IN THE HIGH COURT OF DELHI AT NEW DELHI
Prathiba M. Singh, J.
Information Tv Private Limited - Appellant
Versus
Jitendra Dahyabhai Patel - Respondent
ARB.P. 1143 of 2023
Decided On : 06-02-2024
Arbitration - Appointment of Arbitrator - 1996 Act - Section 11(6)
Fact of the Case:
The Petitioner filed a petition under Section 11(6) of the Arbitration and Conciliation Act, 1996 seeking appointment of an arbitrator in a dispute arising from a Memorandum of Understanding (MoU) for operating a television channel.
Finding of the Court:
The Court found that the arbitral proceedings had commenced within the statutory period, and the petition under Section 11(6) was not barred by limitation. The disputes were referred to arbitration, and the Petitioner was directed to bear the entire cost of the arbitral proceedings.
Issues: The main issue was the timeliness of invoking arbitration and filing the petition under Section 11(6) of the 1996 Act.
Ratio Decidendi: The Court emphasized the need for an intention to arbitrate disputes and effective steps to commence arbitral proceedings. It held that the petition under Section 11(6) was within the limitation period as it was filed within three years of the notice invoking arbitration and the failure to appoint an arbitrator.
Final Decision: The disputes were referred to arbitration, and the Petitioner was directed to bear the entire cost of the arbitral proceedings. The order passed under Section 9 of the 1996 Act remained in effect until the conclusion of arbitral proceedings.
JUDGMENT
Prathiba M. Singh, J. (Oral)
1. This hearing has been done through hybrid mode.
2. The present petition under Section 11(6) of the Arbitration and Conciliation Act, 1996 (hereinafter, `1996 Act') has been filed by the Petitioner-Information TV Pvt. Ltd. seeking appointment of an arbitrator in terms of Clause 6 of the Memorandum of Understanding (hereinafter, `MoU') dated 1st May, 2018. Clause 6 of the MoU reads as under:
"6. That MOU shall be construed in accordance with the laws in force in India and in the eventuality that any dispute or difference should arise on any matter relating to or arising out of the present MOU the same shall be settled by Arbitration and shall be referred to the Sole Arbitrator who shall be appointed by both parties mutually and whose decision shall be final and binding upon the parties. The Sole Arbitrator shall conduct the arbitration proceedings at New Delhi/Delhi. It is also agreed between the parties that arbitration proceeding would be conducted in English only and in no other language. Only appropriate Court at Delhi shall have jurisdiction to entertain the disputes that may arise out of this MOU. No other courts shall have jurisdiction."
3. The crux of the dispute is that the Petitioner and the Respondent- Jitendra Dahyabhai Patel, had agreed, vide the said MoU, for the Respondent to operate a television channel named `India News Gujarat'. As per the MoU, the Respondent was to invest approximately Rs.14 crores into a new company that was to be incorporated. Disputes arose in respect of the said MoU.
4. The Petitioner, thus, invoked Section 9 of the 1996 Act and vide order dated 6th April, 2021, the Court in O.M.P.(I) (COMM) 376/2020 titled `Information TV Private Limited v. Jitendra Dahyabhai Patel' passed the following order:
"1. The petitioner has filed the present petition, inter alia, praying as under:
"a) Pass an ex-parte ad-interim injunction, restraining the Respondent or anyone claiming under him from interfering in the day-to-day functioning or the Petitioner claiming any right under the MoU dated 01.05.2018; and
b) Pass an ex-parte ad-interim injunction, restraining the Respondent or anyone claiming under him from acting as a director, taking any decision, representing himself, taking any steps or in any manner claiming himself to be associated or connected with `India News Gujarat' or the Petitioner or any of its associates/subsidiaries/affiliates, etc.;
c) Confirm the above noted orders after hearing the Respondent; "
2. The present petition was listed for the first time before this Court on 23.11.2020. On that date, the Court had noted the prayers made in the present petition. The notice in the petition was accepted by the learned counsel for the respondent and he had made a statement that the respondent would not interfere with the "day to day functioning of the petitioner company in operating the news channel `India News Gujarat'".
3. After some arguments, the learned counsel appearing for the parties submit that the present petition be disposed of by binding the respondent to the said statement till the conclusion of the arbitral proceedings.
4. In view of the aforesaid consensus, the present petition is disposed of in the aforesaid terms.
5. It is, however, clarified that this would not preclude the parties from approaching the Arbitral Tribunal either for vacation or variation of this order or for seeking further reliefs as they may be advised, as and when the Arbitral Tribunal is constituted.
6. It is clarified that this is without prejudice to all rights and contention of the parties. Nothing stated herein shall preclude the parties from canvassing the respective cases before the Arbitral Tribunal."
5. The Respondent's case is that despite this order having been passed way back in 2021, the Petitioner has chosen to invoke arbitration only now i.e. in September, 2023. Such a petition, according to him, is barred under Section 9(2) of the 1996 Act. He relied upon the decision of
Bharat Sanchar Nigam Limited v. Nortel Networks India Private Limited, (2021)5 SCC 738
J.C. Budhraja v. Chairman, Orissa Mining Corporation Ltd.
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