Madras High Court
M/S.Lifecell Intentional Private ... vs Mr.Vinay Katrela on 30 August, 2019
Author: C.V.Karthikeyan
Bench: C.V.Karthikeyan
CONTEMPT PETITION Nos.142 & 143 of 2019
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 30.08.2019
CORAM
THE HON'BLE Mr. JUSTICE C.V.KARTHIKEYAN
CONTEMPT PETITION Nos.142 & 143 of 2019
M/s.LifeCell Intentional Private Limited,
Represented by its Company Secretary,
Mr.D.Mahesh,
having its Registered Office at No.26,
Vandalur – Kelambakkam Main Road,
Keelakkottaiyur, Chennai-600 127. ... Petitioner in both Contp.
Vs.
Mr.Vinay Katrela ... Respondent in both Contp.
COMMON PRAYER : Contempt Petition filed under Section 11 of the Contempt
of Courts Act, 1971 praying to punish the respondent for willful disobedience of
the order of this Court dated 29.06.2018 passed in the above O.A.Nos.599 &
600 of 2018.
In Both Contempt Petitions:
For Petitioner : M/s.A.Adhithya for
M/s.Paul and Paul
For Respondent : M/s.Raja Adithya
COMMON ORDER
The Contempt Petition in Cont.P.No.142 of 2019 arises out of the interim order passed by this Court in O.A.No.599 of 2018 dated 29.06.2018. The Contempt Petition in Cont.P.No.143 of 2019 arises out of the interim order http://www.judis.nic.in 1/6 CONTEMPT PETITION Nos.142 & 143 of 2019 passed by this Court in O.A.No.600 of 2018 dated 29.06.2019.
2.The applications in O.A.Nos.599 & 600 of 2018 have been filed under the Arbitration and Conciliation Act, 1996. On 29.06.2019, when the applications were taken up for hearing, the respondent did not appear and therefore, an exparte order was granted. The respondent in both the applications were restrained by an order of interim injunction till 13.07.2018, from either competing with the business of the applicant Company or from divulging any information in relation to the applicant Company. In the said order, it was specifically stated that the applicant should initiate arbitration proceeding within a period of 30 days.
3.A brief synopsis with the dates and events has been filed by the learned counsel for the respondent today i.e., 30.08.2019 and it is seen that the orders were passed on 29.06.2018 and on 26.07.2018, the petitioner had issued notice to refer the dispute to arbitration, within the period of 30 days. Thereafter an Arbitration Tribunal has also been formed. Once the Arbitration Tribunal has been formed, the entire dispute between the parties should be sorted out only before the Arbitration Tribunal.
4.It is trite that under Section 9 of the Arbitration and Conciliation Act, 1996 once the Arbitration Tribunal is constituted, under normal circumstances http://www.judis.nic.in 2/6 CONTEMPT PETITION Nos.142 & 143 of 2019 application under Sub-Section (1) of Section 9 should not be entertained unless the Court comes to a conclusion that there exist certain circumstances which may not render the remedy provided under Section 17 efficacious.
As a matter of fact Section 9 Sub Clause 3 provides as follows:-
“(3) Once the arbitral tribunal has been constituted, the Court shall not entertain an application under Sub- section (1), unless the Court finds that circumstances exist which may not render the remedy provided under Section 17 efficacious.”
5.It is seen that an Arbitral award has been passed on 19.08.2019 rejecting the applicant's claim for damages for alleged breach of non-compete and non-disclosure clauses, subsequent to termination of the franchise agreement. It is stated in the affidavit filed by the respondent that the Arbitrator had actually held that the clauses in the agreement are void under Section 27 of the Indian Contract Act and hence not enforceable.
6.At any rate, the Arbitration Tribunal has completed the proceedings and passed an award, which also been challenged under Section 34 of the Arbitration and Conciliation Act. The orders passed in O.A.Nos.599 & 600 of 2018 have worked themselves out on 13.07.2018 itself. http://www.judis.nic.in 3/6 CONTEMPT PETITION Nos.142 & 143 of 2019
7.In the affidavit filed in support of the Contempt Petition, the petitioner has stated that they had sent a legal notice 26.07.2018 calling upon the respondent to desist from further violation of the order of this Court. The Arbitration proceedings have already been initiated. When such being the case, in all fairness, the petitioner should have waited for the outcome of the Arbitration proceedings. It is to be noted here that the sole arbitrator had been nominated as early as on 29.06.2018 itself.
8.In view of these facts it is found that the petitioner is only protracting the proceedings and trying to keep alive, though the disputes have been referred to arbitration and an Award has been passed, a proceeding already referred to the arbitration.
9.In view of the same, this Court does not find merits in the contents raised by the petitioner against the respondent. This Court hold that the respondent has not committed any contempt of the order of this Court.
10.In the result, the Contempt Petitions are dismissed.
30.08.2019 vv2 http://www.judis.nic.in 4/6 CONTEMPT PETITION Nos.142 & 143 of 2019 Internet:Yes Index:Yes/no Speaking/Non speaking order http://www.judis.nic.in 5/6 CONTEMPT PETITION Nos.142 & 143 of 2019 C.V.KARTHIKEYAN, J.
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