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2011 Supreme(Del) 529

IN THE HIGH COURT OF DELHI
Vikramajit Senand Siddharth Mridul, JJ.
Anita Garg
Vs.
Glencore Grain Rotterdam B.V.
FAO (OS) No. 316/2011 and CM No. 11823/2011
Decided On: 11.08.2011

Advocates appeared:
For Appellant/Petitioner/Plaintiff: C.A. Sundaram, Sr. Adv., Narendra M. Sharma, Malik Gahlot, Sachin Mittal, Abhishek Sharma, Rohini Musa and Zafar Hayat, Advs.
For Respondents/Defendant:Rajiv Nayyar, Sr. Adv., Niti Dixit, Darpan Wadhwa, Vidur Bhatia and Raunaq B. Mathur, Advs. for Respondent No. 1

Headnote:

Arbitration and Conciliation Act, 1996 - Section 34--Setting aside interim and final award--The award was passed in a international commercial arbitration--The issue of jurisdiction of the arbitral tribunal raised by the firm before the tribunal and same was rejected--The final award was passed against the firm, wherein petitioner and her husband were partner--Respondent No. 1 filed a execution proceedings--Hon'ble Supreme court granted interim stay against the execution of the foreign award subject to deposit of 50% of the principal amount--However, the partnership firm did not deposit any amount, consequently the stay of execution proceedings did not become operative--Petitioner has deliberately suppressed from this court, the order passed by division Bench of this court, which has attained finality--Court was of view, petitioner, by suppressing the vital documents has sought to mislead this court by seeking challenged the two award on merit to seek fresh adjudication on the question of liability--Hence, petition dismissed with cost of Rs. 2 lacs.

[Paras 30 & 31]

JUDGMENT

Vikramajit Sen, J.

1. This Appeal assails the Order of the learned Single Judge dismissing the Appellant's Objections under Section 34 of the Arbitration & Conciliation Act, 1996 (A&C Act for short) challenging both the Interim Award dated 20.6.1997 as well as the Final Award dated 29.7.1997 passed by The London Rice Brokers' Association (LRBA). These Awards have not been challenged for the first time. In the first instance, M/s Shivnath Rai Harnarain (India), a partnership firm, of which the Appellant before us and her husband, Mr. Prem Chand Garg are partners along with others, filed CS(OS) No. 1103/1997; it was prayed that the subject contracts containing an Arbitration Clause are void and not binding on the firm. The Respondents had filed CS(OS) No. 541/1998 seeking the enforcement of these Awards which was allowed; and by an Order of even date, the said Suit filed by the Firm was dismissed by Reva Khetrapal, J. Our learned Sister, in her judgment dated 27.11.2008, had ordered that the Final Award shall be deemed to be a decree of this Court. The Partnership Firm carried the matter in Appeal to the Division Bench which held that an appeal was not available from such Orders. This view has found favour with the Apex Court as is evident from a study of Fuerst Day Lawson Ltd. v. Jindal Exports Ltd. decided on 8.7.2011 which also dismissed Civil Appeal No. 5156/2011 arising out of SLP(Civil) 31068/2009.

2. In the interregnum, the Respondents had filed Execution Petition No. 72/2009 for execution of the Award in which the partners were impleaded in their individual names, for the first time. By Order dated 19.4.2010, the learned Single Judge had directed the sale of the shares of Shri Lal Mahal Limited held by Mr. Prem Garg and Mrs. Anita Garg, partners of the said partnership firm Shivnath Rai Harnarian (India). That Order was assailed before the Division Bench in EFA(OS) Nos. 15-16/2010 which also came to be dismissed. Taking note of the fact that the Partnership Firm had failed to deposit fifty per cent of the principal amount under the Foreign Awards, in availment of the interim Orders passed by the Hon'ble Supreme Court in the next Special Leave Petition filed by the said Firm, the sale of the shares of the judgment Debtors in Shri Lal Mahal Limited have been ordered. Although the Partnership Firm, as well as one of its partners, Shri Prem Chand Garg, had resisted Execution Petition No. 72/2009 initiated by the Respondents under Section 49 of the A&C Act, neither of them had taken out proceedings under Section 34 there of, as has now been attempted by the Appellant before us, namely, Mrs. Anita Garg, wife of Mr. Prem Chand Garg. In the impugned Order, the learned Single Judge has, inter alia, held that the action before him was barred from consideration on the principles of res judicata. The experience of this High Court is that the partnership firm and each of its partners is an inveterate and chronic litigant.

3. One of the Objections raised by the Respondents before us is that the Appeal is not maintainable on the strength of the decision of the Supreme Court in Videocon v. Union of India, 2011(5) Scale 678, as the parties have specified that 'the contract shall be deemed to have been made in England and the construction, validity and performance thereof shall be governed in all respects by English law.' We should forthwith mention that the common agent, Jackson Son & Company (London) Ltd., is located in England and hence it is not possible to contend that England has no causal connection with the cause of action. But to this question, we shall revert in a while.

4. We must forthwith analyze Bhatia International v. Bulk Trading S.A., (2002) 4 SCC 105 wherein, as per the agreement between the parties, the arbitral proceedings were to be conducted as per the Rules of the International Chamber of Commerce (ICC); the Seat of Arbitration was stipulated to be in Paris, France. Article 23 of the ICC Rules was under scrutiny





































































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