Sindhu Joji v. George C. Mattam and others

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR. JUSTICE SATHISH NINAN** ## **WEDNESDAY, THE 6[TH] DAY OF JULY 2022 / 15TH ASHADHA, 1944** ## **AR NO. 34 OF 2021** ## **APPLICANT:** SINDHU JOJI,AGED 44 YEARS,W/O. JOJI JACOB, KENT GLASS HOUSE, KANIYAMPUZHA ROAD, VYTILA, KOCHI,PINCODE-19 BY ADVS. B.DEEPAK SRI.KARTHIK BHAVADASAN ## **RESPONDENTS:** - 1 GEORGE C. MATTAM,AGED 61 YEARS,S/O. NOT KNOWN,MATTAM HOUSE, POONTHOPPU, AVALOOKKUNNU P.O., ALLEPPEY ,PIN CODE-688 006 - 2 SAJO.G.MATTAM,AGE NOT KNOWN,S/O. GEORGE MATTAM, MATTAM HOUSE, POONTHOPPU, AVALOOKKUNNU P.O., ALLEPPEY ,PINCODE-688 006 - 3 MAJO.G.MATTAM,AGE NOT KNOWN,S/O. GEORGE MATTAM, MATTAM HOUSE, POONTHOPPU, AVALOOKKUNNU P.O., ALLEPPEY ,PINCODE-688 006 - 4 ANISHA.R, AGE NOT KNOWN,D/O NOT KNOWN,B1102, PURVA ETERNITY, ATHANI, KAKKANADU,PIN CODE-682 030 - 5 M/S.AYEGROW BUSINESS SOLUTIONS PRIVATE LIMITED,REPRESENTED BY MANAGING DIRECTOR, SAJO MATTOM, MATTAM HOUSE, POONTHOPPU, AVALOOKKUNNU P.O., ALLEPPEY ,PIN CODE-688 006 - 6 JOJO JACOB,AGED 49 YEARS,S/O. JACOB THOMAS, KENT GLASS HOUSE, KANIYAMPUZHA ROAD, VYTILA, KOCHI,PIN CODE-19 BY ADV G.SREEKUMAR (CHELUR) THIS ARBITRATION REQUEST HAVING COME UP FOR ADMISSION ON 06.07.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ## **Sathish Ninan, J. ============================== Arbitration Request No.34 of 2021 ========================== Dated this the 6[th] day of July, 2022** ## **ORDER** Annexure A-Joint Venture Agreement was executed between the parties with regard to purchase of shares etc. of the 5[th] respondent Company. There arose disputes between the parties. The petitioner issued Annexure B notice invoking the arbitration clause in the agreement, seeking appointment of an Arbitrator to resolve the disputes. The same was replied as per Annexure C, expressing the disinclination for appointment of an arbitrator. The petitioner has accordingly approached this Court seeking appointment of an Arbitrator under Section 11 of the Arbitration and Conciliation Act, 1996. 2. Heard the learned counsel on either sides and also perused the counter affidavit submitted by the 2[nd] respondent. Arbitration Request No.34 of 2021 -: 2 :- ## 3. Clause 19 of Annexure A-Joint Venture Agreement ## reads thus: _“If any dispute or difference shall at any time arise between FIRST PARTY OR SECOND PARTY as to any terms, provisions or matters herein on as to their respective rights, claims, duties or liabilities hereunder or otherwise, howsoever in relation to or arising out of or concerning this Agreement, such dispute or difference shall be referred resolution through the intervention of “Auditor or Practicing company Secretary appointed by the company. If any such matter has not been resolved with such intervention, the matter will be referred to arbitration in accordance with the provisions of the Arbitration and Conciliation Act, 1996. The venue of such arbitration shall be at Ernakulam.”_ 4. Though the respondents admit the existence of an arbitration clause, it is contended that, even as provided under the arbitration clause as above, there has to be an attempt to resolve the disputes by Arbitration Request No.34 of 2021 -: 3 :- mediation through an Auditor or a Practicing Company Secretary appointed by the Company. It is only on the failure of such mediation that the default clause would come into play and matter could be referred for arbitration. 5. There are various litigations between the parties including criminal proceedings. This Court had, as per order dated 01.06.2022, referred the parties for mediation before the High Court Mediation Centre. The mediation failed though the mediator made efforts in the sittings held on 08.06.2022, 22.06.2022 and 23.06.2022. In the light thereof, no purpose would be served by relegating the parties to formally comply with the prearbitral mediation stipulated for in the arbitration clause supra. The Apex court has held that, if it is evident that both parties do not intent to arrive at any settlement, then, a pre-condition providing for resolution of disputes by mediation prior to initiation Arbitration Request No.34 of 2021 -: 4 :- of arbitration will not hinder the initiation of arbitration proceedings (see _**Tulip hotel Private Ltd. and others v Trade Wings Ltd. and others (2010(2) Arb.LR 286(Bom), Visa International Ltd. v. Continental Resorts (USA) Ltd. (2009(2) SCC 55)).**_ 6. In the circumstances as noticed supra, no purpose would be served by requiring the parties to complete a formal procedure of mediation as provided in the clause mentioned above. The objection of the respondents is thus negatived. 7. Coming to the contention of the respondents regarding the jurisdiction of the Arbitrator to adjudicate on the issues involved, it is for the parties to urge their respective contentions before the Arbitrator who is competent to decide on the same in terms of Section 16 of the Arbitration and Conciliation Act. Arbitration Request No.34 of 2021 -: 5 :- Accordingly, leaving open the rights of the parties to agitate their rival contentions before the Arbitral Tribunal, the Arbitration Request is ordered as hereunder: (a) Rtd. Justice Sri.S.S.Satheesachandran, House No.32/2278, 'Swathi', Orient Park, Popular Road, Vaduthala, Kochi – 682 023, is provisionally nominated as the Sole Arbitrator to adjudicate upon the disputes between the parties arising out of Annexure A. (b) A copy of this order shall be communicated to the learned Arbitrator by the Advocate of the applicant within a period of one week from today. A copy of the order shall also be forwarded to the learned Sole Arbitrator by the Registry. (c) The Arbitrator is requested to forward his statement of disclosure under Section 11(8) r/w Section 12(1) of the Act 3 of 2016. Arbitration Request No.34 of 2021 -: 6 :- (d) The registry shall place the disclosure statement before this Court, for confirmation of the appointment of the Arbitrator. (e) The Arbitrator's fees shall be payable as per IV Schedule to the Arbitration and Conciliation Act, 1996. - (f) The arbitration costs and fees shall be shared - equally. Sd/- **Sathish Ninan, Judge** vdv ## **APPENDIX OF AR 34/2021** |RESPONDENT ANNEXURES|| |---|---| |Annexure-R2(a)|True copy of memorandum of understanding| ||dated 01/09/2018.| |Annexure-R2(b)|True copy of the Company Petition No.36/2021.| |Annexure-R2(c)|True copy of the complaint before ROC| ||Bangalore.| |PETITIONER ANNEXURES|| |ANNEXURE-A|THE TRUE COPY OF JOINT VENTURE AGREEMENT| ||DATED 19.10.2018| |ANNEXURE-B|THE TRUE COPY OF THE LAWYER NOTICE DATED| ||30.01.2021| |ANNEXURE-C|THE TRUE COPY OF THE REPLY NOTICE DATED| ||12.03.2021|