Telangana High Court
Gemini Fx vs M.Srinivas Reddy on 26 March, 2024
THE HON'BLE THE CHIEF JUSTICE ALOK ARADHE
AND
THE HON'BLE SRI JUSTICE SUJOY PAUL
CIVIL REVISION PETITION No.1019 of 2024
ORDER:(Per the Hon'ble the Chief Justice Alok Aradhe) Mr. A.Venkatesh, learned Senior Counsel representing Mr. P.Soma Sekhara Naidu, learned counsel for the petitioner.
Mr. M.Vishnu Vardhan Reddy, learned counsel for the respondent No.1.
2. With the consent of the parties, the matter is heard finally.
3. In this petition under Article 227 of the Constitution of India, the petitioner has assailed the validity of the order dated 22.12.2023 passed by the Principal Special Court in the Cadre of District Judge for Trial and Disposal of Commercial Disputes at Hyderabad (hereinafter referred to as, the Commercial Court), by which the application filed 2 by the petitioner under Section 36(2) and (3) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as, the Arbitration Act), seeking stay of the enforcement of the award has been allowed subject to payment of 50% of the amount awarded by the Arbitral Tribunal.
4. Facts giving rise to filing of this petition briefly stated are that the petitioner was a tenant and the respondent No.1 is the owner of the schedule premises. A lease deed dated 01.12.2017 was executed between the parties for a period of five years. A dispute has arisen between them, which was referred for adjudication to the Arbitral Tribunal. The Arbitral Tribunal, by an award dated 08.07.2023, decreed the claim of the respondent No.1 to the extent of Rs.2,63,45,846/- along with interest at the rate of 18% per annum.
5. Being aggrieved, the petitioner challenged the aforesaid award in a proceeding under Section 34 of the Arbitration Act and filed an application seeking stay of the enforcement of the award. The learned Judge of the Commercial Court, by an order dated 22.12.2023, stayed 3 the execution of the award subject to payment of 50% of the amount awarded by the Arbitral Tribunal. In the aforesaid factual background, this petition has been filed.
6. Learned Senior Counsel for the petitioner submitted that the application for stay filed by the petitioner requires to be decided on the principles analogous to one contained in Order XLI Rule 5 of the Code of Civil Procedure, 1908 (hereinafter referred to as, CPC), and the requirement of deposit of the entire amount in cash is harsh and the petitioner is not in a position to comply with the same. It is further submitted that the petitioner is ready and willing to deposit such amount in cash as this Court may direct and is willing to furnish bank guarantee for the remaining amount to secure the amount in the event of success of the respondent No.1.
7. On the other hand, learned counsel for the respondent No.1 submitted that the impugned order does not call for any interference. Alternatively, it is submitted that an appropriate direction be issued to the Commercial 4 Court to decide the petition preferred by the petitioner expeditiously.
8. We have considered the rival submissions made on both sides and have perused the record.
9. Order XLI Rule 5 of CPC requires a party to furnish security. The provision does not provide that the security has to be in the form of cash only.
10. In the facts and circumstances of the case, it is directed that the petitioner shall deposit 25% of the amount in cash and shall furnish bank guarantee in respect of the remaining 25% of the amount within a period of four weeks from today.
11. To the aforesaid extent, the order passed by the Commercial Court is modified. The Commercial Court shall make an endeavour to decide the petition filed by the petitioner under Section 34 of the Arbitration Act expeditiously.
12. Accordingly, the civil revision petition is disposed of. 5
Miscellaneous applications pending, if any, shall stand closed. However, there shall be no order as to costs.
______________________________________ ALOK ARADHE, CJ ______________________________________ SUJOY PAUL, J 26.03.2024 vs/myk