JUDGMENT

[VIA VIDEO CONFERENCING]

SANJEEV NARULA, J. (Oral):

1. The present appeals under Section 37(2)(a) of the Arbitration and Conciliation Act, 1996 [hereinafter referred to as the ‘A&C Act’], impugned four separate orders dated 22nd October, 2020, passed by the learned Arbitrator under Section 16 of the A&C Act.

2. Since the impugned orders have identical reasoning, and all the appeals contain common grounds of challenge, the same are fit to be disposed of by way of this common order.

BRIEF FACTS

3. A summary of the facts of the case, is as follows:

3.1. In March 2014, seven companies forming part of the Zee Group of Companies approached the Appellant viz. Religare Finvest Limited [hereinafter, “Religare”] to avail loan facilities for investment and consolidation of promoters’ interest in their group companies.

3.2. Separate Loan Agreements dated, all on 15th March, 2014 [hereinafter referred to as the “Loan Agreements”] were entered into between Religare and (i) Asian Satellite Broadcast Pvt. Ltd.,1 (ii) Konti Infrapower & Multiventures Pvt. Ltd.,2 (iii) Widescreen Holdings Pvt. Ltd.,3 and (iv) Edisons Infrapower & Multiventures Pvt. Ltd.4 [hereinafter collectively referred to as the “Zee Companies”].

3.3. Zee Companies failed to repay their debt on time, constraining Religare to issue notices dated 7th May, 2019 invoking arbitration viz. Clause 16.1 contained in the Loan Agreements. Consequently, a common Sole Arbitrator was appointed on 7th May, 2019 and four separate arbitration proceedings ensued.

1 Respondent No. 1 in Arb. A. (Comm.) 6/2021. 2 Respondent No. 1 in Arb. A. (Comm.) 7/2021. 3 Respondent No. 1 in Arb. A. (Comm.) 8/2021. 4 Respondent No. 1 in Arb. A. (Comm.) 9/2021.

3.4. Zee Companies filed applications in each of the proceedings, challenging the scope of proceedings and jurisdiction of the Arbitrator under Section 16 of the A&C Act. It was inter-alia contended that, as the Loan Agreements were first executed in Mumbai, they should have been stamped in accordance with Section 24 read with Entry 5(h)(A)(iv)(b) of Schedule I of the Maharashtra Stamp Act, 1958 [hereinafter, “MSA”] at the rate of 0.2%, and since the Loan Agreements are insufficiently stamped, they are unenforceable. Thus, unless deficient Stamp Duty is paid, the proceedings should be terminated.

3.5. Religare contested the application raising several jurisdictional objections and on merits contended that the Loan Agreements are duly stamped as per Article 5(c) of Schedule I-A of the Indian Stamp Act, 1899 (as applicable to the National Capital Territory of Delhi)

[hereinafter, “ISA”].

4. On 22nd October 2020, the Arbitrator passed the impugned Orders, accepting the plea of the Zee Companies. However, instead of terminating the proceedings, they were adjourned sine die, observing that if Religare wishes to continue with its claim, it should take the original Loan Agreement to the Collector of Stamp, Maharashtra – who will, within three months, determine the Stamp Duty payable on the same, including penalty, if any, in terms of the MSA. Further, both parties were given liberty to approach the Tribunal after the requisite Stamp Duty on the Loan Agreements is paid.

5. Aggrieved with the afore-noted order, Religare has filed the present appeals.

RELIGARE’S CONTENTIONS

6. Mr. Ashish Dholakia, Senior Counsel for Religare, has made extensive submissions that are broadly categorised under separate heads, and are discussed in detail later in the judgment while giving issue-wise findings. His contentions are as follows:

A. Judgments relied upon in the impugned order have been over-ruled.

6.1. The judgments relied upon by the learned Arbitrator viz. SMS Tea Estates (P) Ltd. v. Chandmari Tea Co. (P) Ltd.,5 and Garware Wall Ropes Ltd. v. Coastal Marine Constructions & Engineering Ltd,6 have been overruled by the Supreme Court in N.N. Global Mercantile Pvt.

Ltd. v. Indo Unique Flame Ltd. & Ors.7

6.2. In the N.N. Global judgment, the Supreme Court has expressly held that:- (a) t