2015 Supreme(Bom) 543

High Court of Judicature at Bombay
R.D. DHANUKA, J.
Ajay Singh (Sunny) Deol & Another – Appellants
Vs.
Suneel Darshan & Another – Respondents
Arbitration Petition Nos. 819 & 908 of 2011
Decided On : 16-04-2015

The Court held that the claimant failed to prove the existence and contents of the letters exchanged between the claimant and M/s. Gemini. The Court also held that the claimant failed to prove the loss of profit and thus the learned arbitrator was justified in rejecting the claim for loss of profit. The Court further held that the learned arbitrator was justified in awarding the cost of Rs.12 lacs in favor of the claimant.

Headnote:

The Court held that the claimant failed to prove the existence and contents of the letters exchanged between the claimant and M/s. Gemini. The Court also held that the claimant failed to prove the loss of profit and thus the learned arbitrator was justified in rejecting the claim for loss of profit. The Court further held that the learned arbitrator was justified in awarding the cost of Rs.12 lacs in favor of the claimant.

Fact of the Case:

The claimant, a film producer, entered into an agreement with the respondent, an actor, for the production of a film. The agreement provided that the respondent would give 40 shooting dates for completion of the film excluding any date or dates on which the respondent was unable to report for such shooting due to health reasons and for dubbing. The claimant agreed to publish an apology against the respondent in the publications 'Midday', 'Hindustan Times' and the trade journal 'Film Information'. The claimant accordingly published the said apology as agreed. The respondent however sought narration of the script in order to understand his role in the film. The respondent also wanted to know about music director in the film. The claimant addressed a letter to the respondent stating that he would work with the dialogues and would revert back to the respondent. However on 16th May 2008, the claimant addressed a letter to the respondent making various allegations alleging that the respondent was not co-operating with the venture and was delaying the project. The respondent denied all the allegations made by the claimant and informed that he had accepted the subject of the film “Good Morning India”, however, without hearing the dialogues, he could not proceed with the venture. The claimant forwarded various letters to the respondent. The respondent was informed for the first time that the claimant had already executed an Agreement with M/s. Gemini Industries and had received an advance of Rs.3,00,00,000/- (Rs. Three Crores only) for the said film and that he would suffer damages, if that agreement was terminated. The respondent claimed Rs.20,00,00,000/- (Rs. Twenty Crores Only) as damages from the claimant for the alleged breach committed by the respondent of the consent award. The dispute arose between the parties. The said dispute was referred to a former Judge of the Supreme Court of India. The claimant filed a statement of claim demanding a sum of Rs.20,00,00,000/- (Rs. Twenty Crores only) with interest and costs. The respondent denied the said claim and lodged a counter claim. Both the parties examined witnesses. By an award dated 6th June 2011, the learned arbitrator dismissed the claim of the claimant and the counter claim of the respondent. Learned arbitrator, however, awarded costs of Rs.12,00,000/- (Rs. Twelve Lacs only) in favour of the claimant and against the respondent. Both the parties challenged part of the award rendered by the learned arbitrator in these two petitions.

Finding of the Court:

The Court held that the claimant failed to prove the existence and contents of the letters exchanged between the claimant and M/s. Gemini. The Court also held that the claimant failed to prove the loss of profit and thus the learned arbitrator was justified in rejecting the claim for loss of profit. The Court further held that the learned arbitrator was justified in awarding the cost of Rs.12 lacs in favor of the claimant.

Issues: 1. Whether the claimant proved the existence and contents of the letters exchanged between the claimant and M/s. Gemini? 2. Whether the claimant proved the loss of profit? 3. Whether the learned arbitrator was justified in awarding the cost of Rs.12 lacs in favor of the claimant?

Ratio Decidendi: 1. The Court held that the claimant failed to prove the existence and contents of the letters exchanged between the claimant and M/s. Gemini. The Court relied on the judgment of the Supreme Court in the case of Javer Chand & Ors. Vs. Pukhraj Surana, wherein it was held that the contents of the documents were deemed to have been proved or otherwise proved in view of deposition in paragraph 27 of the affidavit in lieu of examination-in-chief of the claimant. 2. The Court held that the claimant failed to prove the loss of profit. The Court relied on the judgment of the Supreme Court in the case of M/s.Kailash Nath and Associates vs. Delhi Development Authority & Anr., wherein it was held that a compensation can only be given on damage or loss suffered and if damage or loss is not suffered, the law does not provide for a windfall. 3. The Court held that the learned arbitrator was justified in awarding the cost of Rs.12 lacs in favor of the claimant. The Court relied on the judgment of the Division Bench of this court in the case of Maharashtra State Electricity Board vs. Sterlite Industries (India) Ltd., wherein it was held that the order for costs follows the success by a party.

Final Decision: The Court dismissed both the arbitration petitions.