INSTALMENT SUPPLY LIMITED Vs. RAM NARAIN SHARMA

JUDGEMENT

(1.) The present petition is filed under Section 20 of the Indian Arbitration Act, 1940 for filing the Arbitration Agreement dated 26th February, 1993 in Court and for an order for reference to the disputes between the parties to the named Arbitrator therein Shri Ramesh Chand, Advocate.

(2.) The petitioner is a Company incorporated under the Indian Companies Act, 1956 and has its registered office at 46, Janpath, New Delhi. It carries on the business of hire purchase of motor vehicles. It is further stated that Shri Krishen Bans Bahadur is the Managing Director of the petitioner Company and is duly authorised to sign and verify the plaint and to file the present petition. The petitioner, it is stated, on 26th February, 1993 on receipt of proposal from respondent No. 1 as hirer and respondent No. 2 as guarantor for hiring a Tata Diesel Bus Model LP/52 bearing Chassis No. 344 050 4 30956, Engine No. 692 D23 4 48013 and bearing Registration No. MP-06/B 0065 executed a Hire Purchase Agreement. By this agreement respondent No. 1 agreed to take the said vehicle on hire from the petitioner Company and respondent No. 2 agreed to stand guarantee for respondent No. 1 on the tern's and conditions contained in the said agreement. The liability of the guarantor is alleged to be co-extensive with that of respondent No. 1 to the petitioner Company. The agreement stipulated that respondent No. 1 agreed to pay 35 monthly instalments of Rs. 11,000.00 each falling due on the 15th day of each month beginning from 15th April, 1993. Therefore, the said respondent was given preliminary possession of the vehicle. The agreement is filed with the petition and is exhibited as Public Witness Public Witness 2 /1. The relevant clauses of the agreement are referred to in para 4 of the petition.

(3.) The broad facts are that respondent No. 1 paid only a sum of Rs. 33,000.00 towards hire money as against a sum of Rs. 3,24,500.00 payable by him under the abovesaid agreement upto the date on which the agreement was terminated by the petitioner by notice dated 2nd September, 1995. A balance of Rs. 2,91,500.00 was due and payable towards hire money and additional finance charges of Rs. 1,25,777.00 on delayed payment in terms of the said Agreement uptil September, 1995 was also payable. The petitioner overall claim a sum of Rs. 431,875.00. The averments are made in paragraph 5 of the petitioner which may be reproduce as follows: