Mitesh Mehta vs Saregama India Limited

Arindam Sinha, J

The Court : Mr.Bose, learned advocate appears on behalf of petitioner in this arbitration petition for setting aside award. He submits, agreement dated 16th May, 2007 between the parties had termination clauses 29 and 30 in it. Clause 31 is consequences of termination. By letter dated 10th September, 2008 respondent claimant terminated the agreement in breach of clause 30, the notice of termination not being for thirty days. Parties proceeded to arbitration. Claimant's witness was examined and discharged. His client's witness was partly cross-examined, after which his client did not further participate in the reference. He submits, the Tribunal mis-directed itself in disregarding his client's entire evidence. Some weight should have been attached to it.

The award is perverse.

Court has perused the award in context of dispute arisen between the parties by termination of the agreement. Paragraph 17 in the award is set out below:-

"17. The claimant claimed a sum of Rs.1,93,96,735/- from the respondent at paragraph 24 of its statement of claim.. The denial in the counter statement is evasize. The claimant had reiterated its claim in its evidence on affidavit at paragraph 26. The witness of the claimant was cross-examined. The cross-examination of the witness of the claimant did not raise any defence in favour of the respondent. There is nothing on record to disbelieve the documents being E-22 to E-27. The claims are specified in paragraph 24 of the statement of claim and the documents E-22 to E-27 of the Evidence on Affidavit adequately supports the claims. I, therefore, allow a sum of Rs.1,93,96,735/- as claimed by the claimant in its statement of claim at paragraph 24."

Court has also perused paragraph 24 in statement of claim.

As aforesaid, disputes between the parties arose on termination of the agreement. While petitioner asserts termination in breach of clause 30, respondent had asserted in the reference, breach of provision regarding consequences of termination, that is, clause 31. Section 73 in Contract Act, 1872 provides for consequences of breach of contract to be either compensation for any loss or damage caused by the breach or compensation for loss or damage, which naturally arose in the usual course of things from such breach, or which the parties knew to be likely from result of the breach. Parties have opportunity to come back and demonstrate that materials before the Tribunal do or do not support the award, such materials indicated in paragraph 24 of statement of claim, which appears to have been relied upon in the award.

Court has prima facie satisfaction regarding arbitrator's finding on termination as would appear from paragraph 14 of the award, set out below:-

"14. Reading the letters dated September 10, 2018 and October 7, 2008 I find that the agreement stood terminated by the claimant with effect from October 11, 2008."

Petitioner will be further heard on this point.

List on 14th August, 2019.