Shubham HP Security Force India Pvt Ltd and Anr. v. Union of India and Ors.

Delhi High Court · 22 Dec 2021 · 2021:DHC:4352-DB
Rajiv Shakdher; Talwant Singh
LPA 492/2021
2021:DHC:4352-DB
civil appeal_allowed

AI Summary

The Delhi High Court allowed the appeal with directions to first attempt amicable resolution under the contract before proceeding with arbitration, holding that arbitration invocation without exhausting prior steps may be premature.

Full Text
Translation output
LPA 492/2021
HIGH COURT OF DELHI
Date of Decision: 22.12.2021
LPA 492/2021
SHUBHAM HP SECURITY FORCE INDIA PVT LTD AND ANR..... Appellants
Through: Mr Kirti Uppal, Sr. Advocate with Mr Navneet, Advocate.
VERSUS
UNION OF INDIA AND ORS ..... Respondents
Through: Mr Rajesh Gogna, CGSC for respondent no.1.
Mr Prabhas Bajaj, Advocate for respondents no. 2 to 4.
CORAM:
HON'BLE MR JUSTICE RAJIV SHAKDHER
HON'BLE MR JUSTICE TALWANT SINGH [Physical Hearing/Hybrid Hearing (as per request)]
RAJIV SHAKDHER, J.: (ORAL)
CM APPL. 46532/2021
JUDGMENT

1. Allowed, subject to just exceptions. CM APPL. 46530/2021 [Application filed on behalf of appellants for interim relief] CM APPL. 46531/2021 [Application filed on behalf of the appellants for placing additional documents on record]

2. This appeal is directed against the order dated 08.12.2021, passed in W.P.(C) 13604/2021.

2.1. Via the impugned order, the learned single judge has dismissed the writ petition filed by the appellants, on the ground that an arbitration agreement has been entered into between the parties.

2.2. In this regard, in paragraph 4 of the impugned judgment, reference has 2021:DHC:4352-DB been made to Article 14.[2] of the Strategic Alliance Management Agreement [in short, “SAMA”], dated 18.04.2020.

3. Mr Prabhas Bajaj, who appears on behalf of respondent nos.[2] to 4, in effect, Central Warehousing Corporation [in short, “CWC”], does not dispute that the agreement obtaining between the parties i.e., SAMA, also contains Article 14.1.

3.1. Article 14.[1] of SAMA requires the parties to attempt an amicable resolution before a Joint Committee, constituted in terms of clause (ii) of Article

14.1.

4. Given this position, counsel for the parties say that the appeal can be disposed of, in terms of the following agreed directions:

(i) Since arbitration has been triggered by CWC, pursuant to the notice dated

30.11.2021, the appellants will have the liberty to file a reply to the said notice wherein, inter alia, they could take the stand that invocation of arbitration, at this juncture, is premature, in view of the provisions contained in Article 14.[1] of SAMA.

(ii) If such a stand is taken, CWC will consider the same and take a decision, as to whether or not a Joint Committee is required to be constituted, in terms of Article 14.[1] of SAMA.

(iii) In case, Article 14.[1] of SAMA is brought into play, then obviously, the next step with regard to the arbitration proceedings will have to be deferred.

(iv) Needless to add, the appellants will act with due expedition and file a reply, within the next ten days.

(v) Once the reply is filed, CWC will take a decision based on the response tendered by the appellants, within ten days of the receipt of the same.

4.1. It is ordered accordingly.

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5. We make it clear that nothing stated herein will impact the merits of the case, or the decision that the CWC may take, concerning the reply filed on behalf of the appellants.

6. Consequently, pending applications shall also stand closed. (RAJIV SHAKDHER) JUDGE (TALWANT SINGH)