Ravinder Jain vs Ajit Prasad Jain (Since Deceased) ...
2012 Latest Caselaw 1274 Del

      IN THE HIGH COURT OF DELHI AT NEW DELHI
F-3 & F-4
             O.M.P. 69/1999 & IAs 7801-02 of 1999,
                6732 of 2000, 4585-86 of 2005

        RAVINDER JAIN                                    ..... Petitioner
                             Through:      Mr. Pradeep Aggarwal, Advocate.
                                  Versus
        AJIT PRASAD JAIN (SINCE DECEASED)
        THROUGH LEGAL HEIRS AND ORS.        ..... Respondents
                      Through: Mr. Pradeep Dewan, Senior
                                 Advocate with Mr. Anupam
                                 Dhingra, Advocate for LRs of R-1
                                 and R-2.
                                 Ms. Mugdha Pandey and Mr.
                                 Girish Aggarwal, Advocates for
                                 R-7.
                                 Mr. Deep Dhamija, Advocate for
                                 R-8 to 10.
                                   AND
                   O.M.P. 70/1999 & IAs 7803-04 of 1999,
                 2210of 2002, 4587-88 of 2005, 10290 of 2010
        BHIKU RAM JAIN (SINCE DECEASED)
        THROUGH LEGAL HEIRS AND ORS.       ..... Petitioners
                     Through: Ms. Mugdha Pandey, Advocate for
                                P-2.
                                Mr. Deep Dhamija, Advocate for
                                P-3 to 5.
                                  Versus
        AJIT PRASAD JAIN (SINCE DECEASED)
        THROUGH LEGAL HEIRS AND ORS.        ..... Respondents
                      Through: Mr. Pradeep Dewan, Senior
                                 Advocate with Mr. Anupam
                                 Dhingra, Advocate for LRs of R-1
                                 and R-2.
                                 Mr. Pradeep Aggarwal, Advocate
                                 for R-6.
        CORAM: JUSTICE S. MURALIDHAR
O.M.P. No. 69 & 70 of 1999                                   Page 1 of 20
                              JUDGMENT

24.02.2012

1. These two petitions under Section 34 of the Arbitration and Conciliation Act, 1996 ('Act') are directed against an Award dated 28th November/13th November 1998 signed by two of the three members constituting the Arbitral Tribunal which adjudicated the disputes between the Petitioners and Respondents. OMP 69 of 1999 is by Mr. Ravinder Jain, son of late Mr. Bhiku Ram Jain and OMP 70 of 1999 is by late Mr. Bhiku Ram Jain son of late Mr. Mangat Rai Jain and the other four other sons of late Mr. Bhiku Ram Jain. During the pendency of the present petition, Mr. Bhiku Ram Jain expired. His legal representatives (LRs) were brought on record by order dated 2nd February 2011 in IA 1512 of 2011. On the same date by a separate order in IA 14673 of 2011, the LRs of late Mr. Ajit Prasad Jain, Respondent No.1 in both petitions, were brought on record.

2. On 2nd February 2011 while disposing of IAs 8330 of 2010 and 10290 of 2010 filed by Mr. Virender Kumar Jain, one of the sons of late Mr. Bhiku Ram Jain, this Court directed him to pay Rs. 50,000 to Respondent No.6 and Petitioners No. 3 to 5 in equal shares. While counsel for Mr. Virender Kumar Jain submitted that the said payment was tendered by way of cheque, this is disputed by the counsel for the Petitioners. Be that as it may, it is confirmed by counsel for Mr. Virender Kumar Jain that the cheque so tendered has not been encashed. It is directed that the payment of the costs as ordered by this Court on 2nd February 2011 will now be made by Mr. Virender Kumar Jain, without any delay, to the Respondent No.6 and Petitioner Nos.3 to 5, through counsel.

3. The factual background to the present petitions is that Mr. Ravinder Jain (the Petitioner in OMP 69 of 1999) and Mr. Virender Kumar Jain, Mr. Narender Kumar Jain, Mr. Arvind Kumar Jain and Mr. Adarsh Jain (Respondents No. 7 to 10 respectively in OMP 69 of 1999) are the sons of late Mr. Bhiku Ram Jain (Petitioner No. 1 in OMP 70 of 1999 and Respondent No. 6 in OMP No. 69 of 1999). For the sake of convenience, the Petitioners in OMP Nos. 69 and 70 of 1999 are collectively referred to as the 'BR Jain Group'. Late Mr. Bhiku Ram Jain was the son of late Mr. Mangat Ram Jain. The other son of Mr. Mangat Ram Jain was late Mr. Ajit Prasad Jain (Respondent No. 1 in both OMP Nos. 69 and 70 of 1999). Mr. Amit Jain, the son of late Mr. Ajit Prasad Jain, is Respondent No. 2 in both OMP Nos. 69 and 70 of 1999. For the sake of convenience Respondent Nos. 1 and 2 in OMP Nos. 69 and 70 of 1999 are referred to as the 'AP Jain Group'.

4. There are a large number of properties and assets belonging to the family of late Mr. Mangat Ram Jain. Meetings were held on 26th September 1983, 27th September 1983 and 22nd July 1984 between the family members of the BR Jain Group and AP Jain Group in respect of division of some of the properties/assets. On 12th February 1990 late Mr. AP Jain filed suit No. 398 of 1990 in this Court seeking partition of the properties and assets of the family. He also filed Company Petition No. 174 of 1990 in this Court alleging acts of oppression and mismanagement in respect of Faridabad Metal Udyog Private Limited, one of the companies belonging to the family of late Mr. Mangat Ram Jain.

5. On 24th September 1998, an Arbitration Agreement was entered into between late Mr. Bhiku Ram Jain, late Mr. AP Jain, Mr. Ravinder Jain,

Mr. Virender Kumar Jain, Mr. Narender Kumar Jain, Mr. Amit Jain, Mr. Arvind Kumar Jain and Mr. Adarsh Jain, in which it was noted that after the death of late Mr. Mangat Ram Jain in 1945, his Hindu Undivided Family ('HUF') continued and in which the parties to the said deed joined as coparceners. It was stated that the HUF carried on business activities on a large scale in various fields, inter alia, in the following trade names and corporate names:

"i) Jain Motor Co. Pvt. Ltd.

ii) Seth & Sons Pvt. Ltd.

iii) Jain Motor Trading Co.

iv) J.M.C. Industries including Jain Motor Car Co. Petrol Pump-cum-Services Pvt. Ltd.

v) Sharco Industries Pvt. Ltd.

vi) Faridabad Metal Udyog Pvt. Ltd.

vii) Bharat Foam Udyog Pvt. Ltd.

viii) Magatrai Jain Investments Pvt. Ltd.

ix) Shri Jain Real Estates Pvt. Ltd.

x) Bahubali Export Pvt. Ltd."

6. The Arbitration Agreement dated 24th September 1998 also noted that the joint family had made investments in the shares of various companies, jewellery etc. in the names of its coparceners/members as well as various immoveable properties, both residential and commercial. After referring to the meetings held on the three dates referred to hereinabove it was stated that "the parties to this deed are desirous of getting some adjustment, getting clarification, etc. with respect to the complete implementation of the family settlement" entered into between the parties as recorded in the minutes of the three meetings aforementioned. It was then stated in the Arbitration Agreement dated 24th September 1998 as under:

"The parties have agreed that the arbitral tribunal to whom the above matter is to be referred shall be constituted by the following persons:

i) Shri K.K. Gupta s/o late Shri Shyam Sunder Lal, Chartered Accountant and his office at 1/3- 10196, Jhandewalan, New Delhi-110055.

ii) Shri Roopak Jain s/o late Shri O.P. Jain, R/o 41, Rajpur Road, Delhi.

iii) Shri Akshay Jain s/o late Lala roshan Lal Jain, R/o C-61, Sham Nagar, Vrindavan Marg, Jaipur (Rajasthan)."

7. Among the terms and conditions set out in the arbitration agreement were the following:

"2. The arbitrators shall hear the parties, administer oath to witnesses, consider all pleadings and answers thereto, all allegations and counter-allegations and evidences, both oral and documentary, placed before them and make and publish their award in writing or on before, the 31st day of October 1998 unless the time for that purpose by mutual consent of the parties hereto or is extended by any court of competent jurisdiction.

3. All the arbitrators shall be present during the entire course of arbitration proceedings and shall effectively take part in all the proceedings under reference. All the arbitrators shall make an award in accordance with law. The venue of the arbitration will be at 1/3-10196, Jhandewalan, New Delhi-110055.

4. The provisions of the Arbitration & Conciliation Act, 1996 with all its statutory modifications and re- enactments so for as consistent herewith shall be deemed to be incorporated herein and all provisions of the said Act shall apply to the reference hereunder contemplated. Parties may appear in persons or by any authorised representative.

5. The arbitrators shall not be entitled to proceed with reference ex parte except in case where either party

wrongfully or willingly shall fail and/or neglect to attend the proceedings after reasonable notice on two occasions the last of such notices shall be peremptory."

7. The award made by the arbitrators shall be final and binding on the parties and persons claiming under them respectively. The parties to this agreement agreed that any award of decision of the arbitrators shall be final and binding between them and they shall not challenge the same in any Court of law except where the award is tainted with fraud or corruption."

8. The impugned Award dated 30th November 1998, signed by Mr. KK Gupta, Presiding Arbitrator and one of the Members Mr. Akshay Jain, has been challenged by the BR Jain Group in these petitions on several grounds, the principal one of which is that no notice was given to the BR Jain Group of the arbitral proceedings held after 1st October 1998. Consequently, it is contended that no representative of the BR Jain Group attended the meetings that took place after 1st October 1998. It is submitted that the arbitral record to the extent it shows that proceedings took place after 1st October 1998 is fabricated and manipulated. Not only the BR Jain group, but one of the Arbitrators, Mr. Roopak Jain, also did not attend any meetings of the Arbitral Tribunal after 1st October 1998 and this was evident from his affidavit dated 22nd February 2000 filed in this Court. This clearly showed that there was a violation of the Clause 3 of the Arbitration Agreement dated 24th September 1998 which required all the Arbitrators to be present during the entire course of the proceedings. It is also submitted that Clause 5 of the said Agreement has also been violated inasmuch as the said clause did not permit the Arbitrators to proceed with the reference ex parte, except where any party deliberately neglected to attend the proceedings after reasonable notice on

two occasions. Relying on the decisions in Vengamma v. Kewsanna AIR 1953 SC 21, Dewan Singh v. Champat Singh AIR 1970 SC 967, Union of India v. M/s. Ghaziabad Railway Station AIR 1972 All 34, Wazir Chand Karan Chand 1989 (1) Arb LR 187, Naginder Singh v. Commander 1989 (2) Arb LR 233 and Ravishankar University v. N.D.B. Enterprises 1999 (Suppl) Arb LR 501 (MP), it is submitted that the entire arbitration proceedings were in violation of the rules of natural justice and, therefore, the impugned Award is a nullity. Relying on the decisions in Subash Chugh & Co. v. Girnar Fibres Ltd. (2001) 1 Arb. LR 430 (P&H), Maganlal Gangaram Rathore v. Ramaji Bondarji AIR 1966 MP 177, Patel Bros. v. Meenakshi Mills Ltd. AIR 1942 Bom 239, Fazalally Jivaji Raja v. Khimji Poonji & Co. AIR 1934 Bom 476 and J. Kuppuswami Chetty v. B.V. Anantharamier AIR 1948 Mad 40 (DB), it is submitted that all the Arbitrators must sign the arbitral award failing which the award rendered by only some of them would be invalid. It is also submitted that Section 29 of the Act has been violated. It is further submitted that the impugned Award has been brought about through fraud, manipulation and fabrication of the arbitral record. It is pointed out that the arbitral proceedings show Mr. Ravinder Jain to be present on 15th October 1998 on which date he was not even present in India. The impugned Award states that representatives of the BR Jain Group were present at each of the hearings of the Arbitral Tribunal that took place after 1st October 1998 when in fact none was present on their behalf.

9. In response to the notice issued in these petitions, a reply was filed by the AP Jain Group on 26th July 1999. Specifically replying to the contention of the Petitioners that no meetings of the Arbitrators took place after 1st October 1998 it was stated by the AP Jain Group as under:

"It is false to allege that no notice of arbitral proceedings held on 15th October 1998, 20th October 1998, 7th November 1998, 19th November 1998 and 21st November 1998 was given to Petitioner / Objector and Respondent No. 6 to 10. Shri Ravinder Jain, the authorised representative of the Petitioner and Respondent No. 6 to 10, was present at all the hearings and actively participated in the proceedings, produced documents and addressed arguments. It is false to allege that Respondent No. 6 nor anyone else attended the proceedings. The record of the proceedings used to be fed in the compute and all the three Arbitrators kept one copy each. Sometimes notes of the proceedings were taken by Shri Roopak Jain Arbitrator in his own hand.

On 21st November 1998 at 3.30 p.m. Shri Ravinder Jain come to the office of Shri K.K. Gupta and wanted to inspect the records of the proceedings. Mr. K.K. Gupta was to leave urgently to attend a meeting of The Vaish Co-operative Adarsh Bank Ltd. scheduled for 4 p.m. He gave the file to Mr. Ravinder Jain with instructions that he should, after inspection, return the file to Mr. Samuksh Gupta a member of the staff. After about an hour Shri Ravinder Jain handed over the file to Clerk who kept it in the office records.

On 27th November 1998 while finalizing the Award, the minutes of the proceedings of the meetings held on 26th September 1998, 28th September 1998, 29th September 1998, 1st January 1998, 15th October 1998, 20th October 1998, 9th November 1998 and 21st November 1998 letter of authorisation and letter giving consent to extension of time were found missing from the file which was handed over to Shri Ravinder Kumar Jain for inspection on his request. Since the proceedings were fed in computer, there were take out and after obtaining the documents from the other arbitrator, the Award was finalised on 28th November 1998. At the time of making the Award the relevant records submitted during the course of arbitral proceedings were placed on record except the following as also stated in the Award dated 28th November 1998. Letter of Authority executed by the members of BRJ

Group in the name of Sh. Ravinder Jain and letter of Extension signed by Shri Ravinder Jain on behalf of BRJ Group and Sh. A.P. Jain on behalf of APJ Group photocopies have been placed on record.

After receiving letters dated 14th December 1998, 22nd December 1998 and 24th December 1998 through search of the entire office premises was made but the original letter of authority and letter of extension could not be traced which gave the impression that these had been stealthily removed during the inspection."

10. On 2nd September 1999 this Court passed the following order:

"In the instant case, an award dated 28/30.11.1998 has been filed by Arbitrator Shri K.K. Gupta, respondent No.3. the said award is signed by Shri K.K. Gupta and arbitrator Shri Akshay Jain, respondent No.5. The award has not been signed by arbitrator Shri Roopak jain, respondent No.4, who is stated to have refused to sign the same. Learned counsel for the petitioner has drawn my attention to Clause 3 of the Arbitration Agreement, which enjoins upon each of the arbitrators to make an award in accordance with law. Learned counsel for the petitioner submits that notice should issue to respondent No.4 Shri Roopak Jain for filing in court the award, if any, made by him and any record of proceedings with him.

Let notice issue to respondent No.4, Shri Roopak Jain for filing in court the award, if any, made by him and any record of proceedings with him, returnable on 27th October, 1999. Learned counsel for the objectors, makes a prayer for sealing of the records. Let a box be provided by the applicants/objectors. Let the parties appear before the Assistant Registrar (Original Side) on 7th September, 1999 for sealing of the arbitral records at 2.00 pm."

11. On 11th August 1999, the AP Jain Group filed IA 780 of 1999 under Order XI Rule 12 CPC stating that the Petitioners had raised a false plea of their not having received notice of the arbitral proceedings or of not

having attended the hearings after 1st October 1998 and praying that "the Respondents may be directed to discover on oath all documents relevant to the matter and suit which have been in their possession and power in Form-V Appendix C, CPC within ten days."

12. In reply to the said application, filed on 26th October 1999, Mr. Ravinder Jain in para 2 stated as under:

"2. Contents of para 2 of the application are denied. It is stated that the on 15.10.98 the Objector was out of India and as such he could not have attended the meeting allegedly held on 15.10.98. A copy of the passport of the objector showing that the objector was out of India on 15.10.98 is annexed hereto and marked "Annexure A-I". It is further stated that the minutes of meeting of the three arbitrators used to be prepared, in triplicate and were duly signed by the parties who participated in those meetings. Out of the three copies, one copy, duly signed by the parties, was given to the Objector and another such copy was given to Shri A.P. Jain. Photocopies of such meetings of Meeting of the Arbitrators held on 26.9.98, 28.9.98, 29.9.98 and 1.10.98 are annexed hereto and marked Annexure A- 2, A-3, A-4 and A-6 respectively."

13. The stamp on his passport showed that he was in Hong Kong between 11th and 16th October 1998. Prior to that, he was in Bangkok on 10th and 11th October 1998. Photocopies of the signed minutes, as enclosed by Mr. Ravinder Jain with his reply show that the meetings of the Arbitrators held on 26th and 28th September 1998 bore the signatures of Mr. Ajit Prasad Jain and Mr. Ravinder Jain and the minutes of the meetings held on 29th September and 1st October 1998 contained both their signatures as well as the signature of Mr. Virender Kumar Jain. The minutes of the fourth meeting held on 1st October 1998 recorded "the final hearing was adjourned for 21.1.1998 at 12.30 pm at the same venue."

14. A rejoinder was filed by the AP Jain Group on 22nd February 2000 to the above reply in which they took the following stand:

"2. Contents of para 2 of the reply are denied. The arbitration proceeding were held on 1.10.1998 when the next meeting was fixed for 21.10.1998 in the presence of the Objector - Applicant. On oral request of the parties, it was anteponed to 17.10.1998. The date 15.10.1998 seems to be an accidental mistake while recording the proceedings in the Computer. On 17.10.1998 the next date was fixed for 20.10.1998 which meeting was attended by Shri Ravinder Jain and he made no grievance about the same. It is false to allege that the record of the meetings was maintained in triplicate and one copy each was given to the parties attending the proceedings are the third copy was kept by the Arbitrator. The facts are that a single sheet of the proceedings was prepared at a meeting which after obtaining the signatures of the parties used to be kept on the record by Shri K.K. Gupta, the Presiding Arbitrator. The photo copies of the minutes of the meeting of the Arbitrators dated 26.9.98, 28.9.98, 29.9.98 and 1.10.98 are the photostat copies of the proceedings stolen by Shri Ravinder Jain from the record of the Arbitrators. The Arbitrators have referred to this fact in their letter dated 23.2.1999 while submitting the same to the High Court. The discovery of document in the possession and power of the Petitioner is necessary for fairly disposing of the case and for saving costs and for no other collateral purpose. No alleged copies of the other proceedings have been produced by the non-applicants."

15. On the same date, i.e. 22nd February 2000, Mr. Ravinder Jain also filed rejoinder to the main OMP 69 of 1999 where, inter alia, he reiterated:

"(iii) Examination of the arbitral records further shows that a meeting is shown to be held on 15.10.98, which is alleged to have been attended by the objector. No

notice of this meeting was given to the objector. Both the parties i.e. Sh. A.P. Jain and the objector have been shown to have attended this meeting on 15.10.98. The minutes of meeting of 15.10.98 further mention that Sh. K.K. Gupta has explained reasons to both the parties for pre-poning of the meeting and both the parties had agreed with the pre-ponment of the date. Both Sh. A.P. Jain and the objector are shown to have been present and to have argued their case at length on 15.10.98, but the fact of the matter is that the objector was not even in India on 15.10.98. He was in Bangkok as is evident from the copy of his passport annexed hereto and marked as Annexure R-2. This fact is clearly demonstrative that the minutes have been manipulated and the story of loss of record is false and fabricated. It is in the meeting held on 15.10.98 that Sh. K.K. Gupta styled himself as a Presiding Arbitrator for the first time at the time of the back of the objector."

16. Mr. Roopak Jain, one of the Arbitrators filed an affidavit in this Court on 22nd February 2000. Paras 3 to 10 of the said affidavit are relevant for the present case and read as under:

"3. At the very outset, I say that it has been wrongly mentioned in the award allegedly passed and signed by Sh. K.K. Gupta and Sh. Aakshay Jain that the copy of the award had been shown to me and I have been consulted before finalisation of the award. In this connection, I say that I have neither been shown the copy of the award nor have been consulted before finalisation of the award. The award has been passed at my back and without my knowledge as such the question of my being consulted or refusing to sign the award does not arise.

4. As regards my having attended the alleged meetings held on 27th November 1998, 28th November 1998, 30th November 1998 when discussions are allegedly held amongst the arbitrators Sh. K.K. Gupta and Sh. Aakshay Jain who signed the award, I say and submit that I was

called on 27th November 1998 by Sh. K.K. Gupta to come to his office on that day itself to hold discussions in this matter. I went to the office of Sh. K.K. Gupta on 27th November 1998. After some discussions, I was shown print outs of some meetings which were prepared by Sh. K.K. Gupta and Sh. Aakshay Jain which print outs were intended to show that proceedings were held in which the parties participated on 15th October 1998, 20th October 1998, 9th November 1998, 19th November 1998 and 21st November 1998. I point blank refused to be a party to this fabrication. After this I was ignored. I was thereafter not consulted and was not shown the copy of the award, which is alleged to have been signed and passed by my two colleagues, Shri K.K. Gupta and Shri Aakshay Jain.

5. I say that it was the procedure adopted by arbitrators to take three print outs of the meetings that were held and have all these three print outs signed by the parties who participated in these meetings. Out of the three print outs, which were signed by the parties who participated, one print out, was kept with me, and one each was given to Sh. Ravinder Jain and Shri A.P. Jain. I further say that on 26th September 1998, 28th September 1998, 29th September 1998 and 1st October 1998 meetings were held at 1/3-10196, Jhandewalan, New Delhi-55 that were attended by all the three arbitrators and the parties. One print out of these meetings held on 26th September 1998, 28th September 1998, 29th September 1998 and 1st October 1998, which were signed by the parties who participated, were kept with me.

6. I further say that in the meeting held on 1st October 1998 Sh. Ravinder Jain and Sh. A.P. Jain filed documentary evidences. The meeting was thereafter adjourned for 21st October 1998 at the same venue. On 21st October 1998, I went to the office of Sh. K.K. Gupta at 12-30 P.M. Sh. Ravinder Jain arrived at about the same time. Although the parties had already filed claims, Sh. K.K. Gupta directed Sh. Ravinder Jain to again file a detailed statement of claim. Sh. K.K. Gupta further directed that as the last date of passing the award the award as per the agreement dated 24th September 1998

was 31st October 1998 and it was not possible o pass the award by that date the time be extended by month i.e. from 31st October 1998 to 30th November 1998. On this date i.e. 21st October 1998 Sh. A.P. Jain did not appear. It was than agreed that the next date would be communicated to the parties.

7. On 4th November 1998, I received letters from Sh. Adarsh Jain and Sh. Arvind Jain objecting to the authority of Sh. Ravinder Jain to extend the time from 31st October 1998 to 30th November 1998.

8. On 12th November 1998, I visited the office of Sh. K.K. Gupta. I handed over copies of the letters dated 4th November 1998 received from Sh. Adarsh Jain and Sh. Arvind Jain. Sh. K.K. Gupta already had copies of these letters as Sh. Adarsh Jain and Sh. Arvind Jain sent the same to all the three arbitrators. Sh. K.K. Gupta gave me two letters to be delivered to Sh. Ravinder Jain and Sh. A.P. Jain. I delivered these letters to Sh. Ravinder Jain and Sh. A.P. Jain.

9. On 16th November 1998, I received another letter from Sh. Narinder Jain objecting to the authority of Sh. Ravinder Jain to extend the time from 31st October 1998 to 30th November 1998. I sent a copy of this letter to Sh. K.K. Gupta.

10. I say that I did not attend the alleged meetings held by my two colleagues after 1st October 1998 i.e. on 15th October 1998, 20th October 1998, 9th November 1998, 19th November 1998 and 21st November 1998. These meetings, if at all held, were held at my back."

17. It was urged by Mr. Pradeep Dewan, learned Senior counsel for the AP Jain Group, that the statement in the impugned Award of the learned Arbitrators that they met on 15th October 1998 was due to "lapse of memory". The statement to the same effect made in the reply filed by the AP Jain Group to the present petitions was also, according to him, a

mistake. However, he candidly stated that no corrigendum to that effect was issued by the two Arbitrators who signed the impugned Award. Further, he did not dispute that the AP Jain Group also did not filed any application or affidavit to that effect in the present petitions.

18. A perusal of the impugned Award shows that at internal page 5, the following statement has been made:

"WHEREAS we entered upon the reference on 24th September 1998 and invited both the Groups vide our letter dated September 25, 1998 to submit their claims, if any in addition to what have already been dealt with in family meetings held on 26th September 1983, 27th September 1983 and 22nd July 1984. They were also requested to produced and submit necessary evidences and material in support of their claims for our consideration. The hearings were held from time to time to provide ample opportunities to both the Groups to make their submissions and justify their claims by producing adequate documentary evidences and any other material they deem appropriate and fit in the matter. Both the Groups have made personal and/or written submissions along with documents which have been examined and taken into consideration.

The following issues for giving the Award have been framed out of the decisions taken in three family meetings held on 26th September 1983, 27th September 1983 and 22nd July 1984 and additional claims made by both the Groups in writing or in person during the course of hearings held at the office of Presiding Arbitrator at 1/3-10196, Jhandewalan, New Delhi- 110055 on September 26, September 28, September 29, October 01, October 15, October 20, November 09, November 19, and November 21, 1998 duly attended by the authorised representatives of both the Groups." (emphasis supplied)

19. The categorical statement in the impugned Award is that hearings

took place on 15th October, 20th October, 9th November, 19th November and 21st November 1998 and that they were "duly attended by the authorized representatives of both the groups."

20. The arbitral record has been perused. File No.2 contains copies of the purported minutes of the hearings of the Arbitral Tribunal that supposedly took place on 15th October, 20th October, 9th November, 19th November and 21st November 1998. They do not bear the signatures of any of the parties or the Arbitrators. The minutes of the meeting of the Arbitrators purportedly held on 27th, 28th and 29th November 1998 have been signed by two arbitrators i.e., Mr. KK Gupta and Mr. Akshay Jain, not by Mr. Roopak Jain.

21. The AP Jain group has no credible explanation for the obviously erroneous statement in the impugned Award regarding the presence of representative of both groups at the meetings of the Arbitral Tribunal held from 15th October 1998 onwards. The fact that Mr. Ravinder Jain was not present in India on 15th October 1998 has not been able to be countered. There is nothing to show that the Arbitrators met at any date after 1st October 1998 and before 15th October 1998 when they decided to advance the next date of hearing from 21st October 1998 to 15th October 1998, as is stated in the purported minutes of the meeting held on 15th October 1998 or to 17th October 1998, as is belatedly sought to be urged by the AP Jain Group in their rejoinder in the application under Order XI Rule 12 CPC. On the contrary, the minutes of the 5th meeting which form part of the arbitral record, indicates the date of that meeting as 15th October 1998. The minutes of the said meeting have not been signed by any one much less by any representative of the BR Jain Group or the third Arbitrator Mr.

Roopak Jain.

22. The above circumstances probabalise the assertion by Mr. Roopak Jain in his affidavit that he did not attend any meeting of the Arbitral Tribunal held after 1st October 1998. The fact that he did not sign any of the minutes of the Arbitral Tribunal after 1st October 1998 is evident. In fact this is not disputed even by the AP Jain Group.

23. It was attempted to be shown by Mr. Dewan, learned Senior counsel for the AP Jain Group that there were writings and notes of Mr. Roopak Jain forming part of the arbitral record which would go to show that he was present at the meetings of the Arbitral Tribunal after 1st October 1998. In the written submissions filed on 13th February 2010 while referring to the said notes, it is stated by the AP Jain Group in para 10 as under:

"10. The first document having heading of "Properties" which is in the hand writing of Rupak Jain is very important. Its contents are in total consonance with the award. This shows that Shri Rupak Jain had participated in the making of the award. The next document having heading "Shares of various Cos." Which is again in hand writing of Shri Rupak Jain clearly matches with item No.10 of the award. The following sheet on which words "APJ" AND "MRJ IPL" are written relate to the minutes of the proceedings dated 29.9.1998, 1.10.1998 and 9.11.1998. The next two documents are the two letters dated 2.11.1998 jotted down by Shri Rupak Jain intended to be addressed to APJ and Ravinder Jain. Now let us match the contents of the first letter dated 2.11.1998 intended to be written to Shri A.P. Jain with the letter dated Nil written by KKG on behalf of the arbitrators to AP Jain, copy whereof has been filed by KKG. The words of the said letter is almost 100 per cent same with little changes here and there. Further, the first para of the letter jotted by Shri Rupak Jain adopts the content of the proceedings dated 20.11.1998. The second para

of the said letter meets the contents of letter dated Nil written by KKG to Shri AP Jain. As far as the second letter dated 2.11.1998 jotted by Shri Rupak Jain intended to be addressed to Shri Ravinder Jain is concerned, this letter was also sent by Shri KKG to RJ. It was in the context of the said letter only that Shri Vijender Jain sent a fax dated 4.11.1998 which relates to the documents required as per the letter dated 2.11.1998. These handwritings thus prove three things. Firstly, proceedings were held by all the arbitrators including Sri Rupak Jain and his claim that he was not aware of the proceedings after 1.10.1998 is falsified. These documents also prove that all the parties including the BRJ group was being effectively represented. Thirdly, the affidavit filed by Shri Rupak Jain is false as he does not in the said affidavit admit that he had ever in any manner participated in the proceedings after 1.10.1998. These letters were available on the records maintained by the Presiding Arbitrator Shri K.K. Gupta and they came into his hand in the normal course. The affidavit of Shri Rupak Jain is thus patently false in view of the aforesaid submissions."

24. What is incredible in the above submissions by the AP Jain Group is that they still state that there was a meeting on 15th October 1998 when plainly they admit in their rejoinder to the application under Order XI Rule 12 CPC, extracted above, that there was no such meeting at all. In the written notes of arguments filed on behalf of AP Jain Group on 15th May 2002, it is stated that "it can be that the meeting was held on 16.10.1998 or 17.10.1998 on which date he was admittedly in India." The above face saving statement has been made out of sheer desperation. As already observed there is no corrigendum issued by the two arbitrators who signed the impugned Award that the statement therein that a meeting took place on 15th October 1998 and that the representatives of the BR Jain Group were present at such meeting was made by mistake. There is no correction to the minutes of the so-called 5th meeting of the arbitrators which gives the date of that meeting as 15th October 1998. No affidavit or application has been filed by the AP Jain Group to amend the statement

made in their reply to the present petitions that a meeting took place on 15th October 1998. Clearly, therefore the utter falsity of the statement in the impugned Award and all the other documents referred to hereinbefore that a meeting of the Arbitral Tribunal took place on 15th October 1998 and that the representatives of the BR Jain Group, including Mr. Ravinder Jain, were present at such meeting stands exposed.

25. Secondly, the writings of Mr. Roopak Jain, which are shown as having been made on loose sheets of paper, even if accepted on their face value, do not lead to the conclusion that all three members of the Arbitral Tribunal met on 15th October 1998 and the dates thereafter, or that any representative of the BR Jain Group was present at those hearings. There has been an attempt by the AP Jain Group and the two arbitrators who signed the impugned Award to falsify the arbitral record. The falsification stands clearly demonstrated by the fact that Mr. Ravinder Jain was not present in India on 15th October 1998 whereas the impugned Award as well as the purported minutes of the so-called meeting of the Arbitral Tribunal on that date shows him as having been present at the said hearing of the Arbitral Tribunal on 15th October 1998. The impugned Award is contrary to Clause 3 of the Arbitration Agreement dated 24th September 1998 which mandatorily requires all arbitrators to be present at each meeting of the Arbitral Tribunal and Clause 5 which mandates that none of the proceedings be conducted ex parte. These facts and circumstances are by themselves sufficient for this Court to conclude that the impugned Award is based on a fabrication of the arbitral record and, therefore, cannot be sustained in law.

26. Consequently, the impugned Award is hereby set aside. The two petitions are allowed with costs of Rs.50,000 in each petition which shall be paid by the AP Jain Group, i.e. Respondents 1 and 2, to the Petitioners within a period of four weeks. All interim orders stand vacated and the pending applications are disposed of.

S. MURALIDHAR, J FEBRUARY 24, 2012 s.pal