Sandeep Mahajan Vs Mahindra And Mahindra Financial Services (Delhi High Court)
Delhi High Court held that any award passed by an arbitrator unilaterally appointed by an interested party is vitiated. Accordingly, ex-parte arbitral award passed is liable to be set aside.
Facts- The petitioner was appointed as a director in Sandeep Axles Pvt. Ltd. on 20.09.1989, and later in SPM Auto Pvt. Ltd. on 10.08.2004. On 23.04.2015, a loan facility of Rs. 3,60,00,000/- was sanctioned to SPM Auto Pvt. Ltd. by the respondent. Pursuant to the sanction, a Loan Agreement dated 24.04.2015 was executed between SPM Auto Pvt. Ltd. as the borrower and the petitioner, along with Mr. Vimal Mahajan and Mr. Vikrant Mahajan, as Personal and Corporate Guarantors for securing the said facility.
The petitioner resigned from the directorship of SPM Auto Pvt. Ltd. on 24.08.2015, and from Sandeep Axles Pvt. Ltd. on 18.02.2016. After his resignation, the petitioner had no further association with either company or its directors.
Vide order dated 17.10.2017, the Hon’ble National Company Law Tribunal initiated the Corporate Insolvency Resolution Process against Sandeep Axles Pvt. Ltd., and subsequently, a liquidation order was passed on 13.09.2018. Similarly, vide order dated 18.11.2020, the Hon’ble NCLT also initiated CIRP against SPM Automotive Components Private Limited.
