CHEMFLO INDUSTRIES PVT. LTD Vs. KMC CONSTRUCTION LTD.

JUDGEMENT

(1.) Mr. Pal, learned advocate appears on behalf of petitioner. He submits, impugned is order dtd. 13/3/2015 passed on the interlocutory application of his client made in arbitration petition (ARBP no. 122 of 2013), of purported challenge of opposite parties to award dtd. 29/1/2011. He submits, by the application his client raised issue of maintainability of the challenge. The ground was regarding 75% deposit as pre-condition for admission of the appeal, mandated by sec. 19 in Micro, Small and Medium Enterprises Development Act, 2006. The Court below rejected the demurrer application on erroneous consideration of fact that already Rs.10,000,00.00 had been realized by his client in the execution proceeding pending in the Court of Principal District Judge at LB Nagar, Hyderabad.

(2.) Mr. Pal relies on view taken by a learned Single Judge in the High Court of Madras on judgment dtd. 21/3/2013 in O.P. no.888 of 2010 (Goodyear India Ltd. v. Nortan Intec Rubber (P) Ltd. and others). A passage from paragraph-9 ( print) is extracted and reproduced below.

(3.) Mr. Pal submits, there can be no dispute that 75% of awarded amount, required to be deposited for admission of challenge to the award, has to be 75% of the aggregate principal and interest. He relies on sec. 16 in the 2006 Act, which mandates that the buyer is liable to pay compound interest with monthly rests on the amount from, inter alia, the appointed day at three times of the bank rate notified by the Reserve Bank. He submits, on date of presentation of the appeal, the aggregate amounted to Rs.55,40,217.00. His client though had realized Rs.10,00,000.00 in execution, further deposit had to be made, of an amount in excess of Rs.5,00,000.00 deposited by opposite parties, for the appeal to be admitted. The Court below acted illegally and with material irregularity in rejecting his client's demurrer application. He seeks interference.