Point of Law: There cannot be splitting of causes of action one between the civil suit and the other arbitral proceedings. Hence, the dispute alleged by the petitioner against the respondents cannot be split and referred to arbitration under these proceedings.

ORDER :

1. The petitioner is before this Court seeking for the following reliefs:

a. Exercise the power under Section 11 of the Arbitration and Conciliation Act, 1996 and appoint Mr. I.S.Antin, Rtd. District Judge as Sole Arbitrator to adjudicate the disputes involved that has arisen between the Petitioner Company and the Respondents as per Clause 14 of Annexure A dated 10.04.2017 and Clause 14 of Annexure B dated 13.10.2017 in the interest of justice and equity.

b. Cost of the proceedings.

c. Grant such other reliefs as this Hon’ble Court deems fit to grant in the circumstances of the case, in the interest of justice and equity.

2. The petitioner is a Company incorporated under the Companies Act, 2013 engaged in the business of operating an Online Technology Platform. The platform is an online marketplace for three kinds of parties viz., the sellers who have sold goods or provided services against an invoice to the customer, the second being the customer who has availed the goods/services from the sellers and is liable to pay the invoice amount to the sellers and the third being the financiers or the purchasers, who wish to purchase the right to receivables under the invoice from the sellers.

3. Respondent No.1 is stated to be an ex-employee of the petitioner, who joined the employment of the petitioner as Senior Manager Business Development. It is contended that respondent No.1 had agreed to the terms and conditions of the Employment Agreement dated 10.04.2017. The said Employment Agreement is governed by an arbitration clause.

4. It is stated that the respondent No.2 is also an ex-employee of the petitioner, who joined the services as a Sales and Business Development Manager and an Employment Agreement dated 13.10.2017 came to be executed between the petitioner and the respondent No.2, which is governed by an arbitration clause in terms of Clause 15 thereof, which is reproduced hereunder for easy reference:

“66. Arbitration:

You agree that the interpretation and enforcement of this Agreement shall be governed by the laws of India and all disputes under this Agreement shall be governed by the provisions of the Arbitration and Conciliation Act, 1996. The venue for arbitration will be Bangalore. The arbitration shall be conducted by a sole arbitrator appointed by the Company, and the award of the arbitration shall be final and binding upon you”.

5. Respondent No.3 is stated to be a Private Limited Company incorporated in May 2018, who is also engaged in running an invoice discounting market place and lease rentals discounting business, which is identical to that of the petitioner.

6. Respondent No.4 is stated to be the brother of respondent No.1 and respondents No.1, 2 and 4 are the founders and Directors of respondent No.3-Company.

7. The petitioner was intended to start a non-banking financial company and as such, several meetings were held in which respondent No.1 had participated and thereby became a recipient of privileged confidential and sensitive information. After receipt of the information, respondent No.1 resigned from the employment without assigning any reason. At that time, respondent No.1 had consented to the terms of the Exit Agreement dated 09.05.2018 and the said Exit Agreement dealt with confidentiality of the information as also is covered by an arbitration clause.

8. Subsequently, some of the customers of the petitioner had informed the petitioner that respondent No.1 had approached the said customers offering to provide the same service as that provided by the petitioner at a lesser rate. It is after enquiry that the petitioner came to know of respondents No.1, 2 and 4 having formed respondent No.3-Company and the same being in violation of the Employment Agreement as also Exit Agreement. The petitioner has initiated proceedings under Section 9 of the Arbitration and Conciliation Act, 1996 in Com.A.A.No.72/2019 and also issued a notice on 17.08.2019 nominated its arbitrator seeking for concurrence from the responden