Delhi High Court - Orders
Aditya Birla Finance Limited vs Balishtha E-Tech Private Limited And ... on 7 May, 2024
Author: Prathiba M. Singh
Bench: Prathiba M. Singh
$~9
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ ARB.P. 133/2024
ADITYA BIRLA FINANCE LIMITED ..... Petitioner
Through: Mr. Aman Vashisht & Mr. Nishant
Srivastav, Advs. along with AR Mr.
Jahirul Islam Laskar in person. (M:
9151386532)
versus
BALISHTHA E-TECH PRIVATE LIMITED AND
ANR. ..... Respondents
Through: None.
CORAM:
JUSTICE PRATHIBA M. SINGH
ORDER
% 07.05.2024
1. This hearing has been done through hybrid mode.
2. This is a petition under Section 11(6) of the Arbitration and Conciliation Act, 1996 (hereinafter, '1996 Act') filed by the Petitioner- Aditya Birla Finance Ltd. seeking appointment of an Arbitrator in terms of the Clause 25.17 of the Loan Agreement dated 28th October, 2020 and connected agreements viz. Clause 25 of the Guarantee Deed dated 28th October, 2022 and Clause 32.17 of the Facility Agreement dated 28th October, 2020 which reads as under:-
"25.17 Arbitration:
All claims or disputes arising out of or in relation to this Agreement shall be settled by arbitration. The arbitration tribunal shall consist of a sole arbitrator to be appointed by Lender. All parties to this Agreement hereby expressly consent to Lender being the sole appointing authority. Any vacancy created in the arbitration tribunal, for any reason whatsoever, shall also be filled only by Lender acting as the sole appointing authority. The place of arbitration shall be ARB.P. 133/2024 Page 1 of 5 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 08/05/2024 at 22:51:10 Delhi. Parties agree that the courts in Delhi shall have the exclusive jurisdiction to exercise all powers under the Arbitration and Conciliation Act, 1996. Notwithstanding anything contained hereinabove, in 1he event the legal status of the Facility Provider changes or in the event of the law being made or amended so as to bring the Facility Provider under The Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (the 'DRT Act"), to proceed to recover dues from the Borrower(s) .under the DRT Act the arbitration provisions hereinbefore contained shall, at the option of the Facility Provider, cease to have any effect and if arbitration proceedings are commenced but no arbitral award is made, then at the option of the Facility Provider such proceedings shall stand terminated and the mandate of the arbitrator shall come to an end from the date of the making of the law or the date when amendment becomes effective or the date when the Facility Provider exercises the option of terminating the mandate of arbitrator, as the case may be. Provided that neither a change in the legal status of the Facility Provider nor a change in law as referred to in this sub paragraph above, will result in invalidating an existing award passed by an arbitral tribunal constituted pursuant to the provisions of this Agreement."
3. The Petitioner's case is that it had issued a loan of more than Rs. 6 crores to the Respondents- Balishtha E Tech Pvt. Ltd., Mr. Avjit Mitra vide Loan Agreement dated 28th October, 2020 which has not been repaid. As per the petition, a loan of around Rs.6 crores was extended to the Respondent No. 1 under the terms of the financial facilities that were agreed upon and sanctioned in 2017 as also in 2020. The petition states that the said loan was sanctioned vide sanction letter dated 24th October, 2020, which approved financial facilities amounting to Rs. 320 Lakhs in the form of a ARB.P. 133/2024 Page 2 of 5 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 08/05/2024 at 22:51:10 line of credit and Rs. 255 Lakhs in the form of a term loan.
4. The notice invoking arbitration was sent by the Petitioner on 15th November, 2022, however the same was not replied to by the Respondents.
5. Notice was issued in this matter on 31st January, 2024. In response, an email was received on 13th March, 2024 from Mr. Abijit Mitra, the sole proprietor, wherein he stated as under:
""1) I was detected with CKD (cronic kidney dieses) at 1st of MARCH 2020 and I was unable to continue my business.
2)From January 2021 for my survival Dialysis journey has started thrice in a week & continued up to May 2023.
3)My Kidney Transplant had happen 23rd of May 2023. (Discharge summary attached).
4)In December 2023 I was admitted in hospital due to virus infection(Discharge summary attached).
5)In January 2024 I was admitted to hospital due virus infection (Discharge summary attached).
6)I have handed over my entire office space to ADITYA BIRLA in 2022. The entire loan has been sanctioned against the office space.
7)As you know the security (property) value is creater than the loan value.
8)I wish ADITYA BIRLA will sale the property & squire off the matter.
9)And this is actually a loan extention & the extention amount of loan was not disbursed to us. This is actually a pareodic extention of time not the monetary extention.""
6. On the next date i.e., on 20th March, 2024, the Court directed as under:
"3. The Court has put a query to the Petitioner as to Whether the office space which is mentioned by the Respondent No.2, is in the possession of the Petitioner, ARB.P. 133/2024 Page 3 of 5 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 08/05/2024 at 22:51:10 to which the counsel submits in the affirmative. Let a competent official from the Petitioner-Company remain present in Court on the next date of hearing. The said official shall ascertain the market value of the property which is in possession of the Petitioner- company and make submissions on the next date of hearing as to the actual loan amount which is due from the Respondents and the market value of the property."
7. Valuation report of the mortgaged property, which is a property having three different addresses, is set out below:
Property Address As Per TRF Unit on Entire Second Floor, "Atindra Centenary Building", Premises No.14B, R.N. Mukherjee Road, P.O. - GPO, P.S. - Hare Street, Ward No.46, under Kolkata Municipal Corporation, City -
Kolkata, District - Kolkata, State - West Bengal, Pin Code - 700 001.
Property Address As Per Visit "Atindra Century Building", Unit on the entire 2nd Floor, 4B, R. N. Mukherjee Road, P.O. - GPO, P.S.
- Hare Street, Ward No.46, under Kolkata Municipal Corporation, City - Kolkata, District - Kolkata, State - West Bengal, Pin Code -
700 001.
Property Address As Per Docs Unit on Entire Second Floor, "Atindra Centenary Building", Premises No.14B, R.N. Mukherjee Road, P.O. - GPO, P.S. - Hare Street, Ward No.46, under Kolkata Municipal Corporation, City -
Kolkata, District - Kolkata, State -
West Bengal, Pin Code - 700 001.
Total Value 32000000 ARB.P. 133/2024 Page 4 of 5 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 08/05/2024 at 22:51:10 Distress Value 24000000 Insurance Value 0 Government Value Rs.2,46,96,752/- @ Rs.9010/- per sq. ft. as Commercial unit
8. Mr. Jahirul Islam Laskar, Regional Legal Manager of the Petitioner is physically present in Court today and submits that the valuation is of the same property but there is a slight difference in the address. As per the valuation report, the property is valued at Rs.3.20 crores. However, the distress value is Rs.2.40 crores. Auction is stated to have been conducted in December, 2023, but no bid was received.
9. According to the Petitioner, the total dues are more than Rs.6 crores. Under these circumstances, since the only reply of the Respondent is that the Petitioner ought to dispose of the property and disputes have arisen as even the sale is not fructifying, the Court is inclined to appoint an Arbitrator. Accordingly, Ms. Deepika Marwah, Senior Advocate (M:9810046917) is appointed as the Sole Arbitrator in the matter. If the property is auctioned during the arbitral proceedings, adjustment for the recovered amount, shall be given by the Arbitrator.
10. The arbitration shall take place under the aegis of the Delhi International Arbitration Centre (DIAC). The fee of the Arbitrator shall be paid as per Fourth Schedule under the 1996 Act as amended by the DIAC Rules, 2023.
11. List before the DIAC on 27th May, 2024.
12. Petition is disposed of.
PRATHIBA M. SINGH, J.
MAY 7, 2024/dk/ks ARB.P. 133/2024 Page 5 of 5 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 08/05/2024 at 22:51:10