Rakesh Gangwal & Ors vs Interglobe Enterprises Private ... on 8 October, 2021

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Delhi High Court - Orders

Rakesh Gangwal & Ors vs Interglobe Enterprises Private ... on 8 October, 2021

1. The present petition under Section 9 of the Arbitration and Conciliation Act, 1996 [hereinafter referred to as, 'the Act'] has been filed O.M.P.(I) (COMM.) 338/2021 Page 1 of 4 post the making of the award dated 23rd September, 2021. The directions given in the final award are as follows :

"e. Claimants [Respondents] and Respondents 1-3 [Petitioners] shall jointly take the following actions to remove the Transfer Restriction Articles from the Company's Articles of Association:

(i) make a requisition to call an extraordinary general meeting of shareholders to vote on a resolution to remove the Transfer Restriction Articles from the Company's Articles of Association, within 30 days after the date of this Award; and

(ii) take the necessary actions to convene and conduct the extraordinary general meeting at joint cost (split equally between (1) Claimants [Respondents] and (2) Respondents 1-3 [Petitioners]), within the timelines specified under the Companies Act and vote in favour of the resolution to remove the Transfer Restriction Articles from the Articles of Association;"

2. The present petition has been filed, inter alia, seeking the following reliefs:

"(i) direct the Respondents to jointly, with Petitioner, requisition an EGM, in compliance with the directions of the Award;

(ii) direct the Respondents to cooperate with the Petitioners and take all necessary actions, as may be required in law or otherwise, to convene and conduct the EGM as mentioned in prayer (i) above and directed by the Tribunal, within the applicable statutory timelines under the Companies Act 2013 and associated rules in compliance with the directions in the Award;

(iii) appoint a Local Commissioner/ Court Receiver to supervise the conduct of the aforementioned EGM to ensure compliance with the terms of the Award;

(iv) Allow the Petitioner No. 1 to deposit USD 25,000 payable to each of the Respondents in terms of the Para 16.1.1 (b) of the Award with the Registry of this Hon'ble Court and treat the same as compliance of 'the aforesaid direction contained in the Award;"

3. Mr. Harish Salve, Senior Counsel for the Petitioners, submits that in order to comply with the direction given in the award and wire the payment of USD 25,000 to each of the Respondents, the Petitioners had sought details from the Respondents. However, since the same were not furnished, the Petitioners seek direction(s) from this Court to allow them to make the O.M.P.(I) (COMM.) 338/2021 Page 2 of 4 deposit with the Registry of this Court.

4. Dr. Abhishek Manu Singhvi, Senior Counsel states that Respondents are willingly accept this payment without prejudice to their rights and contentions.

5. Therefore, in furtherance of the statement made by Dr. Singhvi, no orders are required apropos the directions sought by the Petitioners in para

(iv) of the petition, recorded above. The necessary details for wiring the aforesaid payments will be intimated by the Respondents to the Petitioners within a period of one week from today - within 72 hours of which, the payment shall be made.

6. With respect to the prayer made in para (ii) extracted above, Mr. Salve states that although the award is yet to be enforced, directions of this nature are necessary, so that the preparatory work can be carried out pending further orders. On this aspect, Dr. Singhvi and Mr. Sandeep Sethi, Senior Counsels for the Defendants state that the aforesaid directions are in the nature of execution of the award, and therefore, are outside the purview of Section 9 of the Act.

7. The Court has considered the submissions of the parties. Para (e) of the award in question directs the Claimants [Respondents herein] and Respondents 1-3 [Petitioners herein] to jointly take actions to remove the 'Transfer Restriction Articles' from the Articles of Association of Respondent No. 2 - InterGlobe Aviation Limited.

8. Admittedly, the time period prescribed under the Act to impugn the award has not run out as yet. Mr. Sethi states that indeed the Respondents would be impugning the award.

9. The directions sought in the present petition in para (ii) noted above, O.M.P.(I) (COMM.) 338/2021 Page 3 of 4 in the opinion of the Court, clearly amount to enforcement of the award and cannot be grant at this stage in the present proceedings. Besides, even if one were to construe the prayer as a direction for preparatory work for giving effect to the final direction passed in the award, the court finds no reason to entertain the present petition. There is no pressing need to issue the said directions. If and when the award becomes an enforceable decree, the court can, at the appropriate stage, issue such directions. Post the making of the award, and prior to its enforcement, interim measure of protection within the meaning of Section 9 of the Act is intended to safeguard the fruits of the proceedings until the eventual enforcement of the award. Considering the nature of relief sought and the final award, the court is unable to agree that interim relief of 'preparatory work' is necessary or called for.

10. The Court does not find any merit in the present petition and accordingly, the same is disposed of, in the above terms. The pending applications are also disposed of.

SANJEEV NARULA, J OCTOBER 8, 2021 nd O.M.P.(I) (COMM.) 338/2021 Page 4 of 4

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Delhi High Court - Orders