NDLI: Ratnam Sudesh Iyer Vs. Jackie Kakubhai Shroff

Content Provider	Supreme Court of India
e-ISSN	30484839
Language	English
Access Restriction	NDLI
Subject Keyword	1996: s. 34 Arbitration and Conciliation Act
Content Type	Text
Resource Type	Law Judgement
Jurisdiction	India
Act(s) Referred	Arbitration and Conciliation (amendment) Act, 2015 (3 of 2016) Arbitration and Conciliation Act, 1996 (26 of 1996)
Case(s) Referred	Referred Case 0 Referred Case 1 Referred Case 2 Referred Case 3 Referred Case 4 Referred Case 5
Case Type	Appeal
Court	Supreme Court of India
Disposal Nature	Appeal Dismissed
Headnote	Arbitration and Conciliation Act, 1996: s. 34 – Setting aside of arbitral award –Dispute between the appellant and respondent as regards sale of share – Complaint by the respondent before the police against the appellant – Parties entered into settlement deed whereby the respondent had to withdraw all complaints against the appellant and was forbidden from writing complaints to any person about the Deed and in return was to be paid US$ 1.5 million held in escrow till the withdrawal of complaints; and US$ 2 million was to be paid to the respondent out of the proceeds from the sale of shares of the company – Breach of settlement deed through e-mail sent by respondent’s wife – Initiation of arbitration proceedings –Direction to escrow agent not to hand over the cheque for US$ 1.5 million till the direction of the arbitrator–Meanwhile execution of share purchase agreement and the shares were sold – Final award passed awarding liquidated damages of US$ 1.5 million in favour of the appellant; and that the respondent would not be entitled to the second cheque of US$ 2 million held in escrow – Petition u/s. 34 – Both the Single Judge and the Division Bench set aside the award – On appeal, held: Appellant is a party based in Singapore thus, the arbitration though carried out within the country, would be an international commercial arbitration – Pre-2015 legal position would prevail since s.34 proceedings had already commenced when the 2015 Amendment Act came into effect – A generally worded clause, Clause 9 of the Settlement Deed cannot be said to constitute an agreement to change the course of law that the s.34 proceedings were subject to – General phraseology of a clause which seeks to include any amendment to the Act would not be able to be availed of to expand the scope of scrutiny as it would appear to run contrary to the legislative intent of s.26 of the Amendment Act – Necessary conditions of the Deed of Settlement stood satisfied – Effect of the award would be to deprive the respondent of the due valuation of the shares and what was paid to him to bring his complaints to an end – Respondent cannot be denied his dues because of such indiscreet e-mail by his wife, who was not even party to the proceedings nor party to the Settlement Deed – Arbitrator ’s conclusions not in accordance with the fundamental policy of Indian law, and can thus be set aside under the pre-2015 interpretation of s.34 – Since the consequences are so inappropriate, the both the High Courts opined that whatever be the position that is applicable- pre or post amendment, in these facts the award would not stand and the same is upheld – Arbitration and Conciliation (Amendment) Act, 2015.
Judge	Hon'ble Mr. Justice Sanjay Kishan Kaul
Neutral Citation	2021 INSC 712
Petitioner	Ratnam Sudesh Iyer
Respondent	Jackie Kakubhai Shroff
SCR	[2021] 11 S.C.R. 97
Judgement Date	2021-11-10
Case Number	6112

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Ratnam Sudesh Iyer Vs. Jackie Kakubhai Shroff

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Ratnam Sudesh Iyer Vs. Jackie Kakubhai Shroff

Ratnam Sudesh Iyer Vs. Jackie Kakubhai Shroff

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