The petitioner, a finance company, challenges two orders by an arbitrator that halted arbitration proceedings due to a moratorium under Section 95 of the Insolvency and Bankruptcy Code (IB Code) 2016. The moratorium was triggered by insolvency proceedings against Mr. Tarun Kapoor, the proprietor of Sterling Motor Company (SMC), and guarantor Pavan Kapoor. The petitioner argues that the arbitration should continue against other respondents, particularly the legal heirs of a deceased guarantor, B.L. Passi. The respondent contends that the moratorium covers the entire debt, making the abeyance order valid. The petitioner seeks relief through writ jurisdiction, arguing that the arbitrator's decision was perverse and lacked jurisdiction.

1. Introduction:

   • The petitioner challenges the arbitrator's orders dated 07.10.2022 and 20.03.2023, which halted arbitration proceedings due to a moratorium under the IB Code.

2. Factual Background:

   • Petitioner's Finance Facility:
     • The petitioner, a finance company, granted a finance facility to SMC, with Tarun Kapoor as the proprietor and guarantor.
   • Arbitration Proceedings:
     • Arbitration was initiated due to SMC's default, with Gulnar A. Mistry as the arbitrator.
   • Insolvency Proceedings:
     • Volkswagen Finance Pvt. Ltd. filed insolvency proceedings against Tarun Kapoor, leading to a moratorium under Section 96 of the IB Code.
   • Moratorium Orders:
     • The NCLT issued moratorium orders for Tarun Kapoor and Pavan Kapoor, staying all proceedings related to their debts.
   • Arbitrator's Orders:
     • The arbitrator put proceedings against Tarun Kapoor and Pavan Kapoor in abeyance but continued against other respondents.

3. Petitioner's Arguments:

   • Against Moratorium Scope:
     • The moratorium should only apply to the debts of Tarun and Pavan Kapoor, not to other guarantors.
   • Legal Precedents:
     • Cited cases suggesting the liability of guarantors is co-extensive with the principal debtor and the moratorium should not prevent arbitration against other guarantors.
   • Continuance of Arbitration:
     • Arbitration should proceed against respondents not covered by the moratorium.

4. Respondent's Counterarguments:

   • Scope of Moratorium:
     • The moratorium is debt-centric and applies to the entire debt, not just the debtors in insolvency proceedings.
   • Legal Precedents:
     • Cited cases emphasizing minimal judicial intervention in arbitral proceedings and the broad scope of the moratorium under Section 96.

5. Judicial Review:

   • Scope of Writ Jurisdiction:
     • The court's writ jurisdiction can be invoked only if the arbitrator's orders are perverse or patently illegal.
   • Case Law Analysis:
     • Various Supreme Court judgments highlighting limited judicial intervention in arbitration and the specific protections under Section 96 of the IB Code.

6. Conclusion:

   • The petition challenges the arbitrator's decision to halt arbitration due to a moratorium, with arguments focusing on the scope of the moratorium and the liability of guarantors.