Dismissed

M.N. Reddy Enterprises v. Elite Brands Pvt. Ltd.

Bombay HC10 Aug 2009RP/17/2009

Case brief

AI extract

What is this about?

This Court dismissed the Review Petitioner's plea under section 97 CrPC to review a consent order passed under section 11 and 9 of the Arbitration Act, 1996, as the allegations of fraud and misunderstanding were deemed baseless and dishonest. The Court also rejected a stay application.

What did the court decide?

Review petition dismissed with costs and application for stay rejected.

M.N. Reddy Enterprises Vs Elite Brands Pvt. Ltd. — Arbitration | Bombay HC (2009)

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mgj

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION

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Review Petition (Ld) No. 52 of 2009

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M/s M.N.Reddy Enterprises ..Petitioner

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vs.

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M/s Elite Brands Pvt.Ltd. ..Respondent

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Mr.Avinash B.Avhad for petitioner
Ms.N.S.Nappinai for respondent.

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P.C.

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1This review petition is filed by the

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petitioner (M/s M.N.Reddy Enterprises)

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seeking re-examination of the order dated
26th June, 2009 passed by this Court by
consent of the parties in Arbitration

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Petition No.400 of 2008 filed by ELITE Brands
Pvt.Ltd. respondent herein (hereinafter

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referred to as �ELITE�) against M.N.Reddy
Enterprises (hereinafter referred to as

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�Reddy Enterprises�) under section 9 of the

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Arbitration and Conciliation Act, 1996.

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2When the said petition under sec.9

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of the Arbitration and Conciliation Act, 1996

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was initially taken up for hearing it was

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submitted on behalf of ELITE that under a
franchise agreement dated 21st May, 2005
between ELITE and Reddy Enterprises, ELITE
had handed over watches and travel gears of

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Italian make �Jiordino� which Reddy
Enterprises are not returning to ELITE
despite termination of the franchise

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Agreement and according to information
received by ELITE, Reddy Enterprises are

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selling the said travel gears and watches on

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the streets of Hyderabad. It was also
submitted on behalf of ELITE that they have

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also filed a petition under section 11 of the
Arbitration and Conciliation Act, 1996 which

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is pending and Reddy Enterprises are not

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agreeable to even have the disputes

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arbitrated. The learned Advocate appearing
for Reddy Enterprises submitted that the

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watches and travel gears are not returned by
Reddy Enterprises because ELITE have to pay a

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certain amount to Reddy Enterprises. This
Court, therefore, suggested to the learned
Advocates for the parties that Reddy
Enterprises may hand over the watches and
travel gears to ELITE upon ELITE depositing
in this Court an amount agreeable between
Reddy Enterprises and ELITE and have all
their disputes under the franchise agreement
decided by a sole Arbitrator appointed by the
parties. The learned Advocate for the
respondent informed the Court that his client
is at Hyderabad and that he will have to take
instructions from his client.

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2On 25th June, 2009 at the request of

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the Advocates for the parties the matter was
adjourned to 26th June, 2009. On 26th June,
2009 when the Arbitration Petition reached

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hearing the learned Advocates for ELITE and
Reddy Enterprises informed this Court about

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the settlement talks held between them on the
earlier day. They further informed the Court
that though the parties have agreed to the
interim orders i.e. deposit of an amount of
Rs.1,40,000/- by ELITE with the Prothonotary
and Senior Master, High Court Bombay against
which Reddy Enterprises will be handing over

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the watches and travel gears to the
petitioner as set out in Exhibit D to the
additional affidavit of the ELITE dated 1st

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December, 2008, the parties were unable to
agree upon the name of an Advocate to be
appointed as sole arbitrator to decide the
disputes between the parties. In fact,
Mr.M.C.S.Reddy, partner of Reddy Enterprises

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was also allowed to address the Court when he
informed the Court that he had names of two
Advocates who could be appointed as
Arbitrators to whom all the disputes
pertaining to the franchise agreement dated
21st May, 2005 between the ELITE and Reddy

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Enterprises, could be referred to. The matter
was, therefore, kept back for some time.
After about an hour the matter was mentioned
before the Court and this Court was informed
that as far as the name of the Arbitrator is
concerned, the Court may appoint any Advocate
as an Arbitrator and the parties shall accept

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him as an Arbitrator in the matter.
Thereafter the order dated 26th June, 2009
was passed in open Court in the presence of

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the Advocates for ELITE and Reddy
Enterprises, Mr.Ramesh Chandra Nath C.E.O. Of
ELITE and Mr.M.C.S.Reddy, partner of Reddy
Enterprises.

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3On 3rd August, 2009 Reddy Enterprises
filed this review petition through its
partner Mr.M.C.S. Reddy, seeking review of
the consent order dated 26th June, 2009
passed by this Court. In paragraphs 4 and 5
of the review petition, Mr.M.C.S.Reddy has
alleged that though on the day when the order

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came to be passed i.e. on 26th June, 2009 he
had discussed the matter with his Advocate at
Mumbai, he was unable to understand the legal
terms and was himself confused and hence did
not realise that he had consented for the
said order which would result into foregoing
his objection taken in the arbitration
petition no.181 of 2007 filed under section
11 by ELITE. He has contended that it was
only when he went back to Hyderabad and
discussed with his Advocate and after he
received a copy of the order dated 26th June,
2009 he realised that he had forgone his
challenge to number of issues in respect of
both the arbitration petitions (i.e. under
sections 9 and 11) as a result of his
consent.

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4I have considered the submissions

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made in the Review Petition which are also
reiterated by the learned Advocate appearing

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in support of the review petition. In my

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view, not only has the petitioner (Reddy
Enterprises) not made out any case for review
of the said order dated 26th June, 2009 but

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in view of the above stated facts which led
to the passing of the order dated 26th June,
2009, the case now attempted to be made out
by the review petitioner in paragraphs 4 and
5 of their petition is completely dishonest.
Mr.M.C.S. Reddy is a literate person who

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speaks as well as understands English.
Mr.M.C.S. Reddy along with his Advocate was
admittedly present before this Court on 26th
June, 2009 and he also suggested the names of
certain Advocates who could be appointed as

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Arbitrators. On 26th June, 2009 after the
matter was kept back for more than an hour
the Advocates for the parties along with

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their respective clients returned back to the
Court and requested the Court to pass the
said order dated 26th June, 2009 by consent

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of the parties which again was dictated in
open Court. The learned Advocates also
agreed that this Court may name any Advocate
of this Court to act as the sole Arbitrator
for deciding all the disputes between the
parties arising out of franchise agreement
dated 21st May, 2005. The allegations now
made in paragraphs 4 and 5 of the review
petition as set out above are baseless,
untenable and dishonest and the review

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petition deserves to be dismissed. The review
petition is accordingly dismissed with costs.

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5The learned Advocate appearing for
the review petitioner Reddy Enterprises seeks
a stay of the order dated 26th June, 2009,
the review of which order is sought by filing
the present petition. Since the review
petition itself is dismissed on the ground
that the case made out by the review
petitioner is false and dishonest the

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question of granting any stay as sought does
not arise. Hence the application for stay is
rejected.

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 S.J.KATHAWALLA J.)

M.N. Reddy Enterprises v. Elite Brands Pvt. Ltd.

Case brief

What is this about?

What did the court decide?

M.N. Reddy Enterprises v. Elite Brands Pvt. Ltd.

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

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