Initiation of arbitral proceeding for dispute regarding production of tele-serial.

Common Judgment: P.K. Misra, J.

These Two appeals are directed against the common order of the learned single Judge rejecting the two applications, namely, O.A.Nos.962 and 963 of 2004, filed under Section 9 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as “the Act”).

2. Prayer in O.A.No.962 of 2004 was for issuing an order of interim injunction restraining the respondents in any manner entering into any arrangement, agreement or from assigning marketing rights, copy right and all other related rights in respect of the program “Vikramadityan” or any modification, translation or adaptation thereof and/or giving effect to any such agreement, arrangement or assignment if already entered into with any third party or between the parties, pending arbitration proceedings.

3. Prayer in O.A.No.963 of 2004 was for issuing an order of interim injunction restraining the respondents from producing or continuing to produce, telecasting or continuing to telecast the serial “Vikramadityan” in Tamil or in any other language or under any other title for telecast over any satellite channel and to reproduce, publish or otherwise exploit the copyright in the said program “Vikramadityan” through any other technological medium including videos, DVDs, VCDs etc. in respect of the episodes already telecasted and in respect of future episodes either by themselves or with any other third party under any joint production agreement except with the applicant in accordance with the MOU between the applicant and the respondent dated 2.8.2003 and the Addendum dated 15.7.2004, pending arbitration proceedings.

4. According to the appellant there was a Memorandum of Understanding between the appellant and the two respondents under which Respondent No.1 was to produce a tele-serial. As per clause 6(i) of the said MOU, the applicant had all copyrights and other related rights. It is asserted by the applicant that in violation of the terms indicated in the MOU, the agreement was unilaterally terminated and the applicant was taking steps to refer the dispute to the arbitrator as per the arbitration clause and as the respondents were likely to continue the production by arranging finance from others, interim injunction, substance of which had been already extracted, should be issued. It is further indicated in the application that the applicant without prejudice to the contentions raised, make payments of defaulted amount if any and the respondent No.1 should continue to produce the serial by obtaining finance from the appellant as per the Memorandum of Understanding.

5. In the counter affidavit the respondents indicated that the applicant had defaulted in making payments as per the agreement, and therefore, such agreement has been terminated in accordance with clause 10(ii). It is further indicated that in accordance with clause 10(B)(3), respondent No.1 had the right to continue the production of the serial and broadcast the same. It is further indicated that as a matter of fact a new agreement had been entered into between Respondent No.1 and another financier and thereafter, production and telecasting of the serial continued.

6. Learned single Judge came to the conclusion that the question as to whether termination of the agreement was in violation of the clauses of the Memorandum of Understanding is a matter which has to be decided by the arbitrator and such matter should not be decided in the interlocutory proceedings. It was further observed that in case it is found that termination was illegal and contrary to the terms of the agreement, the arbitrator can award adequate compensation to the applicant and as such there would not be any irreparable loss. Learned single Judge further held that the applicant cannot claim that Respondent No.1 must continue to produce by obtaining finance from the applicant as this would amount to specific enforcement of a contract of personal service and the balance of convenience is not in favour of th