P D KHANNA Vs. ASHWANI KHANNA

JUDGEMENT

(1.) This is an application filed on behalf of the Bank of India (hereinafter called the 'applicant bank') which is seeking an order for allowing it to appropriate a sum of Rs.67,46,090.47 paisa + Rs. 19,65,086.93 paisa outstanding in the account of M/s Prem Engineering Works and M/s Okhla Ice & Food Products respectively.

(2.) It may be mentioned that OMP 93/99 is the petition filed under Section 34 of the Arbitration & Conciliation Act, 1996 (for short 'Act'). By means of this petition, petitioners have filed objections to the award dated 1/1/1999 passed by Sh.Navin Pal Singh Bhandari, who was appointed as the sole Arbitrator. Vide this award the Arbitrator has decided certain disputes between the parties who are related to each other. These parties which form five Groups and are described as Groups A, B, C, D & E were doing various businesses in different names and styles. Some of these business firms had taken loans from various banks. Two such business units namely M/s Prem Engineering Works and M/s Okhla Ice and Food Products being run by these Groups had taken loans from the applicant bank. These loans were secured by mortgaging of properties situated at Plot No.18, C-7 and C-8 Okhla Industrial Area, Delhi. As the advances/loans were not repaid the applicant bank filed two suits for recovery of money in this court which were subsequently transferred to the Debt Recovery Tribunal. On 15/06/1998 suit against M/s Prem Engineering Works was decreed in the sum of Rs.21,52,047.97 paisa with interest at the rate of 19.5 per cent per annum to be calculated from the date of filing of the suit till realisation. On 19/06/1998 the Recovery Officer issued a notice to the aforesaid Groups of the family to pay a sum of Rs.69,78,015.54 paisa to the applicant bank on or before 21/07/1998. As the amount was still not paid the Recovery Officer attached the mortgaged property situated at Plot No. 18, C-7 and C-8, Okhla Industrial Area, Delhi by order dated 30/10/1998. Thereafter by another order dated 16/4/1999 the Recovery Officer directed the sale of the aforesaid mortgaged property on 27/05/1999, Thus in normal course the applicant bank would have realised the amount payable to under the decree by sale of the aforesaid mortgaged property. However, in the meantime the aforementioned arbitration proceedings started which resulted into family settlement and impugned award in terms of family settlement was passed which is the subject matter of the challenge in the main OMP.

(3.) Certain proceedings which took place in this OMP stalled the sale of the aforesaid mortgaged property. This was done by mutual consent of all the parties and being relevant for the disposal of present application, it would be appropriate to take note of these proceedings at this stage.