Dismissed

Roopchand M. Jain v. Chandraprakash S. Malani and Anr.

Bombay HC24 Sept 2012ARBP/1145/2010

Case brief

AI extract

What is this about?

The court dismissed a petition under Section 43 of the Arbitration Act, 1996 seeking time extension to file an arbitration claim. Holding the exchange arbitration statutory under Section 2(4), the court ruled Section 43 did not apply and rejected the claim that the Exchange's rejection letter was an arbitral award.

What did the court decide?

Petition dismissed; petitioner at liberty to adopt other permissible proceedings; no order as to costs.

Roopchand M. Jain Vs Chandraprakash S. Malani and Anr. — Arbitration | Bombay HC (2012)

kvm

ARBP1145.10

IN THE HIGH COURT OF JUDICATURE AT BOMBAY

¶5

ORDINARY ORIGINAL CIVIL JURISDICTION

¶6

ARBITRATION PETITION NO. 1145 of 2010

¶7

Shri Roopchand Mohanlal Jain ) Age : 63 yrs, Occupation : Business ) Prop. of Navkar Commodities trading ) cum clearing member having its office ) at : Office No. 3 & 4, 1^st Floor, Jyotirmay) Complex, Jaina Road, Aurangabad ) ..... Petitioner

¶8

Versus

¶9

Chandraprakash S/o Shrikisan Malani ) Age : 46 years, Occ : Business ) Residing at : Plot No.30, Mahesh Nagar, ) Jalna Road, Opp. To S.F.S. High School, ) Aurangabad )

¶10

National Commodity and Derivatives ) Exchange Limited, having its Registered ) Office at Exchange Plaza, C-1, Block 6, ) Bandra-Kurla Complex, Bandra (E), ) Mumbai 400 051 ) ..... Respondents

¶11

Mr.Pradeep J.Thorat a/w. Mr.Prashant Khedkar for the Petitioner.

¶12

Mr.Yogendra M.Kanchan for the Respondent No.1.

¶13

CORAM : R.D. DHANUKA, J.

¶14

DATE : 24th SEPTEMBER, 2012.

¶15

ORAL JUDGMENT :

¶16

By this petition under Section 43 of the Arbitration and Conciliation Act, 1996 (for short ‘Arbitration Act 1996’), the Petitioner seeks extension of time for filing claim before Arbitrator.

¶17

Some of the relevant facts are as under :-

kvm

ARBP1145.10

(a) The Petitioner is a trading-cum-clearing member

¶22

of the Respondent No.2 i.e. National Commodity and Derivatives Exchange Limited and is governed by the bye-laws which are statutory in nature (for short “the exchange”).

¶23

(b) There is no dispute that the claim is arising for the period between 25^th February, 2005 to 15^th June, 2006. It is the case of the Petitioner that since Respondents did not pay the said amount, by notice dated 9^th April 2007, the Petitioner demanded the outstanding money. Since the Respondents failed to pay the same, on 1^st April, 2008, the Petitioner lodged his claim before the Exchange.

¶24

(c) By letter dated 15^th April, 2008, the Exchange informed the Petitioner that since the complaint was received much beyond the extended timelines, the Petitioner was free to take suitable appropriate legal advice to regularise the matter.

¶25

(d) The Petitioner thereafter filed the Arbitration Petition (12/2009) on the Appellate Side of this Court.

kvm

ARBP1145.10

By an Order dated 18^th June 2010, S.C.Dharmadhikari J.

¶30

returned the Petition to the Petitioner for presentation to the Original Side. The Petitioner accordingly filed this petition.

¶31

The Learned Counsel appearing for the Petitioner submits that the Petitioner was negotiating for settlement of the claim with the first Respondent and therefore could not file the proceedings within time prescribed under the bye-laws of the Respondent No.2.

¶32

The Learned Counsel submits that there is no dispute that the claim was ultimately filed within a period of three years from the date of cause of action and therefore in the interest of justice, time to file the claim be extended under Section 43(3) of the Arbitration Act, 1996.

¶33

The Learned Counsel appearing for the 1^st Respondent on the other hand submits that by the bye-laws framed by the Respondent No.2 Exchange are statutory and the arbitration under such bye-laws is statutory arbitration. The Learned Counsel placed reliance upon the bye-law 11.4 which reads as under :-

¶34

11.4 LIMITATION PERIOD FOR REFERENCE

¶35

OF CLAIMS, DIFFERENCES OR DISPUTES FOR ARBITRATION

¶36

All claims, differences or disputes referred to in clause (1) above shall be submitted to arbitration within six months from the date on which the claim, difference or dispute arose or shall be deemed to have arisen. The

kvm

ARBP1145.10

time taken in conciliation proceedings, if any, initiated and conducted as per the provisions of the Act and the time taken by the Relevant Authority to administratively resolve the claim, differences or disputes shall be excluded for the purpose of determining the period of six months.

¶41

He also placed reliance on the Notification issued by the Respondent No.2 Exchange on 18^th October, 2007 which provides that the Members and Constituents are requested to inform the Exchange about any complaint against any member or any Constituent as the case may be, at the earliest when such dispute arises, keeping in view the prescribed limitation period for reference of dispute to legal process of arbitration as prescribed under bye-law 11 framed by the Exchange.

¶42

The Learned Counsel next submitted that in the alternative, the decision given by the Exchange on 15^th April, 2008 refusing to entertain claim on the ground of limitation is an award. The Petitioner has not challenged the said Award and is thus not entitled to seek extension of time under Section 43 of the Arbitration Act, 1996.

¶43

In so far as the second contention raised by the 1^st Respondent is concerned that communication of the rejection of claim by the Exchange is an award, I am not inclined to accept this submission made by the Learned Counsel. In my view the said communication was only an administrative decision taken by the Exchange and the same cannot be construed as an arbitral Award made by the arbitrator within the meaning of arbitral award under Section 2(1) (c) of the Arbitration Act, 1996.

¶44

Admittedly the claim pertains to the period between 25^th February, 2005 and

¶45

15^th June, 2006 and the same has not been filed within six months from the date of

kvm

ARBP1145.10

difference or disputes having arisen between the parties. Section 2 (4) of the Arbitration Act, 1996 provides as under :-

¶50

2(4) This Part except sub- section (1) of section 40, sections 41 and 43 shall apply to every arbitration under any other enactment for the time being in force, as if the arbitration were pursuant to an arbitration agreement and as if that other enactment were an arbitration agreement, except in so far as the provisions of this Part, are inconsistent with that other enactment or with any rules made thereunder.

¶51

It is not in dispute that the arbitration under bye-laws of the exchange is statutory arbitration. On perusal of the bye-laws and on considering Section 2(4) of the Arbitration Act, 1996, it is clear that the bye-laws framed by the exchange and the remedy of arbitration provided under the said bye-laws is statutory in nature. In view of Section 2(4), Section 43 does not apply to the statutory arbitration. In my view the Learned Counsel appearing for the Respondent No.1 is, therefore, right in his submission that the application filed by the Petitioner for seeking extension of time is not maintainable.

¶52

Resultantly, the Petition is dismissed. It is made clear that Petitioner is at

¶53

liberty to adopt such other proceedings as are permissible in law.

¶54

There shall be no order as to costs.

¶55

(R.D. DHANUKA, J.)

Roopchand M. Jain v. Chandraprakash S. Malani and Anr.

Case brief

What is this about?

What did the court decide?

Roopchand M. Jain v. Chandraprakash S. Malani and Anr.

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

Similar cases

Dena Bank Vs Nilesh Karunakar Shetty and 3 Ors.

Emu Lines Pvt. Ltd. Vs Blue Ocean Lines Pvt. Ltd. and 2 Ors.

Goculdas Dossa and Company Vs Kirtikumar M. Thakkar

Imc Ltd. Vs Ineos Abs (India) Ltd.

Kalpana Munish Bumb Vs Joindre Capital Services Ltd. and Anr.

Hanjer Synthetics Pvt. Ltd. and 3 Ors. Vs the Memon Co-Op. Bank Ltd.