IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT AURANGABAD 933 ARBITRATION APPEAL NO. 92 OF 2026 1 Khan Abdul Naeem Abdul Qayyum, Age 35 yrs., Occ. Business, Prop. Star Utsav Events & Promotions, R/o NTC Mill Area, Mil Gate, Nanded, Tq. & Dist. Nanded. 2 Bharat Jagdish Jethwani, Age Adult, Occ. Business, R/o Bafna Road, Sindhi Colony, Nanded, Tq. & Dist. Nanded. 3 Kharsheed Ahmed Khan, Age Adult, Occ. Business, R/o House No.2-9-392, NTC Mill Area, Nanded, Tq. & Dist. Nanded. 4 Kedar Ratnakar Nandedkar, Age Adult, Occ. Business, R/o Pundlik Mahavir Chowk, Nanded, Tq. & Dist. Nanded. … Appellants … Versus … Godavari Urban Multi State Credit Co-operative Society Limited, Head Office : Suryawanshi Complex, in front of MSEB Store, Opp. Taroda Naka, Nanded Through it’s authorized person / Audit Manager. … Respondent ... 2026:BHC-AUG:40003 2 933_ARBA_92_2026 Mr. Shahed Ali Ansari, Advocate for appellants Mr. R.F. Totala, Advocate for sole respondent ... WITH CIVIL APPLICATION NO. 4972 OF 2026 IN ARBA/92/2026 ... CORAM : ROHIT W. JOSHI, J. DATE : 28th AUGUST, 2026 ORDER : . Present appeal is filed in order to assail Judgment and order dated 13.03.2026 passed by learned District Judge-1, Nanded in Civil Miscellaneous Application No.134/2024 which was filed by the present appellants in order to challenge Arbitral Award in Case No.ARB/GUMCCS Ltd. NANDED/CHK/145/2021, dated 08.07.2023. The respondent is a Credit Co-operative Society registered under the Multi State Co-operative Societies Act, 2002. It had initiated a proceeding for arbitration against the present appellants for recovery of amount. It is the case of respondent that the appellants had borrowed an amount of Rs.24 lakhs and had failed to repay the loan amount. The Arbitral Tribunal allowed a claim by Award dated 08.07.2023. The appellant was directed to pay amount of Rs.33,87,408/- along with interest @ 20% per annum from 01.07.2021 till the date of 3 933_ARBA_92_2026 realisation of the amount. The said Arbitral Award was challenged by filing petition under Section 34 of the Arbitration and Conciliation Act, 1996, which came to be partly allowed by learned District Judge-1, Nanded vide Judgment and order dated 13.03.2026. Learned District Judge-1, Nanded has set aside the Arbitral Award subject to condition that the appellants shall, jointly and severally, deposit amount of Rs.25,00,000/- within a period of four weeks from the date of Judgment and order. The said Judgment dated 13.03.2026 is under challenge in the present appeal to the extent of the condition imposed by Judgment directing the appellants to deposit an amount of Rs.25 lakhs. The contention of learned Advocate for appellants is that once the learned District Court has found that the learned Arbitrator has decided the matter without affording due opportunity to defend to the appellants, the condition of deposit, imposed by learned District Judge is beyond jurisdiction. 2 Perusal of paragraph No.8 of the Judgment by the learned District Judge-1, Nanded will demonstrate that a specific finding is recorded that despite being served in the arbitration proceedings the appellants have deliberately failed to cause appearance and, therefore, arbitration proceeding was required to be decided ex parte. Learned District Judge-1, Nanded has further held that there is no material on record to indicate that sufficient 4 933_ARBA_92_2026 opportunity was not given by the Arbitral Tribunal to the appellants to defend their case. It is further recorded in paragraph No.11 that the appellants have failed to take steps to defend themselves. 3 However, having held so in paragraph No.11 of the Judgment learned District Judge has recorded that it prima facie appears that notice with respect to appointment of Arbitrator was not served upon the appellants. The Arbitral Award is set aside only on the ground that notice of appointment of Arbitrator was not served upon the appellants, although thereafter the Arbitrator had duly served the notice of arbitration proceeding so as to enable him to contest the same. The learned District Judge-1 has further recorded that the principal loan amount borrowed loan of Rs.27 lakh and a period of other six years has lapsed since the date of disbursement of the loan amount. Learned District Judge-1 has also recorded that payment of around 4 to 5 lakhs only was made by the appellants. On recording a prima facie satisfaction that the outstanding dues were to the tune of Rs.45 lakhs approximately, while setting aside the Award the learned District Judge-1 has imposed condition of deposit of Rs.45,00,000/-. 4 Learned Advocate for the appellants relying on Section 34(2)(a) (iii) contends that since the notice of appointment of Arbitrator was not served upon the appellants, award is vitiated. I am afraid the said contention 5 933_ARBA_92_2026 cannot be accepted with respect to statutory arbitration as provided under the Multi State Co-operative Societies Act. However, not much can be said about the said aspect since the respondent society has not challenged the said order of remand. 5 In the considered opinion of this Court the learned District Judge-1, Nanded has recorded a categorical finding despite being provided sufficient opportunity to defend the claim on merits the appellants failed to avail of the opportunity to defend themselves. The Award is set aside on the ground that notice while making appointment of the arbitration is not served on the appellants. With such observations, in order to balance equities learned District Judge has directed the appellants to deposit an amount of Rs.25,00,000/- while setting aside the arbitral award and remanding the matter to the Arbitral Tribunal for deciding the matter afresh. Cogent reasons are recorded for balancing the equities. The principal loan amount is Rs.27,00,000/-, out of which merely 4 to 5 lakh were repaid and total outstanding amount was approximately Rs.45,00,000/-, as such this Court sees no reason to interfere with the said condition imposed by the learned District Judge-1, Nanded while setting aside the Award and remanding the matter to the Arbitral Tribunal for deciding the arbitration case afresh, particularly in view of the fact that a categorical finding is recorded that the 6 933_ARBA_92_2026 appellants were provided proper opportunity to defend their case before the Arbitral Tribunal, which they did not avail. In the result, the appeal stands dismissed with no order as to costs. Pending civil application also stands disposed of. ( ROHIT W. JOSHI, J. ) agd