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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
SANDEEP V.MARNE
ICICI Securities Ltd. – Appellant
Versus
Ridhi Siddhi Investment – Respondent
| Table of Content |
|---|
| 1. misconception of conciliator's report as award raised key issues. (Para 1 , 2 , 3) |
| 2. broker's pan error caused mtf pledge failure and share auction. (Para 4 , 5 , 6 , 7) |
| 3. failed conciliation led to arbitration with split tribunal award. (Para 8 , 9 , 10 , 11) |
| 4. petitioner contests counterclaim absence; respondent upholds loss claim. (Para 12 , 13 , 14 , 15 , 16 , 17) |
| 5. conciliator's value fixes arbitration fees only, non-binding. (Para 18 , 19 , 20 , 21 , 22 , 23) |
| 6. statement of defence substance treated as counterclaim. (Para 24 , 25 , 26 , 27 , 28 , 29 , 30) |
| 7. shared misconception excuses formal counterclaim filing. (Para 31 , 32 , 33 , 34 , 35 , 36) |
| 8. reasonable guesswork allows conservative loss compensation award. (Para 37 , 38 , 39) |
| 9. no section 34 interference with majority arbitral award. (Para 40 , 41) |
JUDGMENT :
SANDEEP V. MARNE, J.
1) This is an interesting case where the constituent/investor raised a complaint before the National Stock Exchange Limited complaining about action of the Trading Member/Stockbroker in selling its shares purchased under the Margin Trading Facility (MTF) on account of technical glitch in the software leading to non-placement
Arbitral award upheld under Section 34 despite no formal counterclaim, as tribunal treated statement of defence as such given parties' misconception of conciliator's fee-value report, emphasizing sub....
Profits from trades executed on erroneously credited margin belong to the client, not the broker, as retention by the broker amounts to unjust enrichment.
An obligation to provide notice prior to squaring off is fundamental in arbitration proceedings, and any failure renders such actions illegal.
Parties must exhaust conciliation procedures before pursuing arbitration under the Arbitration and Conciliation Act, emphasizing adherence to specified dispute resolution clauses in contracts.
Stockbroker liability for losses in trades hinges on adherence to SEBI Circulars; regulatory violations alone do not create client compensation rights without proof of actual loss.
An arbitral tribunal lacks inherent jurisdiction to adjudicate a claim against a third party arising out of a private transaction not governed by an arbitration clause.
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