Bombay High Court
Cms Computers Limited vs Microcomm India Limited on 13 January, 2023
Author: Bharati Dangre
Bench: Bharati Dangre
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
IN ITS COMMERCIAL DIVISION
COMM. ARBITRATION APPLICATION NO.213 OF 2021
CMS Computers Limited .. Applicant
Versus
Microcomm India Limited .. Respondent
...
Mr.Subhradeep Banerjee with Mr.Harsh Moorjhani i/b Mr.Navin
P. Sachanandani for the Applicant.
...
CORAM: BHARATI DANGRE, J.
DATED : 13th JANUARY, 2023
P.C:-
1. Despite service, the respondent has chosen not to remain
present.
The order dated 21/02/2022 indicate that last chance was
given to the respondent to appear in the proceedings and notice
was directed to be served by all permissible modes. It was made
clear that if the respondent, despite service, choose not to remain
present, the Court shall proceed to hear the application and pass
appropriate orders.
On an Hamdast being issued, Master (Adm), Suit Board
Department has tendered his service report dated 31/05/2022,
which clearly refect that the envelope was posted by speed post
and it was refused by the respondent. The envelope, which
returned with a refusal endorsement, forms part of the
proceedings.
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In the wake of the above refusal, the respondent is deemed
to have been served. Further, the respondent is served by
private notice by the applicant and the affdavit of service to that
effect is also placed on record.
2. The Department of Horticulture, Bangalore foated a tender
for supply, installation and maintenance of automated weather
stations, including software development and hardware and
software maintenance for a period of fve years. The applicant
alongwith the respondent, as consortium partners, were awarded
the Work Order on 30/03/2017 in the sum of Rs.1,40,28,521/-
and, accordingly, purchase orders were placed on 24/08/2017. A
service agreement was executed on 18/04/2019, wherein an
arrangement was worked out between the applicant and
respondent-consortium partner for executing the services, as per
the terms and conditions stipulated in the agreement. Under the
purchase order, the respondent was obligated to supply,
installation and maintenance of automated weather stations.
The said agreement contain a clause for resolution of
dispute in form of clause No.9. Apart from this, the purchase
order also refect the terms and conditions of the agreement
entered between the parties and specifcally contain a clause for
dispute resolution.
3. The facts reveal that the purchase order was acted upon
and on various dates, the applicant had made payments to the
respondent and as per the applicant, the total amount which was
paid to the respondent was amounting to Rs.55,00,000/-. On
04/09/2020, the Department of Horticulture, Bangaluru
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terminated the contract awarded to the consortium and forfeited
the EMD amount, alleging various breaches. This constrained
the applicant to issue legal notice to the respondent, inviting it's
attention to the alleged breaches, which was responded by
denying all the allegations, on 26/02/2021. Since the arbitration
clause is contained in the agreement as well as in the purchase
order, the applicant invoked arbitration and even suggested the
name of the arbitrator to adjudicate the dispute. There was no
response from the respondent and on the other hand, the
respondent chose to fle the complaint before Facilitation Council.
4. In the wake of the aforesaid background, since the disputes
have arose between the parties and the arbitration is invoked,
the learned counsel seeks appointment of a sole arbitrator to
resolve the dispute. By way of an abundant precaution, in order
to negate any argument to the effect that since the respondent
has already approached the Council, the arbitration proceedings
could not be entertained or the Court will be precluded from
exercising it's power under Section 11, the learned counsel for
the applicant rely upon the latest exposition of law on the said
subject, by considering the overriding effect of the Micro, Small
and Medium Enterprises Development Act, 2006 (for short,
"MSMED Act") in the case of Gujarat State Civil Supplies
Corporation Ltd. vs. Mahakali Foods Pvt. Ltd. (Unit 2) & Anr.1
5. In the wake of the above decision, I can see no diffculty in
Court exercising the power to appoint an arbitrator, since an
arbitration agreement exists between the parties and the
applicant has invoked the arbitration. Hence, I deem it expedient
to pass the following order.
1 2022 SCC OnLine SC 1492
M.M.Salgaonkar
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: ORDER :
TERMS OF APPOINTMENT
(a) Appointment of Arbitrator :
Mr.Rohan Kelkar, An Advocate of this Court is hereby appointed as a Sole Arbitrator to decide the disputes and differences between the parties under the documents referred to above.
(b) Communication to Arbitrator of this order :-
(I) A copy of this order will be communicated to the learned Sole Arbitrator by the Advocates for the applicant/ petitioner within one week from the date this order is uploaded.
(c) Disclosure : The learned Arbitrator, within a period of 15 days before entering the arbitration reference, shall forward a statement of disclosure as per the requirement of Section 11(8) read with Section 12(1) of the Arbitration and Conciliation Act, 1996, to the Prothonotary & Senior Master of this Court, to be placed on record of this application, with a copy to be forwarded to both the parties.
(d) Appearance before the Arbitrator :The parties shall appear before the Sole Arbitrator within a period of two weeks from today and the learned Arbitrator shall fx up a frst date of hearing in the week commencing from 06/02/2023. The Arbitral Tribunal shall give all further directions with reference to the arbitration and also as to how it is to proceed.
(e) Contact and communication information of the parties : Contact and communication particulars are to be provided by both sides to the learned Sole Arbitrator. This information shall include a valid and functional E-mail address as well as mobile numbers of the parties, participating in the process as well as of the Advocates.
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(f) Section 16 application : The respondent is at liberty to raise all questions of jurisdiction within the meaning of section 16 of the Arbitration Act. All contentions are left open.
(g) Fees : The Arbitrator shall be entitled to fees prescribed under Rules, 2018 and the arbitral costs and fees of the Arbitrator shall be borne by the parties in equal portion and shall be subject to the fnal Award that may be passed by the Tribunal.
(h) Venue and seat of Arbitration : Parties agree that the venue and seat of the arbitration will be in Mumbai.
(i) Procedure : These directions are not in derogation of the powers of the learned Sole Arbitrator to decide and frame all matters of procedure in arbitration.
5. All the rights and contentions of the parties are kept open.
6. The Application stands disposed off in the aforesaid terms.
( SMT. BHARATI DANGRE, J.) M.M.Salgaonkar ::: Uploaded on - 17/01/2023 ::: Downloaded on - 17/01/2023 22:34:34 :::