Remanded

Best Sellers Apparels Pvt. Ltd. v. M/s. D.M.Fabrics India, a Sole Pro. concern of M/s.Babulal Mundhra HUF

Bombay HC25 Jan 2011ARBP/782/2010

Case brief

AI extract

What is this about?

In an arbitration petition challenging an ex parte award, the High Court remanded the matter for a fresh award if the petitioner deposits a specified sum within eight weeks, granting the petitioner an opportunity to prove their case.

What did the court decide?

Order a fresh award by the arbitral tribunal within three months upon petitioner's deposit of Rs. 2,50,000 within eight weeks.

Best Sellers Apparels Pvt. Ltd. Vs M/s. D.M.Fabrics India, a Sole… — Arbitration | Bombay HC (2011)

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ARBP782-10

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION ARBITRATION PETITION NO.782 OF 2010

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Best Sellers Apparels Pvt.Ltd. Versus

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M/s.D.M.Fabrics India, A Sole Proprietary Concern of M/s.Babulal Mundhra HUF

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.. Petitioner

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.. Respondent

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Mr.Tushar Goradia and Shweta Jain for petitioner Mr.Anil Agarwal for respondent

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CORAM : S.C.DHARMADHIKARI, J.

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DATE : 25th January 2011

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P.C.:

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1] The petitioners have impugned an Award dated 29^th January

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2009, which has been passed by Hindustan Chamber of Commerce.

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2] Respondent is the original claimant, whereas the petitioner is original opponent. The claim of the respondent is purely on interest. It is stated that the claim of Rs.3,19,993/- is consisting of interest together with further interest and arbitration costs.

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ARBP782-10 2

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3] While it is true that notices have been given to the petitioners but they remained absent, yet, from the Award itself it is apparent that the Tribunal has relied upon all documents and statement of accounts produced by the respondents. There is a reply of the petitioners inasmuch as their stand was that no amount of interest was payable. It is equally true that the petitioner is a private limited company whereas the liability is that of the partnership firm. However, the petitioners state that the liability has been taken over and, therefore, the claim could not have been awarded.

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4] Reliance is placed by the Tribunal on a letter, a copy of which is at Exh.B to the petition. In my view, bearing in mind that the Award has been rendered ex parte and the petitioner had no opportunity to prove their case as set out in their letter dated 26^th August 2008, addressed to the Executive Secretary, Hindustan Chamber of Commerce, interest of justice would be served, if one opportunity is given to them but on certain conditions.

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5] I am of the view that the Award does not assign reasons as to why the letter dated 26^th March 2008 forwarded to the Tribunal cannot be accepted. The Tribunal proceeded on the basis that the petitioner neither submitted any reply nor informed the chamber about appointment of Arbitrator on their behalf. However, the documents that have been produced by the respondent have been relied upon. But, how the accounts prove the claim of interest and whether there was any term to pay interest and the letter, copy of which is at Exh.B, is capable of being relied upon, is not clear from the Award. The evidentiary value thereof is also not discussed. In these circumstances, following order would meet the ends of justice.

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6] On the petitioner depositing in this Court a sum of Rs.2,50,000/within a period of eight weeks from today and producing proof in respect thereof before the Tribunal, the arbitral tribunal shall take up the subject reference for a decision afresh and render a fresh award within a period of three months from the date of the production of such proof. On deposit of the said sum, the petitioner to also intimate

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the respondents’ Advocate of such deposit. Both sides to then appear before the Tribunal which shall render the award afresh within three months from the date aforesaid.

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7] Needless to add that if the amount is not deposited within this

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period, the award stands confirmed and the petition is then dismissed without any further reference to court.

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(S.C.DHARMADHIKARI, J)

Best Sellers Apparels Pvt. Ltd. v. M/s. D.M.Fabrics India, a Sole Pro. concern of M/s.Babulal Mundhra HUF

Case brief

What is this about?

What did the court decide?

Best Sellers Apparels Pvt. Ltd. v. M/s. D.M.Fabrics India, a Sole Pro. concern of M/s.Babulal Mundhra HUF

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

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Coram

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