, J. (ORAL)

1. The petitioner in the instant petition prays for the following relief:-

“Pass an order or direction appointing a sole Arbitrator and/or constituting Arbitral Tribunal in accordance with the terms of the Arbitral Clause contained in the Arbitration Agreement and under the provisions of the Section 11(5) of the Arbitration and Conciliation Act, 1996, to adjudicate upon the dispute(s) and claim(s) arising between the parties”

2. Learned counsel for the petitioner submits that the petitioner is a Private, Non-Banking Financial Company registered with the Reserve Bank of India, and a wholly-owned subsidiary of Cars24 Services Private Limited. The petitioner-company is engaged in offering various lending products to customers. He submits that respondent no. 1 and respondent no. 2 are co- borrowers and signatories to the Credit Facility Agreement dated Signature Not Verified Signature Not Verified Digitally Signed By:PRIYA Digitally Signed

15.02.2020, and both are engaged in the business of dealing in used/pre- owned cars, based in Meerut. It is further submitted that the respondents had approached the petitioner-company seeking sanction of a revolving credit facility under the UNNATI scheme for the purchase of used cars from M/s Cars24 Services Private Limited, and in doing so, had undertaken and assured compliance with the terms and conditions of the agreement while maintaining financial discipline. He further submits that the liability of both respondents is joint and several, extending co-extensively for the repayment of the loan amount and outstanding dues to the petitioner company.

3. Learned counsel for the further petitioner submits pursuant to the execution of the agreement, the respondents were assigned Dealer ID No. 72563, and under its terms, they had agreed to repay each tranche within 60 days from the date of disbursement along with interest charges. He further submits that the respondents availed various cars from the petitioner company from time to time, with the finance/credit facility being extended on each occasion for a period of 60 days from the date of disbursement.

4. However, due to their failure to adhere to the agreed terms, disputes arose between the parties, leading the petitioner to issue a Credit Facility Recall Notice on 24.06.2021, terminating the facility and requesting the respondents to clear the outstanding amount within seven days. Learned counsel further submitted that the respondents neither responded to the notice nor made any payment, and despite repeated attempts by the petitioner to amicably resolve the dispute, no settlement could be reached. Consequently, the petitioner invoked arbitration as per Clause 15.2 of the Credit Facility Agreement dated 15.02.2020.

5. Learned counsel contends that the respondents have acted Signature Not Verified Signature Not Verified Digitally Signed By:PRIYA Digitally Signed fraudulently, and have no intention of abiding by their contractual promises and assurances. The petitioner asserts that despite the clear terms of the Credit Facility Agreement, the respondents failed to repay the outstanding loan amount and adhere to the agreed terms and conditions. Aggrieved by the default, the petitioner issued a notice dated 14.08.2024, invoking arbitration under the Credit Facility Agreement bearing No. 72563, seeking the appointment of a Sole Arbitrator.

6. He submits that the dues payable as on 14.09.2024 amounts to a sum of Rs. 9,68,492/- (Rupees Nine Lakhs Sixty-Eight Thousand Four Hundred and Ninety-Two Only) remains due and payable by the respondents to the petitioner.

7. Heard learned counsel appeari