ARVIND V. SHETH Vs. MAHENDRA MOHANLAL JAIN

JUDGEMENT

(1.) By this petition, filed under section 34 of the Arbitration & Conciliation Act, 1996 (for short "the Arbitration Act"), the petitioners have impugned the arbitral award dated 1st December, 2017 passed by the learned arbitrator directing the petitioners to pay a sum of Rs.1,37,70,861/- along with further interest at the rate of 18% p.a. from the date of filing of the statement of claim till realization and costs of the arbitration in the sum of Rs.10,00,000/-.

(2.) There is no dispute between the parties that under the Memorandum of Understanding dated 14th June, 2007 entered into between the petitioners and the respondent, the petitioners were appointed as the sole selling agents for a project of the respondent on the terms and conditions recorded in the said Memorandum of Understanding. Clause 7 of the said Memorandum of Understanding provided that the respondent to pay a sum of Rs.2,00,000/- per month to the petitioners and if the project of the petitioners does not start or whatsoever situation arises and the project is not going for any reason, the petitioners would be entitled to recall the entire amount whatever is paid by the respondent by the respondent to the petitioners to the respondent with 12% p.a. simple interest to be calculated within three months from the expiry of 36 months. Clause 9 of the Memorandum of Understanding provided that till the project was not finalized and could not get any concrete platform till then, whatever amount given by the respondent to the petitioners for prelaunch preliminary expenditure to the petitioners would be calculated as a deposit / loan amount in the account.

(3.) It is not in dispute that the respondent paid a sum of Rs.72,00,000/- plus Rs.4,50,000/- to the petitioners. It is also not in dispute that the project of the petitioners did not commence.