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| ARBITRATION AND CONCILIATION ACT, 1996 | DECEMBER, 2022 |
| WHETHER THE COURT HAS POWER UNDER SECTION 14 OF ARBITRATION & CONCILIATION ACT, 1996 (‘A&C’) TO TERMINATE THE MANDATE OF AN ARBITRATOR ON THE GROUND OF BIAS? Recently, the Hon’ble Delhi High Court comprising of Hon’ble Mr. Justice Yashwant Varma in the case titled ‘Union of India v. Reliance Industries Limited & Ors.’ observed that the appointment of an arbitrator cannot be challenged based the justifiable doubts as to the arbitrator’s independence and impartiality under Section 14 of the A&C, Act. In the present case, the Petitioner instituted proceedings under Sections 14(2) read with Section 15(2) of the A&C Act inter-alia contending that the mandate of the two Arbitrators out of three, stands terminated in terms of Section 14 of the A&C Act. The Petitioner contended that the orders passed by the Arbitral Tribunal and the manner in which proceedings have been conducted clearly leads to apprehend an evident bias and harboring justifiable doubts as to the independence and impartiality of the Arbitrators. The Hon’ble Delhi High Court observed that the subject of bias and justifiable doubts is clearly one which is provided under Section 12 of the A&C Act and once that subject is specifically provided under the said provision, it would be tenuous if the same is triable under Section 14 proceeding also. The Hon’ble Court further placed reliance on the judgment passed in the case titled “HRD Corporation vs. GAIL (India) Limited” wherein the Hon’ble Supreme Court observed a challenge on grounds set out in the Fifth Schedule related to justifiable doubts with respect to the Arbitrator’s independence or impartiality would have to be determined in accordance with the challenge procedure set out in Section 12 and Section 13 of the A&C Act. Read More... |
| WHETHER THE JURISDICTION OF AN ARBITRAL TRIBUNAL CAN BE CHALLENGED BY A PARTY PURSUANT TO PARTICIPATING IN ARBITRAL PROCEEDING VOLUNTARILY? Recently, the Hon’ble Madhya Pradesh High Court comprising of Hon’ble Justice S. A. Dharmadhikari in the case titled ‘State of Madhya Pradesh vs. Nathuram Yadav’, observed that the jurisdiction of an arbitral tribunal cannot be challenged under Section 37 of the Arbitration & Conciliation Act, 1996 (A&C) by a party after participating in an arbitral proceeding voluntarily. In the present case, the Appellant preferred an Appeal under Section 37 of the A&C Act, thereby challenging the jurisdiction of the Arbitrator. The Hon’ble Court while adjudicating the present Appeal observed that the issue of jurisdiction was never raised by the Appellants before the Arbitrator and the same has been raised for the first time in the present proceedings under Section 37 of the A&C Act of 1996. In view of Section 4 of the A&C Act of 1996, the Hon’ble High Court held that since the jurisdiction of the arbitral tribunal was accepted by the appellants, therefore, it cannot be raised at the appellate stage and thus, the award passed by the arbitral tribunal was considered within the jurisdiction and the orders passed under Section 34 of the A&C Act was also within the realm of its jurisdiction. Read More... |
| INSOLVENCY AND BANKRUPTCY CODE, 2016 |
WHETHER SECTION 66 OF THE INSOLVENCY AND BANKRUPTCY CODE, 2016 (‘IB CODE’) PROVIDES FOR ANY LOOK BACK PERIOD FOR FRAUDULENT TRANSACTIONS? Thus, the Hon’ble NCLAT while adjudicating the present Appeal observed that since, the Appellant was given sufficient opportunity to file Reply, there is no ground made out for setting aside the Ex-Parte Order. The Hon’ble Tribunal further observed that Section 66 of the IB Code envisages that the losses caused to the Creditors are recovered in the event of the Liquidation and that the Directors who caused such losses are made liable to make good such losses. Read More... |
| WHETHER INVOCATION OF CORPORATE INSOLVENY RESOLUTION PROCESS MAKES A DISPUTE NON-ARBITRABLE? Recently, the Hon’ble Delhi High Court Bench comprising of Hon’ble Ms. Justice Neena Bansal Krishna in the case titled ‘Brilltech Engineers Pvt. Ltd. v. Shapoorji Pallonji and Co. Pvt Ltd’, observed that mere filing of a corporate insolvency application under section 9 of the IB Code would not render a dispute non-arbitrable. In the present case, the Petitioner filed an Application under Section 11(6) of the A&C Act, 1996 for appointment of Sole Arbitrator. The said Application was contested by the Respondent on the ground that the Petitioner has already invoked the Section 9 of the IB Code and thus, expressly rejected any remedy available under the Arbitration Agreement. The Hon’ble High Court observed that the jurisdiction of Ld. Adjudicating Authority, National Company Law Tribunal (‘Ld. AA’) can be invoked only in respect of determined debts, however, merely filing of a petition asserting that the definite amount is payable by the Respondent would not imply the admission of the disputed amount, rather, it indicates respondent’s inability to pay. The Hon’ble Court further observed that the Respondent has been consistently disputing the amount as claimed by the Petitioner and thus, there is arbitrable disputes in regard to the claimed amount and the disputes between the parties are referable to Arbitration. Read More... |
| WHETHER THE EXISTENCE OF PRE-EXISTENCE DISPUTE BE CONSIDERED IF THE SAME WAS NOT COMMUNICATED TO THE OPERATIONAL CREDITOR IN THE REPLY TO DEMAND NOTICE OR BEFORE FILING OF THE APPLICATION UNDER SECTION 9 OF THE INSOLVENCY AND BANKRUPTCY CODE, 2016? Recently, the National Company Law Appellate Tribunal, Principal Bench, New Delhi comprising of Justice Ashok Bhushan, Chairperson and Mr. Barun Mitra, (Member Technical) in the case titled “Writers and Publishers Pvt. Ltd. vs. M/s Oriental Coal Corporation & Anr.” observed that in order to establish the pre-existence of the Dispute as a ground under Section 9 of the IB Code, the Dispute, if any, has to be in existence prior to the issue of demand notice and should have been brought to the notice of the Operational Creditor. In the present case, the Corporate Debtor challenges the order of the Ld. Adjudicating Authority wherein the Application under Section 9 of the IB Code filed by the Operational Creditor was admitted. The Hon’ble Appellate Tribunal while adjudicating the afore-mentioned Appeal observed that though the pre-existence of Dispute in respect of coal-quality has been alleged, no document/correspondence has been placed on record by the Corporate Debtor to establish that coal-quality issues were taken up with the Operational Creditor prior to issue of demand notice. In this regard, the Hon’ble Appellate Tribunal placed reliance on a judgment passed by the Hon’ble Supreme Court in the case titled ‘Mobilox Innovations (P) Ltd. v. Kirusa Software (P) Ltd., (2018) 1 SCC 353’ wherein the Hon’ble Supreme Courthas held that the existence of the dispute and/or the suit or arbitration proceeding must be pre-existing i.e. it must exist before the receipt of the demand notice or invoice. Read More... |
| WHETHER THE DATE OF NON-PERFORMING ASSET (‘NPA’) BE CONSIDERED TO DETERMINE THE DATE OF DEFAULT FOR COMPUTING THE LIMITATION OF AN APPLICATION FILED UNDER SECTION 7 OF THE INSOLVENCY AND BANKRUPTCY CODE, 2016? Recently, the Hon’ble National Company Law Appellate Tribunal, New Delhi (‘NCLAT’) comprising of Hon’ble Justice Ashok Bhushan (Chairperson), Mr. Kanthi Narahari (Member Technical), Mr. Barun Mitra (Member Technical) in the case titled “Mr. Abhay Narendra Lodha vs. Bank of Baroda & Anr.” observed that there is no such provision in Section 7 of the IB Code, 2016 stipulating the occurrence of default can be taken into account from the date of NPA. In the present case, Appellant filed an Appeal under Section 61 of the IB Code against the Impugned Order passed by the learned Adjudicating Authority. The Appellant contended that the Application filed under Section 7 of IB Code, 2016 is beyond 3 years from the date of occurrence of NPA and is barred under the law of limitation. The Hon’ble NCLAT while adjudicating the present Appeal, placed reliance on the judgement passed in the case titled ‘Swiss Ribbons Pvt. Ltd. v. Union of India (2019) 4 SCC 17’ wherein the Hon’ble Supreme Court observed that the other source of evidence can be taken into consideration for the purpose of existence of financial debt which includes the copies of entries in a Bankers Book in accordance with the Bankers Book Evidence Act, 1891. Therefore, the Hon’ble Tribunal affirmed the view taken by the Adjudicating Authority that the Appeal is within the limitation. Read More... |
| INTELLECTUAL PROPERTY RIGHTS |
| WHETHER THE DEFENDANT’S TRADEMARK “SHARBAT DIL AFZA” IS DECEPTIVELY SIMILAR TO APPELLANT’S TRADEMARK “ROOH AFZA”? Recently, the Hon’ble Delhi High Court Division Bench comprising of Hon’ble Mr Justice Vibhu Bakhru and Hon’ble Mr Justice Amit Mahajan in the case titled “Hamdard National Foundation (India) & Anr vs. Sadar Laboratories Pvt. Ltd.” observed that the meaning of the words ‘ROOH’ and ‘DIL’, when translated in English, are commonly used in conjunction, and the person who looks at the label of DIL AFZA may recall the label of ROOH AFZA as the word ‘AFZA’ is common and images of both the products shows that there is even a similarity in the trade dress of the two products. Thus, the overall commercial impression, prima facie, shows that the impugned trademark lacks sufficient degree of dissimilarity, which is required to protect the Appellant’s trademark. In the present case, Appellant challenged the Impugned Order passed by the Hon’ble Single Judge Bench whereby an interim injunction against the Respondent from infringing the Appellants’ registered trademarks, was rejected. The Hon’ble Division Bench while allowing the Appeal observed that the two composite marks are similar or not, must be adjudged by examining the two marks as a whole and not by dissecting the same, however, for the purpose of examining whether the two marks are similar, it may be expedient to examine the dominant part of the marks and it is also settled that a composite mark may have more than one dominant part. Further, any propensity of confusion must be viewed considering the overall commercial impression that the impugned trademark may leave on a person of average intelligence and imperfect recollection. Read More... |
| Miscellaneous |
| WHETHER A PLAINT CAN BE ADMITTED IF SUCH PLAINT IS NOT SUPPORTED BY THE DOCUMENTARY EVIDENCE? Recently, the Hon’ble Delhi High Court Single Bench comprising of Hon’ble Mr. Justice Sanjeev Narula in the case titled “Shyam Lal Mulwani & Anr. vs. ABC Chashmewale LLP” observed that the question of jurisdiction has to be decided on a demurrer by taking the statements made in the plaint to be true and absence of any documentary proof in support thereof, cannot be a ground to reject the plaint. In the present case, Petitioner filed an Application aggrieved by the Order passed by the Trial Court wherein the Application under Section 7, Rule 11 of the Code of Civil Procedure, 1908 (‘CPC’), thereby assailing the jurisdiction of the Hon’ble Trial Court, was dismissed. The Petitioner contended that the plaint is not accompanied with any shred of document that would demonstrate that Petitioners have been carrying out business in Delhi. The Hon’ble Delhi High Court while dismissing the present petition, placed reliance on the judgment passed in “Exphar SA and Anr. vs. Eupharma Laboratories Ltd. and Anr.” wherein the Hon’ble Supreme Court had taken the same view that when an objection to jurisdiction is raised by way of demurrer and not at the trial, the objection must proceed on the basis that the facts as pleaded by the initiator of the impugned proceedings are true. Read more... |
| WHETHER MERELY BEING A SIGNATORY TO THE CHEQUE MAKES A PERSON GUILTY UNDER SECTION 138 OF THE NEGOTIABLE INSTRUMENTS ACT, 1881 (‘NI ACT’), IF THE CHEQUE RETURNED UNPAID BY THE BANK FOR INSUFFICIENCY OF FUNDS? Recently the Hon’ble Delhi High Court Single bench comprising of Hon’ble Mr. Justice Anup Jairam Bhambhani in the case titled “Man Mohan Patnaik vs. Cisco Systems Capital India Pvt. Ltd & Ors.” observed that Section 141 of the NI Act stipulates that for guilt to be imputed to an officer of a company, at the very least, the officer should have been responsible for the business and affairs of the company and for honouring the cheque on the date when the cheque was returned unpaid. In the present case, the Petitioner impugned the summoning order made by the learned Metropolitan Magistrate under section 138 of the NI Act. The Petitioner contended that the cheques had been issued on behalf of the Company, where the Petitioner was employed as Chief Technology Officer at the time of signing of the cheques. Thus, the Hon’ble Delhi High Court while observing the above-stated facts held that since, the Petitioner had retired from the services of the company, the proceedings in the said Criminal Complaint insofar as against the petitioner, was stayed. Read More... |
| WHETHER A DELEGATED LEGISLATION MADE UNDER A PROVISION OF THE PARENT ACT CAN BE INCONSISTENT WITH ANOTHER PROVISION OF THE SAME ACT? Recently the Hon’ble Supreme Court comprising of Hon’ble Justice J.B. Pardiwala in the case titled “Kerala State Electricity Board and Ors. vs. Thomas Joseph allies Thomas M. J. Anr.” observed that Kerala Electricity Regulatory Commission while framing Regulation 153(15) of the Kerala Electricity Supply Code, 2014 (‘Code’) under Section 50 or Section 181 of the Electricity Act, 2003 (‘Act’), have transgressed the realm of Section 126 of the same Act. In the present case, the Hon’ble Supreme Court was hearing a batch of petitions at the instance of the Kerala State Electricity Board against the Respondents i.e. Consumers who are found to be drawing electricity in excess of the connected / contracted load. The main issue that has arisen in the present case is whether the Respondents (‘consumers’) can be assessed at the rate equal to twice the tariff applicable as stipulated in Section 126(6) of the Act. Thus, the Hon’ble Supreme Court held that Regulation 153(15) of the Code is invalid being inconsistent with the provisions of Section 126 of the Act 2003 and further observed that the regulation making power cannot be used to bring into existence substantive rights which are not contemplated under the Act of 2003 Read More... |
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