Anil Kumar, J. - (1.) THIS is a petition under Section 11(6) of the Arbitration & Conciliation Act, 1996 for appointment of an arbitrator in terms of Clause 9 of the agreement dated 9th October, 2007 between the parties which is the arbitration agreement between the parties.
(2.) THE contention of the petitioner is that the petitioner is a company duly incorporated under the Companies Act and respondent is a non -banking finance company and is a subsidiary of Aditya Birla Nuvo Limited. The petitioner company had contended that he approached the respondent company for grant of loan facility to the tune of Rs. 6.5 crores and the loan against the shares was sanctioned by letter dated 9th October, 2007 on the following terms: (i) Loan amount Rs. 6.5 crore (Rupee Crore) (ii) Nature of Facility Loan against shares (iii) Rate of Interest 14.30% p.a. (payable monthly year ended) Interest to be rest at the end of every 91 days from the date of first disbursement based on mutual consent. (iv) Tenure 365 days from the date of first disbursement (v) Upfront Interest/Charges Nil. (vi) Security Scrip Margin Bajaj Auto Limited 35% GHCL Limited 50% Maximum exposure against GHCL Limited not to exceed Rs. 2.27 crore other scrip's as per approved list of securities at applicable margin. (vii) Margin 30% to 50% i.e. Market value of share - loan and other dues ___________________________________________ Market Value of Shares Valuation of GHCL Limited to be based on six months average market price or the current market price, whichever is lower.
(3.) THE petitioner has also referred to Clause 4(b)(vi) of the sanction letter which is as under: You shall maintain the stipulated margin at all times during the continuance of security and in the event of margin falling 4% less than the stipulated due to fall in the market value of the securities, you shall make good such shortfall on your own within a period of 2 days from the date of such shortfall by pledging with BGFCL further securities of sufficient value of make up the deficiency or shall reduce the amount for the time being due to BGFCL by cash payment so as to maintain the margin. Failing which BGFCL shall be entitled to charge panel interest @ 2% p.m. on the outstanding amount for the period from the expiry of the said days till the date of making good the deficiency in the margin or payment cash as stipulated.;