TMI Blog2009 (11) TMI 981X X X X Extracts X X X X X X X X Extracts X X X X ..... is confined to the distribution of sale proceeds of US$ 550,000. This submission of Mr. Singh also finds reflection in the order dated 25. 05. 2008 passed by the Bench then hearing the appeal. The order dated 22. 05. 2008, inter alia, recorded: mr. V. P. Singh, Sr. Advocate, on instructions, on behalf of respondent no. 1 states that it is the respondent's contention that the subject matter of the dispute before the Arbitrators was only the dispute with regard to half a million dollars sale consideration of the house in Kabul and no more. ( 4. ) We were shown the arbitration agreement entered into between the parties on 29. 08. 2009. The same, inter alia, provided: by this letter, we, each one of us, Nirmal Singh, Harinder Singh, kirat Singh all sons of Amar Singh agree in regard to the money from the sale of Wazir Akbar Khan House the value of which is five hundred fifty thousand US Dollars until the arbitration/settlement of accounts be kept in the custody of the following: 1. With Harinder Singh three hundred thousand US Dollars 2. With Kirat Singh two hundred fifty thousand US Dollars. The expenses of sale deed based on documentary proof, be borne by kirat Sing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8. 2002 postulated as follows: by this letter, we, each one of us, Nirmal Singh, Harinder Singh, kirat Singh all sons of Amar Singh agree in regard to the money from the sale of Wazir Akbar Khan House the value of which is five hundred fifty thousand US Dollars until the arbitration/settlement of accounts be kept in the custody of the following: 1. With Harinder Singh three hundred thousand US Dollars 2. With Kirat Singh two hundred fifty thousand Dollars. it is not in dispute that the sum of USD 300,000 has not been kept in the custody of the appellant Harinder Singh during the pendency of the arbitration proceedings, or thereafter. It is also not in dispute that the said amount is with the respondents. It is stated that the said amount was received late due to some intervention by the appellant Harinder singh in the completion of the sale transaction of the property in Kabul. The respondent is directed to bring the aforesaid sum of USD 300,000 or its converted equivalent rupees and deposit the same in Court not later than eight weeks from today. The respondents shall also file an affidavit supported by documentary evidence to show as and when the said amount of USD 550,000 was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d asserting that he also has 1/4th share in the said property. Due to this illegal assertion by respondent No. 1, Mr. Rajinder Singh did not complete the transaction and pay the balance sale consideration. The Respondent No. 1 Mr. Harinder Singh also claimed that since the company namely Omega exports Pvt. Ltd. was his company, the shares in the same were held benami by petitioner No. 2 and late S. Manmeet Singh and they were merely name lenders and they should return the same to him with nil value. ( 11. ) Mr . Sethi submits that as the said amount of US4 550,000 had not been received by respondent No. 2, there could be no direction issued by the court to the respondents to deposit US$ 300,000 in this Court. ( 12. ) Mr . V. P. Singh, learned senior counsel also appearing for the respondents, has now sought to urge that the order dated 12. 01. 2009 as corrected on 06. 02. 2009 is per incuriam, inasmuch as, it has been passed in ignorance of Section 4 of the Act. He submits that the appellant was aware of the fact that the amount of US$ 550,000 had to be kept in custody of the parties in terms of the arbitration agreement above extracted. He was also aware that the amount ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lled mistake in the recording of the order dated 12. 01. 2009, in so far as it proceeded on the basis that the amount of US$ 550,000 had been received by the respondents and that the said amount was in the custody of the respondents. ( 15. ) Mr . Patwalia further submits that in response to the aforesaid averment made by the respondents in their objection petition, the appellant had, inter alia, stated it is wholly incorrect to state that S. Avtar Singh entered into an agreement with the Petitioners. It is also false that S. Rajinder Singh sold the property to an Hon'ble Judge in Kabul on 15% commission. The said property in fact has been sold by S. Rajinder Singh to one Ahmed Zia who is at present Afghan Ambassador to Russia. The respondent has been able to obtained certificate from the office of the municipal Corporation of Kabul, certifying that the said property was transferred one year back in the name of Ahmed Zia, under two sale deeds and currently the property is in the occupancy of South Korean Embassy. A true copy of the certificate along with photograph of the property is annexed hereto as Annexure R/3 (Colly) . In their rejoinder to the said averment of the appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in with them in their custody only ; and (vi) amount of US$ 300,000 be transferred in the account of S. Harinder Singh within 15 days. ( 18. ) Mr . Patwalia submits that all the aforesaid obligations had been undertaken only in view of the fact that the amount of US$ 550,000 had already been received by the respondents. ( 19. ) Having heard learned counsel for the parties, we are of the view that there is absolutely no merit in this application. Firstly, we may note that when the order dated 12. 01. 2009 was passed, though the presence of the parties was not recorded in the order sheet, as a matter of fact the parties were present in Court. Since Mr. V. P. Singh, learned senior counsel appearing for the respondents had also appeared on the said date as the respondents' counsel, we apprised him of the aforesaid position. He has not denied the fact that his clients were indeed present in the Court when the order dated 12. 01. 2009 was passed by us. This is also evident from our order dated 12. 01. 2009. The submission that the amount had been received late was made by the respondents during the course of hearing on 12. 01. 2009 on the instructions of the respondents who wer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the objection petition. ( 22. ) A perusal of the arbitration agreement itself shows that the same had been arrived at keeping in view of the fact that the amount of US$ 550,000 had been received by the respondent S. Kirat Singh. Else there was no question of the parties agreeing to the keeping of the amount of US$ 300,000 in the custody of the appellant, which had to be transferred by S. Kirat Singh in favour of the appellant within a short period of 15 days. The agreement did not recite that the same was subject to the respondents receiving the amount of US$ 550,000 or that the same had not been received by the respondent S. Kirat Singh till the time of signing of the agreement. ( 23. ) Even according to the respondents, the only dispute in arbitration was with regard to the distribution of US$550,000. This question had not arisen in a vacuum or merely on a hypothetical basis that the said amount would be received in future. ( 24. ) We may also note that though the award does return a factual finding that the respondent S. Kirat Singh had received and pocketed the amount of US$ 550,000, no specific objection in respect of the said finding was taken by the respondents in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dvantage being enjoyed by the respondents, who continue to hold the entire amount of US$ 550,000, even though, as per the agreement dated 29. 08. 2002 the amount of US$ 300,000 had to be transferred to the appellant and was to remain his custody till the resolution of the disputes. Where is the incentive for the respondents to settle their disputes with the appellant? The fact that the respondents are enjoying the custody, and possibly the gainful use and exploitation of the entire amount of US$ 500,000, in our view is a stumbling block to a fair and equitable resolution of the disputes between the parties who are brothers. ( 29. ) Section 9 of the Act (which could be invoked on 12. 01. 2009 as the appeal was even then pending) not only entitles a party to apply to the Court for an interim measure of protection in respect of preservation, interim custody of the subject matter of the arbitration agreement and to secure the amount in dispute in arbitration , but also goes on to say and the Court shall have the same power for making orders as it has for the purpose of, and in relation to, any proceedings before it. The power of the Court to suo moto pass orders in terms of Se ..... X X X X Extracts X X X X X X X X Extracts X X X X
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