Delhi High Court - Orders
Sterlite Technologies Limited vs Bharat Broadband Network Ltd on 18 February, 2019
Author: Rajiv Shakdher
Bench: Rajiv Shakdher
$~3
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ ARB.P. 726/2018
STERLITE TECHNOLOGIES LIMITED ..... Petitioner
Through Mr. A.K. Thakur, Mr. R.K. Mishra
and Mr. Rishi Raj, Advs.
versus
BHARAT BROADBAND NETWORK LTD. ..... Respondent
Through Mr. Nikhilesh Krishnan, Advs.
CORAM:
HON'BLE MR. JUSTICE RAJIV SHAKDHER
ORDER
% 18.02.2019
1. On the last date of hearing i.e. 14.1.2019, the following order was passed by this Court:
"1. I may indicate herein that the disputes between the parties pertain to levy of liquidated damages and the rate on which excise duty was payable in respect of supplies made by the petitioner to the respondent.
2. Learned counsel for the respondent says that the issue with regard to the rate on [sic 'at'] which excise duty had to be paid by the respondent to the petitioner can be referred to an Arbitrator.
3. The only objection that the respondent has is with regard to the arbitration in the matter pertaining to imposition of liquidated damages.
3.1 Learned counsel for the respondent says that clause III 16.2
(d) of the Contract obtaining between the parties excludes arbitration in respect of matters pertaining to liquidated damages.
3.2 Mr. Thakur on the other hand says that the exclusion is only vis-a-vis the 'quantum' of the liquidated damages and not as to whether or not petitioner was in breach of the timeline set down in the Contract obtaining between the parties.
ARB.P. 726/2018 Page 1 of 33.3 It is Mr. Thakur's contention that in any event respondent cannot be vested with the authority to determine as to whether or not the petitioner had delayed supplies.
4. At request, renotify the matter on 18.2.2019."
2. A perusal of the aforesaid extract would show that the parties were ad idem that insofar as the dispute with regard to rate at which excise duty had to be paid by the respondent to the petitioner could be referred to the Arbitral Tribunal.
3. The parties, however, were at variance with regard to the other issue qua which disputes have arisen i.e. imposition of liquidated damages by the respondent on the petitioner.
4. The respondent, as is evident, once again, from the extract of the order dated 14.1.2019 relies upon Clause III 16.2(d) of the contract executed with the petitioner to contend that the aspect pertaining to liquidated damages is not arbitrable.
5. Given this backdrop, I have put to Mr. Krishnan, who appears for the respondent, as to whether or not this aspect could be raised by the respondent by way of an application under Section 16 of the Arbitration and Conciliation Act, 1996 (for short „1996 Act‟).
6. This query was raised having regard to the narrow bounds within which the Court exercises its jurisdiction under Section 11 of the 1996 Act after the amendment brought about w.e.f. 23.10.2015. In response Mr. Krishnan submitted that as long as this Court keeps that option open he would have no difficulty in the matter being referred to the Arbitral Tribunal.
ARB.P. 726/2018 Page 2 of 37. Accordingly, the captioned petition is disposed of with the following directions:
(i) Hon‟ble Mr. Justice R.V. Easwar, former Judge of this Court (Cell No: 9560899997) is appointed as an Arbitrator in the matter.
(ii) The learned Arbitrator will be paid his fee as per the provisions of the Fourth Schedule of the 1996 Act.
(iii) The respondent will have liberty to move an application under Section 16 of the 1996 Act qua the issue concerning liquidated damages.
(iv) The learned Arbitrator will render his decision on the application, if and when, it is moved by the respondent after hearing both the sides.
(v) Before entering upon reference, the learned Arbitrator will file his declaration under Section 12(5) read with the attendant provisions of the 1996 Act.
8. No order as to costs.
RAJIV SHAKDHER, J FEBRUARY 18, 2019 rb ARB.P. 726/2018 Page 3 of 3