Parvesh Kumar Sahni vs Manjushree Production
1997 Latest Caselaw 698 Del

JUDGMENT

K.S. Gupta, J.

(1) In this petition under Section 20 of the Arbitration Act it is alleged that the petitioner is carrying on business of telecasting of cinematographic films on Doordarshan Kendras in India under the name and style of M/s. Konca Video of which he is the sole proprietor. Respondent is a film producer and amongst other pictures produced Bhojpuri picture "Bahina Tore Khatir". Under the agreement dated August 20, 1988 entered into between the parties at Delhi the respondent assigned to the petitioner telecasting rights of the aforesaid picture for a period of four years at Doordarshan Kendras and all Lpt Centres for a sum of Rs. 40.000.00 . Rs. 5,000.00 were paid by the petitioner on signing of the agreement and a sumofRs.5,000.00 which was to be paid in due course of time, was also paid alongwith Rs.2,000.00 to the respondent leaving a balance of Rs. 28.000.00 to be paid on receipt of approval letter for telecasting the picture at Lpt Centres. It is further alleged that under the abovementioned agreement it was agreed between the parties that the respondent will provide a good print for the purpose of preview and telecasting and after telecasting the print would be sent back to the respondent. It is pleaded that after receipt of Rs. 12,000.00 respondent supplied the print of the aforesaid picture for a period of one week for the purpose of preview thereof by the Doordarshan authorities to the petitioner. However, for some reasons Doordarshan authorities could not preview the picture. Proprietor of the respondent oncoming to know that the preview is likely to take another four weeks' time, came to Delhi and took back the print of the picture on the pretext that he will send the same again as and when preview date is fixed. Thereafter, petitioner wrote various letters to the respondent for sending the print for the purpose of preview but it did not supply the print. By the letter dated May 5, 1992, respondent categorically refused to supply the print on the ground of the agreement dated May 20,1988 having been cancelled by the letter dated February 9,1992 which was never received by the petitioner. It is alleged that respondent did not have any right to cancel the aforesaid agreement nor was there any occasion for doing so. Petitioner had always been willing and ready to perform his part of the contract by making the balance payment on getting the approval from Doordarshan authorities. It is further alleged that Clause 6 of the aforesaid agreement provides that in case of any dispute between the parties same is to be settled by arbitration. Nature of the disputes which are alleged to have arisen has been set out in detail in Para Ii of the petition. It was prayed that the original arbitration agreement may be ordered to be filed in Court and an Arbitrator be appointed to adjudicate upon the disputes as mentioned in Para Ii of the petition.

(2) In the written statement respondent has not denied that under the agreement dated August 20, 1988 entered into between the parties respondent assigned the telecast rights of the picture "Bahina Tore Khatir" for a period of four years in favour of the petitioner for a sum of Rs. 40,000.00 to be paid in the manner stated in Para 4 of the petition. However, it is pleaded that the proprietor of the respondent personally handed over the print of the picture after receiving advance of Rs. 12,000.00 to the petitioner who in turn promised to return the print after its preview by Doordarshan by July 25,1991. Neither the print was got previewed by the petitioner nor was it returned to the respondent even after the expiry of more than a month. Therefore, the proprietor of the respondent came to Delhi and took back the print. It is further alleged that due to non-telecast of the picture on or before the eve of Raksha Bandhan respondent had to face lot of difficulties and he also suffered heavy loss of money. It is emphatically denied that the proprietor of the respondent took back the print on the pretext that he would send it against as and when the preview date is fixed. It is pleaded that in view of the cancellation of the aforesaid agreement by the respondent on February 9,1992 there was no question for supply of the print to the petitioner for preview and telecast. It is, denied that the petitioner did not receive the registered letter dated February 9, 1992 sent by the respondent cancelling the aforesaid agreement dated August 20,1988. Petition is alleged to be not legally maintainable as it was filed on August 26,1992 after the expiry of the period of four years for which the aforesaid agreement was to remain in force. Existence of any dispute is emphatically denied. On July 27, 1995, following issues were framed : 1. Whether agreement to refer the matter to Arbitrator has come to an end for the reason stated in the written statement ? 2. Whether the dispute between the parties is to be referred to the Arbitrator. ?

In support of the petitioner, the petitioner has filed his affidavit dated December 12, 1995. Gianinder Kumar Srivastava, proprietor of the respondent, filed his affidavit dated September 21, 1996, in support of the pleas raised in the written statement. Issue No. 1:

(3) In the written statement respondent has alleged that under the agreement dated August 20, 1988, telecasting right in respect of the picture "Bahina Tore Khatir" was granted to the petitioner for a period of four years and as the present petitioner was filed after the expiry of that period on August 26,1992, the same is not legally maintainable. Contention advanced on behalf of the petitioner was that as per the averments made in Para 9 of the written statement on merits, aforesaid agreement was cancelled by the respondent on February 9, 1992. The petitioner came to know about the cancellation only through the respondent's letter dated May 5,1992. Assuming for the sake of argument that the aforementioned agreement was cancelled on February 9, 1992, the limitation would start running from that date and as the period of limitation for filing petition under Section 20 of the Arbitration Act is three years under Article 137 of the Limitation Act, the petition filed on August 26,1992, was well within time. There is considerable merit in this submission. The period given in the agreement dated August 20, 1988, is relevant only in regard to providing of print of picture for telecasting at Lpt centres by the respondent against the balance payment of Rs. 28,000.00 to be made by the petitioner. It has absolutely no relevance on the point of limitation for a petition under Section 20 of the Act. Right to apply for referring the disputes to an Arbitrator accrued to the petitioner when the respondent failed to make available the print of the picture for preview and telecast after August, 1991 and cancelled the aforementioned agreement on February 9,1992. Thus the present petition filed on August 26, 1992, is well within limitation. Issue No. 2:

(4) Execution of the agreement dated August 20, 1988, containing the arbitration clause is admitted by both the parties. Case set up by the respondent particularly in Para 8 of the written statement on merits is that the print of "Bahina Tore Khatir" was personally handed over by Gianinder Kumar Srivastava to the petitioner who in turn promised to return the same after its preview by Doordarshan latest by July 25,1991. However, neither the print was got previewed by the petitioner nor was it returned to the respondent even after the expiry of more than a month and thereupon, said Gianinder Kumar Srivastava came to Delhi and took back the print of the picture. It is not in dispute that thereafter the print was not made available by the respondent for preview and telecast to the petitioner and the former cancelled the aforementioned agreement before the expiry of the period for which it was to remain in force, on February 9, 1992. Non-supply of the print and cancellation of the agreement by the respondent obviously gave rise to the disputes on the lines noted in Para Ii of the petition which need to be referred to an Arbitrator for adjudication as provided in Clause 6 of the aforementioned agreement.

(5) Petition is, therefore, allowed and the claim made by the petitioner is referred to the sole arbitration of Shri Justice S.C. Jain, retired Judge of this Court. It would be open to the respondent to file claim or counter-claim before the Arbitrator. Arbitrator will fix his own fee, enter upon the reference and make and publish the award within the time prescribed by law.