OM SAKTHI RENERGIES LIMITED Vs. MEGATECH CONTROL LIMITED

JUDGEMENT

(1.) THIS appeal is directed against the order of the learned single Judge in an application under Section 9 of the Arbitration and Conciliation Act, 1996 (for short 'the Act') making absolute the prohibitory order restraining the Garnishee, the second respondent in this appeal, from making any payment to the appellant.

(2.) THE appeal arises under the following circumstances: -

(3.) THE first respondent filed Application No. 4149 of 2004 before this court under Section 9 of the Act praying for a prohibitory order restraining the second respondent/garnishee from paying to the appellant the amounts, and consequently restraining the appellant from receiving monies and directing the second respondent to deposit the amount to the credit of the above application. According to the first respondent, there was an outstanding amount of Rs. 60. 50 lakhs payable by the appellant to the first respondent. The first respondent sent several letters demanding payment of monies, the receipt of which is not denied by the appellant. However, the appellant failed to pay the monies or replied to any of the letters. Further, according to the first respondent the appellant is in financial crisis. It owes more than Rs. 1. 6 crore to various persons and all its assets are encumbered.