ArcelorMittal Nippon Steel has filed a contempt petition in the Bombay High Court against Essar Services India and Essar House for failing to refund its ₹82-crore security deposit despite court direction.
ArcelorMittal Nippon Steel (AMNS) entered into agreement to avail managerial, accounting and administrative services from Essar Services and paid interest free deposit of ₹47.41 crore in January 2012.
In 2019, AMNS took over Essar Steel and terminated Essar Services agreement and sought refund of the security deposit. However, Essar Services refused to repay the deposit and AMNS filed an arbitration petition.
In December 2020, a single judge of the High Court granted an interim relief directing Essar Services to deposit ₹47.41 crore or furnish bank guarantee of that amount with interest and appointed Soli Cooper as sole arbitrator.
In January 2021, Essar Services filed another arbitration petition seeking to dismiss the previous order directing to deposit the disputed money with the court. In February, the court dismissed the petition and asked Essar Services to deposit ₹47.41 crore by March.
In February 2021, Essar Services moved a Special Leave Petition before the Supreme Court seeking to dismiss the High Court order forcing AMNS to file a contempt petition with the High Court.
Second case
Similarly, Essar Steel had an agreement to avail business centre facility on the sixth floor of Essar House by paying refundable security deposit of ₹35.52 crore. After AMNS took over Essar Steel, it was asked to vacate the place and did so in December 2019.
In December 2020, the High Court granted interim relief and ordered Essar House to deposit ₹35.52 crore by March, 2021. However, in February, Essar House moved the Supreme Court and disagreed to comply with the High Court order till its petition is heard in the Supreme Court.