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2016 Supreme(Mad) 3871

IN THE HIGH COURT OF MADRAS
Rajiv Shakdher, J.
Interbulk Trading, Switzerland rep. By its Power of Attorney Ravindra Kumbhar - Petitioner
Versus
Adam and Coal Resources Private Limited - Respondent
O.P. Nos. 438 and 439 of 2014
Decided On : 09-12-2016

Advocates Appeared:
For the Petitioner: Mr. P. Giridharan
For the Respondent: Mr. Anirudh Krishnan

Headnote:

Arbitration and Conciliation Act, 1996 - Sections 47 to 49, 48 - Indian Income Tax Act, 1961- Section 237 – Double Taxation Avoidance Agreement - Article 22 - Singapore International Arbitration Centre - Settlement Agreement - Course of arguments - Rigours of obligations - First one to confess, that there is no perfect answer to every legal problem, which is why, in an adversarial system, one party goes back, feeling dissatisfied - Only because of a hierarchical system that the Courts maintain. As Judges we are trained to be interventionist – Court attempt to set right, in a manner of speech, slightly crooked picture hanging on the wall, till we reach, what according to us, is a just solution - Held, record and aforesaid narration distinctly demonstrates that, each stage, Adam Coal has been in breach of its obligations - Breach began with non-fulfilment of obligations by Adam Coal under the main contract - Conduct of Adam Coal continued with its failure to comply with the settlement arrived at between the parties despite time being given by Interbulk to fulfil terms of the settlement vide its communication - Breach of the so-called final settlement agreement, appeared to be, a proverbial final straw on camels back – Court of the view that no interference is called for in respect of the impugned awards. Consequently, the objections raised by Adam Coal are rejected - Aforesaid would be that the captioned petitions would have to be allowed - Ordered accordingly

ORDER :

Mr. Rajiv Shakdher, J.

Preface :

Let me preface this judgment with two aspects, which crossed my mind during the course of arguments advanced before me.

1.1. First, is there a perfect answer to every legal issue, which comes before the Court.

1.2. Second, will the Court try and reduce the rigours of obligations reflected in a commercial contract, executed between two entities, having equal bargaining power.

2. In so far as the first aspect is concerned, I would be the first one to confess, that there is no perfect answer to every legal problem, which is why, in an adversarial system, one party goes back, feeling dissatisfied.

2.1. A quietus is put to litigation, only because of a hierarchical system that the Courts maintain. As Judges we are trained to be interventionist. We attempt to set right, in a manner of speech, that slightly crooked picture hanging on the wall, till we reach, what according to us, is a just solution.

2.2. Whether such an approach is right or wrong, is often governed, both by the jurisdiction that a Judge sits in and the personal disposition as well as predilection of a person exercising that jurisdiction. Some jurisdictions have more width and amplitude than others. Restraints are often self imposed.

3. Arbitration is one such jurisdiction, where the temptation for a judge to straighten that proverbial crooked picture is, immense.

3.1. Repeatedly, the interventionist in the Judge comes to fore, however, in my view and experience the rule, which should play out, is that, once, parties have made their bed, they should be made to sleep on it. Any other approach is a recipe for docket clogging and is often seen to give succour to critics, and perhaps, rightly, that the alternate dispute resolution system is a failing proposition.

3.2. Having said so, the exception to this approach should be : that obvious case of fraud, compromised integrity of arbitrators and plainly erroneous awards, which go against the stated position of law and, hence, border on perversity and/or, those awards, which go against public policy.

4. The second aspect, which caught my attention in this case and, in a sense, is interlinked with the first, was the tenacity and, perhaps, the remorselessness, with which, the petitioner was seeking to enforce the award.

4.1. At first blush, I came to believe that the petitioner was acting in manner which ran close to the conduct of the well known Shakespearean character, Shylock. However, on a closer examination of the case and on a sober reflection, I have come to the conclusion, as my discussion hereafter would reveal, that the, petitioner was much harried and frustrated by the respondent at every step of the case.

Background :

5. These are two petitions filed, essentially, under Sections 47 to 49 of the Arbitration and Conciliation Act, 1996 (in short, 'the 1996 Act') by an entity going by the name : Interbulk Trading SA (hereafter referred to as "Interbulk").

5.1. Via these petitions, Interbulk, essentially, seeks enforcement of two awards dated 14.01.2013 and 12.04.2013.

5.2. The first award is a final award, concerning the merits of the dispute obtaining between the Interbulk and the respondent, i.e., Adam and Coal Resources Private Limited (hereafter referred to as "Adam Coal"), while the second award is a supplementary award, whereby, costs are awarded in favour of Interbulk by the learned Arbitrator.

5.3. Based on the first award, Interbulk seeks a direction qua Adam Coal for payment of USD329,273.40. Insofar as the second award is concerned, once again, Interbulk seeks a direction qua Adam Coal for payment of USD 37,938.12, albeit, towards costs.

6. Upon notice being issued in the captioned petitions, Adam Coal has filed its replies. The replies filed are in the nature of objections taken under Section 48 of the 1996 Act.

7. Pertinently, the seat of arbitration was Singapore and the proceedings were governed by Singaporean Law and the rules formulated by the Singapore International Arbitration Ce





































































































































































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