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Judgment
D. N. Patel, CJ
Proceedings in the matter have been conducted through video conferencing.
CM 29146/2020 (exemption)
Exemption allowed, subject all just exceptions.
The application stands disposed of.
FAO(OS) (COMM) 146/2020 & CM 29145/2020 (stay)
This appeal has been preferred under Section 37 of the Arbitration and Conciliation Act, 1996 (for short ‘the Act of 1996’) against an order
passed by the learned Single Judge dated 03.11.2020 in OMP(I)(COMM) No.123/2020 and IA No.4644/2020 (Annexure-A1 to the memo of this
appeal), whereby the learned Single Judge has directed this appellant (original respondent) to deposit Rs.2,23,50,000/- (Rupees Two Crores Twenty
Three Lakhs Fifty Thousands only) before the Registrar General of this Court. Being aggrieved and feeling dissatisfied by this order, the present
appeal has been preferred by the original respondent.
Learned counsel for both the parties have jointly represented to this Court that an arbitrator is required to be appointed to resolve the disputes
between the parties arising out of the Management Service Agreement entered into between the parties to this litigation. Under clause 10 of the said
Agreement, there is a provision for appointment of the arbitrator and the applicability of the laws to resolve the disputes arising between the parties.
Moreover, it is submitted by the learned counsel for the respondent (original applicant in OMP No.123/2020) that an application under Section 11 of
the Act of 1996 has already been preferred after giving a notice to this appellant and this Court has issued a notice in the said application returnable on
07.01.2021.
It is agreed by the learned counsel for both the sides that any former judge of this Court be appointed as the Arbitrator to resolve the disputes
between the parties as mentioned in this appeal and as mentioned in OMP No.123/2020. They have jointly requested this Court to appoint the
arbitrator.
We, therefore, appoint Hon’ble Mr. Justice (Retd.) G. S. Sistani, former Judge of this Court (Mobile: 98713-00034), as the learned Arbitrator to
resolve the disputes between the parties to this litigation arising out of the Management Service Agreement. The learned Arbitrator will fix his own
terms.
As we have already appointed the arbitrator, we do not think it is necessary to go into the questions raised in this appeal. Keeping in mind the
principles of Section 9(3) of the Act of 1996, it would be more appropriate to grant liberty to this appellant to prefer an application under Section 17 of
the Act of 1996 for variation in the interim arrangement contained in the impugned order dated 03.11.2020 in OMP(I)(COMM) No.123/2020 with IA
No.4644/2020, within a period of 15 days from today. As and when such application is preferred by this appellant before the learned Arbitrator, the
same will be decided on its own merits and in accordance with law and on the evidence on record and without being influenced by the order of the
learned Single Judge dated 03.11.2020 in OMP(I)(COMM) No.123/2020 with IA No.4644/2020 (Annexure-A1 to the memo of this appeal).
Till the application, to be preferred by the appellant (original respondent) under Section 17 of the Act of 1996, is decided by the learned Arbitrator,
the order passed by the learned Single Judge dated 03.11.2020 in OMP(I)(COMM) No.123/2020 with IA No.4644/2020 is hereby stayed and will not
be operative, subject to the orders passed by the learned Arbitrator under Section 17 of the Act of 1996. This appellant will also give an undertaking in
the application before the learned Arbitrator that it will maintain assets worth at least Rs.2,23,50,000/- as a security. This is also subject to further
orders that may be passed by the learned Arbitrator. The parties are at liberty to move application(s) before the learned Arbitrator in accordance with
law.
It is also agreed by the learned counsel for both the parties that the learned counsel of the appellant (original respondent) will hand over the keys of
the premises in question to the learned counsel for the respondent [original applicant in OMP(I)(COMM) No.123/2020] within a period of one week
from today.
With these observations, this appeal is disposed of. The application for stay is also disposed of.