TMI Blog2022 (11) TMI 284X X X X Extracts X X X X X X X X Extracts X X X X ..... igh Court has refused to appoint an arbitrator, interalia, on the ground that at the time when the application was filed there were already arbitral proceedings pending between the parties and the award was passed and also on the ground that the proceedings were pending before the NCLT at the instance of the respondent on the allegation of mismanagement and oppression which was filed by the respondent as minority shareholder. Refusal to refer the dispute between the parties and appoint an arbitrator, namely that the proceedings at the instance of the respondent as minority shareholder for oppression and mismanagement is pending before the NCLT - HELD THAT:- On the pendency of such proceedings the application under Section 11(6) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the appellants herein approached the High Court under Section 11(6) of the Act, 1996 by way of O.P. No. 304/2019 to appoint an arbitrator so that the arbitral tribunal can be constituted in terms of clause 17.1.2 of the Share Subscription and Shareholders Agreement entered into between the appellants and the respondent at Chennai on 27.04.2016. By the impugned judgment and order the High Court has dismissed the said application and refused to appoint an arbitrator mainly on the grounds that at the time when the application under Section 11(6) of the Act, 1996 was filed in the year 2019, the matter was already referred to the arbitral tribunal with respect to agreement dated 27.04.2016, subsequent amendment agreement dated 06.12.2017 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 3.1 Now so far as the proceedings pending before the NCLT initiated by the respondent with respect to the oppression and mismanagement as a minority shareholder is concerned, pendency of such proceedings cannot be a ground to not to refer the dispute between the parties and appoint an arbitrator. 3.2 Making the above submissions and relying upon the decision of this Court in the case of Vidya Drolia and Ors. Vs. Durga Trading Corporation; (2021) 2 SCC 1 (paragraphs 147.9, 147.11 and 225), it is prayed to allow the present appeal. 4. Learned counsel appearing on behalf of the respondent relying upon the decisions of this Court in the cases of Booz Allen Hamilton Inc. Vs. SBI Home Finance Ltd., (2011) 5 SCC 532, Chloro Controls I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rdance with the laws of India. If any question, dispute, controversy or claim shall at any time arise between the Parties inter se or between a Party(ies) and the Company, with respect to the validity, interpretation, implementation or alleged material breach of any provision of this Agreement or the rights or obligations of the Parties and the Company hereunder, or regarding any question including the question as to whether the termination of this Agreement by either Party has been legitimate, (collectively, Dispute ) then the Parties shall attempt to settle . such Dispute amicably between them by reference to the management of the Parties. In case of KEA, such management shall be represented by a Director, and in case of VGP, such manage ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... risdiction of the competent courts as may be necessary for the enforcement of an arbitral award obtained in accordance with this Clause 17. 17.1.8 Notwithstanding any other provision of this Agreement, the rights and obligations of the Parties under this Clause shall survive termination of this Agreement. 5.2 As observed hereinabove and from the impugned judgment and order passed by the High Court it appears that the High Court has refused to appoint an arbitrator, interalia, on the ground that at the time when the application was filed there were already arbitral proceedings pending between the parties and the award was passed and also on the ground that the proceedings were pending before the NCLT at the instance of the respon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proceedings the application under Section 11(6) of the Act, 1996 cannot be dismissed. It should be left to the arbitrator to consider the entire aspect. The dispute is with respect to the Share Subscription and Shareholders Agreement which is altogether different from the allegations of mismanagement and oppression at the instance of minority shareholder initiated by the respondent. 6. In view of the above and for the reasons stated above the High Court has erred in dismissing the application under Section 11(6) of the Act, 1996 and has erred in refusing to appoint an arbitrator with respect to the dispute between the parties with respect to the Share Subscription and Shareholders Agreement dated 27.04.2016. The impugned judgment and ord ..... X X X X Extracts X X X X X X X X Extracts X X X X
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