Delhi High Court - Orders
Indiabulls Housing Finance Ltd. & Anr vs Shipra Leasing Pvt. Ltd on 2 September, 2022
Author: Anup Jairam Bhambhani
Bench: Anup Jairam Bhambhani
$~41-43
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ ARB. A. (COMM.) 61/2022 & CAV 263/2022, I.A.14170/2022,
I.A.14171/2022, I.A.14172/2022
INDIABULLS HOUSING FINANCE LTD. & ANR...... Petitioners
Through: Mr. Rajiv Nayar, Senior Advocate
with Mr. Rishi Agrawala, Mr. Karan
Luthra, Mr. Ankit Banati, Mr.
Shravan Niranya and Mr. P.
Bahuguna, Advocates.
versus
SHIPRA LEASING PVT. LTD. ..... Respondent
Through: Mr. Abhimanyu Bhandari with Ms.
Gauri Rishi, Ms. Srishti Juneja, Ms.
Garima Sehgal and Ms. Nandita
Rathi, Advocates.
+ ARB. A. (COMM.) 62/2022 & CAV262/2022, I.A.14173-75/2022
INDIABULLS HOUSING FINANCE LTD. & ANR...... Petitioners
Through: Mr. Rajiv Nayar, Senior Advocate
with Mr. Rishi Agrawala, Mr. Karan
Luthra, Mr. Ankit Banati, Mr.
Shravan Niranya and Mr. P.
Bahuguna, Advocates.
versus
SHIPRA HOTELS LTD ..... Respondent
Through: Mr. Abhimanyu Bhandari with Ms.
Gauri Rishi, Ms. Srishti Juneja, Ms.
Garima Sehgal and Ms. Nandita
Rathi, Advocates.
+ ARB. A. (COMM.) 63/2022 & CAV261/2022, I.A.14176-78/2022
INDIABULLS HOUSING FINANCE LTD. & ANR...... Petitioners
Through: Mr. Rajiv Nayar, Senior Advocate
with Mr. Rishi Agrawala, Mr. Karan
Luthra, Mr. Ankit Banati, Mr.
Shravan Niranya and Mr. P.
Bahuguna, Advocates.
Signature Not Verified
Digitally Signed
By:SUNITA RAWAT
Signing Date:06.09.2022 ARB. A. (COMM.) Nos. 61-63/2022 Page 1 of 4
17:24:15
versus
SHIPRA ESTATE LTD. ..... Respondent
Through: Mr. Abhimanyu Bhandari with Ms.
Gauri Rishi, Ms. Srishti Juneja, Ms.
Garima Sehgal and Ms. Nandita
Rathi, Advocates.
CORAM:
HON'BLE MR. JUSTICE ANUP JAIRAM BHAMBHANI
ORDER
% 02.09.2022 By way of the present appeals under section 37(2)(b) of the Arbitration & Conciliation Act, 1996 ('A&C Act' for short) the petitioner impugns common order dated 30.08.2022 made by the learned Sole Arbitrator in three separate, but connected, arbitration proceedings, whereby on an application under section 17 of the A&C Act filed by the respondent, the learned Sole Arbitrator has prohibited the petitioner from confirming the sale of the property known as 'Shipra Mall' in Ghaziabad ('Mall Asset') owned by the respondent, thereby interdicting proceedings initiated by the petitioner against the Mall Asset under the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 ('SARFAESI Act' for short).
2. Mr. Rajeev Nayar, learned senior counsel appearing for the petitioner has taken the court through the impugned order and has inter-alia highlighted the following aspects, on which the impugned order proceeds:
Signature Not Verified Digitally Signed By:SUNITA RAWAT Signing Date:06.09.2022 ARB. A. (COMM.) Nos. 61-63/2022 Page 2 of 4 17:24:15a. The learned Sole Arbitrator has directed that order dated 11.06.2022 made earlier in the arbitral proceedings, which was subject matter of previously instituted proceedings before this court, shall continue to apply, ignoring the fact that the earlier petitions bearing ARB. A. (COMM.) Nos. 36/2022, 37/2022 and 38/2022 filed before this court were withdrawn only on the premise that since the petitioner had issued a fresh sale notice, order dated 11.06.2022 which applied to an earlier sale notice, had become infructuous;
b. The learned Sole Arbitrator has held that section 34 of the SARFAESI Act only bars the jurisdiction of 'civil courts' from entertaining any suits or proceedings in respect of any matter with which the Debt Recovery Tribunal or the Appellate Tribunal are concerned under the SARFAESI Act; and that the said provision does not bar proceedings before an arbitral tribunal;
c. While observing that arbitration proceedings are not in derogation of the SARFAESI Act, since they precede any action under that special statute, the learned Sole Arbitrator has at the same time prohibited the petitioner from confirming the sale of the Mall Asset through subsequent auction proceedings; d. The learned Sole Arbitrator has also erroneously applied the law as laid down in M.D. Frozen Foods Exports (P) Ltd. And Ors. vs. Hero Fincorp Ltd. 1 , which had relied upon HDFC 1 (2017) 16 SCC 741 Signature Not Verified Digitally Signed By:SUNITA RAWAT Signing Date:06.09.2022 ARB. A. (COMM.) Nos. 61-63/2022 Page 3 of 4 17:24:15 Bank Ltd. vs. Satpal Singh Bakshi2, without appreciating that the principle applied by him has subsequently been overruled in Vidya Drolia vs. Durga Trading Corpn.3;
e. The learned Sole Arbitrator has also ignored the fact that proceedings for issuance of a sale notice under the SARFAESI Act are proceedings in-rem over which an arbitrator has no jurisdiction.
3. Upon a prima-facie view of the foregoing, issue notice.
4. Learned counsel appearing for the respondent on advance copy accepts notice; and seeks time to make detailed submissions in the matter.
5. Learned counsel for the parties are directed to file written synopses of their respective submissions, not exceeding 03 pages, along with a list of judicial precedents they seek to rely upon; with copies to the opposing counsel.
6. Re-notify for hearing on 14th September 2022.
ANUP JAIRAM BHAMBHANI, J SEPTEMBER 2, 2022 ds 2 2012 SCC OnLine Del 4815 3 (2021) 2 SCC 1 Signature Not Verified Digitally Signed By:SUNITA RAWAT Signing Date:06.09.2022 ARB. A. (COMM.) Nos. 61-63/2022 Page 4 of 4 17:24:15