Delhi High Court - Orders
Bhartia Non Conventional Products ... vs Akshit Enterprises Private Limited on 6 July, 2021
Author: Rajiv Sahai Endlaw
Bench: Rajiv Sahai Endlaw, Amit Bansal
$~12 to 16
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ FAO (COMM) 103/2021
BHARTIA NON CONVENTIONAL PRODUCTS
(JAMSHEDPUR) ..... Appellant
Through: Mr. Rajiv Shankar Dvivedi, Ms. Arti
Dvivedi, Mr. Sushant Kumar Sarkar
and Mr. Rishabh Jain, Advs.
versus
AKSHIT ENTERPRISES PRIVATE LIMITED ..... Respondent
Through: Mr. Vilas Sharma, Adv.
AND
+ FAO (COMM) 104/2021
BHARTIA NON CONVENTIONAL PRODUCTS
(PUNE) ..... Appellant
Through: Mr. Rajiv Shankar Dvivedi, Ms. Arti
Dvivedi, Mr. Sushant Kumar Sarkar
and Mr. Rishabh Jain, Advs.
versus
AKSHIT ENTERPRISES PRIVATE LIMITED ..... Respondent
Through: Mr. Vilas Sharma, Adv.
AND
+ FAO (COMM) 105/2021
BHARTIA NON CONVENTIONAL PRODUCTS
(KOLKATA) ..... Appellant
Through: Mr. Rajiv Shankar Dvivedi, Ms. Arti
Dvivedi, Mr. Sushant Kumar Sarkar
and Mr. Rishabh Jain, Advs.
versus
AKSHIT ENTERPRISES PRIVATE LIMITED ..... Respondent
Through: Mr. Vilas Sharma, Adv.
AND
+ FAO (COMM) 106/2021
BHARTIA ALLOYS (CHANDRAPUR) ..... Appellant
Through: Mr. Rajiv Shankar Dvivedi, Ms. Arti
Dvivedi, Mr. Sushant Kumar Sarkar
and Mr. Rishabh Jain, Advs.
versus
FAO (COMM) 103/2021 FAO (COMM) 104/2021 FAO (COMM) 105/2021 FAO (COMM) 106/2021 FAO (COMM) 107/2021 Page 1 of 7
AKSHIT ENTERPRISES PRIVATE LIMITED ..... Respondent
Through: Mr. Vilas Sharma, Adv.
AND
+ FAO (COMM) 107/2021
BHARTIA ALLOYS (FARIDABAD) ..... Appellant
Through: Mr. Rajiv Shankar Dvivedi, Ms. Arti
Dvivedi, Mr. Sushant Kumar Sarkar
and Mr. Rishabh Jain, Advs.
versus
AKSHIT ENTERPRISES PRIVATE LIMITED ..... Respondent
Through: Mr. Vilas Sharma, Adv.
CORAM:
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
HON'BLE MR. JUSTICE AMIT BANSAL
ORDER
% 06.07.2021
[VIA VIDEO CONFERENCING]
CM APPL. 18844/2021 in FAO (COMM) 103/2021, CM APPL. 18848/2021 in FAO (COMM) 104/2021, CM APPL. 18856/2021 in FAO (COMM) 105/2021, CM APPL. 18860/2021 in FAO (COMM) 106/2021 & CM APPL. 18864/2021 in FAO (COMM) 107/2021 (all for exemption).
1. Allowed, subject to just exceptions and as per extant rules.
2. The applications are disposed of.
FAO (COMM) 103/2021, CM APPL. 18845/2021 (for condonation of delay in filing the application), CM APPL. 18846/2021 (for permission to deposit 75% of the awarded amount) & CM APPL. 18847/2021 (for ad interim stay), FAO (COMM) 104/2021, CM APPL. 18849/2021(for condonation of delay in filing the application), CM APPL. 18850/2021 (for permission to deposit 75% of the awarded amount) & CM APPL. 18851/2021(for ad interim stay), FAO (COMM) 105/2021, CM APPL. 18857/2021(for condonation of delay in filing the application) , CM APPL. 18858/2021 (for permission to deposit 75% of the awarded amount) & CM APPL. 18859/2021(for ad interim stay), FAO (COMM) 106/2021, CM APPL. 18861/2021 (for condonation of delay in filing the FAO (COMM) 103/2021 FAO (COMM) 104/2021 FAO (COMM) 105/2021 FAO (COMM) 106/2021 FAO (COMM) 107/2021 Page 2 of 7 application), CM APPL. 18862/2021 (for permission to deposit 75% of the awarded amount) & CM APPL. 18863/2021(for ad interim stay) & FAO (COMM) 107/2021, CM APPL. 18865/2021(for condonation of delay in filing the application), CM APPL. 18866/2021 (for permission to deposit 75% of the awarded amount) & CM APPL. 18867/2021(for ad interim stay).
3. These appeals impugn the common order dated 11th June, 2021 of the Commercial Court, North West District, Rohini Courts, Delhi, of dismissal of applications under Section 152 read with Section 151 of the Code of Civil Procedure, 1908 (CPC), filed by the appellants for correction/recall of the order dated 24th January, 2020 of dismissal of the applications/petitions filed by the appellants under Section 34 of the Arbitration and Conciliation Act, 1996 with respect to the arbitral awards in the arbitration between the respondent in all the appeals on the one hand and the appellants in each of the appeals on the other hand.
4. The respondent in each of the appeals being governed by the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006, the Commercial Court, vide order dated 20th December, 2019, in accordance with Section 19 of the said Act, directed the appellants to deposit 75% of the awarded amount in the Court, in four equal instalments, on or before 10th of each month starting from the month of January, 2020. The appellants however failed to deposit the first instalment and sought extension of time. Vide order dated 24th January, 2020, the Commercial Court dismissed the applications/petitions under Section 34 of the Arbitration Act, for the reason of the appellants having not made the deposit as earlier directed.
5. The appellants, though did not challenge the order/s dated 24th January, 2020 of dismissal of their applications/petitions under Section 34 of FAO (COMM) 103/2021 FAO (COMM) 104/2021 FAO (COMM) 105/2021 FAO (COMM) 106/2021 FAO (COMM) 107/2021 Page 3 of 7 the Arbitration Act, however filed applications under Section 152 read with Section 151 of the CPC before the Commercial Court, seeking to deposit 75% of the award amount and which applications have been dismissed vide the order/s impugned in these appeals and the appellants in these appeals have also challenged the order/s dated 24th January, 2020.
6. The counsel for the appellants has drawn our attention to page 144 of the file in FAO(COMM) 103/2021, being part of the order dated 20th December, 2019 aforesaid of the Commercial Court, finding a total sum of Rs.2,69,73,017/- to be due to the respondent under the arbitral awards. The counsel for the appellants states that the appellants are ready to immediately deposit 75% of the said sum of Rs.2,69,73,017/- in the Court.
7. We have enquired from the counsel for the appellants, whether not further amounts towards future interest would be due under the arbitral awards.
8. The counsel for the appellants states that the appellants will deposit 75% of Rs.2,69,73,017/- in the Commercial Court on or before 9th July, 2021 and shall deposit 75% of the amount due towards future interest till the date of deposit, on or before 16th July, 2021. He states that on such deposit, the applications/petitions under Section 34 of the Arbitration Act be allowed to be heard on merits.
9. The counsel for the respondent in all the appeals appears on advance notice and informs that, (i) the Courts at Delhi do not have the jurisdiction to entertain Section 34 applications/petitions filed by the appellants, with the territorial jurisdiction being of the Courts at Karnal; (ii) the respondent, in opposition to Section 34 applications/petitions, has taken/will be taking inter alia the said plea also; (iii) the respondent has also approached the Courts at FAO (COMM) 103/2021 FAO (COMM) 104/2021 FAO (COMM) 105/2021 FAO (COMM) 106/2021 FAO (COMM) 107/2021 Page 4 of 7 Nagpur for execution of the arbitral awards subject matter of all these appeals and which execution proceedings are also pending; and, (iv) since the Courts at Delhi do not have jurisdiction to entertain Section 34 applications/petitions, the entire exercise as aforesaid would be futile.
10. We are however of the opinion that the respondent being a small enterprise within the meaning of MSMED Act, it is in the benefit of the respondent that the respondent, instead of wasting time and money in pursuing the execution proceedings at Nagpur, at least has certainty of receipt of 75% of the awarded amount. We have thus persuaded the counsel for the respondent to agree to what is recorded herein below and to which the counsel for the respondent, in the interest of his client, has agreed.
11. Thus, acting in the interest of justice and without going into the aspect of maintainability of these appeals and/or of condonation of delay in filing thereof, we dispose of these appeals with the following order/direction:-
(i) The statement of the counsel for the appellants on behalf of the appellants, that the appellants, on or before 9th July, 2021 will deposit 75% of Rs.2,69,73,017/- in the Commercial Court, is accepted and the appellants are ordered to be bound thereby.
(ii) The statement of the appellants through counsel that the appellants, on or before 16th July, 2021 will deposit the balance amount towards 75% of the amount due under the award/s with interest till the date of deposit, is accepted and the appellants are ordered to be bound thereby.
(iii) If there is a default by the appellants in any of the said deposits, the challenge in these appeals to the orders dated 24th January, 2020 and 11th June, 2021 shall automatically stand dismissed, FAO (COMM) 103/2021 FAO (COMM) 104/2021 FAO (COMM) 105/2021 FAO (COMM) 106/2021 FAO (COMM) 107/2021 Page 5 of 7 as consented to by the counsel for the appellants.
(iv) However if the amounts are deposited, then the Section 34 Arbitration Act applications/petitions filed by the appellants and which were dismissed on 24th January, 2020 shall stand restored and the Commercial Court shall proceed to decide the said Section 34 applications/petitions preferred by the appellants on merits, including the ground of territorial jurisdiction raised by the respondent and the said applications/petitions shall be decided by the Commercial Court on or before 27th August, 2021.
(v) The counsels are directed to participate in physical/virtual hearing, as may be deemed appropriate by the Commercial Court and if neither physical nor virtual hearing is possible, to submit their arguments in writing before the Commercial Court and on the basis whereof the Commercial Court, within the time aforesaid, shall decide the Section 34 applications/petitions.
(vi) The disbursal of the amounts aforesaid to be deposited by the appellants in the Commercial Court shall await the disposal of Section 34 applications/petitions and shall abide thereby.
(vii) Even if the Section 34 applications/petitions are dismissed/rejected on the ground of Court at Delhi not having jurisdiction or on the ground of delay or on any other technical ground, the amounts deposited by the appellants in the Commercial Court together with interest accrued thereon shall be released in favour of the respondent, subject of course to the FAO (COMM) 103/2021 FAO (COMM) 104/2021 FAO (COMM) 105/2021 FAO (COMM) 106/2021 FAO (COMM) 107/2021 Page 6 of 7 right of the appellants to restitution in the event of Court of appropriate jurisdiction setting aside or interfering with the arbitral award.
(viii) The respondent, for the balance amounts if any due under the arbitral awards, shall be entitled to enforce the arbitral awards in accordance with law.
(ix) Subject to the deposit aforesaid by the appellants, till the disposal of the Section 34 applications/petitions by the Commercial Court, adjournment shall be taken in the execution/enforcement proceedings initiated by the respondent.
12. The appeals having been disposed of on the very first date, in the manner aforesaid, the parties to bear their own costs of these appeals.
RAJIV SAHAI ENDLAW, J AMIT BANSAL, J JULY 6, 2021 'pp' FAO (COMM) 103/2021 FAO (COMM) 104/2021 FAO (COMM) 105/2021 FAO (COMM) 106/2021 FAO (COMM) 107/2021 Page 7 of 7