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Issues:
1. Appointment of a receiver under section 9 of the Arbitration and Conciliation Act, 1996 to restrain respondents from selling leased equipment due to defaults in lease rentals. 2. Interpretation of section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985 in the context of ownership of leased equipment. 3. Application of judgments in Credit Capital Finance Corpn. v. Foremost Industries Ltd. and GE Capital Transportation Financial Services Ltd. cases to determine ownership of machinery and applicability of section 22. 4. Analysis of Bombay High Court judgment in Kotak Mahendra Finance Ltd. v. Deve Paints Ltd. regarding properties not owned by the sick industrial undertaking under section 22. 5. Examination of the bar under section 22 in relation to proceedings against the properties of the industrial company. Detailed Analysis: 1. The petitioner sought interim orders under section 9 to appoint a receiver to prevent the sale or transfer of waste heat recovery system-equipment leased to the respondents due to defaults in lease rentals. Respondents resisted, citing section 22 of the Sick Industrial Companies Act, 1985, which prohibits the appointment of a receiver. 2. The judgment in Credit Capital Finance Corpn. v. Foremost Industries Ltd. clarified that ownership of leased equipment remains with the lessor, not the lessee, thus not constituting the property of the industrial company. This interpretation was supported by the Supreme Court's decision in Shree Chamundi Mopeds Ltd. v. Church of South India Trust Association. 3. The judgment in GE Capital Transportation Financial Services Ltd. v. Dee Pharma Ltd. reinforced that ownership of machinery vests with the lessor, making section 22 inapplicable as it pertains to the property of the lessee company. This principle was upheld in subsequent judgments and deemed applicable to the present case. 4. The Bombay High Court's ruling in Kotak Mahendra Finance Ltd. v. Deve Paints Ltd. emphasized that properties not owned by the sick industrial undertaking are not covered under section 22. The judgment clarified that actions against financed vehicles, not owned by the lessee company, do not fall within the purview of section 22. 5. Section 22 specifically refers to proceedings against the properties of the company, indicating that it does not encompass equipment leased out by the petitioner. The court highlighted that accepting the respondent's plea would unfairly impact the lessor's rights and defeat the purpose of leasing the equipment. 6. The judgment concluded that the ownership of the leased equipment remained with the petitioner financing company, rendering section 22 inapplicable. The court directed the appointment of a receiver to secure the leased equipment, emphasizing that the equipment being affixed to the ground did not make it immovable property. 7. The court disposed of the petition, instructing the arbitrator to conclude arbitration proceedings promptly. The judgment referenced a previous case where a receiver was appointed in similar circumstances, reinforcing the decision's consistency with legal precedents.
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