After Losing Flat Possession, 75-Year-Old Widow On Dialysis Can Withdraw ₹1.25 Crore Pending Arbitration, Subject To Any Repayment Order: Bombay HC

In brief

The question

Whether the Petitioner should be permitted to withdraw the ₹1.25 crore deposited pursuant to the Court’s earlier interim order, together with accrued interest, before the parties’ claims are finally determined in arbitration.

The court held

The Court allowed the application and permitted the Petitioner to withdraw ₹1.25 crore with accrued interest, subject to her filing an undertaking that the withdrawal would remain subject to the final decision in arbitration and to any competent court’s direction for repayment or restitution.

It also directed

The withdrawal does not prevent the Respondents from raising their defences before the Arbitrator; there was no order as to costs.

01Facts

The Petitioner, a 75-year-old widow undergoing dialysis, claimed that she paid ₹85.10 lakh and gave gold valued at ₹40 lakh to Respondent No. 1 for Flat No. 301, despite the flat having previously been sold and mortgaged to DBS Bank.

¶ 2–3

The Bank later auctioned the flat, and the Petitioner was dispossessed on 1 April 2025.

¶ 2–3

In an earlier interim order, the Court found a strong prima facie case in the Petitioner’s favour and directed the Respondents to deposit ₹1.25 crore.

¶ 4–7

The deposit was completed only in August and September 2026, after contempt proceedings, and after the Petitioner had lost possession of the flat.

¶ 16–17

She then sought permission to withdraw the deposited amount and accrued interest pending arbitration; the Respondents opposed withdrawal, arguing that the claim remained disputed and withdrawal would amount to final relief.

¶ 8–10

02Issues

i.Whether the Petitioner should be permitted to withdraw the ₹1.25 crore deposited pursuant to the Court’s earlier interim order, together with accrued interest, before the parties’ claims are finally determined in arbitration.

¶ 1, 10, 18

ii.Whether withdrawal could be permitted subject to conditions that preserve the Respondents’ right to contest the claim and seek repayment or restitution.

¶ 19–23

03Law Applied

The Court applied the principles governing interim protection and equitable relief: it considered the strength of the prima facie case, the balance of convenience, the risk of irreparable harm, the purpose of the prior deposit order, subsequent developments, and the comparative hardship to the parties.

¶ 6–7, 19–23

It treated the earlier findings as relevant to the withdrawal application without treating them as a final determination of liability, and recognised that withdrawal could be made subject to an undertaking to comply with any later direction for repayment or restitution.

¶ 5, 19–20, 24(c)–(d)

The judgment cites no specific statutory provision or precedent.

Provisions in the judgment · 1

the Act (alias, unresolved) Section 11

04Reasoning

The Court declined to assess the application solely by reference to the Respondents’ asserted admission of approximately ₹85 lakh.

¶ 11–15

The earlier order had considered the receipts, payments, signatures, correspondence, and the Respondents’ statements, and had directed the deposit of ₹1.25 crore; that order had not been set aside.

¶ 11–15

The Respondents’ delay in completing the deposit, the Petitioner’s loss of possession, and her age and medical circumstances weighed in favour of releasing the funds.

¶ 16–22

Although withdrawal would give the Petitioner immediate access to the money before arbitration, the Court considered that concern manageable through an undertaking, while preserving the Respondents’ right to contest liability and seek appropriate relief at the final stage.

¶ 19–23