The arbitral tribunal may require a party to provide appropriate security in connection with a measure ordered under sub-section: High Court Of New Delhi
The present appeal is directed against an order dated 17th April 2021 passed by the learned Arbitral Tribunal, on an application under Section 17 of the Arbitration and Conciliation Act, 1996 and the same issue was held in the judgement passed by a Single bench judge HON’BLE MR. JUSTICE C.HARI SHANKAR, in the matter DM SOUTH INDIA HOSPITALITY PRIVATE LIMITED & ORS V. L AND T FINANCE LIMITED dealt with an issue mentioned above.
In this case, the appellants had, in the application, sought a restraint against the respondent dealing with the shares pledged against advancing of a loan by the respondent to the appellants.
The learned Arbitral Tribunal had, vide order dated 8th June, ARB. A. (COMM.) 24/2021 2020 directed return of the pledged shares by the respondent to the appellants, against the appellants liquidating the dues of the respondent. Later that order was challenged before this Court by way of ARB A (Comm.) 14/2020.
Meanwhile, the appellants moved a fresh application under Section 17 of the 1996 Act, before the learned Arbitral Tribunal, which has come to be decided by the presently impugned order dated 17th April 2021. It was mentioned that Para 14 of the impugned order dated 17th April 2021, to which Mr Jayant Mehta, learned Senior Counsel draws the attention.
In Para 14 it was mentioned about, the undertaking by the ARB. A. (COMM.) 24/2021 appellants, to abide by the order to be passed by this Court in Arb A (Comm.) 14/2020 and a further undertaking that, were the respondent to succeed in the said appeal, it would be entitled to sell the pledged shares. The respondent has, as it transpires, not succeeded in Arb. A (Comm) 14/2020 which stands decided in the appellant’s favour vide judgment dated 8th November 2021.
Mr Mehta points out, therefore that the present appeal may be disposed of, based on para 14, by interdicting the respondent from dealing with the pledged shares pending the passing of the final award by the learned Arbitral Tribunal. He also submits that the final award stands reserved by the learned Arbitral Tribunal and that, therefore, it would be in the interests of justice that the respondent is directed to maintain the status quo.
Mr Chaturvedi, learned Counsel for the respondent, submits, very fairly, that given the order dated 8th November 2021, passed by this Court in Arb A (Comm.) 14/2020, his client would not be dealing with the pledged shares, pending the passing of the final award by the Arbitral Tribunal.
The court perused the facts and argument’s presented, it thought that- “In view thereof, the prayer in the appeal stands satisfied. ARB. A. (COMM.) 24/2021 Page 4 of 4 Recording the submission of Mr Chaturvedi and binding the respondent thereto, the appeal stands disposed of. I.A. 6630/2021 (ex-parte ad interim stay) & I.A. 6631/2021 (exemption) 13. Because of the order passed in Arb. A. (Comm) 24/2021, nothing survives in these applications. The applications are disposed of”.
Judgment reviewed by: Mandira BS