Dbm Geotechnics And ... vs West Quary Multiport Private ...
2021 Latest Caselaw 5903 Bom

                                                         18-CARBP-6-2021+.DOC




 Arun



      IN THE HIGH COURT OF JUDICATURE AT BOMBAY
           ORDINARY ORIGINAL CIVIL JURISDICTION
                     IN ITS COMMERCIAL DIVISION
        COMM ARBITRATION PETITION NO. 6 OF 2021
                                    WITH
      COMM ARBITRATION APPLICATION NO. 217 OF 2018


 DBM Geotechnics And Constructions Pvt Ltd                          ...Petitioner
      Versus
 West Quay Multiport Pvt Ltd                                     ...Respondent

Mr Simil Purohit, with Amol Bavare & Krishna Baruha, for the Petitioner in CARBP/6/2021 and for the Applicant in CARAP/217/2018.

                               CORAM:     G.S. PATEL, J
                               DATED:     1st April 2021
 PC:-

COMM ARBITRATION PETITION NO. 6 OF 2021:

1. There is a service report of the Registry of 30th March 2021. At the frst address at Mathew Road, the Respondent was not found and the Bailif was told that the Respondent had left the premises a long time ago. The second premises are at Nariman Point. The Respondent was not found at that address and the Bailif was informed that no one at the building knew anything at all about the

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Respondent. This was also the result when service was attempted at the third address at Colaba. There is, following my previous order, an Afdavit proving publication.

2. Mr Purohit appears for the Resolution Professional. He submits that nothing further can now be done in regard to service. His instructions are to press for relief in terms of prayer clause (a) which seeks a deposit of an amount of Rs.10,72,48,787/-.

3. The facts are very few.

4. The Respondent entered into a Concession Agreement with the Board of Trustees of Visakhapatnam Port Trust for the construction development and other related activities of the West Quay-6 Berth ("WQ6") in the Northern Arm of the Inner Harbour of Visakhapatnam Port for handling dry bulk cargo. On 21st October 2011, pursuant to a tender notice, the Petitioner was declared to be the successful tenderer by the Respondent and on 10th April 2012 the parties entered into a formal Agreement for civil engineering works. A performance bank guarantee was also submitted. On 8th April 2015, since everything but minor work was complete, the Petitioners sought a provisional completion certifcate and the release of 50% of the retention amount, Rs. 1,79,87,671/-. The Respondent refused to make payments. It threatened to invoke the performance bank guarantee. The parties arrived at an Memorandum of Understanding ("MoU") on 8th March 2016. Disputes arose again and on 18th August 2016 the Respondent invoked the performance bank guarantee to its full extent of Rs. 6.75

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crores. On 14th September 2016, the Petitioner invoked arbitration and fled an application under Section 11. That is pending.

5. On 22nd February 2021 there was a notifcation issued by the Bank of Baroda for inviting expressions of interest for selling the Respondent's fnancial assets.

6. The claim today of Rs.10,72,48,787/- is for the balance due under the Petitioner's fnal bill.

7. The lack of any response to the notices of invocation and to this Petition and the failure of the Respondent to accept service leads me to believe that the Petitioner is deserving of protection. There is certainly a prima facie case made out. Mr Purohit submits that the relief may be viewed as one in the nature of attachment before judgment. There is a sufcient case made out for that too. In paragraphs 6 and 7 the averment is that the Respondent is unable to pay its debts, and is probably disposing of its assets with the view to defeat and delay its creditors. There is also now an averment in paragraph 7 without traverse that the Petitioner has completed its obligations under the civil engineering contract.

8. The arbitration clause at page 145 says that disputes between the parties are to be referred to arbitration in Mumbai. The composition of the Arbitration Tribunal is not indicated in the clause itself. However the existence of the Arbitration Agreement cannot be denied.

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9. There will be an ad-interim order in terms of prayer clause (a) which reads thus:

"(a) pending the fnal hearing and disposal of the arbitration proceedings and execution of the arbitral award, this Hon'ble Court be pleased to direct the Respondent to deposit the amount of Rs.10,72,48,787/- (Rupees Ten Crore Seventy Two Lakh Forty Eight Thousand Seven Hundred Eighty Seven Only) with the ofce of the Prothonotary and Senior Master of this Hon'ble Court."

10. The amount is to be deposited within four weeks from today. Alternatively it is open to the Respondents to furnish a bank guarantee of a nationalised bank for the whole or any part of the amount. Upon the deposit being made, the Prothonotary and Senior Master is to invest the amount with a nationalised bank in accordance with the usual practices of his ofce. If a bank guarantee is furnished for the whole or any part of the amount, this is to also include interest as claimed and is to be kept alive until further orders of this Court either in the present proceedings or, post-award in Section 9, Section 37 or Section 34 proceedings. Upon the deposit being made, the Petitioners will be entitled to apply to the Arbitral Tribunal for liberty to withdraw the whole or any part of the amount on such terms and conditions as the Arbitral Tribunal may think ft. This will be considered on its own merits. The Petitioner will also apply to the Arbitral Tribunal for an encashment of the bank guarantee, if furnished, and this will also be decided on its merits.

11. Liberty to the Respondent to apply for a recall, modifcation or variation of this order but only after fve clear working days' notice to the Advocates for the Petitioners.

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12. The Respondent will also be entitled to apply to the Arbitral Tribunal for a variation, modifcation or recall of this order.

13. Subject to these conditions, the deposit or bank guarantee (or both) is/are to continue until the disposal of the arbitral proceedings or an order of the Arbitral Tribunal, whichever is earlier, and, in the event that it continues until the disposal of the arbitration, until the expiry of the period for fling a challenge to the Arbitral Award.

14. The Petitioners will be entitled to recover the costs of this Petition as costs in arbitration along with interest.

15. The Petition is disposed of in these terms.

16. All contentions in arbitration are kept open.

COMMERCIAL ARBITRATION APPLCATION NO. 217 OF 2018:

17. In the companion Commercial Arbitration Application, M/s Argus Partners had entered appearance. They are not present today. The order of 2nd November 2018 indicates that an issue was taken regarding stamp on the document in question, a copy of which is at page 15. There is no doubt that the Agreement contains an Arbitration Clause at page 131, GCC 62 which provides for an arbitration in Mumbai. The composition of the Arbitration Tribunal is not specifed.

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18. Mr Purohit states that the Applicant has no difculty in submitting the document for adjudication as to stamps but the Applicant does not have the original. The Collector of Stamps will proceed to adjudicate the document on the basis of a copy submitted by the Applicant to the Collector of Stamps. That document will be complete in all respects. The Collector will complete the adjudication process at the earliest possible and preferable within six weeks from today (45 days).

19. In the meantime, I appoint Mr Ankit Lohia, learned Advocate of this Court, as a sole Arbitrator to decide the disputes and diferences between the parties arising from an Agreement dated 10th April 2012.

TERMS OF APPOINTMENT

(a) Appointment of Arbitrator: Mr Ankit A Lohia, learned Advocate, is hereby nominated to act as a Sole Arbitrator to decide the disputes and diferences between the parties under an Agreement dated 10th April 2012.

(b) Communication to Arbitrator of this order:

(i) A copy of this order will be communicated to the learned Sole Arbitrator by the Advocates for the Applicant within one week from the date this order is uploaded.

(ii) The Advocates for the Applicant will forward an ordinary copy of this order to the learned

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Sole Arbitrator at the following postal and email addresses:

                               Arbitrator         Ankit A Lohia, Advocate.
                               Address            2nd Floor
                                                  Techno Heritage
                                                  NM Road
                                                  Fort
                                                  Mumbai 400 001.
                               Mobile             98211 25936
                               Email              [email protected]

         (c)      Disclosure: The learned Sole Arbitrator is requested to

forward, in hard copy or soft copy (or both), the necessary statement of disclosure under Section 11(8) read with Section 12(1) of the Arbitration Act to Advocates for the parties as soon as possible. The Advocates for the Petitioners will arrange to fle the original statement in the Registry. If the statement is forwarded in soft copy, a print out of the covering email is also to be fled in the registry.

(d) Appearance before the Arbitrator: Parties will appear before the learned Sole Arbitrator on such date and at such place as the learned Sole Arbitrator nominates to obtain appropriate directions in regard to fxing a schedule for completing pleadings, etc.

(e) Contact/communication information of the parties:

Contact and communication particulars are to be provided by both sides to the learned Sole Arbitrator.

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The information is to include functional email addresses and mobile numbers.

(f ) Section 16 application: The respondent is at liberty to raise all questions of jurisdiction within the meaning of section 16 of the Arbitration Act. All contentions are left open.

         (g)      Interim Application/s:

                  (i)          Liberty to the parties to make an interim

application or interim applications including (but not limited to) interim applications under Section 17 of the Arbitration & Conciliation Act, 1996 before the learned Sole Arbitrator. Any such application will be decided in such manner and within such time as the learned Sole Arbitrator deems ft.

(ii) The present Petition under Section 9 of the Arbitration Act for any remaining relief will be treated, heard, and disposed of as an application under Section 17 of the Act. All afdavits fled in the Section 9 petition will be treated as afdavits fled in the Section 17 application. Liberty to apply to the learned Sole Arbitrator for leave to fle further afdavits.

(iii) The learned Sole Arbitrator is requested to dispose of all interim applications at the earliest.

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(h) Fees: The arbitral tribunal's fees shall be governed by the Bombay High Court (Fee Payable to Arbitrators) Rules, 2018.

(i) Sharing of costs and fees: Parties agree that all arbitral costs and the fees of the arbitrator will be borne by the two sides in equal shares in the frst instance.

(j) Consent to an extension if thought necessary. Parties immediately consent to a further extension of up to six months to complete the arbitration should the learned Sole Arbitrator fnd it necessary.

(k) Venue and seat of arbitration: Parties agree that the venue and seat of the arbitration will be in Mumbai.

(l) Procedure: These directions are not in derogation of the powers of the learned Sole Arbitrator to decide and frame all matters of procedure in arbitration.

20. The Commercial Arbitration Application and the Commercial Arbitration Petition are disposed of in these terms. Liberty to the Petitioners/Applicants to seek the costs of both the Petition and the Application in arbitration.

21. All concerned will act on production of an ordinary copy of this order.

(G. S. PATEL, J)

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