ORDER :

PRAYER : Petition filed under Sections 34 of Arbitration and Conciliation Act, 1996 to set aside the award of the arbitrators on the file of the National Stock Exchange of India Ltd., Chennai in arbitration matter A.M.No.CM/C-011/2016, dated 19.10.2016.

Aggrieved over the Order of the Arbitrator of National Stock Exchange of India Limited, the present Original Petition has been filed.

2. Brief facts leading to filing of this petition is as follows :

The respondent is a client of the petitioner for trading in the securities market through the petitioner from August, 2013. The respondent opened a trading and demat account with the petitioner. Since the respondent failed to eliminate the deficit despite several requests, respondent has filed a complaint for referring the claim of Rs.44,78,899/- before Investor Grievance Redressal Forum of NSE [IGRC] and the IGRC, which is a Conciliatory Forum of the Exchange, held that the claim to the tune of Rs.16,84,600/- was admissible. As against which arbitration proceedings were conducted by the respondent. The arbitrator has confirmed the Order of IGRC against which, the present petition has been filed under section 34 of the Arbitration and Conciliation Act.

3. Heard both sides.

4. It is the contention of the learned counsel for the petitioner that the arbitrator has just confirmed the Order of IGRC. It is his contention that the main power of IGRC is to give monetary relief during the course of pendency of the proceedings. Whereas, IGRC is in the nature of Conciliation and it has to identify the amount payable to the complainant. Therefore such a finding of IGRC confirmed by the arbitrator, is against the very procedure and it has to be set aside.

5. Whereas, it is the contention of the learned counsel for the respondent that IGRC has infact identified the amount payable to the petitioner and the circular of National Stock Exchange of India dated 26.09.2013 indicate that upon conclusion of the proceedings of IGRC, in case the claim is admissible to the investor, the Stock Exchange, shall block the value from the deposit of the member and thereafter within 7 days of such IGRC directions, the party should inform whether the member intends to pursue the next level of resolution, i.e., arbitration. If the member does not opt for arbitration, the Stock Exchange shall release the blocked amount to the investor after 7 days. Hence, it is his submission that the applicant has not invoked the arbitration within 7 days as per the circular. Therefore, now they cannot challenge the award of the learned arbitrator. In support of his contention, he relied upon the judgment of the Delhi High Court M/s.Sai Soft Securities Ltd. Vs. Manju Ahluwalia in O.M.P.Nos.69 and 70 of 2015.

6. It is relevant to note that Arbitration Mechanism and Investor Grievance Redressal Mechanism is formed by the Securities and Exchange Board of India as per PR No.94 od 20133, which reads as follows :

With a view to streamline the investor grievance redressal mechanism at Stock Exchanges and made it more effective from the angle of investor protection, SEBI has decided to give monetary relief to investors having claims upto Rs.10 lac, during the course of proceedings from the investor Protection Fund of Stock Exchange. Further, SEBI has decided to shorten the time taken for these proceedings.

1. Some of the salient features of the initiatives taken are as under :

[a] It has been decided to empower IGRC [Investor Grievance of Redressal Committee] in the stock exchange to look into admissibility of claims in addition to conciliation process. As such if the complaint s no resolved through conciliation process, IGRC, on conclusion of the proceedings may ascertain the claim amount admissible to the investor, which the Stock Exchange shall block from the deposit of the concerned Member. The Stock Exchange shall give a time of 7 days to the Member from the date of signing of IGRC directions, to inform the Stock Exchange whether the Mem