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Delhi District Court

K K Motors vs Bimlesh Kumar on 26 November, 2019

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             IN THE COURT OF SH. SANATAN PRASAD,
             ADDITIONAL DISTRICT JUDGE­01, (EAST),
                 KARKARDOOMA COURTS, DELHI.

Suit No. 60/19
In the matter of :­

K K MOTORS,
REGD. OFFICE ­451,
JHEEL KHURENJA,
GEETA COLONY,
DELHI­110051,

THROUGH
AUTHORIZED REPRESENTATIVE
SH. YOGESH LAL RAJORA                                 ...Petitioner.

Versus.

BIMLESH KUMAR,
S/O AVADH BIHAR,
R/O HOUSE NO. J, B­37,
KARTAR NAGAR­III,
PUSHTA, NORTH EAST,
DELHI­110053.                                     ....Respondent.

                                ORDER

Present:­ Ms. Sonia Rajput proxy for Sh. Vishal Khanna furnishes the address form in respect of Recovery manager/Receiver and also submits that Arbitration Proceedings has not been commenced and arbitrator has not been appointed so far.

1. The present petition has been filed by the petitioner under Section 9 of the Arbitration and Conciliation Act seeking appointment of receiver to take possession of vehicle TSR Auto OMP NO. 60/19 K K MOTORS VS BIMLESH KUMAR DOD : 26.11.2019 Page No.1 2 Riksha, bearing Registration No. DL­1R­N­9437, Chasis No. MD2AAAFZZTWB05549, Engine No. AFBMTB002210 which stood hypothecated with the petitioner.

2. Case of the petitioner is that the petitioner is a company, carrying on business of hire­purchase of vehicle/TSR and Sh. Yogesh Lal Rajora is duly authorized to sign, verify and institute the petition on behalf of the petitioner company. On 10.12.2018 the respondent approached the petitioner for purchase of vehicle bearing registration No. DL­1R­L­9437 and the petitioner financed the same to respondent. An agreement of loan­cum­ hypothecation, dated 28.01.2019 was executed between the petitioner and the respondent. Under the agreement, it was agreed that the respondent would hypothecate and create first charge over the said vehicle in favour of the petitioner company, as such, the vehicle stood surety for due performance of the agreement. Under the agreement, petitioner disbursed a sum of Rs.2,20,000/­ (Rupees Two Lakhs, Twenty Thousand only) to the respondent, which was to be repaid by the respondent in 36 equal monthly installments of Rs.9044/­, commencing from 10.01.2019. It is claimed that the respondent failed/avoided/adhered to make the payment, as per schedule and after lapse of four months, respondent has paid only one installment. It is stated that as on date, respondent is liable to pay a sum of Rs.54264/­ and he has failed to pay or remit the amount despite due service of the legal notice dated 11.10.2019. The petitioner is having apprehension that respondent is contemplating to shift the vehicle elsewhere.

OMP NO. 60/19

K K MOTORS VS BIMLESH KUMAR DOD : 26.11.2019 Page No.2 3 The agreement entered into between the parties contains arbitration clause/(s) No.10.14, which the petitioner intends to invoke. The petitioner has prayed for appointment of Sh.Yogesh Lal Rajora, Authorized Representative of the petitioner, as 'RECEIVER' to take possession of vehicle i.e. bearing Registration No. DL­1R­N­9437, Chasis No. MD2AAAFZZTWB05549, Engine No. AFBMTB002210.

3. It has been argued by the ld. counsel for the petitioner that the balance of convenience lies in favour of the petitioner and if the 'RECEIVER' is not appointed, irreparable loss would be caused to it, as there is apprehension that the respondent may disposed of the vehicle. It is further argued that there is no necessity to issue notice to the respondent, as this stage, and ex­ parte order, regarding appointment of 'RECEIVER' can be straightway passed. In support of arguments advanced, judgment in case of GE Capital Transportation Financial Services Ltd. v. Raj Tours Private Ltd. Reported as 159(2009) DLT 440 has been relied, in which, the Hon'ble High Court had appointed the 'RECEIVER' to take the possession of the vehicle, as the respondent had failed to make the payment of the installments. Another judgment relied is in the case of Jai Singh v. IndusInd Bank Ltd., reported as MANU/DE/4655/2009, in which the order of Ld. Trial Court for appointment of 'RECEIVER' was upheld. Another judgment relied upon is in the case of Sundaram Finance Ltd. v. NEPC India Ltd., reported as (1999) 2 SCC 479, wherein, it has been held that interim order can be sought from the Court, OMP NO. 60/19 K K MOTORS VS BIMLESH KUMAR DOD : 26.11.2019 Page No.3 4 even before commencement of the proceedings. It was further held that Court is not debarred from dealing with the application under Section 9 of the Arbitration & Conciliation Act, merely, because, no notice has been issued. Next, judgment is in the case of Citicorp Finance (India) Ltd. v. Neeraj Jain & Anr., (FAO 283/2005, DOD : 20.09.2005, by Hon'ble High Court of Delhi), in which, it was held that delay occasioned due to issuance of notice, thereby, preponement of interim protection, to which, the appellant appears entitled, is likely to defeat the object of filing of the petition. It was held that the Ld. Trial Court ought to have passed an ex­parte order, appointing a receiver to secure possession of the vehicle.

4. Perusal of agreement shows that the vehicle in question can be repossessed by the petitioner, as per Article 6.1(ii) in case of default by the respondent. As per judgment Sundaram Finance, (supra), and Citicorp Finance (India) Ltd., (supra), there is no requirement of issuance of notice to the respondent before passing an ex­parte order. An ex­parte order for appointment of 'RECEIVER' can be passed without issuance of such notice to the respondent.

5. Accordingly, in view of the aforesaid judgments and facts and circumstances of the case, a balance of convenience lies in favour of the petitioner and in case exparte order, regarding appointment of 'RECEIVER' is not passed, it would cause irreparable loss to the petitioner. In case exparte 'RECEIVER' is OMP NO. 60/19 K K MOTORS VS BIMLESH KUMAR DOD : 26.11.2019 Page No.4 5 not appointed, there is likelihood of disposal of hypothecated vehicle by the respondent and that its value may depreciate day by day. Consequently, I, hereby, appoint Sh. Sunil Kumar S/O Sh. Kiran Pal, Assistant Manager of the petitioner company, R/O H. No. D­21/28B, Gali No.2, D­Block, Vijay Colony, Delhi­ 110053 as 'RECEIVER' with directions to take possession of vehicle bearing Registration No. DL­1R­N­9437, Chasis No. MD2AAAFZZTWB05549, Engine No. AFBMTB002210, from the respondent or any other person found in possession thereof. 'RECEIVER' is authorized to take appropriate police assistance, if required. However, the vehicle shall not be sold till further order of the Court and the vehicle shall not be repossessed if the respondent pays the entire dues amounting to Rs.54264/­ against issuance of valid receipts to the respondent.

6. The petitioner is directed to refer the matter to the Arbitrator within three weeks. The petitioner is further directed not to transfer the possession as well as title of the vehicle in question. Compliance report regarding status of vehicle and appointment of Arbitrator be filed within three weeks. In case, vehicle is repossessed, compliance report be filed immediately after its repossession, failing which, interim order shall stand vacated.

7. In case, vehicle is repossessed, 'RECEIVER' shall report to the local police station and shall submit the compliance report before this Court within three days of the repossession of the OMP NO. 60/19 K K MOTORS VS BIMLESH KUMAR DOD : 26.11.2019 Page No.5 6 vehicle in question. The copy of the order be given to the 'RECEIVER' on his furnishing complete details of his residence, contact number etc. alongwith proof.

8. The receiver shall take over the possession of the vehicle from the respondent at the address(es) given in the loan application. If the vehicle is not available at the said address(es), the receiver shall be at liberty to recover the vehicle wherever found. However, the receiver shall not stop a running vehicle on the road to forcibly take out the driver to take the possession of the vehicle. The receiver shall also not make any attempt to block the passage of the vehicle to bring it to a halt to take its possession.

9. The receiver shall avoid taking the possession of the vehicle, if the vehicle is occupied by a woman who is not accompanied by a male member or an elderly, infirm or physically/mentally challenged person. In such cases, the receiver shall take the possession of the vehicle from the borrower's residence.

10. The receiver shall be at liberty to take the assistance of the local police, if required, for taking over possession of the vehicle. The concerned SHO shall provide assistance to the receiver as and when requested.

11. The receiver shall also ensure that the repossession of the vehicle does not result in any breach of peace. In the event of any breach of peace, the receiver shall not proceed without assistance of OMP NO. 60/19 K K MOTORS VS BIMLESH KUMAR DOD : 26.11.2019 Page No.6 7 police.

12. At the time of taking the custody of the vehicle, the receiver shall deliver a copy of this order to the person from whom the possession it is taken.

13. At the time of taking the custody of the vehicle, the receiver shall take the photographs of the vehicle from different angles alongwith the person(s) occupying the vehicle as well as the place of taking over the possession.

14. The receiver shall remain personally present at the time of seizure of the vehicle and shall prepare and inventory of the articles/accessories found in the vehicle and shall furnish the copy of the inventory to the person from whom the possession is taken. The exact date and time of the seizure shall also be noted down and copy of the seizure memo shall be supplied to the respondent or his representatives at the spot itself. Before taking possession of the vehicle, the respondent shall be permitted to remove his belongings, if any from the vehicle.

15. After taking the vehicle in possession, the receiver shall keep the vehicle in safe custody for which the petitioner shall make appropriate arrangements at his own cost, risk & responsibility.

16. The maximum period for which this order shall remain effective is 90 days, i.e., Maximum time granted by this Court to the OMP NO. 60/19 K K MOTORS VS BIMLESH KUMAR DOD : 26.11.2019 Page No.7 8 applicant/petitioner under Section 9(2) of the Arbitration & Conciliation (Amendment) Act, 2015 and the Arbitral Proceedings shall be commenced within a period of 90 days from the date of this order.

17. The respondent/ borrower is at liberty to approach the office of the Ld. Arbitrer Tribunal for issuance of any interim measure of protection to safe guard his interest in accordance with the provisions of Arbitraion & Conciliation Act 2015.

Be consigned to Record Room.

Announced in the open Court on 26.11.2019 ( Sanatan Prasad ) Additional District Judge­01 (East)/KKD/Delhi /26.11.19 OMP NO. 60/19 K K MOTORS VS BIMLESH KUMAR DOD : 26.11.2019 Page No.8