Calcutta High Court
Infinity Infotech Parks Limited vs Tecpro Systems Limited on 9 March, 2016
Author: Biswanath Somadder
Bench: Biswanath Somadder
ORDER SHEET
AP No.1439 of 2015
IN THE HIGH COURT AT CALCUTTA
Ordinary Original Civil Jurisdiction
ORIGINAL SIDE
INFINITY INFOTECH PARKS LIMITED
Versus
TECPRO SYSTEMS LIMITED
BEFORE:
The Hon'ble JUSTICE BISWANATH SOMADDER
Date : 9th March, 2016.
Appearance:
Mr. Sabyasachi Chowdhury, Adv.
Mr. R.K. Khanna, Adv.
Mr. S.E. Huda, Adv.
...for the petitioner.
Ms. Noelle Banerjee, Adv.
Mr. Avijit Dey, Adv.
...for the respondent.
The Court : This is an application under section 11 of the Arbitration and Conciliation Act, 1996.
It appears that there exists an arbitration clause that binds the parties which is embedded in a deed of sub-lease dated 21st June, 2011. It further appears that by a letter dated 12th September, 2014, the advocate for the petitioner invoked the arbitration clause and nominated one Mr. Aryak Dutt as the sole arbitrator to adjudicate upon the disputes and differences as elucidated in the said letter dated 12th September, 2014. This letter was duly received by the respondent on 15th September, 2014, but was not replied to. Hence, the present proceeding under section 11 of the Arbitration and Conciliation Act, 1996 has been initiated by the petitioner.
During the course of hearing, the learned advocate representing the respondent drew this Court's attention to a letter dated 14th July, 2015, issued by the Registrar, Board for Industrial and Finance Reconstruction, New Delhi, addressed to the Chairman 2 and Managing Director of the respondent company. The learned advocate representing the respondent submits that this letter would reveal that the respondent company has been referred to the BIFR and the reference has been registered with the Board as Case no.86/2015. She further submits that since the respondent company is now before the BIFR, there is no scope for this Court to entertain the instant application, till the matter before the BIFR is finally disposed of. The other submission she has made is that the disputes sought to be referred for arbitration are not arbitrable disputes.
In reply, the petitioner has referred to the judgment of the Supreme Court rendered in the case of AGIO Countertrade Pvt. Ltd. Vs. Punjab Iron And Steel Co. Ltd. reported in Volume 100 Company Cases 826. Referring to the said judgment, he submits that the very issue which is sought to be raised by the learned advocate for the respondent company was considered by the Supreme Court which has clearly held to the effect that the scope of section 11 of the Arbitration and Conciliation Act for appointment of an Arbitrator was very narrow and the same are not covered by section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985. So far as the other contention raised by the learned advocate for the respondent company to the effect that the disputes sought to be referred for arbitration are not arbitrable disputes, the learned advocate for the petitioner refers to the letter dated 12th September, 2014 invoking the arbitration clause and submits that all the disputes have been spelt out under paragraph 32 of the said letter are clearly arbitrable in nature.
Having considered the submissions advanced by the parties, this Court is of the view that a proceeding under the BIFR cannot stand in the way for appointment of an Arbitrator under section 11 of the Arbitration and Conciliation Act, 1996. Even if the respondent company is finally declared as a sick industrial company (which is not even the case here), a proceeding under section 11 of the Arbitration and Conciliation Act, 1996 would be very much maintainable. The ratio of the decision rendered by the Supreme Court in AGIO Countertrade Pvt. Ltd. (supra) is clearly applicable in the facts 3 of the instant case. So far as the point raised by the learned advocate for the respondent company with regard to the disputes not being arbitrable, this Court is of the view that in the absence of any reply to the letter dated 12th September, 2014, which was duly received by the respondent company, such a stand is nothing but purely an afterthought. In any event, the respondent company can raise this issue, which is essentially on the point of jurisdiction, before the Arbitral Tribunal, in view of the clear provision of law as contained under section 16 of the Arbitration and Conciliation Act, 1996.
Since the existence of an arbitration clause is not in dispute and it appears that the respondent company, by not replying to the letter dated 12th September, 2014, has not agreed to the petitioner's nominated arbitrator, this Court appoints Hon'ble Justice Ronojit Kumar Mitra, a retired Judge of this Court, as the arbitrator to adjudicate upon the disputes which have arisen between the parties. The arbitrator will be entitled to determine his own remuneration which shall be borne by the parties, equally. The arbitrator will also be entitled to secretarial and clerical assistance, the remuneration of which shall be determined by the arbitrator and shall also be borne by the parties, equally. The arbitrator shall make an endeavour to conclude the proceedings as expeditiously as possible. The arbitrator shall not grant unnecessary adjournment to the parties and the parties are directed not to pray for any adjournments other than for exceptional or rare reason.
The application is accordingly disposed of.
Urgent photostat certified copy of this order be supplied to the parties, if applied for, upon compliance of all requisite formalities.
(BISWANATH SOMADDER, J.) B.Pal/sp/pa