The court affirms the maintainability of arbitration requests despite challenges based on non-arbitrability and previous proceedings under the Companies Act.

ORDER

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INKEL, a Public Private Partnership Company promoted by the Government of Kerala, is the petitioner in both the Arbitration Requests.

2. The petitioner states that M/s.Seguro Foundations and Structures Private Limited (hereinafter referred to as 'M/s.Seguro', for brevity) was managed by Mr. Rajeev C. Vijayan, who was the Managing Director, his wife Ms.Seena Rajeev and Mr. P.J. Jacob who were the shareholders of M/s.Seguro. Mr. P.J. Jacob is the respondent in AR No.48/2021. Mr.Rajeev C. Vijayan and Ms. Seena Rajeev are the respondents in AR No.49/2021.

3. The petitioner-INKEL Limited acquired 65% shares in M/s.Seguro as per an agreement dated 08.11.2017, share purchase agreement dated 08.11.2017 and share subscription and shareholders agreement dated 16.11.2017. Even after acquiring 65 shares by the petitioner, Mr. Rajeev C. Vijayan, the 1^st respondent in AR No.49/2021 was appointed as the Managing Director. Ms. Seena Rajeev was appointed as Additional Director.

4. Disputes arose between the petitioner and the respondents regarding over valuation of M/s.Seguro's shares for investment by INKEL. Information pertaining to amount receivables by M/s.Seguro was suppressed. Inaccurate representations and warranties were made by the respondents. The petitioner came to know of the irregularities, mismanagement and breaches of the agreements by the respondents only in January, 2019 after reviewing the internal audit report. These irregularities were discussed in the 82^nd Board meeting of M/s.Seguro held on 01.01.2019. There was no satisfactory response from the respondents.

5. The petitioner states that the INKEL Limited subscribed to the shares of M/s.Seguro at a premium of ₹257/- based on the statements, books of accounts, representations and warranties of the respondents. Annexure-F report dated 24.12.2019 of the Sub Committee appointed by the Board of Directors of INKEL Limited revealed that the respondents did not present the status of the Company correctly and provided exaggerated value of their Company. The disputes remained unresolved.

6. The petitioner states that Clause 16 of the agreement dated 08.11.2017 provides for arbitration for resolution of disputes between the parties. The petitioner therefore sent legal notice dated 16.01.2021 seeking inter alia initiation of arbitration under Section 11 of the Arbitration and Conciliation Act , 1996. The respondent in AR No.48/2021 sent reply notice dated 01.02.2021 refusing consent to appoint the Arbitrator suggested by the petitioner.

7. In AR No.49/2021, the notice dated 16.01.2021 sent by the petitioner remained undelivered as the respondents had shifted to a new address. The petitioner again sent another noticed dated 04.02.2021 by e-mail. The respondents by letter dated 05.02.2021 refused to give their consent to appoint the Arbitrator nominated by the petitioner.

8. The counsel for the petitioner submits that there is an arbitration clause in the agreement entered into by the petitioner with the respondents. The petitioner had sent arbitration notices to the respondents. The respondents did not agree to appoint the Arbitrator nominated by the petitioner. The counsel for the petitioner argued that the Arbitration Requests are not barred by limitation. At any rate, the respondents can raise objections as to limitation, which the Arbitral Tribunal is competent to decide. As regards the question of arbitrability or non-arbitrability of the issues involved, the Arbitral Tribunal will be the primary forum to decide the issue.

9. The respondents resisted the Arbitration Requests. The respondent in AR No.48/2021 pointed out that the allegations of the petitioner are mainly