2004 (12) TMI 381 - HC - Companies Law

Summary

Issues:
Challenge to arbitration award based on limitation and jurisdiction of the arbitrator.

Analysis:
The petitioner challenged an arbitration award dated 15-7-2004, where disputes arose from a transaction with respondent Nos. 1 and 2 on the stock exchange. The petitioner sought recovery of Rs. 5,02,385 for bad delivery and speculation loss. The Arbitrator granted Rs. 4,96,159 with interest at 12% from 1-4-2001. The petitioner contested the award on grounds of limitation and lack of arbitration agreement.

Regarding the limitation issue, the Arbitrator found the claim within the limitation period. The petitioner disputed the entry date of 6-12-2000 for bad delivery, but admitted selling shares through respondent No. 1, leading to the conclusion that the limitation period ended on 31-3-2004 or 6-12-2003, both after the claim filing on 4-11-2003. Thus, the limitation argument was dismissed.

On the jurisdiction issue, the petitioner argued lack of privity of contract, contending the Arbitrator had no authority. However, the Arbitrator determined that transactions occurred on the stock exchange, invoking Bye-law 248(a) for arbitration. Citing precedent, the court affirmed that transactions through the stock exchange establish an arbitration agreement under Bye-law 248, even without formal contract notes.

In conclusion, the court found no merit in the petitioner's contentions. The existence of an arbitration agreement through stock exchange transactions negated the lack of privity of contract argument. Thus, the petition was dismissed without costs.