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2012 Supreme(Bom) 1965

High Court of Judicature at Bombay
R.D. DHANUKA, J.
Spice Digital Ltd.
Versus
Vistaas Digital Media Pvt. Ltd.
Arbitration Petition (L) No. 1164 of 2012
Decided on : 12-10-2012

Advocates Appeared:
For the Appellant:D.D. Madon, Sr. Advocate alongwith Sanaya Dadachanji alongwith Amit Chavan along with Tanvi Dudeja & Ujwal Trivedi i/by M/s. Manilal Kher Ambalal & Co., Advocates.
For the Respondent:Pradip Sancheti, Sr. Advocate alongwith Nirmay Dave along with Mayur Agarwal i/by M/s. Bilawala & Co., Advocates.

The contract was determinable during the lock-in period and thus no specific performance of such contract can be enforced in view of section 14(1)(c) of the Specific Relief Act, 1963. The contract involved performance of continuous duty which the court cannot supervise, and thus no specific performance of the agreement was enforceable under section 10 of the Specific Relief Act.

Headnote:

Arbitration Act, 1996 - Challenge to Order Rejecting Application for Interim Relief - Clause 6.2, Clause 12.1, Clause 12.2, Clause 14.6, Clause 14.7 - The court dismissed the application under section 17 of the Arbitration Act, 1996 filed by the appellant seeking to challenge the order dated 16th August, 2012 passed by the learned arbitrator rejecting the application for interim relief sought by the appellant under section 17 of the Arbitration Act, 1996.

Fact of the Case:

The appellant sought to challenge the order dated 16th August, 2012 passed by the learned arbitrator rejecting the application for interim relief sought by the appellant under section 17 of the Arbitration Act, 1996.

Finding of the Court:

The court found that the contract was determinable during the lock-in period and thus no specific performance of such contract can be enforced in view of section 14(1)(c) of the Specific Relief Act, 1963. The court also found that the contract involved performance of continuous duty which the court cannot supervise, and thus no specific performance of the agreement was enforceable under section 10 of the Specific Relief Act. The court also found that the appellant had committed breaches and that no irreparable loss would be caused to the appellant if the reliefs as prayed for were not granted, and that the balance of convenience was not in favour of the appellant.

Issues: Challenge to Order Rejecting Application for Interim Relief

Ratio Decidendi: The contract was determinable during the lock-in period and thus no specific performance of such contract can be enforced in view of section 14(1)(c) of the Specific Relief Act, 1963. The contract involved performance of continuous duty which the court cannot supervise, and thus no specific performance of the agreement was enforceable under section 10 of the Specific Relief Act. The appellant had committed breaches and that no irreparable loss would be caused to the appellant if the reliefs as prayed for were not granted, and that the balance of convenience was not in favour of the appellant.

Final Decision: The appeal is rejected. There shall be no order as to costs.

Judgment

1. By this appeal filed under Section 37(2)(b) of Arbitration & Conciliation Act, 1996 (for short Arbitration Act, 1996) though lodged as petition, the appellant (original claimant/applicant before the arbitral tribunal) seeks to challenge the order dated 16th August, 2012 passed by the learned arbitrator rejecting the application for interim relief sought by the appellant under section 17 of the Arbitration Act, 1996. Some of the relevant facts which emerge from the pleadings and documents filed by both the parties are:

2. The company carries on business of telecom value added services. The respondent is carrying on business of telecom content aggregation. It is the case of the appellant that the respondent approached the appellant in the month of September, 2009 with a proposal for providing “Live Aarti” feed from Shree Shirdi Saibaba Shrine, Shree Siddhivinayak Temple, Mumbai and Shree Kashivishwanath Temple, Varanasi and certain other shrines and sought the appellant's support and assistance in developing the market for the said service. The appellant accordingly entered into an agreement with the respondent for a period of three months.

3. On 11th June, 2010 the parties entered into the Content Licence Agreement effective from 1st January, 2010 initially for a period of 18 months. Clause 6.2 of the said agreement provides that there shall be a lock-in period of 18 months for licensor from the effective date i.e. 1st January, 2010. Clause 1.6 provided that Manokamana, a unique service developed by Licensee, which will enable the End User to record his/her “Manokamna(wish)” (the “ManokamnaFeed”) on Licensee's platform, which shall be played inside the Temple Premises at “Shree Shirdi Saibaba, at Nashik through licensor respondent. Scope of agreement was provided in clause 2 of the said agreement. The appellant was granted exclusive licence and right to provide content and its related services specified in Annexure A to the agreement, the rights to use the Content with mobile and/or landline devices of the End User. The respondent also agreed to provide its expert services to the appellant for the Manokamnaservices as per the instructions of the licensee for the consideration stated therein. Clause 12.1.(a) and (b) provided that:

“12. TERMINATION:

12.1 Subject to clause 6.2, this agreement or any part thereof may be terminated;

(a) By either party, upon giving at least thirty (30) days prior written notice to the other without assigning any reason thereof; however both the parties shall continue performing their respective obligations during the notice period.

(b) Immediately, upon written notice by either party, if the other breaches a performance, representation, warranty or material obligation of this Agreement and fails to cure the breach within fourteen (14) days from the receipt of a written request to cure from the non-breaching Party; or …...”

Clause 12(2)(a) to (f) reads as under:

“12.2 Consequences of termination:

Withstanding any other rights and remedies provided elsewhere in the Agreement, on termination of this Agreement:

(a) Neither party will represent the other Party in any of its dealings.

(b) Neither Party shall intentionally or otherwise commit any act(s) as would keep a third party to believe that the other Party is still associated with the former party in terms of this Agreement.

(c) Each Party shall immediately stop using the other Party's name, trade, mark, intellectual property, etc. in any audio or visual form for any activity whatsoever and return/destroy as directed by the other Party, all intellectual property; information in relation to such intellectual property of the other party in its possession and also the live audio feed.

(d) Neither Party will be entitled to claim any amount of loss or compensation for termination of Agreement.

(e) Each Party must, at the requisition of the other Party, either; (I) return to the other Party the other Party's Confidential Information, or (ii) destr












































































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