Telepathy Inc. vs Directi Interest Solutions Pvt. Ltd.

Anoop V. Mohta, J.—The Petitioner, has invoked Section 34 of the Arbitration and Conciliation Act, 1996 (the Arbitration Act), thereby challenged award dated 20 February 2012 passed by Respondent No.4, being an Arbitrator appointed under .In Domain Name Dispute Resolution Policy (INDRP).

By the impugned award, the following decision is taken:-

"7. Decision

In light of the foregoing findings, namely, that the domain name is confusingly similar to a mark in which the Complainant has rights, that the Respondent has no rights or legitimate interests in respect of the domain name, and that the domain name was registered n bad faith and is being used in bad faith and for the purposes of sale, in accordance with the Policy and the Rules, the Arbitrator orders that the domain name WWW.FLS.IN be transferred to the Complainant."

The Petitioner is a renowned company incorporated under the laws of United States of America carrying on varied business including providing search engine services, web development services, online (over the internet) marketing, advertisement and promotions. The Petitioner is the owner/"Registrant" of the domain name "FLS.IN" as registered on 24 March 2005. Directi Internet Solutions Limited is Respondent No.1, accredited domain name registrar; National Internet Exchange of India is Respondent No.2, Section 25 company promoted by the Government of India inter-alia to set up internet domain name operations and related activities; .In Registry is Respondent No.3, body set up by Respondent No.2 to implement the INDRP Policy and Rules; Vinod Agarwal is Respondent No.4, the Arbitrator and; Flsmidth A/s is Respondent No.5, the Complainant.

INDRP rules have been invoked on the complaint filed by Respondent No.5 with Respondent Nos. 2 and 3. The Petitioner never received any communication firstly from Respondent Nos. 2 and 3 and even from the Arbitrator-Respondent No.4 as contemplated and required under the INDRP rules and also under the Arbitration and Conciliation Act, 1996 (The Arbitration Act). On 9 January 2012, the complainant-Respondent No.5 sent an email enclosing a domain name complaint to the Petitioner. On 12 January 2012, the Arbitrator was appointed. On 9 February 2012, the Petitioners Attorneys wrote to Respondent No.2 and 3 stating that no official intimation was received of filing of complaint and that future correspondence should be issued to them. On 20 February 2012, the Award allegedly passed, without intimation to the Petitioner. On 22 February 2012, teleconference by attorney of Petitioner with representative of Respondent No.3 when they were for the first time over the phone informed of appointment of arbitrator but no official intimation was given. Email from the Petitioner Attorney to Respondent Nos. 2/3 recording above fact. On 22 February 2012, email from the Petitioner Attorney to Respondent No.4 arbitrator stating no intimation received. On 1 March 2012, further teleconference between the Petitioner Attorney and Respondent Nos. 2/3. Intimation over phone that the award passed. The Petitioner protested and recorded over email to Respondent Nos. 3 and 4. On 2 March 2012, the Petitioner emailed response to the complaint as abundant caution. On 27 March 2012, award dated 20 February 2012 published on website of Respondent No.3 though not communicated to the Petitioner officially.

The Petitioner, in view of above, filed the present Arbitration Petition on 13 March 2012. This Court, on 16 March 2012, in view of peculiar circumstances as recorded admitted the Petition with further order not to enforce the award till the final decision. The Rule was made returnable on 16 April 2012. Though served privately, none appeared for the Respondents.

On 21 March 2012, none appeared for the Respondents again in Arbitration Petition No. 342 of 2012 which was filed under Section 9 of the Arbitration Act for ex-parte ad-interim relief, basically on the averments that without due notice the Arbitrator passed the ex-parte award, revolving around the domain name of the Petitioner (FLS.IN). This Court, by recording the reasons in view of above facts and circumstances, granted an ad-interim relief in terms of prayer clause (b). By order dated 13 August 2012, even after hearing Respondent Nos. 2 and 3 the ad-interim order granted on 21 March 2012 was confirmed; Section 9 Petition was disposed of in view of admission of the present Petition filed under Section 34 of the Arbitration Act.

As none appeared for the contesting Respondents, this Court on 12 September 2014, issued fresh notices and made it returnable on 6 October 2014. Office endorsement dated 24 November 2014 shows that the notice issued to Respondent No.5 "is served". Respondent Nos. 2 and 3 already appeared, but still there is no appearance shown in this Petition. The matter is therefore, heard finally today, as inspite of service the contesting Respondents have not denied the averments so made in the present Petition, specifically referring to the causes averred in para 5 to 19. Therefore, uncontroverted averments in the present facts and circumstances and in view of the additional averments made based upon the documents annexed, in my view, sufficient to consider the case of the Petitioner referring to the non-following of essential procedure as contemplated under the Arbitration Act and INDRP Rules.

The relevant INDRP Rules deal with the following subjects'' procedure:-

(2) "Communications", (3) "The Complaint", (4) "Notification of Complaint", (5) "Appointment of the Panel and Timing of Decision", (6) "Impartiality and Independence", (7) "Communication between Parties and the Arbitrator", (8) "General Powers of the Arbitrator", (9) "Language of the Arbitration Proceedings", (10) "In-Person Hearings", (11) "Default", (12) "Arbitrator Decisions" and; (13) "Communication of Decision to Parties".

The learned Arbitrator also, though recorded in the award in para 3 of sub-para (c) in a Procedural History that "the Arbitrator formally notified the Respondent of the Complaint through the e mail address admin@telepathy.com", but there is nothing to support the basis for such endorsement. The Petitioner specifically denied even the receipt of communication dated 16 January 2012. The Petitioner, through the attorney, informed the Respondents by email dated 9 February 2012, that no complaint received from Respondent Nos. 2 and 3; and they have no intimation with regard to the complaint. By e-mail, it was also intimated that all future communication with regard to the complaint should be addressed to the attorney. This was in view of specific clauses 2(a) (ii) and (iii), and 2(d) of the INDRP Rules. No communication from Respondent Nos. 2 and 3 received even thereafter. Clauses 2(a) (ii) and (iii), and 2(d) of the INDRP Rules read as under:-

"2 (a) (ii)- Sending the Complaint in electronic form (including annexes to the extent available in that form) by e-mail to:

A. the e-mail addresses shown in the domain name''s registration data through .IN REGISTRY''s WHOIS function at www.registry.in; and

B. postmaster@[the contested domain name]"

(iii) sending the Complaint to any address the Respondent has notified to the .IN Registry in writing (including email) at which it prefers and, to the extent possible, to all other addresses provided to the .IN Registry by Complainant under Paragraph 3(b)(v)".

"2(d) Either Party may update its contact details by notifying to the .IN Registry."

It appears that the learned Arbitrator without responding to the communication so read and referred on 22 February 2012, passed the impugned award. It appears that there was communication gap between the Registrar and the Arbitrator. The Petitioner could not give any response within 20 days based upon notice dated 16 January 2012 issued by the Arbitrator, as there was no such communication received by the Petitioner. Therefore, there was no occasion to respond to the communication of the Arbitrator. In the award, there is no material placed on record to justify about the service/delivery of communication to the Petitioner, as referred in para 3 (c) of the award.

It is relevant to note that the Rules so stated above, mandate even to the Registrar to communicate the proceedings based upon the complaint so filed to the "Registrant" even before the notice/communication from the Arbitrator. Strikingly, there is no mention about such communication by the Registrar in the Procedural History recorded by the learned Arbitrator.

This breach, in my view, goes to the root of the matter and basically against the mandate of the Arbitration Act and INDRP Rules, apart from principle of natural justice. No mandatory notices issued, as contemplated under the Rules. Mere issuance itself is not sufficient. Those notices ought to have been served and must have been recorded accordingly, before passing such drastic award against the unserved "Registrant" (owner) of the domain name. This is impermissible and it is contrary to the provisions of law and the record. Therefore, I am inclined to interfere with the award so passed, also on merits, as the same was without giving equal opportunity to the Petitioner in breach of principle of "natural justice", "fair opportunity", "equal treatment to the parties" and above all "policy".

The law with regard to Section 34 of the Arbitration Act is settled. It applies to such Arbitration proceedings initiated under such INDRP Rules. The Supreme Court recently in Oil and Natural Gas Corporation Ltd. Vs. Western Geco international Ltd., observed that-

"35 .Judicial approach ensures that the authority acts bona fide and deals with the subject in a fair, reasonable and objective manner and that its decision is not actuated by any extraneous consideration. Judicial approach in that sense acts as a check against flaws and faults that can render the decision of a Court, tribunal or authority vulnerable to challenge."

"38 ..Besides the celebrated audi alteram partem rule one of the facets of the principles of natural justice is that the court/authority deciding the matter must apply its mind to the attendant facts and circumstances while taking a view one way or the other. Non-application of mind is a defect that is fatal to any adjudication. Application of mind is best demonstrated by disclosure of the mind and disclosure of mind is best done by recording reasons in support of the decision which the Court or authority is taking. The requirement that an adjudicatory authority must apply its mind is, in that view, so deeply embedded in our jurisprudence that it can be described as a fundamental policy of Indian Law".

"40 It is neither necessary nor proper for us to attempt an exhaustive enumeration of what would constitute the fundamental policy of Indian law nor is it possible to place the expression in the straitjacket of a definition. What is important in the context of the case at hand is that if on facts proved before them the arbitrators fail to draw an inference which ought to have been drawn or if they have drawn an inference which is on the face of it, untenable resulting in miscarriage of justice, the adjudication even when made by an Arbitral Tribunal that enjoys considerable latitude and play at the joints in making awards will be open to challenge and may be cast away or modified depending upon whether the offending part is or is not severable from the rest."

Therefore, taking overall view of the matter and as the case is made out, to interfere with the award so passed, I am inclined to pass the order of remand instead of simply setting aside the award, as the learned Arbitrator has to re-decide the case on merits after hearing both the parties, not only by accepting the case of the Complainant. Further for the reasons so recorded above, as the award was passed without giving opportunity and hearing, the observations, even if any, made against the Petitioner, just cannot be accepted as a foundation to set aside the ownership of the petitioner and replacing it with Respondent No. 5''s domain name. However, in the interest of justice and to give equal opportunity to both the parties, which the Arbitrator ought to have been given in view of the basic principles of law of arbitration, I am inclined to direct Respondent Nos. 2, 3 and 4 to re-consider the complaint so lodged by Respondent No.5 afresh.

The learned counsel appearing for the Petitioner makes statement that the defence dated 2 March 2012 was already circulated and forwarded to Respondent Nos. 2,3 and 5 and the same was duly received by them. Therefore, I am inclined to observe and direct Respondent Nos. 2,3 and 4 -Authority to re-consider the case of the Petitioner, by giving equal opportunity to both the parties. Both the parties are at liberty to apply for appropriate hearing and/or permitted to file additional documents, if any.

It is important to note that in view of the award, though this court in Section 9 Petition on 13 August 2012, restrained the Respondents to execute the award itself, yet the Petitioner could not use his domain name. As it was practically blocked by the Registrar for all the purposes, since the date of complaint dated 6 January 2012. It is made clear that once the award is set aside under Section 34 of the Arbitration Act, the Petitioner is at liberty to take out an appropriate Application before Respondent Nos. 2 and 3 for permission to use and/or renew its original domain name in question.

There is no actual hard copy received by the Petitioner till this date. The Petitioner noted the award on web-site on 28 March2012. Therefore, taking overall view of the matter and as there is no opposition though served, I am inclined to entertain the present Petition of Section 34 of the Arbitration Act and decide it on merits and therefore, the following order:-

ORDER

a) Impugned award dated 20 February 2012 is quashed and set aside.

b) The matter is remanded back. The complaint is restored.

c) Respondent Nos. 2, 3 and 4 to re-consider the complaint, by giving opportunity to the parties/Petitioner, in accordance with law.

d) The Petitioner is at liberty to file appropriate application before Respondent Nos. 2 and 3 for permission to use and/or renew its original domain name, in question.

e) Petition under Section 34 is accordingly allowed.

f) There shall be no order as to costs.