Karnataka High Court
Bhagwati Products Limited vs Indkal Technologies Private Limited on 20 August, 2024
Author: S.R.Krishna Kumar
Bench: S.R.Krishna Kumar
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NC: 2024:KHC:33322
RP No. 201 of 2024
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 20TH DAY OF AUGUST, 2024
BEFORE
THE HON'BLE MR JUSTICE S.R.KRISHNA KUMAR
REVIEW PETITION NO. 201 OF 2024
IN
CIVIL MISCELLANEOUS PETITION No.313 OF 2023
BETWEEN:
BHAGWATI PRODUCTS LIMITED
A COMPANY INCORPORATED UNDER THE PROVISIONS
OF THE COMPANIES ACT, 1956,
AND HAVING ITS REGISTERED OFFICE AT
BLOCK A, PLOT NO. 21/14,
4TH FLOOR, NARAINA INDUSTRIAL AREA,
PHASE II, NEW DELHI - 110 028,
REPRESENTED BY ITS AUTHORIZED SIGNATORY,
MR. RAVINDER KUMAR.
...PETITIONER
(BY SRI. MANASI KUMAR, ADVOCATE)
AND:
INDKAL TECHNOLOGIES PRIVATE LIMITED
Digitally signed
by A COMPANY INCORPORATED UNDER THE PROVISIONS
LEELAVATHI S OF THE COMPANIES ACT, 2013 AND HAVING ITS
R
REGISTERED OFFICE AT C-102,
Location: HIGH
COURT OF HUNDUJA LAKE FRONT,
KARNATAKA HULIMAVU, BANNERAGHATTA ROAD,
BENGALURU - 560 076,
REPRESENTED BY ITS HEAD-OPERATIONS AND
AUTHORISED SIGNATORY,
MR. SHASHANK KAPOOR.
...RESPONDENT
(BY SRI. GITANJALI MIRIAM MATHEW, ADVOCATE)
THIS REVIEW PETITION IS FILED UNDER ORDER 47 RULE 1
READ WITH SECTION 114 OF THE CPC, 1908 PRAYING TO ISSUE A
WRIT, ORDER, OR DIRECTION, A. SETTING ASIDE THE JUDGMENT
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NC: 2024:KHC:33322
RP No. 201 of 2024
DATED 19.01.2024 IN CMP NO.313 OF 2023 AND ALL ACTIONS
PURSUANT THERETO (ANNEXURE A), B. ANY OTHER ORDER(S)
THAT THIS HON'BLE COURT MAY DEEM FIT, IN THE INTEREST OF
JUSTICE AND EQUITY.
THIS PETITION, COMING ON FOR ORDERS, THIS DAY,
ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR JUSTICE S.R.KRISHNA KUMAR
ORAL ORDER
This review petition is directed against the impugned order dated 19.01.2024 passed in CMP No.313/2023, whereby the said petition filed by the respondent under Section 11 of the Arbitration and Conciliation Act, 1996 (for short 'the said Act, 1996') was allowed by this Court.
2. Heard learned counsel for the review petitioner and learned counsel for the respondent and perused the material on record.
3. A perusal of the impugned order will indicate that this Court recorded a finding that the petitioner herein who was arrayed as respondent in CMP No.313/2023 served with notice of the said petition and had chosen to remain unrepresented and was placed exparte.
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NC: 2024:KHC:33322 RP No. 201 of 2024
4. In this context, learned counsel for the petitioner submits that due to bonafide reasons, unavoidable circumstances and sufficient cause, the review petitioner was not in a position to contact his counsel and give necessary instructions for the purpose of appearing in CMP No.313/2023, which was allowed exparte in the absence of the review petitioner. It is also submitted that the petitioner has a good case to urge on merits and that if the impugned order is set aside and CMP No.313/2023 is restored to the file of this Court, the petitioner would file statement of objections and contest the said CMP No.313/2023 on merits.
5. It is submitted that the petitioner has always categorically/specifically disputed/denied the alleged agreement dated 31.05.2022 alleged to contain the arbitration clause/agreement said to have been entered into between the parties. In this regard, my attention is invited to the reply dated 02.12.2022 issued by the review petitioner to the termination notice dated 19.11.2022, in which the petitioner has specifically disputed/denied the execution as well as the existence of the agreement including the arbitration clause. It is also pointed out that to the arbitration notice dated 10.04.2023, review petitioner -4- NC: 2024:KHC:33322 RP No. 201 of 2024 herein issued a reply dated 08.05.2023 specifically and categorically denying and disputing not only the agreement dated 31.05.2022, but also the arbitration clauses alleged to be contained therein.
6. It is therefore submitted that finding recorded by this Court at paragraph No.4 of the impugned order that the petitioner has not disputed/denied the existence of arbitration agreement/clause in the contracts entered into between the parties, is clearly an error apparent on the face of the record warranting interference by this Court under Section 114 r/w Order XLVII Rule 1 of CPC and as such, the present petition deserves to be allowed.
7. Per contra, learned counsel for the respondent would reiterate the various contentions urged in the statement of objections and submit that the petitioner had not made out valid or sufficient cause for not appearing before this Court at the time of disposal of CMP No.313/2023. It is also submitted that review petition is not maintainable against the order passed under Section 11 of the said Act, 1966, as held by the Co-ordinate Bench of this -5- NC: 2024:KHC:33322 RP No. 201 of 2024 Court in the case of Electronics & Controls Power Systems Private Limited Vs. WeP Peripherals Limited1.
8. I have given my anxious consideration to the rival contentions of both parties and perused the material on record.
9. A perusal of the material on record, will indicate that the petitioner was served with notice of CMP No.313/2023 and did not appear when the matter was taken up before this Court. However, the specific assertion on the part of the petitioner that due to bonafide reasons, unavoidable circumstances and sufficient cause, the petitioner was not in a position to engage the services of a counsel and provide instructions for the purpose of contesting the matter, deserves to be accepted especially in the light of the correspondence between the parties prior to filing of CMP No.313/2023 being preferred by the respondent which clearly indicates that the petitioner categorically and specifically disputed/denied the alleged agreement dated 31.05.2022, propounded by the respondent.
1 RP No.38/2017 in CMP No.15/2012 dated 22.08.2019 -6- NC: 2024:KHC:33322 RP No. 201 of 2024
10. Under these circumstances, in the light of the specific denial of the alleged agreement dated 31.05.2022 said to have contained arbitration clause/agreement, I am of the view that in the facts and circumstances of the instant case, the petitioner has a good defence to urge on merits in CMP No.313/2023 and the balance of convenience is in its favour and consequently, it would be just and proper to provide one more opportunity to the review petitioner to file objections and contest CMP No.313/2023 on merits and in accordance with law.
11. A perusal of the impugned order dated 19.01.2024 passed in CMP No.313/2023 will indicate that this Court recorded a finding that the review petitioner had sent a reply dated 08.05.2023 in which the petitioner had not disputed/denied the existence of the arbitration agreement/clause in the contract entered into between the parties. However, a perusal of the said reply which is produced by the respondent herein itself as Annexure-C1 to CMP No.313/2023 is sufficient to come to the conclusion that in the said reply, the review petitioner has not only disputed/denied the alleged agreement dated 31.05.2022 but also the very existence of the alleged arbitration clause/agreement between the parties. -7-
NC: 2024:KHC:33322 RP No. 201 of 2024
12. It is therefore clear that this Court has proceeded on the erroneous premise that the petitioner had admitted the existence of the arbitration clause/agreement and consequently, the said finding recording the non-existent admission on the part of the petitioner as regards existence of the arbitration agreement is incorrect and an error apparent on the face of the record warranting interference of this Court under the provisions of Section 114 r/w Order XLVII Rule 1 of CPC.
13. Insofar as the judgment of the co-ordinate bench of this Court in RP No.38/2017 is concerned, a perusal of the same will clearly indicate that this Court has not laid down any law or legal principle that a review petition against an order passed under Section 11 of the said Act of 1996 was not maintainable and as such, the said judgment would not be applicable to the facts of the instant case. At any rate, exercising the inherent power of this Court under Articles 226 or 227 of the Constitution of India would be sufficient to enable a High Court to exercise its power of recall / review which inheres in every court of plenary jurisdiction to prevent miscarriage of justice or to correct grave and palpable errors committed by it, in order to do substantial justice. Viewed -8- NC: 2024:KHC:33322 RP No. 201 of 2024 from this angle also, in the specific denial by the petitioner of the existence of the arbitration agreement, the present case warrants interference by setting aside the impugned order and to restore CMP No.313/2023 for disposal on the merits.
14. Accordingly, I pass the following:
ORDER
i) Review Petition is allowed.
ii) Impugned order dated 19.01.2024 passed in CMP No.313/2023 is set aside.
iii) CMP No.313/2023 is restored to file for disposal on merits.
iv) Registry to show the name of Sri. Manasi Kumar, as
learned counsel for the respondent in CMP
No.313/2023 and post the matter before the
appropriate bench having roster.
Sd/-
(S.R.KRISHNA KUMAR)
JUDGE
MDS
List No.: 1 Sl No.: 30