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2014 Supreme(Bom) 1638
High Court of Judicature at Bombay
R.P. SONDURBALDOTA, J.
Gaurang
Versus
Vinay A. Choksi
Arbitration Petition No. 846 of 2010
Decided on: 20-08-2014
For the Petitioner:Ashok S. Davar, a/w. Datta Mane i/by. Dinesh C. Shah, Advocates.
For the Respondent:Kishor Jain with Nisha Parmar, i/by. Mamta A. Shah, Advocates.
Headnote:Arbitration and Conciliation Act, 1996 - Section 7 Arbitration clause. - Articles of Association providing for settlement of disputes by way of arbitration, constitutes arbitration clause. There can be no merit in the argument of Mr. Davar. Admittedly, all the three persons to the transaction are members of IMPAA and the Articles of Association of IMPAA provides for resolution of the disputes inter se it’s members, by way of arbitration conducted by "Sub-Committee of Producers Grievances Cell and In-House Settlement". It is nobody’s case that the IMPAA makes any distinction amongst it’s members. Therefore, even if the dispute between it’s members arises out of any capacity other than strictly that of a producer in the transaction between the parties, there can be no escape from the arbitration clause in the Articles of Association.
Arbitration and Conciliation Act, 1996 - Sections 31(5) and 34(3) Setting aside of arbitral award. - Period of limitation for filing application for setting aside arbitral award, would commence from date when signed copy of award is delivered to party. In the light of the legal position the date of delivery of the award to the Advocate for the petitioner cannot be the starting point for commencement of the period of limitation. In absence of any other material on record the date claimed by the petitioner of receipt of the award by him will have to be accepted as the correct date. There is no substance in the preliminary objection of limitation taken by the respondent and hold that the petition filed is within the period of limitation prescribed under Section 34(3) of the Arbitration Act.
1. This petition filed under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as “the Arbitration Act”) challenges the arbitral award dated 10th August, 2008 made by “Sub-Committee of Producers Grievances Cell and In-House Settlement” (for short “the Committee”) of Indian Motion Picture Producers Association (IMPPA). The challenge to the award is on three grounds. Firstly that, there is no arbitration agreement between the petitioner and the respondent. Therefore, the learned arbitrator had no jurisdiction to decide the dispute between the parties. Secondly that, the notice of the arbitral proceedings had not been served upon the petitioner. And thirdly that the award deals with the dispute which is beyond the statement of claim. The respondent contests the petition contending that the same is barred by the law of limitation and also on merits.
2. Briefly stated the facts of the dispute decided by the arbitral award are as follows:-
One Vinod Doshi (since deceased), father of the petitioner, carried on business of film production in the name and style of “M/s. V.R. Pictures”. He intended to produce a Hindi feature film titled “Trishul-The Game of Death”. He had approached the respondent a financer, for financial assistance. Tri-partite agreement dated 18th June, 2004 was executed between the father of the petitioner, the petitioner and the respondent for rendering financial assistance in which the father of the petitioner was described as the “Producer”, the petitioner as the “Guarantor” and the respondent as the “financer”. Under the agreement, the respondent agreed to provide financial assistance to the extent of Rs.60,00,000/- payable as under:-
Rs.25,00,000/- Amt transferred from picture “Deewaarlet's bring our heroes home”
Rs.35,00,000/- As per the discretion of the Third part subject to progress of the said picture.
Rs.60,00,000/- Total (Rupees Sixty Lacs Only)
The amount was to be repaid “along with 18% discount in commission thereon before effecting the delivery of the prints of the picture for the territory, C.P. BERAR C. I” i.e. on/or before 18th December, 2004 whichever was earlier.” The discounting commission was to be paid at the rate of 1.50 per month per Rs.100/- till repayment of the loan. The father of the petitioner and the petitioner jointly executed a Bill of Exchange guaranteeing the repayment of the loan. The petitioner also issued post-dated cheques totalling to Rs.25,00,000/- being the amount already received by the father of the petitioner. Another similar Bill of Exchange was to be executed and post-dated cheques issued for the balance amount, as and when, the same was received. Finally the total amount of financial assistance extended by the respondent under the agreement was of Rs.57,00,000/-. As a security for repayment of loan, M/s. V.R. Pictures had forwarded a letter from M/s. Adlabs Films Limited to the respondent, stating that they shall not deliver any print for release in C.P. BERAR & C-I Circuit without written consent of the respondent. Later the father of the petitioner by his letter dated 18th December, 2004 got the due date of repayment under the agreement extended by another 18 months i.e. until 18th June 2006 for the reason that the project of producing the picture had got delayed. Unfortunately however he died on 31st October, 2006.
3. As the amount under the agreement remained unpaid the respondent by his letter dated 25th July, 2007 complained to IMPPA and requested it to arbitrate upon the dispute. The Committee of IMPPA took up the dispute for arbitration and made the impugned award directing the petitioner, in his capacity as “the proprietor of M/s. V.R. Pictures” and in his individual capacity as “the guarantor” to deposit a sum of Rs.57,00,000/- with IMPPA within a period of one month from the date of the award for paying to the respondent. The petitioner was also directed to pay interest at the rate of 18% p.a. on the amount from the date
