TMI Blog2021 (5) TMI 272X X X X Extracts X X X X X X X X Extracts X X X X ..... ether there is debt and default in the instant application. The alternative remedy that is available may not be of much help to the corporate debtor as long as there is debt and default in regard to the operational debt. Application filed by the corporate debtor/applicant has no substance - application dimissed. - IA No. 1066 of 2020 in C.P. (IB) No. 331/9/HDB/2020 - - - Dated:- 28-4-2021 - Bhaskara Pantula Mohan, Member (J) And Veera Brahma Rao Arekapudi, Member (T) For the Appellant : M. Vazra Laxmi For the Respondents : S. Keshava Rao ORDER Veera Brahma Rao Arekapudi, Member (T) 1. This application is filed by the applicant/Corporate Debtor under section 8 of Arbitration and Conciliation Act, praying that an order be passed directing the parties to refer the dispute or difference to the arbitration as per Clause 12 of the agreement referred by the Respondent Company at Page No. 81-83 in the Company Petition No. 331/9/HDB/2020. 2. Averments made in the application are such that: a) It is averred that the Applicant Company i.e. Trident Sugars Limited is into the business of manufacturing of refined sugar, pure sugar and crystal sugar and in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... direct the parties to refer the dispute or differences raised under the agreement to the Arbitration as per clause 12 of the Agreement. 3. Reply/Counter filed the Respondent/Operational Creditor. a. Respondent stated that the Application filed under Section 8 of Arbitration Conciliation Act, 1996 is not maintainable in law and thus it is liable to be dismissed. b. It is submitted that the entire averments stated by the Applicant is that as per the agreement entered between the parties in Clause 12, is that if any dispute arises between the parties the said dispute ought to have been referred to sole arbitration and that Arbitration should be conducted as per the provisions of the Arbitration and conciliation Act, 1996. c. It is averred that the present Application has been filed by the Applicant based on the judgments laid down by the Apex Court as well as the NCLT, Mumbai Bench are not applicable to the present case which is explained in detail at para 5 6 of the counter which is mentioned at page No. 3-7. d. It is averred that the present company petition is filed under the provision of I B Code, 2016 which have framed by taking various aspects into c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce of arbitration agreement, for seeking a reference under section 8 was emphasized by the Supreme Court in Smt. Kalpana Kothari VS. Smt. Sudha Yadhav and Ors. wherein the court said that As long as the arbitration clause exits, having recourse to Civil Court for Adjudication of disputes envisaged to be resolved through arbitral process or getting any orders of the nature from Civil Court for appointment of receiver or prohibitory orders without evincing any intention to have recourse to arbitration in terms of the agreement may not arise. c. It is further stated that Section 8 mandates that the subject matter of the dispute is the same as the subject matter of the arbitration agreement and the subject matter of the captioned petition is the subject matter of the Arbitration Agreement. d. The averments made by the respondent that as per the Section 238 of the I B Code, 2016 provisions of the code will override other laws, it is submitted that when two provisions of law one being general law and other special law govern the matter, the court should endeavor to apply a harmonious construction to the provisions. e. Therefore, in view of the existence of arbitra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting between the parties. 10. However, the operational creditor has submitted that the averments made in the above IA No. 1066/2020 is that as per the agreement entered into between the parties in Clause No. 12 upon any disputes arising between the parties under the said agreement the disputes ought to have referred to sole arbitration and that the arbitration should be conducted as per the provisions of the Arbitration and conciliation Act, 1996 and the award of arbitrator would be final and he further submitted that the applicant has purely misconceived and filed based upon wrong understanding of the Law as had laid down by the Apex Court as well as NCLT Mumbai. As such both the judgments submitted by the Applicant here in would not be helpful and the law laid down in by the Hon'ble Apex Court and Mumbai Bench are not relevant to this present case. 11. Operational creditor further submitted that there is civil suit for adjudication of a dispute. Law is settled as far as this aspect is concerned. However, operational creditor has submitted that parties bind them under a special enactment such as Arbitration and conciliation Act, then any suit filed under the General Law ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal is not binding upon this Tribunal and this Tribunal can apply its analogy and interpretation of statute and pass appropriate orders and as such it is not binding precedent for this Hon'ble Tribunal to be followed. 16. He further submitted that once the Adjudicating Authority is convinced as to existence of default according to Section 9 of the IBC, the existence of an arbitration agreement between the parties would not restrict the NCLT from initiating CIRP against the corporate debtor. Therefore, Section 8 of the Arbitration Act would not prevail over Section 9 of the IBC. 17. In support of his contention the operational creditor has submitted the order passed by the Hon'ble NCLAT in the matter of Sodexo India Services Pvt. Ltd. vs. Chemizol Additives Private Ltd. wherein Hon'ble NCLAT has observed that we can't understand as to how the availability of alternate remedy would render the debt and default disputed. In absence of pre-existing dispute having been raised by the corporate debtor or it being demonstrated that a suit or arbitration was pending in respect of the operational debt, in respect whereof corporate debtor was alleged to have committed de ..... X X X X Extracts X X X X X X X X Extracts X X X X
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