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As per case facts, Zion Shipping Ltd. (appellant) chartered a vessel to Sarala Foods Pvt Ltd and others (respondents) for rice carriage. A delay in discharge led to demurrage claims
...by the appellant, which respondents failed to pay despite reminders. Appellant sought attachment of rice cargo before judgment under Section 9 of the Act. The Single Judge initially ordered conditional attachment, which respondents fulfilled by depositing security. However, the Single Judge later vacated these interim orders and dismissed the Section 9 application on merits, ordering the return of security. This prompted the appellant's appeal to the High Court under Section 37 of the Act. The question arose whether the Single Judge's orders warrant interference. Finally, the High Court found no strong prima facie case for the appellant as demurrage liability was contested and unliquidated damages do not constitute a debt until adjudicated. The balance of convenience was not with the appellant due to their significant delay in action and the respondents' prompt compliance with the initial security order. The Court observed no real risk of asset diminution and concluded that the Single Judge's discretion was properly exercised, dismissing the appeal as there was no arbitrariness, perversity, or patent illegality.
Bench
Applied Acts & Sections
Section 9
–The Arbitration And Conciliation Act, 1996
Section 37
–The Arbitration And Conciliation Act, 1996
Section 31
–The Right To Fair Compensation And Transparency In Landacquisition, Rehabilitation And Resettlement Act, 2013
Legal Notes
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