IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 06TH DAY OF AUGUST, 2019 BEFORE THE HON’BLE MR.JUSTICE ARAVIND KUMAR WRIT PETITION No.7444/2019 (GM-RES) BETWEEN:
Vatsala Constructions and Consultants Pvt. Ltd., A Company incorporated under The provisions of Indian Companies Act, 1956 Having registered office at No.32 2nd Main Road, N.R.Colony Bengaluru – 560 019 Operating from No.64(109) 38th Cross Road, 6th Main Road 5th Block, Jayanagar, Bengaluru – 41 Represented by its Managing Director H.S.Vishwanath …Petitioner (By Sri Kumar M.N, Advocate) AND:
1. The Director Arbitration & Conciliation Centre Bengaluru (Domestic and Internal) Khanija Bhavan, No.49 3rd Floor, East Wing Race Course Road Bengaluru – 560 001 2. Sri Krishna Shelters Private Limited A Company incorporated under The provisions of Indian Companies Act 1956, having its office at No.59 “Shri Krishna Soudha”
Opp. Basavanagudi Main Road Gandhi Bazaar, Bengaluru – 560 004 Represented by its Managing Director Raghavendra K (By Sri K.Ranjan Kumar, Advocate for R2; R-1 served & unrepresented) ...Respondents This writ petition is filed under Articles 226 and 227 of the constitution of India praying to quash the order dated 25.01.2019 passed by the Director, Karnataka Arbitration and Conciliation Centre, Bengaluru(R-1) in CMP No.349/2017 at Annexure-F, etc.
This writ petition coming on for orders this day, the court made the following:
O R D E R Learned counsel for petitioner submits that he would not press prayer No.2. His submission is placed on record and accordingly prayer 2 is dismissed as not pressed.
2. This petition is filed for quashing of the order dated 25.01.2019 passed by the Director, Karnataka Arbitration and Conciliation Centre, Bengaluru in C.M.P.No.349/2017 (Annexure-F), where-under order dated 05.11.2018 had been passed on the administrative side by the Director Arbitration and Conciliation Centre closing the proceedings on account of claimant having not filed the claim petition. This order was sought to be recalled and as such an application under Rule 10(3) of Arbitration and Conciliation Rules 2012 came to be filed by petitioner. However, by impugned order, same has been rejected by the Director by interpreting the order dated 05.11.2018 (closure of proceedings) as an order passed under Rule 10(7) of Arbitration and Conciliation Rules, 2012. It has been further held that Director cannot exercise the powers which is not vested with it to grant the relief sought for by the claimant.
3. In the instant case it can be noticed that an order came to be passed by this Court under Section 11(6) of Arbitration and Conciliation Act, 1996 (for short ‘Act’) in C.M.P.No.349/2017 on 01.08.2018 appointing Sri I.S.Antin, Former District Judge as sole Arbitrator which resulted in notice being issued by the Arbitration Centre to the petitioner herein by communication dated 21.08.2018. Since said notice reflected as Hon’ble Shri Justice Anand Byrareddy, Former Judge, High Court of Karnataka having been appointed as sole Arbitrator, which was factually not so, in as much as order passed in C.M.P.No.349/2017 dated 01.08.2018 clearly disclosing that Sri I.S.Antin, Former District Judge having been appointed as sole Arbitrator, the initial flaw or illegality in the communication dated 21.08.2018 had continued.
4. However subsequently by another communication dated 03.09.2018 addressed to the petitioner intimating that Sri I.S.Antin, Former District Judge having been appointed as sole Arbitrator in C.M.P.No.349/2017 came to be communicated to the petitioner. The said communication forwarded to the petitioner by registered postal article had been returned unserved with a postal shara “addressee left without intimation”. In fact, address of the petitioner as found in the communication dated 21.08.2018, 03.09.2018 as well as address found in the cause title of the present writ petition are one and the same. In other words, the Registered office of the petitioner is same. It is because of this precise reason petitioner was not aware of the fact that claim petition was to be filed within time fixed under said communication and hence claim petition was not filed. Though petitioner was expected to ascertain from the Arbitration Centre, after having received communication dated 21.08.2018 and filed the claim petition, it did not choose to do so. On the other hand, on technical glitch, the petitioner wants to lay blame at the doors of the Arbitration Centre, which cannot be accepted.
5. Be that as it may. Fact remains that claimant now intends to prosecute the proceedings before the Arbitration and Conciliation Centre by filing a claim petition. Sri K.Ranjan Kumar, learned counsel appearing for respondent No.2 does not have any objection and he would also pray for opportunity being granted to the respondent to file objections to the claim petition if any filed by petitioner.
6. In the light of these developments which had taken place subsequent to order dated 05.11.2018 passed by the Director, Arbitration and Conciliation Centre closing the proceedings and the fact that direction has been issued in C.M.P.No.349/2017 appointing sole Arbitrator to arbitrate the dispute between the parties, necessary further directions required to be issued to the first respondent who is served and unrepresented.
7. Hence the following:
ORDER (i) Writ Petition is allowed in part.
(ii) Order dated 25.01.2019 (Annexure-F) is hereby quashed.
(iii) A direction is issued to the first respondent to receive the claim statement that would be filed by the petitioner/claimant within 15 days from today, without waiting for copy of this Order and on receipt of the claim petition the first respondent shall take steps in accordance with Rule 10(4) and onwards of the Arbitration and Conciliation Rules, 2012.
(iv) The petitioner shall also furnish advance claim statement copy on the respondents in addition to the steps that would be taken by the first respondent.
All pending applications stands consigned to records.
Sd/- JUDGE Kmv/-