Disputes involving a tripartite agreement, integral to the loan agreement, must be resolved through arbitration despite varying signatures among parties.

JUDGMENT

HARISH VAIDYANATHAN SHANKAR, J.

1. The present regular first appeal under Section 13 (1A) of the Commercial Courts Act, 2015 read with Section 96 of the Code of Civil Procedure, 1908 , [1CPC] has been filed against the Judgment dated 06.05.2022, [Impugned Judgment] passed by the learned District Judge, Commercial Court- 05, Central District, Tis Hazari, Delhi in CS (Comm) No. 4274/2021 titled as Canara Bank vs. Sanjeev Sharma And Ors., for remanding the case back to the learned District Judge for trial and adjudication on merits.

2. By the judgment impugned herein, the learned District Judge has dismissed the suit and held as follows:

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4) Defendants no. 1 & 2 executed the loan application, mortgaged deed of the allotted flat on 24.07.2008, which was still under construction and no possession of the same was handed over to them by the builder defendant no.3. Since, the mortgage could not take place and it could not be treated as a security for repayment of the loan so the bank required one tripartite agreement to be executed by the borrower as well as the builder also and ultimately this additional tripartite agreement was executed on 18.11.2008. This fact is not in dispute that whatever payment was released by the plaintiff bank was credited in the account of the defendant no.3 builder. In this agreement dated 18.11.2008, certain more obligations were put upon the defendant no. l borrower and defendant no. 3 builder. The clause 10 on page no. 3 of this agreement clearly mention that the payment is to be disbursed by the plaintiff bank even if the borrower is unable to create mortgage on the strength of this tripartite agreement. On the basis of this agreement, it was decided that the bank will disburse the sanctioned loan amount to the builder directly, the builder will have no objection in creating the mortgage of the allotted flat in favour of the bank which will have also a lien on the same and the builder will also complete the necessary formalities regarding completion of the mortgage of the flat, handing over the documents to the bank etc. In case of the cancellation of the allotment, the builder was to return the amount to the bank including the amount deposited by the borrower with it. The money which the builder will receive from the bank will be held in the capacity of trust and separate account of the same has to be maintained etc. Certain more conditions were agreed upon by the plaintiff bank with the borrower and the builder relating to alloted flat, to secure the money given as loan etc. Clause 16 and 17 of this tripartite agreement mention that in case of a dispute, the matter will be sorted out through arbitrator. It was also agreed upon in the tripartite agreement that in case of non payment of the installments by the defendant no. l borrower, plaintiff bank will issue a letter to the defendant no.3 for cancellation of the allotment and to enforce the lien till the amount is returned by the builder.

5) The tripartite agreement dated 18.11.2008 has to be treated as a part and parcel of the original loan agreement dated 24.07.2008 executed between the plaintiff and defendants no. l & 2 because certain formalities regarding mortgage, release of payment, creation of lien, terms and conditions regarding non payment and its consequences etc. were finalised