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TMI Blog2019 (5) TMI 607X X X X Extracts X X X X X X X X Extracts X X X X ..... oad proposition that the dispute arising out of breach of contractual obligations referable to the MOUs or otherwise would be arbitrable. It is also indisputable that the statutory powers and plenary jurisdiction vested in the Tribunal renders it the appropriate forum to deliver result oriented justice. Admittedly, the statutory jurisdiction vested in the Tribunal cannot be exercised by the Arbitrator. Given the nature of allegations in the Company Petition in the context of reliefs that survive for consideration there is no escape from the conclusion that the dispute raised in the Company Petition and sought to be referred for arbitration is non-arbitrable. Impugned order upheld - appeal dismissed. - Company Appeal (AT) No. 389 of 2018 - - - Dated:- 10-4-2019 - Mr. Bansi Lal Bhat, Member (Judicial) and Mr. Balvinder Singh, Member (Technical) For Appellant: Mr. Rahul Chitnis, Mr. Aman Vachher and Mr. Ashutosh Dubey, Advocates. For Respondents: Mr. Vikas Mehta and Mr. Vasanth Bharani, Advocates. JUDGMENT This appeal is directed against an order dated 31st August, 2018 passed by National Company Law Tribunal, Mumbai Bench (he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of its assets. 3. The case set up by Appellant before the Tribunal for referring the disputes between the parties to arbitration under Section 8 of the Arbitration and Conciliation Act, 1996 was that the disputes raised by Respondent Dynatron Services Private Limited in Company Petition arose out of the First MOU dated 15.04.2015 and Second MOU dated 21.08.2015 and in terms of Arbitration Agreement as contained in clauses 17.2 and 5.2 of the first and second MOUs respectively, such disputes are to be finally settled by a Sole Arbitrator. Respondent No.1 herein who is the Petitioner in the Company Petition did not file reply before the Tribunal but relied upon written submissions to oppose the motion. On consideration of the stands taken by the respective sides, the Tribunal crystallized the controversy involved in the application into the following issues:- (i) Whether the Petition is barred under law in view of the Application filed u/s 17 of Arbitration and Conciliation Act before the Sole Arbitrator and the Petitioner voluntarily submitting himself to the jurisdiction of Arbitral Tribunal? (ii) Whether the acts complained of in the Petition can be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompany Petition was only a dressed up petition to steer clear of the arbitration clause contained in the two MOUs. Per contra it is submitted on behalf of Respondent No. 1 that Respondent No.1 being 49 per cent shareholder of Respondent No. 2 has been illegally ousted from functioning and management of the Company and none of its Directors are on board, no notices of AGM or EOGM have been given to Respondent No. 1 and details of management of funds have not been shared with it. The Company Petition seeks to enforce the statutory rights of Respondent No. 1 as a shareholder and the reliefs claimed in the Company Petition seek an appropriate order to bring to an end acts of oppression and mismanagement apart from jointly controlling and managing Respondent No. 2 and allied reliefs which can be granted only by NCLT exercising exclusive jurisdiction under the Companies Act, 2013 and not by the Arbitrator. Learned counsel for Respondent No.1 vehemently refuted the allegation of the Company Petition being a dressed up petition . It is further contended that four reliefs have been voluntarily dropped by Respondent No. 1 in its application u/s 17 of the Arbitration and Conciliation Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Every civil or commercial dispute, either contractual or non-contractual, which can be decided by a court, is in principle capable of being adjudicated and resolved by arbitration unless the jurisdiction of the Arbitral Tribunals is excluded either expressly or by necessary implication. Adjudication of certain categories of proceedings are reserved by the legislature exclusively for public fora as a matter of public policy. Certain other categories of cases, though not expressly reserved for adjudication by public fora (courts and tribunals), may by necessary implication stand excluded from the purview of private fora. Consequently, where the cause/dispute is inarbitrable, the court where a suit is pending, will refuse to refer the parties to arbitration, under Section 8 of the Act, even if the parties might have agreed upon arbitration as the forum for settlement of such disputes. 36. The well-recognised examples of non-arbitrable disputes are: (i) disputes relating to rights and liabilities which give rise to or arise out of criminal offences; (ii) matrimonial disputes relating to divorce, judicial separation, restitution of conjugal rights, child custody; (iii) gu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts to deal with them the resulting award will be unenforceable. These include matters where the type of remedy required is not one which an Arbitral Tribunal is empowered to give. The subsequent edition of Russell (23rd Edn., p. 470, Para 8.043) merely observes that English law does recognise that there are matters which cannot be decided by means of arbitration. 41 . Mustill and Boyd in their Law and Practice of Commercial Arbitration in England (2nd Edn., 1989), have observed thus: In practice therefore, the question has not been whether a particular dispute is capable of settlement by arbitration, but whether it ought to be referred to arbitration or whether it has given rise to an enforceable award. No doubt for this reason, English law has never arrived at a general theory for distinguishing those disputes which may be settled by arbitration from those which may not. Second, the types of remedies which the arbitrator can award are limited by considerations of public policy and by the fact that he is appointed by the parties and not by the State. For example, he cannot impose a fine or a term of imprisonment, commit a person fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing before the High Court in which the application was filed by the petitioner herein was relating to winding up of the company. That could obviously not be referred to arbitration and, therefore, the High Court, in our opinion was right in rejecting the application. (emphasis supplied) 8. The dictum of Hon ble Apex Court is loud and clear. The judicial authority which includes the National Company Law Tribunal which is ceased of the Company Petition under Section 241-244 r/w 246 of the Companies Act, 2013 would be bound to refer the parties to arbitration of the matter brought before it in accordance with the arbitration agreement provided that the arbitrator is competent or empowered to decide such dispute. Be it seen that the claim in the Company Petition pending adjudication before the Tribunal relates to matters arising out of the two Memorandums of Understanding. Disputes raised by the Respondent No. 1 in the Company Petition are in regard to alleged acts of oppression and mismanagement. It is alleged by Respondent No. 1 in the Company Petition that the Appellant has neither transferred the assets of Yeoman Marine Services Pvt. Ltd to the newly formed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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