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2013 (12) TMI 32 - HC - Companies LawReferral to be made to Arbitrator u/s 8 of Arbitration and Conciliation Act, 1996 - Failure to make payments under the agreement Failure to execute the personal guarantee Held that:- The Plaintiff is correct in contending that once the specific performance is ordered in their favour, the Court in the very same suit can grant enforcement of the mortgage - The suit is a composite suit including for enforcement of the mortgage - Those composite reliefs together form the subject matter of the suit - the relief for enforcement of the mortgage is not arbitrable as such relief affect the rights of third parties who are not parties to the Arbitration Agreement. Relying upon Booz Allen and Hamilton Inc. Versus SBI Home Finance Ltd. & Others [2012 (10) TMI 459 - SUPREME COURT] - mere Agreement to sell or an Agreement to mortgage does not involve any transfer of right in rem but creates only a personal obligation - if only specific performance is sought either in regard to an Agreement to sell or an Agreement to mortgage, the claim for specific performance will be arbitrable - A suit on mortgage is not a mere suit for money - A suit for enforcement of a mortgage being the enforcement of a right in rem, will have to be decided by the courts of law and not by the Arbitral Tribunal the Suit filed by the Plaintiffs seeking both specific performance and enforcement of the mortgage, being a right in rem, will have to be decided by this Court and not by an Arbitral Tribunal - the subject matter being enforcement of the mortgage is not arbitrable and Reference under Section 8 of the Arbitration Act cannot be directed. Part referral to Arbitration u/s 8 of Arbitration and Conciliation Act, 1996 Held that:- It would be difficult to give an interpretation to Section 8 under which bifurcation of the cause of action that is to say the subject matter of the suit or in some cases bifurcation of the suit between the parties who are parties to the arbitration agreement and others are possible - This would be laying down a totally new procedure not contemplated under the Act - If bifurcation of the subject matter of a suit was contemplated, the legislature would have used appropriate language to permit such course - there is no such indication in the language Thus, bifurcation of the subject matter of an action brought before a judicial authority is not allowed Decided in favour of Plaintiff.
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