Siemens Financial Services Pvt Ltd vs Nadeem Ahmad Khandey Sole Proprietor Ms Moumin Polyclinic And Diagnostic Centre And Ors

CNR No : HCBM020250532026

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AGK
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
IN ITS COMMERCIAL DIVISION
COMM ARBITRATION PETITION (L) NO.25053 OF 2026
Siemens Financial Services Private Limited
… Petitioner
Vs.
1. Nadeem Ahmad Khandey
ATUL
GANESH
KULKARNI
2. Dr. Manzoor Ahmad Dar
3. Hameem Rashid
… Respondents
Digitally signed by
ATUL GANESH
KULKARNI
Date: 2026.10.19
13:35:09 +0530
Mr. Anoshak Daver with Ms. Khushboo Rupani, Mr.
Gaurav Jain, and Mr. Sharan Shetty i/by India Law LLP
for the Petitioner
Ms. Aayushi Chauhan i/by Mr. Manindra Pandey for
Respondent Nos.1 and 3.
Mr. Sanjay Kumar Lalit for Respondent No.2.
CORAM : AMIT BORKAR, J.
RESERVED ON : OCTOBER 15, 2026.
PRONOUNCED ON : OCTOBER 19, 2026
JUDGMENT:
1. The present Petition is filed under Section 9 of the
Arbitration and Conciliation Act, 1996. By this Petition, the
Petitioner seeks interim and ad-interim reliefs.
2. According to the Petitioner, the facts which led to the filing
of the present Petition are as follows. The Petitioner and
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Respondent No.1 entered into a Finance Agreement under which
the Petitioner sanctioned a loan of Rs.1,05,00,000/- to Respondent
No.1 for purchasing the medical equipment which was to remain
hypothecated with the Petitioner. The loan was subject to the terms
of the Agreement, Schedule-I and the Finance Schedule. The loan
was granted for a period of 72 months at an interest rate of
11.50% per annum. On 19 December 2023, upon the request of
Respondent No.1 for financial assistance, the Petitioner sanctioned
and disbursed the loan amount of Rs.1,05,00,000/- for purchasing
the hypothecated medical equipment, namely, “Somatom Go Now
Compact with accessories”. The Petitioner accordingly issued a
Sanction Letter dated 19 December 2023, and Respondent Nos.1
to 3 executed the Finance Agreement and other related
documents. For repayment of the loan, Respondent Nos.1 to 3
agreed that the amount would be repaid in Equated Monthly
Instalments (EMIs) through ECS/NACH, as provided in the
repayment schedule forming part of the Finance Agreement.
According to the Petitioner, although Respondent No.1 availed of
the loan facility, it repeatedly failed to pay the instalments as
agreed under the Finance Agreement. As a result, the loan account
was classified as a Non-Performing Asset (NPA) on 27 November
2024. Thereafter, by a Pre-Litigation Notice dated 27 November
2025, Respondent Nos.1 to 3 were informed that an amount of
Rs.1,06,58,167/- was outstanding under the Agreement. They
were called upon to appear before the National Lok Adalat on 13
December 2025 to explore the possibility of settling the dispute
amicably. Subsequently, by a Surrender Letter dated 23 February
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2026, Respondent No.1 expressed its willingness to hand over
possession of the hypothecated machinery, stating that it was
unable to regularise the loan account and clear the outstanding
dues. The Petitioner states that, despite repeated reminders, the
Respondents admitted the outstanding liability, sought time to
make payment and assured the Petitioner that the loan account
would be regularised. However, they failed to pay the outstanding
amount and continued to remain in default.
3. The Petitioner states that, on 13 May 2026, having regard to
the continued defaults and the failure of the Respondents to repay
the loan despite repeated opportunities and efforts to settle the
dispute, it issued a Loan Recall Notice. By this notice, the
Petitioner recalled the loan facility, invoked arbitration and called
upon Respondent Nos.1 to 3 to jointly and severally pay the entire
outstanding amount, together with applicable interest, charges and
costs. According to the Petitioner, despite repeated assurances,
admissions and representations made by Respondent No.2, neither
Respondent No.1 nor Respondent Nos.2 and 3 took steps to
regularise the loan account or pay the outstanding dues. They
continued to commit defaults under the Finance Agreement. The
Petitioner relies upon the reply dated 19 May 2026 sent by
Respondent No.1, which, according to the Petitioner, admits the
contractual relationship between the parties, the Petitioner's
security interest in the machinery and the outstanding liability. The
Petitioner submits that, although Respondent No.1 had issued a
Surrender Letter and assured repayment, it continued to retain
possession of the hypothecated machinery and failed to cooperate
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with the Petitioner in taking possession of it. The Petitioner
apprehends that Respondent No.1 may sell or transfer the
machinery or create third-party rights in respect of it. According to
the Petitioner, under the Finance Schedule and the Pre-Termination
Statement, an amount of Rs.1,22,61,244/- was payable by the
Respondents as on 2 June 2026. The Petitioner claims default
interest at the rate of 36% per annum from 3 June 2026 until
payment or recovery of the amount. In these circumstances, the
Petitioner filed the present Commercial Arbitration Petition on 8
July 2026.
4. Mr. Daver, learned Advocate appearing for the Petitioner,
invited my attention to Clause 8 of the Finance Agreement. He
submitted that Clause 8(b) provides that, in the event of default,
the borrower is required to immediately hand over possession of
all the assets to the lender whenever demanded. He referred to
Clause 9, which defines the events of default. According to him,
these events include failure to pay any amount on its due date
under the repayment schedule and a change in the borrower's
business. He submitted that the Agreement treats deterioration in
the borrower's financial condition as a matter relating to
insolvency. Mr. Daver then invited my attention to three emails
sent by Respondent No.1 on 18 March 2026. He submitted that, in
these emails, Respondent No.1 specifically admitted that it had
been facing internal and financial difficulties for the preceding few
months. Respondent No.1 accepted that the operations of its
medical centre and its cash flow had been affected. It stated that it
was concentrating on stabilising the operations of the centre and
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arranging funds to clear the outstanding dues. Mr. Daver referred
to paragraph 2 of the notice issued by the Advocate for
Respondent No.1, which is at page 125 of the record. He submitted
that even this notice acknowledges the financial difficulties,
operational problems and reduction in revenue faced by the
medical establishment. Mr. Daver submitted that Respondent Nos.1
and 3 had filed a suit before the Court of the Munsiff/Civil Judge
at Kulgam. According to him, the suit appears to have been filed in
collusion between the parties. In that suit, the parties were
directed not to create any third-party interest by selling or
transferring the CT Scan Unit operated under the name and style
of Moumin Poly Clinic and Diagnostic Centre. He submitted that
the Petitioner is not a party to that suit. Therefore, according to
him, the order passed by the Civil Court does not prevent the
Petitioner from exercising its contractual rights under Clause 8 of
the Finance Agreement. Mr. Daver submitted that the loan was
granted to the sole proprietorship business of Respondent No.1.
However, without obtaining the Petitioner's permission,
Respondent No.1 converted the proprietary business into a
partnership business. According to him, this amounts to a breach
of the terms of the Finance Agreement. He submitted that the
financial disclosure made by the Respondents in compliance with
the order passed by this Court shows that Respondent No.1 is not
in a position to repay the loan. He stated that the outstanding dues
have now increased to approximately Rs.1.27 crore.
5. Respondent No.2, who is a guarantor for the loan
transaction, invited my attention to the communication sent by
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him to the Petitioner in response to the Petitioner's notice. By that
communication, Respondent No.2 called upon the Petitioner to
exercise its contractual and legal rights and immediately take
possession of the hypothecated machinery from the borrower.
Relying upon the communication dated 17 May 2026 issued by
Respondent No.2, it was submitted that this Court should appoint
a Court Receiver to take possession of the hypothecated machinery.
6. Ms. Chauhan, learned Advocate appearing for Respondent
No.1, opposed the Petition. She submitted that granting the relief
of taking possession of the machinery at this stage would amount
to granting the final relief sought by the Petitioner. She submitted
that the income generated from the hypothecated machinery is the
only source of income of Respondent No.1. She invited my
attention to Civil Suit No.215 of 2026 filed by the partner against
Respondent No.1 before the Munsiff/Civil Court at Kulgam. She
submitted that, by an order dated 30 May 2026, the Civil Court
granted ad-interim relief restraining the parties to that suit from
creating any third-party interest in respect of the CT Scan Unit. Ms.
Chauhan submitted that the Petitioner has not produced any
material to show that the Respondents are attempting to sell or
dispose of the machinery with the intention of defeating the
arbitration proceedings or frustrating the enforcement of any
future arbitral award.
7. Ms. Chauhan submitted that the Petitioner has received
repayment of Rs.24,96,328/- and that the balance amount would
be paid. She contended that the machinery in question generates
income and is essential for carrying on the Respondents' business.
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According to her, appointing a Court Receiver or stopping the use
of the machinery would bring the business to a standstill. She
challenged the amount claimed by the Petitioner, particularly the
default interest charged at the rate of 36% per annum. She
submitted that, because of this high rate of interest, the claim of
Rs.1.22 crore is substantially inflated.
REASONS AND FINDINGS:
8. I have considered the submissions made by Mr. Daver,
learned Advocate for the Petitioner, Ms. Chauhan, learned
Advocate for Respondent No.1, and the submissions made on
behalf of Respondent No.2.
9. In the present case, the execution of the Finance Agreement
and the grant and payment of the loan are not seriously disputed.
The Petitioner had granted a loan of Rs.1,05,00,000/- to
Respondent No.1 for purchasing medical machinery described as
“Somatom Go Now Compact with accessories”. The loan amount
was to be repaid in monthly instalments over a period of 72
months. The machinery was hypothecated in favour of the
Petitioner as security for repayment of the loan. The Finance
Agreement produced before the Court contains Clause 8, under the
heading “Hypothecation of Assets and Undertakings”. Clause 8(b)
provides as follows:
“Upon the occurrence and continuance of any Event of
Default, the Lender or its nominees shall have declared all
outstanding amounts as due and payable in accordance with
the terms of the Agreement and in case such breach or
default is not remedied by the Borrower to the satisfaction of
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the Lender, within a period of 15 (fifteen) days from the date
of intimation by the Lender or within such time as may be
extended by the Lender in writing to the Borrower, then the
Lender shall be entitled to take charge and/or possession of
the Assets without intervention of the court and deal with all
or any part of the said Assets as it deems appropriate,
without prejudice to the Lenders rights and remedies of suit
or otherwise and notwithstanding that there may be any
pending suit or process or other proceeding. The Borrower
undertakes to give immediate possession to the Lender on
demand of the Assets and to transfer, and to deliver to the
Lender all related bills, contracts, securities and documents
and the Borrower hereby agrees to pay on demand by the
Lender any shortfall or deficiency thereby shown by the
Lender.”
10. The above clause shows that the parties had agreed that, if
the borrower commits a default and does not correct it within the
period mentioned in the Agreement, the Petitioner would be
entitled to take possession of the hypothecated machinery, subject
to the terms of the Agreement. Respondent No.1 had agreed to
hand over possession of the machinery whenever demanded. The
clause provides that the lender may exercise this right without
approaching the Court.
11. Clause 9 of the Finance Agreement holds the circumstances
which would amount to a default. Clause 9(a) deals with failure to
pay an amount on its due date under the repayment schedule.
Clause 9(b) refers to a change in the borrower's business or a
change in the ownership of the asset. The provision relating to
insolvency refers to a deterioration in the borrower's financial
condition. These clauses are relevant because the Petitioner is
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seeking possession of the same machinery which was purchased
with the loan amount and given as security for repayment. Thus,
the machinery is directly connected with the loan transaction.
12. The material placed before the Court shows that the default
complained of is not limited to one instalment or a short delay in
payment. According to the Petitioner, the loan account was
classified as a Non-Performing Asset on 27 November 2024.
Thereafter, a Pre-Litigation Notice dated 27 November 2025 was
issued, stating that Rs.1,06,58,167/- was outstanding. The
Respondents were called upon to appear before the National Lok
Adalat so that an attempt could be made to settle the dispute
amicably. Thereafter, Respondent No.1 issued a Surrender Letter
dated 23 February 2026. By this letter, Respondent No.1 expressed
its willingness to hand over possession of the hypothecated
machinery because it was unable to regularise the loan account
and pay the outstanding dues. This letter shows that Respondent
No.1 had itself accepted that it was facing difficulty in repaying the
loan and had expressed its willingness to surrender the machinery.
13. The subsequent events are relevant. The Petitioner issued a
Loan Recall Notice dated 13 May 2026, demanding repayment of
the outstanding dues. Respondent No.1 replied on 19 May 2026.
According to the Petitioner, this reply accepts the contractual
relationship between the parties, the Petitioner's security interest
and the outstanding liability. Even after the Surrender Letter and
the subsequent communications, the machinery has not been
handed over to the Petitioner.
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14. Mr. Daver has relied upon three emails dated 18 March
2026. According to him, Respondent No.1 admitted in these emails
that it had been facing financial and internal difficulties for the
preceding few months. The operations of the medical centre and
its cash flow had been affected. Respondent No.1 had stated that it
was trying to stabilise its business and arrange funds to pay the
outstanding dues. Mr. Daver has relied upon paragraph 2 of the
notice issued by the Advocate for Respondent No.1. According to
him, that paragraph accepts that the medical establishment was
facing financial difficulties, operational problems and a reduction
in income.
15. Financial difficulty alone cannot be a reason to appoint a
Receiver over the assets of every borrower. A business may face
temporary financial problems and may still be able to repay its
loan. However, in the present case, the financial difficulties have to
be considered along with the repeated defaults, the demand for
repayment, the Loan Recall Notice and the Surrender Letter. When
all these circumstances are considered together, they support the
Petitioner's concern regarding repayment and protection of its
security.
16. Respondent No.2, who is stated to be the guarantor, sent a
communication to the Petitioner on 17 May 2026. In that
communication, Respondent No.2 called upon the Petitioner to
exercise its contractual and legal rights and take immediate
possession of the hypothecated machinery. Respondent No.2 has
supported the request for appointment of a Court Receiver before
this Court. The communication of Respondent No.2 cannot decide
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the rights of Respondent No.1. The objections raised by the
borrower must be considered. However, this communication
supports the Petitioner's case that the loan transaction has reached
a stage where possession of the secured machinery is being sought
as a means of dealing with the continuing default.
17. Ms. Chauhan submitted that taking possession of the
machinery would amount to granting the final relief sought by the
Petitioner. This objection requires consideration. An order directing
possession of the machinery would have an immediate and serious
effect on the business of Respondent No.1. The Court cannot grant
such relief merely because it has been sought under Section 9 of
the Arbitration and Conciliation Act, 1996. At the same time,
Section 9 permits the Court to appoint a Receiver and make
arrangements for the interim custody of property. Such an order
does not necessarily decide the final dispute between the parties.
Its effect depends upon the purpose for which it is passed and the
conditions imposed by the Court.
18. In the present case, if possession is taken only to preserve the
machinery and the Receiver and the Petitioner are prohibited from
selling or otherwise disposing of it, the order will remain an
interim measure. It will not decide the final amount payable by the
Respondents. It will not decide whether the default interest
claimed by the Petitioner is legally payable. It will notdecide the
rights of the parties in arbitration. The machinery will remain
preserved, and its use or disposal will be subject to the orders of
the Court and the outcome of the arbitral proceedings.
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19. Ms. Chauhan submitted that the income earned from the
machinery is the only source of income of Respondent No.1.
According to her, the machinery is the main equipment used for
running the medical centre, and taking it away would bring the
business to a standstill. This submission cannot be ignored. The
Court must consider the effect of its order on the borrower,
particularly because the machinery is used for providing medical
diagnostic services. An order for taking possession cannot be
passed merely to put pressure on the borrower to make payment.
It cannot be used as a substitute fordeciding the financial dispute.
However, the interest of the Respondents in continuing their
business must be considered along with the Petitioner's security
interest and the circumstances showing continued default. The
material available does not show that the loan account has been
regularised. Respondent No.1 issued the Surrender Letter because
it was unable to clear the outstanding dues. Despite issuing that
letter, it did not hand over possession of the machinery. The
Petitioner's demand for possession remains unfulfilled. The fact
that the machinery generates income is relevant when considering
its preservation. The machinery was purchased with the financial
assistance given by the Petitioner and was hypothecated in its
favour. If the machinery is damaged, transferred or placed beyond
recovery before the dispute is decided, the Petitioner's security may
be affected. The Court must balance the concern of the
Respondents about their business against the need to protect the
machinery. In my view, this concern can be addressed to some
extent by limiting the relief to taking possession and preserving the
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machinery. No power to sell, auction, transfer or otherwise dispose
of the machinery is being granted. The Petitioner cannot treat the
machinery as its own property or use this order to adjust its
claimed dues by taking ownership of the machinery.
20. Ms. Chauhan submitted that the Petitioner has received
repayment of Rs.24,96,328/- and that the balance amount will be
paid. The amount repaid is relevant while calculating the
outstanding dues. All payments received by the Petitioner must be
given proper credit in the accounts. However, a statement that the
balance amount will be paid does not show that the defaults have
been corrected or that the loan account has been regularised. At
this stage, no final finding is being recorded about the exact
amount outstanding after giving credit for all payments. The
purpose of the present order is not todecide the Petitioner's claim
for money. The question is whether the machinery given as
security should remain without effective protection when the loan
has been recalled and possession has not been handed over despite
the Surrender Letter and subsequent demands. The exact amount
due, including the credit to be given for the payments made, will
remain open for determination in the appropriate proceedings.
21. The objection regarding default interest at the rate of 36%
per annum requires consideration. The Petitioner claims that
Rs.1,22,61,244/- was due on 2 June 2026 and seeks default
interest from 3 June 2026. Ms. Chauhan contends that the amount
claimed is highly inflated because of the default interest charged at
the rate of 36% per annum. At this stage, the Court is not required
todecide whether the claimed rate of interest is enforceable under
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the Agreement, whether the amount has been correctly calculated,
or whether any adjustment is required. These questions can be
decided in the appropriate proceedings after considering the
Agreement, the accounts and the submissions of the parties. The
objection regarding the rate of interest does not require the Court
to refuse every form of protection for the machinery. Possession
may be taken to preserve the secured asset without directing the
Respondents to pay the entire amount claimed. Nothing in this
order shall be treated as acceptance of the Petitioner's calculation
of Rs.1,22,61,244/- or its claim for default interest at the rate of
36% per annum.
22. The Petitioner has submitted that Respondent No.1 was
originally carrying on business as a sole proprietor but later
changed it into a partnership business without obtaining the
Petitioner's permission. According to the Petitioner, this amounts to
a breach of the Finance Agreement. This submission is relevant
because Clause 9(b) refers to a change in the borrower's business
or a change in the ownership of the asset. However, having regard
to the repayment difficulties and the other material discussed, it is
not necessary at this stage to give a final finding on whether the
alleged change in the nature of the business amounts to an
additional event of default. This issue will remain open for
consideration in the appropriate proceedings.
23. The Petitioner's request for interim protection does not
depend only on this allegation. The repeated defaults, recall of the
loan, Surrender Letter and failure to hand over possession provide
separate grounds for considering the limited relief sought in this
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Petition.
24. The Petitioner has referred to Civil Suit No.215 of 2026
pending before the Munsiff/Civil Court at Kulgam. Ms. Chauhan
submitted that, by an order dated 30 May 2026, the Civil Court
restrained the parties to that suit from creating third-party
interests in respect of the CT Scan Unit. Mr. Daver submitted that
the Petitioner is not a party to that suit and that the order does not
prevent it from exercising its rights under the Finance Agreement.
He alleged that the suit had been filed in collusion between the
parties. The material placed before this Court is not sufficient to
give a final finding that the civil suit is collusive. Such a finding
cannot be recorded merely because a suit has been filed or an
interim order has been passed. The rights of the parties to that suit
must be considered by the Civil Court in the proceedings pending
before it. At the same time, the mere filing of that suit does not
defeat the Petitioner's request for protection under Section 9. The
relief being considered here is limited to taking custody of the
machinery through an officer of this Court. No sale, transfer or
creation of third-party rights is permitted. The order passed by the
Civil Court is neither set aside nor changed by this order. No
finding is being recorded on the merits of the dispute pending
before that Court. The Receiver shall preserve the machinery and
shall not take any step to sell or otherwise dispose of it.
25. The judgment in L & T Finance Ltd. v. G.G. Granites, 2013
SCC OnLine Mad 2719, which helps in considering the rights of a
lender over hypothecated movable assets. In paragraph 18, the
learned Single Judge observed:
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“Therefore, there can be no doubt about the fact that
hypothecation creates a charge, without delivery of
possession of the movable asset. Since hypothecation is not a
statutory creation, the rights of the hypothecatee are
governed by the terms of the contract.”
26. The judgment holds that, where the Hypothecation
Agreement contains a specific clause permitting the lender to take
possession in the event of default, that contractual right may be
exercised subject to the law governing its enforcement. The
learned Judge referred to the decision of the Supreme Court in
Indian Oil Corporation v. NEPC India Limited, 2006 (4) CTC 60
(SC) : AIR 2006 SC 2780. In that case, the Supreme Court did not
express any opinion on whether a creditor could take possession
with or without approaching a Court of Law. Therefore, the
decision in L & T Finance Ltd. cannot be understood to mean that
every request for possession must automatically be granted. It
supports the principle that the rights of the lender must be
considered in the light of the contract. The Court must still
examine whether the conditions for granting interim relief are
satisfied in the facts of the particular case.
27. After considering all the material, I am satisfied that the
Petitioner has made out a prima facie case for appointment of a
Court Receiver. The loan transaction and the hypothecation are
supported by the Finance Agreement. The defaults have continued
for a substantial period. The loan was recalled, and Respondent
No.1 had earlier expressed willingness to surrender the machinery
but did not hand over possession. The financial difficulties
admitted in the communications and the failure to regularise the
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loan account create concern about the protection of the Petitioner's
security.
28. The balance of convenience supports a limited order for
protection. If possession is not secured and the machinery is later
damaged, transferred or placed beyond recovery, the Petitioner's
security may be affected. On the other hand, Respondent No.1 has
a genuine concern because the machinery is stated to be its main
source of income. This concern is a reason for not granting an
immediate power to sell or dispose of the machinery. However, in
the present circumstances, it does not require the Court to refuse
appointment of a Receiver altogether, particularly when
Respondent No.1 had itself earlier expressed willingness to
surrender possession. The apprehension regarding the machinery
must not be treated as proof that Respondent No.1 has tried to sell
or transfer it. The order is not being passed on the basis of any
finding of fraud or a proved attempt to defeat the arbitration
proceedings. It is being passed because of the contractual security,
the continued defaults, the failure to hand over possession and the
need to preserve the machinery until the dispute is decided.
29. The question of irreparable loss must be considered in this
background. The Petitioner's claim is mainly for recovery of money,
and the exact amount can be decided in arbitration. However, the
Petitioner has a security interest over identified machinery. If the
machinery is damaged, transferred or placed beyond recovery, the
Petitioner's ability to enforce any future award may become more
difficult. The Court can make an order to preserve the machinery,
provided the order does not unnecessarily decide the final rights of
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the parties. Appointment of a Receiver will ensure that possession
is taken under the supervision of the Court. This will avoid the
need for the Petitioner to use private recovery agents or adopt any
method which may lead to a dispute about how possession was
obtained. Police assistance, wherever required, will be given only
to enable the Receiver to carry out the Court's directions peacefully
and properly. However, the Petitioner has not made out a case at
this stage for giving the Receiver any power to sell the machinery.
The amount claimed, the default interest, the payments received
and the final liability of the Respondents are matters which have to
be decided in accordance with law. Taking possession does not
make the Petitioner the owner of the machinery. Nor does it permit
the Petitioner to adjust the value of the machinery against the
claimed dues without orders. The machinery must be preserved.
The Receiver may take physical possession and hand it over to the
Petitioner, but the Petitioner shall hold it only as custodian legis,
meaning that the machinery will remain in its custody on behalf of
the Court. Neither the Receiver nor the Petitioner shall sell,
auction, transfer, alienate, encumber, dismantle or otherwise
dispose of the machinery, or create any third-party rights over it.
No sale is permitted under the present order.
30. For the reasons stated above, I am satisfied that the limited
reliefs sought in prayer clauses (c) and (d) deserve to be granted.
Appointment of a Receiver and police assistance are necessary to
secure and preserve the hypothecated machinery. At the same
time, not granting any power to sell will protect the Respondents
against disposal of the machinery before the rights and liabilities of
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the parties are decided in the arbitral proceedings. The order will
remain an interim measure for protection of the machinery. It shall
not be treated as a final decision regarding the amount due, the
validity of the claimed default interest or the ultimate rights of the
parties under the Finance Agreement. Subject to these limits, the
following order is passed.
31. In view of the foregoing discussion, and upon overall
assessment of the material record, the following order is passed:
(i) Prayer clause (c) of the Petition is allowed to the extent
stated below;
(ii) The Court Receiver, High Court, Bombay, or such fit
and proper person as may be designated by the Court, is
appointed as Receiver in respect of the hypothecated medical
equipment described as “Somatom Go Now Compact with
accessories”;
(iii) The Court Receiver shall take physical possession of the
aforesaid machinery, together with its accessories, from the
premises where it is installed or kept, in accordance with
law. The Receiver shall prepare an inventory of the
machinery and accessories and record their existing
condition at the time of taking possession;
(iv) After taking possession, the Court Receiver shall hand
over the machinery to the Petitioner, which shall hold it only
as custodian legis, on behalf of the Court and subject to
orders. The handing over of possession shall not confer
ownership upon the Petitioner;
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(v) The Court Receiver is authorised to seek police
assistance for taking possession of the machinery. The
concerned police authorities shall provide necessary
assistance upon a written request made by the Court
Receiver. If access to the premises is obstructed, or the
premises are found locked, the Receiver may, where
necessary, seek assistance to open the lock and enter the
premises for the limited purpose of taking possession of the
machinery, while recording the steps taken and the condition
of the machinery;
(vi) Neither the Court Receiver nor the Petitioner shall have
any power under this order to sell the machinery by public
auction or private treaty, or otherwise dispose of, transfer,
alienate, encumber, dismantle or create third-party rights in
respect of the machinery. The machinery shall be preserved
in its existing condition, subject to necessary measures for its
protection and maintenance, until orders of the Court;
(vii) The Petitioner shall bear the initial expenses of the
Receiver, including reasonable expenses for taking
possession, transportation where necessary, preservation and
custody of the machinery. Such expenses shall remain subject
to orders of the Court and the final determination of the
rights and liabilities of the parties;
(viii) Prayer clause (d) is allowed. Police assistance shall be
made available to the Court Receiver for implementing this
order, subject to the directions recorded above;
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(ix) The order is confined to the interim protection of the
hypothecated machinery. It shall not be treated as a final
finding regarding the total amount due, the rate of default
interest, the claim for prepayment fees, or any other dispute
arising under the Finance Agreement;
(x) If the arbitral proceedings have not commenced, the
Petitioner shall take the necessary steps for their
commencement within the period prescribed under Section
9(2) of the Arbitration and Conciliation Act, 1996;
(xi) The Petition is allowed to the above extent. All other
rights and contentions of the parties are kept open for
adjudication in accordance with law.
(AMIT BORKAR, J.)
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