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2016 (7) TMI 1648 - HC - Indian LawsSeeking interim injunction against the arbitration proceedings initiated by the appellant - invocation of doctrine of forum non conveniens - whether the court could at all interfere in the course of an arbitral proceeding? - whether the arbitral proceedings could be regarded as vexatious or oppressive? - whether the arbitration agreement was null and void and/ or incapable of performance? - whether there was waiver of the arbitration clause on the part of the appellant because of its withdrawal of a petition under Section 45 of the Arbitration and Conciliation Act, 1996 which had been filed before the Company Law Board in the said Company Petition? HELD THAT:- It is clear that the doctrine of forum non conveniens can only be invoked where the court deciding not to exercise jurisdiction, has jurisdiction in the strict sense, but comes to the conclusion that some other court, which also has jurisdiction, would be the more convenient forum. It must also be kept in mind that the doctrine of forum non conveniens is essentially a common law doctrine originating from admiralty cases having trans-national implications. It is clear that the doctrine of forum non conveniens is only available when a Court has the jurisdiction but the respondent is able to establish the existence of another competent court. The finding of the learned single Judge that the arbitration agreement in the present case is incapable of performance or inoperative because of the pendency of the proceedings in the Company Law Board is clearly out of line. As pointed out above, while discussing the World Sport Group (supra) decision, it was specifically noted that the mere existence of the multiple proceedings (proceedings before the Company Law Board and those before the arbitral tribunal) is not sufficient to render the arbitration agreement inoperative or incapable of being performed - In any event, the subject matter of the proceedings before the Company Law Board fell within the ambit of the alleged oppression and mismanagement whereas the subject matter of the dispute before the arbitral tribunal related to the termination of the JVA and the rights flowing therefrom. The learned single Judge was of the view that there was a waiver or abandonment of the arbitration clause by the parties. This finding is clearly erroneous. The learned single Judge was of the view that merely because the appellant withdrew its application under Section 45 which it had challenged before the Company Law Board, the appellant had abandoned the arbitration agreement - The learned single Judge lost sight of the fact that, while through the application under Section 45, the appellant had sought a reference to arbitration of the claims of the respondents before the Company Law Board, it had subsequently directly invoked the arbitration agreement which had also been set in motion and, therefore, by no stretch of imagination could it have been concluded that the appellant had abandoned and / or waived the arbitration agreement. There was some debate and discussion that the ‘place of arbitration’ was not London in terms of the arbitration agreement and, therefore, Part I would not apply. On the one hand, it was contended on the part of the respondents that London was only a venue and not the ‘place of arbitration’, which, according to them, was New Delhi. Thus, their arguments and counter-arguments as to whether Part I applied or Part II applied were based on the difference of opinion with regard to the ‘place of arbitration’. There appears to be confusion even in the minds of the parties as, on the one hand, the appellant had filed an application under Section 45 of the 1996 Act (which falls in Part II) before the Company Law Board and, on the other hand, the very same appellant filed an application under Section 9 (which falls in Part I) of the 1996 Act. Of course, the appellant took the plea that because the agreement was prior to 06.09.2012, the decision in Bhatia International would apply and, therefore, Part I would be applicable even in respect of arbitration agreements referred to in Section 44 of the 1996 Act. Be that as it may, we are not entering into this controversy. Courts need to remind themselves that the trend is to minimize interference with arbitration process as that is the forum of choice. That is also the policy discernible from the 1996 Act. Courts must be extremely circumspect and, indeed, reluctant to thwart arbitration proceedings. Thus, while courts in India may have the power to injunct arbitration proceedings, they must exercise that power rarely and only on principles analogous to those found in sections 8 and 45, as the case may be, of the 1996 Act - Application disposed off.
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