Tata Capital Limited vs Katyayini Paper Mills Pvt Ltd Ors

Court
Delhi High Court

$~35
* IN THE HIGH COURT OF DELHI AT NEW DELHI
# CNR No. DLHC010281812026
+ O.M.P.(I) (COMM.) 261/2026
TATA CAPITAL LIMITED .....Petitioner
Through: Ms. Ragini Kapoor, Adv.

versus

KATYAYINI PAPER MILLS PVT LTD ORS .....Respondents
Through: Mr. Apar Gupta, Ms. Uzma
Sheikh, Ms. Pragya Jain, Mr.
Naman Kumar and Mr. Rahul,
Advs. for R-1 to 4.
CORAM:
HON'BLE MR. JUSTICE OM PRAKASH SHUKLA

JUDGMENT(ORAL)
% 21.08.2026
1. The present petition has been filed under Section 9 of the Act,
seeking following reliefs:

“a. That pending the Arbitral proceedings, making of the
Arbitral Award and until final execution of the Arbitral Award, the
Respondents jointly and/ or severally be ordered and directed to
either furnish security/ies and/or bank guarantee in favour of the
Petitioner towards a sum of Rs. 2,53,29,762/- (Rupees Two Crores
Fifty-Three Lakhs Twenty-Nine Thousand Seven Hundred and
Sixty-Two Only), due as on 25.05.2026, together applicable and
additional interest, till payment and/or realization and other
expenses, costs, charges etc due and payable to the Petitioner in
terms of the Master Lease Agreement dated 21.10.2024 and as per
the Summary of dues set out in the Petition;
b. That pending the Arbitral proceedings, making of the
Arbitral Award and until final execution of the Arbitral Award, the
Respondents, their agents/s, servant/s, and any third person/s
claiming through them be restrained by an Order or injunction of
this Hon'ble Court from in any manner selling, transferring,
disposing-off, and/or alienating or encumbering or mortgaging or
charging or parting with possession of or transferring, or
inducting anyone else into or creating any right, title or interest or
license in favour of anyone else in respect of properties not
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Signing Date:01.09.2026
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mortgaged with the Petitioner and all the moveable and
immoveable assets (including stock and trade) disclosed by the
Respondents pursuant to the direction of this Hon'ble Court,
including properties as mentioned in paragraph 17 hereinabove;
c. Appoint a Court Receiver to take possession/custody of the
Goods/Machines leased out to the Respondents under the Master
Lease Agreement dated 21.10.2024 and hand over the same to
Petitioner with liberty to sell out the same and adjust sale proceeds
from respondent’s liability;
d. That Respondents be directed to disclose whether any
charge exists on any of the properties as mentioned in the
application, details of mortgagor, valuation of properties and their
liability by way of affidavit;
e. That pending the Arbitral proceedings, making of the
Arbitral A ward and until final execution of the Arbitral Award, a
Court Receiver or any other fit and proper person be appointed as
Receiver under Order XL Rule 1 of Code of Civil Procedure, 1908
by this Hon’ble High Court, with a specific direction to the Court
Receiver to take physical possession of the properties not
mortgaged with the Petitioner, including the property/ies as
mentioned in paragraph 17 hereinabove and all the moveable and
immoveable assets (including stock and trade) disclosed by the
Respondents pursuant to the direction of this Hon'ble Court, with
police assistance, if necessary and also with the power to sell the
said property by public auction or private treaty and appropriate
the sale proceeds towards the outstanding loan of the Respondents;
f. That pending the Arbitral proceedings, making of the
Arbitral Award and until final execution of the Arbitral Award, the
Respondents may be directed to submit the by way of affidavit
details of their assets, liabilities and Bank Account Statements of
all their accounts from the date of disbursement of the Loan till
date along with a list of assets and liabilities by way of an affidavit
for disclosure before this Hon'ble Court and based on the said
Bank Statement the Respondents may be directed not to make any
high value transactions from their bank accounts and the bank
accounts of the Respondents be frozen till the disposal of the
Arbitration proceedings;
g. Ad-interim and interim reliefs in terms of prayers (a) to (e)
hereinabove;
h. For costs of this Petition; and
i. Pass such order and further orders as this Hon’ble Court
may deem fit and proper in the facts and circumstances of the
present case.”

2. It is the Petitioner’s case that the Respondents defaulted in
payment of the lease rentals and other contractual dues. Consequently,
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Signed By:GUNN
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the Petitioner issued a Legal Notice dated 23.03.2026, recalling the
lease facility and invoking Clause 21.4 of the Master Lease
Agreement dated 21.10.2024 and Clause 34 of the Letter of Guarantee
dated 21.10.2024.

3. That the Petitioner issued Section 21 notice on 23.03.2026
invoking arbitration to which the Respondent denied the appointment.

4. According to the Petitioner, an amount of Rs.2,53,29,762/- is
due to Petitioner.

5. The Petitioner has thereafter, filed the present petition under
Section 9 of the Act seeking interim protection till the constitution of
the Tribunal.

6. Learned Counsel appearing for the Respondent submits that the
Respondent has no objection to the disputes being referred to
arbitration by appointment of the Learned Sole Arbitrator.

7. Parties are ad idem that the matter can be referred to arbitration.

8. It is well settled that, while exercising jurisdiction under Section
11 of the Act, the scope of enquiry is confined to examining the prima
1
facie existence of an arbitration agreement .

9. In the present case, there is no dispute with regard to the
existence of a valid arbitration clause between the parties.


1
SBI General Insurance Co. Ltd. v. Krish Spinning 2024 SCC OnLine SC 1754

Signature Not Verified
Signed By:GUNN
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10. In the aforesaid circumstances, this Court finds no impediment
in appointing a Sole Arbitrator.

11. Accordingly, Hon’ble Ms. Justice Anjana Mishra (Retd.), Patna
High Court (Mob. No. 7033297222) is appointed as a learned Sole
Arbitrator to adjudicate the disputes arisen between the parties. The
learned Sole Arbitrator shall enter upon the reference within two
weeks from today.

12. The learned Sole Arbitrator will proceed to the arbitration
proceedings subject to furnishing requisite disclosures as required
under Section 12(2) of the Act within two weeks of entering reference.

13. The arbitration shall be carried under the rules and aegis of
Delhi International Arbitration Centre (“DIAC”). The learned
Arbitrator shall be entitled to fees as per the Schedule of Fees
maintained by the DIAC.

14. It shall be open to the parties to raise all pleas, including
objection as to arbitrability and jurisdiction, before the learned Sole
Arbitrator who shall decide the same in accordance with law.

15. It is clarified that the observations made herein are only for the
purpose of deciding the present petition. The learned Sole Arbitrator
shall adjudicate the disputes independently and on their own merits,
uninfluenced by any observations contained in the present order.

16. The Registry is directed to send a receipt of this order to Ms.
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Signed By:GUNN
Signing Date:01.09.2026
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Anjana Mishra, learned Arbitrator through all permissible modes
including email.

17. The learned Sole Arbitrator shall enter reference within a period
of three weeks from today.

18. Both parties are at liberty to file application under Section 17 of
the Act before the learned Arbitrator.

19. Accordingly, the present petition is disposed of in the above
terms.


OM PRAKASH SHUKLA, J
AUGUST 21, 2026/ ss




Signature Not Verified
Signed By:GUNN
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