Madras High Court
Nissan Motor India Pvt. Ltd vs Rajesh Kumar Jain on 12 January, 2022
CMA.No.58 of 2022
and CMP.Nos.403 & 430 of 2022
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 12.01.2022
CORAM:
THE HONOURABLE MR.JUSTICE R.SUBRAMANIAN
CMA.No.58 of 2022
and
CMP.Nos.403 & 430 of 2022
Nissan Motor India Pvt. Ltd.,
Represented by its Authorised Signatory
having registered Office at:
Plot No.1A, SIPCOT Industrial Park,
Mattur (Post), Oragadam, Sriperumpudur Taluk,
Kanchipuram District – 602105. ...Appellant
Vs.
Rajesh Kumar Jain ..Respondent
Prayer: Civil Miscellaneous Appeal filed under Section 37 of the Arbitration
and Conciliation Act r/w. Madras High Court Appellate Side Rules, against
the order dated 22.10.2021 passed by the Sole Arbitrator, Hon'ble Mr.Justice
N.Paul Vasanthakumar in arbitration arising out of OP.No.45 of 2021 in
Letters of Intent dated 17.03.2014.
For Appellant : Mr.M.Velmurugan
1/6
https://www.mhc.tn.gov.in/judis
CMA.No.58 of 2022
and CMP.Nos.403 & 430 of 2022
JUDGMENT
This appeal is directed against an order of the Arbitrator made in
an application under Section 16 of the Arbitration and Conciliation Act,
rejecting the preliminary objection raised by the Appellant relating to
maintainability of the Arbitration proceedings.
2.The main contention of the petitioner is that the dealership
agreement and the letter of intent was issued in favour of one Rajesh Kumar
Jain as an individual and it also contained a non-disclosure clause, which
requires the individual to maintain secrecy in respect of the transaction
between the parties. The said Rajesh Kumar Jain has also undertaken vide
his acknowledgement dated 18.03.2014 to maintain secrecy and return all
proprietary materials and confidential information, if he is not appointed as a
dealer. Arbitration proceeding was launched by the said Rajesh Kumar Jain
and claim statement was filed seeking compensation of Rs.14,72,83,862/-
along with interest at 24% per annum and Hon'ble Jusitce N.Paul
Vasanthakumar, former Chief Justice of High Court of Jammu & Kashmir
https://www.mhc.tn.gov.in/judis
CMA.No.58 of 2022
and CMP.Nos.403 & 430 of 2022
has appointed as an Arbitrator.
3.Before the Arbitrator, the appellant filed an application under
Section 16 seeking dismissal of the claim statement and determination of
arbitral proceedings on the ground that the arbitration proceedings have
been filed by a Company and not by the individual. The 1st paragraph of the
claim statement it is stated that the claimant statement is being filed by one
Mr.Ritesh Jain, who is one of the Board Directors of M/s.R.K.Earthmovers,
who has been duly authorized by way of Board Resolution on 01.06.2021.
This is projected as a reason for rejection of the claim aAt the threshold
under Section 16. The Hon'ble Arbitrator had dismissed the application
concluding that the issue has to be decided during the course of the
arbitration and it cannot be subject matter of rejection under Section 16 of
the Arbitration and Conciliation Act.
4.Mr.M.Velmurugan, learned counsel appearing for the appellant
would vehemently contend that the Arbitrator erred in overlooking the fact
that the contract is between an individual and the appellant therefore, the
individual cannot be represented by a Company. The learned counsel would
https://www.mhc.tn.gov.in/judis
CMA.No.58 of 2022
and CMP.Nos.403 & 430 of 2022
try to bring the case within the scope of Section 16. Section 16 of the
Arbitration and Conciliation Act confers the power of arbitral tribunal to rule
on its own jurisdiction. The jurisdiction of the Arbitral Tribunal can be
questioned only on specific grounds not on other grounds. Section 16(3)
required the party to raise the issue relating to the jurisdiction of the Arbitral
Tribunal at the earliest point of time and the arbitral tribunal is required to
rule on its own jurisdiction. I do not think the grievance of the appellant
could be brought with in the scope of Section 16 (3) of the Arbitration and
Conciliation Act.
5.The issue that is now raised is not regarding the competence or
jurisdiction of the Arbitral Tribunal. The issue that is now sought to be
projected is the competence of the party, who had signed the claim petition.
This issue will have to be decided by the Arbitrator after evidence is let in. I
do not think, this issue would form the subject matter of rejection of a claim
under Section 16 of the Arbitration and Conciliation Act. Once the existence
of the arbitration agreement is admitted and the claimant has come up with a
claim the Arbitral Tribunal under Section 16 can only reject a plea, which
https://www.mhc.tn.gov.in/judis
CMA.No.58 of 2022
and CMP.Nos.403 & 430 of 2022
would be beyond its jurisdiction. The Arbitral Tribunal will have the right to
examine as to whether the claim petition has been made by the proper
person or not. That cannot be a subject matter, which would affect the
jurisdiction of the Arbitral Tribunal to enter upon arbitration. I therefore, do
not see any reason to interfere with the order of the learned Arbitrator. This
civil miscellaneous appeal therefore, fails and it is accordingly, dismissed.
No costs. Consequently, connected miscellaneous petitions are closed.
12.01.2022
kkn
Index:No
Internet:Yes
Speaking
https://www.mhc.tn.gov.in/judis
CMA.No.58 of 2022
and CMP.Nos.403 & 430 of 2022
R.SUBRAMANIAN, J.
KKN
CMA.No.58 of 2022
and
CMP.Nos.403 & 430 of 2022
12.01.2022
https://www.mhc.tn.gov.in/judis
