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TMI Blog2013 (8) TMI 1052X X X X Extracts X X X X X X X X Extracts X X X X ..... he respondents and no affidavit-in-reply has been filed at this stage in this appeal. 2. We have heard Mr. N.D. Nanavati, learned Senior Counsel assisted by Mr. Jai Kans and Ms. Gargi Vyas, learned advocate appearing for the appellants and Mr. Mihir Joshi, learned Senior Counsel assisted by Mr. Gursharan H. Virk and Mr. S.N. Soparkar, learned Senior Counsel assisted by Mr. Sandeep Singhi appearing for respondent Nos. 2 and 3. 3. The aforesaid counsels for the respondents are appearing on the caveat. Notice. They waive service of notice on behalf of respective respondents. 4. Counsel for the parties agree that all the other respondents are formal respondents and no notice is required to be issued to them and they are not required to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntioned for hearing on 29.7.2013. It is also relevant to mention over here that on 9.5.2013 invoking arbitration clause contained in paragraph 36 of the share-holders agreement a notice was given to respondent No. 1 Montecarlo Limited. Respondent No. 1 replied to the notice dated 9.5.2013 by letter dated 17.5.2013 that arbitration is not acceptable and the proposal for appointing Mr. Justice M.B. Shah as sole arbitrator was not agreed upon by respondent No. 1. 7. The Company Law Board took the matter for the first time for hearing on 29.7.2013 and passed the interim order extracted above. On the application under Section 8 of the Arbitration Act the Board granted time to the parties to exchange their affidavits. 8. We have carefully g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sideration is as to whether the company law board could have proceeded to grant interim order without deciding the application under Section 8 of the Arbitration Act or at least giving reasons as to why it is granting interim order irrespective of the fact that the application under Section 8 of the Arbitration Act has been filed in view of the law laid down by the Apex Court in Hindustan Petroleum Corporation Ltd. v. Pinkcity Midway Petroleums reported in (2003) 6 SCC 503, wherein paragraph 14, the Hon'ble Apex Court has held that where there is an arbitration clause in the agreement, it is obligatory for the court to refer the parties to arbitration in terms of their arbitration agreement and nothing remains to be decided in the origi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to pass an interim order to protect the petitioners/original respondents and decision on section 8 application would required some time as their affidavits were required to be exchanged. Therefore, according to them, the court below did not commit any illegality and the case relied upon by the Apex Court in Jehal Tanti and others v. Nageshwar Singh (D) thr.LRs. reported in AIR 2013 SC 2235 in paragraph 10, wherein it has been held by the Apex Court that while deciding a civil dispute where the objection about the jurisdiction of the Court is raised, it is open to the court to grant an interim relief and thereafter decide the injunction application. 13. In our opinion, in view of the two Supreme Court decisions mentioned above, the law ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s raised by the learned counsel for the parties. 16. Therefore, we do not fit it proper to express any opinion on this question. We leave it open to the company law board to decide the objection after it decides the applicability of Section 8 of the Arbitration Act. 17. Learned counsel for the respondents has also urged that the order passed by the company law board and proceedings before the law board were in rem and not in persona. 18. We do not go into this question which has been raised by the learned counsel for the caveators before the Company Law Board, therefore, we are of the considered opinion that since no reasons has been assigned while granting interim order nor the application under Section 8 has been examined by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m relief and fixing the same before the Company Law Board on 30.8.2013 and on that date, Company Law Board shall decide the applicability of section 8 of the Act either prima facie or finally as to whether condition mentioned under Section 8 is satisfied and what order are required to be passed by the Company Law Board on the application under Section 8 and interim relief and petition and prayer for interim relief. 21. The order dated 29.7.2013 passed by the Company Law Board is hereby quashed and set aside. 22. This Original Jurisdiction Appeal is allowed with the aforesaid directions and observations. There shall be no order as to costs. 23. Since the main O.J. Appeal has been allowed, therefore, Civil Application No. 479 of 2013 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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