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2009(7) Supreme 459
SUPREME COURT OF INDIA
J.M. Panchal, J.
Geo-Group Communications Inc — Appellant
versus
IOL Broadband Ltd. — Respondent
Arbitration Petition No (s) 9 of 2009
Decided on : 17-11-2009
Arbitration and Conciliation Act, 1996 – section 2 (1) (b) – Application for appointment of arbitrator – Plea that Arbitration Agreement being not duly stamped, application should be dismissed held unsustainable – Section 2(1) (b) of Act, 1996 defines term arbitration agreement to mean an agreement referred to in section 7 – Subsection (2) of Section 7 further provides that on arbitration agreement may be in form of an arbitration clause in a contract or in the form of a separate agreement – Facts of the case showed that Arbitration agreement was in the form of an arbitration clause, i.e. clause No. 11.7 incorporated in a contract should be stamped – Hence the plea that Arbitration agreement was not stamped and hence applicant was not entitled to relief held unacceptable (Para 8)
Facts of the case :
An application under section 11 (6) of Arbitration and Conciliation Act, 1996 has been filed by applicant company here in the instant case praying for appointment of Mr. Justice D.R. Dhanuka, a retired judge of Bombay High Court as sole arbitrator for adjudicating disputes that had arisen between applicant and respondent company under the share subscription and shareholders Agreement dated December 1, 2005.
Findings of the Court :
Evidence on record showed that conditions precedent set out in section 11(6) of Act were Completely satisfied and applicant was entitled to approach Court for Securing appointment of sole arbitrator for resolution of dispute which had arisen between parties. It was nobody’s case that retired Mrs. Justice Dhanuka was in any manner disqualified to Act as sole arbitrator Hence application held liable to be allowed.
ORDER
By filing the instant application under Section 11 (6) of the Arbitration and Conciliation Act, 1996, the applicant Company has prayed to appoint Mr. Justice D.R. Dhanuka (a retired Judge of Bombay High Court) “ as Sole Arbitrator for adjudicating the disputes that have arisen between the applicant and the respondent Company under the Share Subscription and Shareholders Agreement dated December 1,2005.
2. The facts emerging from the record of the case are as under: -
The applicant, i.e., Geo-Group Communications, Inc., is• a company incorporated under the laws of Delaware USA, having its principal office at USA. It is engaged in business of providing telecommunication services. The respondent, i.e., IOL Broadband Limited is a company registered under the Companies Act, 1956. It is a commercial Metro Ethernet Fiber Network Infrastructure company and is engaged in delivery of broadcast-quality television/video signals to subscribers over a broadband connection using the Internet Protocol (IPIV). The applicant entered into a Share Subscription and Shareholders Agreement (for short SHA) dated December 1, 2005 with Exatt Technologies Private Limited (for short Exatt), which was a Company registered under the provisions of the Companies Act, 1956. Under the terms of SHA dated December 1, 2005 the applicant agreed to supply• certain CISCO equipments to Exatt equivalent to US$ 400,000. It was further provided under the said Agreement that in lieu of supply of CISCO equipments, Exatt •would issue equity shares to the applicant aggregating to 6.50% of the then paid-up equity share capital of Exatt on terms and conditions set out in the said Agreement. Pursuant to the said Agreement, the applicant Company supplied CISCO equipments, delivery of which was acknowledged by Exatt without any demur as to quantity or quality. As per the arrangements -made between the parties under the Agreement, -the Exatt should - have issued 6920 equity shares of Rs.10/- each to the applicant. But Exatt issued a Xerox copy of Share• Certificate bearing No.6 dated December 31, 2006. The applicant has produced Xerox copy of the Share Certificate at Annexure A-2 to the application, which indicates that the applicant Company was treated as the registered holder of 6920 equity shares of Rs.10/- each numbered (from 1,00,00/ to 1,07,000 both inclusive in Exatt subject to provisions of Memorandum and Articles of Association and a sum of Rs.3,600/- had been paid up upon each of the said shares. However, the record does not indicate that original Share Certificate allotting 6920 equity shares of Rs.10/- each was issued by Exatt to the applicant Company. Therefore the name of the applicant Company was not mentioned as one of the members in the Register of Members maintained by Exatt. In the year 2007, Exatt entered into a Scheme of Amalgamation (for short, Scheme) with the respondent Company, which was previously known as, IOL Broadband Limited. The previously known Company was listed on the Bombay Stock Exchange and National Stock Exchange. The Scheme of Amalgamation was approved by the High- Court of Judicature at Bombay vide order dated November 23, 2007. A copy of the Scheme is produced by the applicant at AnnexureA-3 to the application. The applicant has claimed that it being a body corporate based in USA was not aware of the Amalgamation of Exatt with the respondent Company pursuant to order dated November 23, 2007 passed by the Bombay High Court. On perusal of some: of the provisions of the Scheme it becomes evident that in terms of Clause 1.8 (b) all the debts, liabilities, contingent liabilities, duties, obligations and guarantees of the Exatt Company stood transferred 10 the respondent Company.
Thus the liabilities, duties, obligations and guarantees of the Exatt Company under SHA dated December 1, 2005 stood transferred to the respondent Company and this is not disputed by the respondent Company at all. Clause 9 of the Scheme further provided that the sha
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