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Judgment
Aravind Kumar, J.—This appeal is filed by respondents Nos. 2 and 3 before the Company Law Board questioning the correctness and legality of the order passed in CA No. 34 of 2009 in CP No. 34 of 2009 [Dirak GmbH v. S.D. Chakravrthy (2010) 4 Comp LJ 151 (CLB): (2010) 153 Comp Cas 1 (CLB)].
The short question which arises for our consideration in this appeal is whether the Company Law Board was justified in rejecting the application filed by the appellants herein seeking appointment of arbitrator by filing an application under sub-section (2) of section 8 of the Arbitration and Conciliation Act, 1996. The appellants herein who were respondents Nos. 2 and 3 before the Company Law Board and in the company petition on service of notice appeared before the Company Law Board and filed an application u/s 8 of the Arbitration and Conciliation Act, 1996, read with regulation 44 of the Company Law Board Regulations, 1991, contending that the company petition was not maintainable in respect of disputes raised by the petitioner in terms of article 17. of the financial collaboration agreement since in the said agreement it had been specifically provided for referring the disputes inter se between the parties to an arbitrator and, accordingly, the said application has been filed. The said application was not examined on the merits by the Company Law Board. However, the Company Law Board found that the original agreement dated 7'' May, 1998, or its duly certified copy thereof, had not been filed and, accordingly on this short ground, it held that the application itself was not maintainable, and accordingly CA No. 34 of 2009 (Dirak GmbH v. S.D. Chakravarthy (2010) 4 Comp LJ 151 (CLB) : (2010) 153 Comp Cas 1 (CLB)) came to be rejected.
We have heard learned senior counsel Sri S.S. Naganand, appearing for the appellants and Sri A. Murali, learned counsel, appearing for J. Sagar Associates.
Learned counsel appearing for the respondents does not dispute the (sic) of the agreement dated 7 May, 1998, and in view of the existence of the (sic) agreement and same having not been denied by the respondents, we are of the opinion that the order of the Company Law Board suffers from legal.
Learned counsel for the appellants would also rely upon the decision of the Hon''ble Supreme Court in Bharat Sewa Sansthan Vs. U.P. Electronics Corporation Limited, , wherein it has been held by their Lordships that when the original agreement is in the possession of the opposite party, the question of producing the same by an applicant would not arise. We find that the said decision is squarely applicable to the facts of the present case.
Accordingly, we set aside the order dated 23 October, 2009, passed by the Company Law Board and remand the matter to the Company Law Board, Chennai for reconsidering the Company Application No. 34 of 2009 (Dirak GmbH S.D. Chakravarthy (2010) 4 Comp LJ 151 (CLB); (2010) 153 Comp Cas 1 (CLB) filed by respondents Nos. 2 and 3 that is appellants Nos. 1 and 2 herein on merits for disposal in accordance with law.
Accordingly, the present appeal is allowed. It is needless to say that the Company Law Board would take up the present application for consideration before proceeding further in the matter as it would have a direct bearing on proceeding in the matter on merits.