Dismissed

Jatin Keshruwala v. Dag Creative Media Private Limited and Anr.

Bombay HC3 Jul 2019COMAP/410/2019

Case brief

AI extract

What is this about?

This full bench dismissed a commercial appeal filed against an order of the Bombay High Court Single Judge in a garnishee proceeding under the Arbitration and Conciliation Act, 1996. The bench held that it could not adjudicate the merits as the Single Judge was seized of the issue, thereby dismissing the appeal.

What did the court decide?

The appeal was dismissed. The Single Judge was directed to continue with the proceedings.

Jatin Keshruwala Vs Dag Creative Media Private Limited… — Company and Corporate | Bombay HC (2019)

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COMAPL 322.19.doc

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JPP

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

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COMMERCIAL APPEAL (Lodg.) NO. 322 OF 2019

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COMM. ARB. PETITION (Lodg.) NO. 659 OF 2019

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Jatin Keshruwala … Appellant

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V/s.

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M/s. DAG Creative Media Pvt. Ltd. & Ors. ... Respondents.

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Ms. Kritika Seth a/w. Mr. Aditya Chopra, Ms. Sayali Phansikar, Ms. Dhwani Shah I/b. PSL Advocates & Solicitors for the Appellants. Dr. Birendra Saraf, Ms. Megha Chandra, Ms. Madhu Godadia, Mr. Nitesh Agarwal, Mr. Rushabh Mehta I/b. Naik Naik & Co. for the Respondent No.2.

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CORAM : PRADEEP NANDRAJOG,C.J. & N.M. JAMDAR, J.

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DATE : 3 JULY 2019.

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P.C. :-

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Heard learned Counsel for the Appellant and Respondent No.2.

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Briefly stated relevant facts would be that on 4 May 2017 the 2^nd Respondent entered into a production agreement with the 1^st

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COMAPL 322.19.doc

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Respondent. As per the production agreement, the 1^st Respondent was charged with various obligations and in a nut shell principally was to play the role of a producer.

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The agreement envisaged a Serial to be produced under the title “Maha Prabhu Shree Chaitanya”. Consideration payable by the 2^nd Respondent to the 1^st Respondent was 1,90,000/- per episode plus 5,00,000/- towards promo.

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The Appellant entered into an independent agreement with the 1^st Respondent and under the agreement paid 1.3 Crores. Under the said agreement the 1<sup>st</sup> Respondent was to return said sum of 1.3 Crores plus ` 18,000/- per episode.

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The agreement between the Appellant and the 1^st Respondent envisage money received by the 1^st Respondent from the 2^nd Respondent to be deposited in an Escrow Account, to be jointly operated by the Appellant and the 1^st Respondent.

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Dispute arose between the Appellant and the 1^st Respondent. Their being an arbitration clause in the agreement between the Appellant and the 1^st Respondent, an Arbitrator was appointed and in an application filed under Section 17 of the Arbitration and Conciliation Act, 1996, an order was passed

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COMAPL 322.19.doc

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directing the 1^st Respondent to deposit ` 1.3 Crores in the Escrow Account opened by the Appellant and the 1^st Respondent or furnishing a bank guarantee in said sum or offer a security of either movable or immovable property in said sum.

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It is not in dispute that the 1^st Respondent did not complied with the interim measures directed by the learned Arbitrator as per the order dated 4 February 2019.

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The Appellant filed an application under Section 9 of the Arbitration and Conciliation Act, 1996 against the 1^st Respondent seeking an interim measure which is in the nature of a garnishee order.

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The Appellant prayed that the 2^nd Respondent be directed to deposit in the Escrow Account opened by the Appellant and the 1^st Respondent the payments payable by the 2^nd Respondent to the 1^st Respondent.

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The stand of the 2^nd Respondent before the learned Single Judge was that no amount is payable by it to the 1^st Respondent and as per the agreement between the parties, the 2^nd Respondent is entitled to damages against the 1^st Respondent for breach of the agreement between the two.

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COMAPL 322.19.doc

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The learned Single Judge has recorded the said stand of Respondent No.2 that no amount shall be paid to Respondent No.1 directly has been accepted by the Court. The learned Single Judge has not terminated the proceedings. While directing the 2^nd Respondent to file an affidavit disclosing the amount payable by it to Respondent No.1. Hearing has been deferred to 9 July 2019.

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As per the Appellant, the 2^nd Respondent is making payment to 3^rd parties which are to the credit of the 1^st Respondent and thus, learned Counsel urges that a security available with the Appellant is being diminished.

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Learned Counsel for the 2^nd Respondent informs that in terms of its obligations in the agreement between the 1^st Respondent and the 2^nd Respondent to produce the Serial, the 1^st Respondent had engaged services of technicians, artists and vendors. Payments to them were not made by Respondent No.1 since the services of these technicians, artists and vendors is utilized by the 2^nd Respondent for the production of the Serial in question as also for other works, payment is being made to the three categories of service providers because they have put a condition that unless they are paid their past dues, they would not render any service for future Serials.

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COMAPL 322.19.doc

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Now, it needs to be highlighted that there is no privity between the Appellant and the 2^nd Respondent. The proceedings initiated by the Appellant before the learned Single Judge is to seek a garnishee order. A garnishee order would not be passed if injury is caused to the person holding money on behalf of another party. On this principle alone the 2^nd Respondent would be entitled to clear the dues of the technicians, artists and vendors for their input concerning the Serial which was the subject matter of the agreement between the 1^st Respondent and the 2^nd Respondent.

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We speak no further for the reason the learned Single Judge is still seized of the issue and anything more stated by us may prejudice either parties.

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We find no infirmity in the pro-tem ad-interim order dated 25 June 2019.

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The Appeal is dismissed.

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N.M. JAMDAR, J. CHIEF JUSTICE

Jatin Keshruwala v. Dag Creative Media Private Limited and Anr.

Case brief

What is this about?

What did the court decide?

Jatin Keshruwala v. Dag Creative Media Private Limited 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

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