Redemption of Mortgage disputes non-arbitrable: Bombay High Court

The Bombay High Court has held that a dispute seeking the enforcement of a mortgage deed cannot be referred to arbitration as it is a right in rem.

The interim application was filed seeking recovery of money in a loan agreement secured by an Indenture of Mortgage executed by the appellant in the plaintiff's favour.

The Court clarified that a dispute can be referred for arbitration under Section 8 of the Arbitration Act only when the action was the subject of an arbitration agreement.

It further held that the Court retains the ultimate authority to decide whether a matter is arbitrable, notwithstanding the existence of an arbitration clause. 

[Divya Enterprise v Capri Global Capital Ltd.]