AMBAJOGAI PEOPLES COOPERATIVE BANK LTD Vs. SHRIMAULI BUILDERS

JUDGEMENT

(1.) The Appeal in these proceedings is directed against an order of a Learned Single Judge dated 15th February, 2007, dismissing Judges Order 494 of 2006 filed by the Appellant for the payment to it of a sum of Rs.2.12 Crores deposited by the Second Respondent in an arbitration petition, along with the interest accrued thereon. The Appellant is a cooperative bank of which the First Respondent is a member. The Appellant had advanced monies to the First Respondent and upon a default committed by the First Respondent the Appellant instituted proceedings under Section 101 of the Maharashtra Cooperative Societies Act, 1960.

(2.) The Third Respondent to the Appeal had instituted two arbitration petitions (Arbitration Petitions 242 and 66 of 2005) against the First Respondent under Section 9 of the Arbitration and Conciliation Act, 1999 for interim relief pending arbitral proceedings. The Appellant was not a party to the arbitral agreement. On 16th July, 2005 an order was passed in Arbitration Petition 242 of 2005 by which the Second Respondent (The Banglore Water Supply and Sewerage Board) was directed to deposit in this Court a sum of Rs.2.12 Crores owed by the Second Respondent to the First Respondent. The Second Respondent deposited the amount in compliance with the order of the Court. By an order dated 7th March, 2006 the arbitration petitions were finally disposed of by a direction pursuant to which the First Respondent was permitted to withdraw the amounts by furnishing a bank guarantee of a nationalized bank within a period of eight weeks, failing which the amount was to be invested in a nationalized bank. The First Respondent did not withdraw the amount which accordingly is stated to have been invested in terms of the order. The arbitral proceedings between the First and Third Respondents are pending.

(3.) Upon the issuance of a recovery certificate in favour of the Appellant on 14th September, 2006, the Appellant filed a Judges Order (Judges Order 494 of 2006) before the Learned Single Judge for a direction that the amount deposited by the Second Respondent in this Court be paid over to the Appellant in partial satisfaction of the decree. In the meantime, the Fourth Respondent had in arbitral proceedings against the First Respondent secured in its favour an award for a sum of Rs.91,61,727.42. In execution, the Fourth Respondent filed Chamber Summons 530 of 2005 and 124 of 2007 inter alia for an order directing a disclosure of assets by the First Respondent; an order restraining the First and Third Respondents from withdrawing the amounts deposited in Court by the Second Respondent and for an order permitting the Fourth Respondent to withdraw the amounts deposited towards satisfaction of the award in favour of the Fourth Respondent.