Sharda Aggarwal, J.

1. The petitioners have moved the present petition under Section 9 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the) for interim relief. Petitioner No. 1 is a company in the field of manufacturing of all types of summer and winter cloth having a turn over of more than Rs. 300 crores. Petitioner No. 2 M/s. Sandhya Textiles is duly constituted as institutional co-ordinator representing petitioner No. 1 company specifically for the tender floated by Mahanagar Telephone Nigam Ltd. (for short MTNL), the respondent. Reference to the petitioner would hereinafter mean petitioner No. 1.

2. MTNL invited tenders from those who had minimum turn over of rupees three hundred crores for supply of cloth for summer and winter uniforms for Group C and D of its employees. Notice inviting tenders (NIT) was for cloth for the following five types of uniforms :

TABLE

3. As it was open to the participants to bid either for one or more upto all the five items, the petitioners participated only for first three items which were for gents and did not bid for items 4 and 5, the four types of ladies wear. The petitioners bid being the lowest was accepted. After the acceptance of tender, the price was further negotiated on the basis of the specification of cloth supplied earlier by the applicant to Airport Authority of India (for short AAI). Revised and finally agreed prices were as under:

TABLE

4. After the prices were finalised, MTNL placed the first purchase order No. APO/PO No. AGM(MMI)STAFF UNIFORM/2000-01/KW-II/44 dated 17th February, 2001. The respondent placed second purchase order dated 19th April, 2001 for supply of staff uniform cloth (winter), by which the following quantity was ordered :

SAMPLE - A 63,615.80 metres

SAMPLE - B 1,27,231.80 metres

SAMPLE - C 660.00 metres

TOTAL 1,91,507.40 metres

5. The first purchase order dated 17th February, 2001 was duly complied with and the MTNL received all the supplies against the same as per the specifications laid therein and made payments to the tune of Rs. 5,55,01,143.93 paise against the said supplies. There is no dispute with regard to the first purchase order. The uniform cloth, as against the second purchase order, was to be supplied in two parts i.e. 57452 mtrs. by 16th July, 2001 and 134055.18 metres by 17th September, 2001. This supply was rescheduled to 22nd July, 2001 and 20th September, 2001 respectively by MTNL. On account of delay on the part of MTNL, petitioner sought further extension which was agreed to as under :

(i) 30% of the ordered quantity by 30.9.2001.

(ii) Second 30% by 30.10.2001, and

(iii) Balance 40% by 30.11.2001.

6. During the stipulated period, the petitioner supplied and delivered the cloth and some payments made by MTNL as shown in para 6(xxvi) of the petition. It is alleged by the petitioner that as regards, Invoice No. 67 dated 18th October, 2001, respondent having accepted the supplies as per the laid down specifications had prepared a cheque dated 22nd October, 2001 for Rs. 1,37,76,401/- for payment to the petitioner. The respondent despite repeated letters of the petitioner failed to handover the said cheque to the petitioner on the ground that some CBI investigation was initiated on registration of FIR dated 10th October, 2001 against some of the officers of MTNL alleging that the contract was wrongfully procured though records of MTNL were seized by the CBI but the cheque for Rs. 1,37,76,401/-, payable to the petitioner, was not seized. Supplies against Invoice No. 68 dated 18th October, 2001 were duly received by the respondent but it failed to pay Rs. 76,71,355/- against the said invoice.

7. On the ground of CBI investigation, the respondent refused to further pursue the purchase order and refused to proceed with the acceptance and processing of supply in terms of the second purchase order. The petitioner had completed their part of the purchase order by 7th November, 2001 when the last instalment of 33703.76 metres of polywool fabric became ready for dispatch at the factory godown of the petitioner. Supplies of ready stock of 34,842.49 metres awaited directions at the transporters godown at Okhla Industrial Area. A registered letter dated 28th November, 2001 in response to petitioners letters dated 31st October, 2001, 6th November, 2001, 9th November, 2001 and 20th November, 2001 was received by the petitioner on 5th December, 2001 by which the MTNL had asked the petitioner to withhold the supply of the balance quantity of cloth till further communication.

8. The petitioner has outlined the broad disputes in the form of liquidated damages on account of delay in receipt of stores/supplies lying at the factory godown and at the transporters godown awaiting directions for delivery and for wrongful withholding the already drawn cheque dated 22nd October, 2001 and for not releasing the payments against duly received supplies against Invoice No. 68 for a sum of Rs. 76,71,355/-. The petitioner has expressed its intention to invoke the arbitration clause and refer the disputes to the Arbitrator for adjudication. In fact, the petitioner has already approached the ICADR for appointment of an Arbitrator.

9. The petitioner has prayed for interim orders in para 8 of the petition in the following terms :

8. Relief Sought For :

(a) Pass ex parte ad interim direction in favour of the applicants and against the respondents thereby directing the MTNL to accept the remaining supplies of 68,546.25 metres of fabric, (34842.49 metres lying with transported godown since 24.10.2001) and remaining 33703.76 mtrs. lying in the factory godown immediately, preferably within 10 days to cease further deterioration in the fabric and remove possibilities of any damage, either directly or in the presence of the Local Commissioner be appointed as deem fit and proper under this circumstances by this Honble Court.

(b) Direct the MTNL to deliver already drawn cheque dated 22.10.2001 against the invoice No. 67 immediately and also process invoice No. 68 and release the payment in time bound schedule as per the terms of purchase order dated 10.4.2001.

(c) xxx xxx xxx

10. The respondent refutes the petition, inter alia, on three grounds. Firstly, that the petitioners through their officials have committed fraud on the respondent pursuant to which an FIR has been lodged and the matter is under investigation by CBI and as such the contract cannot be enforced during the pendency of CBI investigation. Secondly, the petition is not maintainable under Section 9 of theas interim relief claimed is in the nature of specific performance of the contract which is not permissible under law. Thirdly, the petitioner Company has made a reference under Section 15 of Sick Industrial Companies (Special Provisions) Act, 1985 (in short SICA) and in case the applicant receives the amount under the contract, respondent would be unable to recover the same by operation of Section 22(i) of SICA.

11. At the outset, Mr. Rajiv Nayyar, Senior Advocate appearing for the petitioner stated that the relief sought in para 8(a) which is in the nature of specific performance of the contract is not pressed as the same would be adjudicated by the Arbitrator. The interim relief in para 8(b) of the petition is pressed as this relief is by way of directions to MTNL to deliver the already drawn cheque dated 22nd October, 2001 for Rs. 1,37,76,401/- against Invoice No. 67 and also process Invoice No. 68 to release the payment of Rs. 76,71,355/- as against the said invoice as the cloth has already been received and utilised by the MTNL.

12. The fact that the respondent had floated tender for cloth for uniform for their Group C and D employees is not disputed. There is also no dispute that the petitioners bid was accepted. There is no controversy about the fabric supplied. There is also no dispute that the total contract was for about Rs. 12 crores, out of which about Rs. 8 crores have already been paid by the MTNL. With regard to the second purchase order dated 19th April, 2001, it is not disputed that supplies against Invoice No. 67 were received and even a cheque for the payment against the same to the tune of Rs. 1,37,76,401/- was prepared by the MTNL on 22nd October, 2001 but not dispatched on account of the CBI investigation. The fact that as against Invoice No. 68, supplies have already been received by the MTNL is also not disputed. MTNL has in fact not processed the payment as against the said invoice. Admittedly, till date neither the contract has been repudiated nor the material has been rejected. No dispute regarding the quantity supplied and the quality of goods has also been raised.

13. In view of the above admitted facts, I proceed to examine the pleas of the parties. The first objection raised by the respondent relates to the pendency of CBI investigation in pursuance of an FIR dated 10th October, 2001 against some officers of the MTNL and that of the petitioner. The FIR was registered on 10th October, 2001. The FIR in fact alleges wrongful awarding of the contract to the petitioner on exorbitant rates on account of a conspiracy of the MTNL officers (accused) with the petitioners officials. A criminal action is sought against the accused officers. The FIR and the investigation in pursuance thereof has not bearing on the contract between the parties.

14. Mr. Rajiv Nayyar contends that at no point of time the respondent raised any objection regarding the quality of the cloth or the price being exorbitant. It is contended that even after the acceptance of tender, price was further negotiated and re-fixed as comparable to the price at which the fabric was supplied by the petitioner to AAI. The fact that fabric has been received as against Invoice No. 67 and a cheque was drawn up for its payment is also admitted. The contention is that any criminal proceedings initiated against some officials of the MTNL cannot stand in way in the compliance of a contract. Prosecution of the officials of MTNL will not effect the civil liabilities. The respondent at no point of time challenged the purchase order on the basis of fraud or otherwise. The allegations in the FIR cannot be termed as fraud. It is pointed out that a joint inspection was carried out on 10th July, 2001 and the payment to the tune of about Rs. 8 crores was made after that. Even the cheque dated 22nd October, 2001 against Invoice No. 67 was drawn after the FIR was registered. While registering the FIR, no prohibitory orders were passed by the CBI to withhold the payment or not to release the cheque drawn in favour of the petitioner. Admittedly, the cheque was not seized by CBI alongwith the other record. The respondent only contends in the reply that in the FIR it is alleged that undue favour is shown to the petitioner causing pecuniary loss to MTNL and also giving scope for supply of sub-standard cloth. Admittedly, the FIR is not lodged at the complaint of the respondent. It is contended that possibly CBI had registered the case against certain officials of the respondent at the behest of those participating bidders who could not secure the bid. It is pointed out that regarding the material supplied, each lot was subjected to testing and inspection was carried out at three stages involving a third agency NITRA which was appointed at the instance of the respondent. By way of some allegations in the FIR, respondents cannot say that they ever raised any objection regarding the quality of the fabric. The respondent has in fact utilised the material supplied against Invoice Nos. 67 and 68 and issued the same to its employees for uniforms. This act is demonstrated by a letter dated 24th December, 2001 circulated by MTNL to all its GMs/CE (BW) by which directions were issued for distribution of uniform to Group C and D employees. A copy of this letter is enclosed with the rejoinder. This letter is not denied by the respondent when referred in the arguments. It is also demonstrated from the said letter that two sets of winter uniform were to be distributed and cash payment for the third set including the stitching charges for all the three winter uniforms were to be worked out as per the tender rate. The argument is that this letter shows that tender rates were accepted by the respondent even in December, 2001. The contention is that under the circumstances and in view of the fact that respondent has neither repudiated the contract nor rejected the material on any ground and even utilised the same, they cannot withhold the payment.

15. I agree with the aforesaid contentions of the learned Counsel for the petitioner. Till date the respondent has not questioned the quality or price of the cloth. Even after the registration of the FIR, the respondent has accepted the supplies and prepared a cheque for payment against Invoice No. 67. The fact that an FIR has been registered against some officers of the MTNL and officials of the petitioner for the alleged wrongful procurement of the contract has no bearing on its performance. I, therefore, reject the respondents plea that on account of pendency of CBI invesigation, the contract cannot be enforced.

16. The second challenge to the petition is on the ground that the relief claimed is in the nature of allowing the whole claim amounting to specific performance of contract, which cannot be allowed under Section 9 of the. The relief claimed by the petitioner in para 8(a) of the petition, which is in the nature of specific performance of contract, has not been pressed by the learned Counsel for the petitioner at the outset. The interim relief claimed is the delivery of cheque for Rs. 1,37,76,401/- as against Invoice No. 67 dated 18th October, 2001 and processing the payment against the admitted supply of cloth as per Invoice No. 68. This claim of the petitioner is in fact an admitted obligation of the respondent. The fact that the cheque for Rs. 1,37,76,401/- dated 22nd October, 2001 was prepared against Invoice No. 67 is not denied. Also the cloth having been supplied and received against this invoice is admitted. Supply against Invoice No. 68 is also admitted to have been received and even utilised. Regarding these two claims, there is no dispute which can be referred for adjudication to the Arbitrator. It is for this admitted obligation, the petitioner is seeking directions and such an admitted obligation can be enforced under Section 9 of theby way of interim relief. In the given facts and circumstances of the case it would be just and convenient to grant relief claimed by the petitioner. Reference is made to 2000 (3) Arb.LR 668 (Calcutta), Tata Finance Limited v. Pragati Paribahan & Ors. where relief under Section 9 of thewas granted with respect to the admitted obligation of respondent. In the said case, Pragati Paribahan, the hirer, entered into an agreement of hire purchase with the appellant M/s. Tata Finance Limited. The hirer failed to make payment of instalments as specified in the agreement, as a result of which the entire amount became payable at once empowering the appellant/financier to seize the vehicle in question. In reply to the notice served by the financier, the hirer admited his fault and requested for allowing him some time to pay the arrears of instalments. The appellant had, however, seized the vehicle. At this, the respondent/hirer moved the Court under Section 9 of thefor interim directions. The Trial Court directed the respondent/hirer to deposit the arrears by a particular date and to pay the instalments within a time frame. It was further directed that on payment of arrears, appellant shall release the vehicle. On appellant preferring an appeal, a Division Bench of Calcutta High Court direced the respondent to pay the entire arrears of instalments which had become due up to 5th June, 1999 i.e. the date of seizure within one month. The arrears already paid were allowed to be adjusted. After such payment, the vehicle was directed to be released and after a month of the release of the vehicle, respondent/hirer was directed to pay rest of the monthly instalments. Such an interim order was passed by the Calcutta High Court because of the admitted liability of the hirer in order to protect the interest of both the parties as there was no dispute that the payment was due.

17. The above judgment is fully applicable to the facts of the instant case. In the instant case, there is no dispute about the quantity, quality and delivery of the goods supplied by the petitioner. Till date the contract has neither been repudiated nor cancelled. The supplies against Invoice Nos. 67 and 68 are duly received and even utilised by the respondent. The cheque against supplies of Invoice No. 67 was duly prepared and drawn in favour of the petitioner. These are the admitted obligations of the respondent on which there is no dispute which would be referred for arbitration. Allowing such a claim does not amount to the allowing of the whole claim or specific performance of the contract.

18. Learned Counsel for the respondent has relied upon 1987 (2) Arb.LR 10, Vinit Manchanda v. Rishi Co-operative Group Housing Society & Anr. It was a case under the old Act. The petitioner in the said case was awarded a contract for construction, in pursuance of which, he had taken possession of the site. The petitioners contract was later on cancelled on account of certain irregularities and the contract of construction was awarded to some other person. The petitioner invoked the arbitration clause. He also sought interim relief under Section 41 of the old Act restraining the respondent from dispossessing the petitioner from the work site and from directly and indirectly interfering with the awarded work. This relief was declined as grant of such interim relief, amounted to the specific performance of the contract. Otherwise also, it was held that the contract depended upon volition of the parties and it could not be enforced specifically. This case is not applicable on facts to the case in hand.

19. Learned Counsel for the respondent also refers to 1995 (2) Arb.LR 479, Mahanagar Telephone Nigam Ltd. v. M/s. Vichitra Construction Pvt. Ltd. In this case, M/s. Vichitra Construction Pvt. Ltd. had entered into a contract with MTNL. After the completion of work, the contractor submitted 13 bills. The MTNL refused to pay the same in the stipulated period. Disputes arose between the parties. The contractor invoked the provisions of Section 20 of the Arbitration Act, 1940 and prayed for appointment of an Arbitrator. Alongwith the petition, the contractor also moved an application under Section 41(b) of the 1940 Act for interim relief seeking injunction restraining the MTNL from recovering or adjusting the amount of Rs. 2,57,767/- against the alleged excess amount paid to the contractor. The Trial Court gave an interim direction in favour of the contractor, but the High Court set aside the same holding that the claim of the contractor was yet to be adjudicated and allowing the same would amount to the allowing his whole claim. This case also has no bearing on the facts of the present case. In the instant case, the relief claimed is the release of cheque already prepared against Invoice No. 67 and processing the payment against Invoice No. 68 for which supply has been admittedly received and utilised which is an admitted obligation of the respondent.

20. Also reference to 76 (1998) DLT 908 [LQ/DelHC/1998/511] =AIR 1998 Delhi 397, M/s. Global Company v. M/s. National Fertilizers Ltd. does not help the respondent. It is also not applicable to the facts of the instant case. In the said case, an award was passed in favour of M/s. Global Company. Respondent failed to file objections under Section 34 of theand the award became a decree. The petitioner moved the Court under Section 9 of thefor securing the decretal amount payable to them. The relief was declined as the interim orders could not be granted on the sole ground of protection of his financial interests. In the instant case, interim orders claimed by the petitioner are not in the nature of securing or protecting their financial interests. But what is sought by way of interim relief is discharge of respondents admitted obligation under the contract for which there is no dispute between the parties which could be referred to the Arbitrator. The interim reliefs claimed in the instant case is nothing else but an admitted obligation on the part of the respondent and such an obligation can be enforced under Section 9 of theby way of interim relief.

21. The third challenge is that the petitioner company has made a reference under Section 15 of SICA and in case petitioner received the amount under the contract, respondent would be unable to recover the same by operation of Section 22(i) of SICA. It is pointed out by Mr. Rajiv Nayyar that the proceedings before BIFR already stand concluded with the acceptance of scheme of financial restructuring by the financial institution. It is submitted that the bar of Section 22 of SICA applies only to such of those dues reckoned or included in the scheme of rehabilitation. The contention is that rehabilitation scheme with respect to the petitioner has already been accepted and obviously any prospective claim which might arise in future against the petitioner could not have formed part of the scheme. In AIR 1997 SC 2027, Deputy Commercial Tax Officer & Ors. v. Corromandal Pharmaceuticals & Ors., the Supreme Court held that the bar or embargo envisaged under Section 22(1) of SICA could apply only to such of those disputes reckoned or included in the sanctioned scheme. The respondents apprehension that any future claim against the petitioner would be barred under Section 22(i) of SICA is misconceived and devoid of any merits.

22. In view of the above discussion and considering the peculiar facts and circumstances of the case, I am of the considered opinion that the petitioner is entitled to the interim relief claimed in para 8(b) of the petition. I accordingly direct MTNL to deliver to the petitioner the already drawn cheque of Rs. 1,37,76,401/- dated 22nd October, 2001 against Invoice No. 67 and also process Invoice No. 68 and release the payment as per the terms of the purchase order dated 19th April, 2001 within one month from today. It is, however, made clear that the cheque for Rs. 1,37,76,401/- be revalidated or a fresh cheque of that amount be issued.

23. The petition is accordingly disposed of.