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Madhya Pradesh High Court

M/S Continental Telepower Industries ... vs Union Of India on 29 August, 2023

Author: Chief Justice

Bench: Ravi Malimath, Vishal Mishra

                                                                1
                           IN      THE       HIGH COURT OF MADHYA PRADESH
                                                  AT JABALPUR
                                                       BEFORE
                                         HON'BLE SHRI JUSTICE RAVI MALIMATH,
                                                    CHIEF JUSTICE
                                                          &
                                         HON'BLE SHRI JUSTICE VISHAL MISHRA
                                                 ON THE 29 th OF AUGUST, 2023
                                               WRIT PETITION No. 13556 of 2019

                          BETWEEN:-
                          M/S CONTINENTAL TELEPOWER INDUSTRIES LTD. (A
                          COMPANY CONSTITUTED UNDER THE PROVISIONS OF
                          THE COMPANIES ACT, 1956) HAVING ITS REGISTERED
                          OFFICE AT D-2/3 2ND FLOOR, REAR SIDE OKHLA
                          INDUSTRIAL AREA PHASE II NEW DELHI 110013,
                          THROUGH ITS DIRECTOR DR. SANJEEV KUMAR, S/O
                          SHRI MONOHARLAL, AGED 47 YEARS

                                                                                            .....PETITIONER
                          (BY SHRI R.K. VERMA - SENIOR ADVOCATE WITH SHRI RAM MURTI
                          TIWARI - ADVOCATE)

                          AND
                          1.     UNION OF INDIA, MINISTRY OF RAILWAY,
                                 THROUGH ITS SECRETARY, RAIL BHAWAN, NEW
                                 DELHI

                          2.     CHIEF MATERIALS MANAGER, WEST CENTRAL
                                 R AILWAY, O/O PRINCIPAL CHIEF MATERIAL
                                 MANAGER, CORE BUILDING, 1ST FLOOR,
                                 JABALPUR (MADHYA PRADESH)

                                                                                         .....RESPONDENTS
                          (BY SHRI PUSHPENDRA YADAV - DEPUTY SOLICITOR GENERAL)

                                 This petition coming on for admission this day, Hon'ble Shri Justice
                          Ravi Malimath, Chief Justice passed the following:
                                                                 ORDER

This petition is filed seeking the following reliefs:-

"I. Hon'ble Court may be pleased to call for the relevant records from Signed by: TAJAMMUL HUSSAIN KHAN Signing time: 8/31/2023 6:20:58 PM 2 the possession of the respondents for its kind perusal; II. Hon'ble Court may further be pleased to quash and set aside the impugned demand notice dated 28.06.2019 (Annexure-P/1); III. Hon'ble Court may kindly be further pleased to restrain the respondents from effecting any recovery from the petitioner under the debitable clause towards alleged loss pursuant to the cancellation order dated 30.01.2019 unless the dispute between the parties is finally adjudicated by an independent authority/Arbitrator; IV. Any other suitable relief deemed fit in the facts and circumstances of the case may also kindly be granted together with the cost of this petition."

2. The primary contention of the petitioner is that without the Arbitrator deciding all the disputes at large, the recovery cannot be made by the respondents. In terms of the impugned order dated 28.06.2019 (Annexure P/1), the recovery of Rs.2,95,44,458/- has been made. The arbitration has been invoked in terms of Clause-2900 of the contract. The said fact is not disputed by the learned counsel for the respondents.

3. Therefore, the only question that remains for consideration is as to whether the recovery can be effectuated even prior to approaching the Arbitrator. Necessarily it is for the Arbitrator to pass appropriate orders. Since that is the appropriate remedy to challenge an order of termination, we do not find that the recovery order could be maintainable.

4. For this reason, the writ petition is allowed. The order dated 28.06.2019 (Annexure P/1) is quashed. Since the arbitral proceedings have already commenced before the Arbitrator, the dispute at large will be settled by him. It is needless to state that the Arbitrator may pass any appropriate order based on the facts and circumstances of the matter.

5. Pending interlocutory applications are disposed off.

                                (RAVI MALIMATH)       (VISHAL MISHRA)
                                  CHIEF JUSTICE            JUDGE
                          taj




Signature Not Verified
Signed by: TAJAMMUL
HUSSAIN KHAN
Signing time: 8/31/2023
6:20:58 PM