FEDERAL AGENCY FOR STATE PROPERTY MANAGEMENT OF RUSSIAN FEDERATION (ROSEMUSHESTVO) Vs. SARAF AGENCIES PVT LTD

JUDGEMENT

(1.) This is a post-interim award application under Section 9 of the Arbitration and Conciliation Act, 1996 (in short "the Act of 1996"), at the instance of The Federal Agency for State Property Management of The Russian Federation (Rosemushestvo), the respondent no. 1 in the arbitral proceeding.

(2.) The brief facts relevant for the decision in this application are that the disputes having arisen between the respondent nos. 1 and 2 in this application on the one hand and the petitioner and the proforma respondent on the other hand, relating to a joint venture agreement dated January 29, 2008 the same were referred to an Arbitral Tribunal comprising three retired Judges of the Supreme Court. In the arbitral proceeding the respondent nos. 1 and 2 herein, as the claimants raised various claims against the petitioner and the proforma respondent. The petitioner has been contesting the claims of the respondent nos. 1 and 2 in the arbitral proceeding. In its counter statement filed in the arbitral proceeding the petitioner also raised various counter-claims against the respondent nos 1 and 2. In its fifth counter-claim the petitioner claimed for refund of an amount of Rs. 135.13 crores by the present respondent no. 1, to the account of Titainium Products Pvt. Ltd. (hereinafter to referred to as "TPPL"), the joint venture company formed under the joint venture agreement. Before the learned Arbitral Tribunal, the petitioner also filed an application under subSection (5) of Section 31 of the Act of 1996 for an interim award in support of its said fifth counterclaim, which was contested by the respondent no. 1. On October 14, 2016 the learned Arbitral Tribunal allowed the said application of the petitioner and passed an interim award directing the respondent no. 1 claimant to pay Rs. 135.16 crores to the account of TPPL within one month, failing which the same shall bear interest at the rate of 24%, per annum.

(3.) Since the respondent no. 1 did not make any payment in terms of the said interim award dated October 14, 2016 and when the statutory period under Section 34 of the Act of 1996 for challenging the said interim award had not expired, the petitioner filed an application A.P. No. 1013 of 2016, under Section 9 of the Act of 1996, before this Court for various reliefs against the respondent no. 1. In the said application, on November 29, 2016 a learned Single Judge of this Court passed an interim order directing the respondent no. 1 not to alienate, encumber and/or create any third party interest over its fixed assets and properties. By an order dated February 22, 2017 the said interim order was directed to continue till vacated. In the meantime, the respondent nos. 1 and 2 filed an application, A.P. No. 1038 of 2016, under Section 34 of the Act of 1996 for setting aside of the said interim award dated October 14, 2016. By an order dated March 24, 2017 a learned Single Judge of this Court admitted the said application of the respondents and held that since in the present case, the arbitral proceeding had commenced before October 23, 2015 in order to obtain stay of operation of the said interim award dated October 14, 2016 the respondent nos. 1 and 2 are not required to file any separate application or furnish any security. During the pendency of the first application, A.P. No. 1013 of 2016 the petitioners have filed this second application, under Section 9 of the Act of 1996 for an order directing the respondent no. 1 to deposit Rs. 135,16,92,947.73/- in cash before this Court to be put in an interest bearing account held by the Registrar, Original Side of this Court.