IIFL Finance Gets Debit Freeze on Respondents

Authority: High Court of Judicature at Bombay, Commercial Division

Order Date: 08 October 2026

Petition filed by IIFL Finance Ltd under Section 9 of the Arbitration and Conciliation Act, 1996 seeking interim protection pending arbitration.
Business Loan Agreement dated 23 August 2024 for Rs10,22,846.00 was executed with respondents Jay Shree Shyam Traders and another.
Respondents defaulted on instalment payments; a Loan Recall Notice dated 10 September 2025 demanded repayment of the entire outstanding amount.
Petitioner claims outstanding dues of Rs12,52,097.82 together with interest at 23% per annum from 5 September 2025.
Respondents neither replied to the recall notice nor repaid the amount, and have not appeared before the Court despite service.
The Court previously directed respondents to disclose movable and immovable assets; this order remains uncomplied.
Petitioner alleges respondents are attempting to dispose of or transfer assets to defeat recovery, though no direct evidence of asset transfer is produced.

The Court finds a prima facie case for interim protection under Section 9, noting respondents' non‑appearance, failure to disclose assets, and risk of asset dissipation.
Order partially allows the petition, directing a debit freeze on all bank accounts of the respondents, including those linked with PAN No. AYXPJ1351.
The observations are prima facie and confined to the Section 9 application; the arbitral tribunal will decide the dispute on its merits.
Petitioner is directed to constitute the arbitral tribunal within 90 days from the order date.
The petition is disposed of with no order as to costs.

Topics: Arbitration; Interim Relief; Banking