VIJAY KARIA & ORS. v. PRYSMIAN CAVI E SISTEMI SRL & ORS.

The Judgment of the Court was delivered by R. F. NARIMAN, J. D

1Copy pinpoint1. Leave granted.

2Copy pinpoint2. The present appeals are filed against the judgment of a Single Judge of the Bombay High Court dated 07.01.2019, by which four final awards made by a sole arbitrator in London under the London Court of International Arbitration Rules (2014) (hereinafter referred to as the E “LCIA Rules”) were held to be enforceable against the Appellants in India.

3Copy pinpoint3. The brief facts of this case are as follows. The Appellants, i.e. Appellant No.1 Shri Vijay Karia, and Appellants No.2 to 39 (who are represented by Appellant No.1) are individual, non-corporate shareholders of Ravin Cables Limited (hereinafter referred to as “Ravin”). On F 19.01.2010, the Appellants and Ravin entered into a Joint Venture Agreement (hereinafter referred to as “JVA”) with Respondent No.1, i.e. Prysmian Cavi E Sistemi SRL – a company registered under the laws of Italy. By this JVA, Respondent No.1 acquired a majority shareholding (51%) of Ravin’s share capital. The material clauses of G the JVA are set out hereinbelow: “8. Purpose and Objectives 8.1 Purpose of the Company and Scope of the Agreement Subsequent to Closing, the Company shall be a joint venture between Prysmian and the Existing Shareholders for the purposes H

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A of undertaking and conducting the business of the company, or for such other activities as may be determined by the Shareholders from time to time, subject to the applicable law. The business of the company shall be conducted in the best interests of the Company, and in accordance with sound professional and commercial principles.” B “12.6. Chairman and Managing Director 12.6.1 Mr. Karia shall be the Chairman of the Board as well as the Managing Director of the Company until: (i) Expiry of seven (7) years from the Agreement Date; or C (ii) The date of which the Existing Shareholders cease to hold in the aggregate at least ten percent (10%) of the share capital of the Company: Whichever occurs earlier. D It is hereby agreed that Mr. Karia shall not, during such term, be entitled to be removed as a Chairman and Managing Director by the passing of an ordinary resolution at a general meeting of the Company…” “12.6.4.Without prejudice to the aforesaid clause 12.6.3, the E Managing Director shall continue to remain responsible for the day to day management of the Company in accordance with the Interim Period Policy adopted by the Board on the Closing Date, until the appointment of the CEO of the Company (“Interim Period”)” F “12.6.5 As soon as practicable after the efflux of the Interim Period, a Board shall be convened to resolve upon a new policy, applicable for a period of 6 (six) months thereafter (the “Integration Period”), for the delegation of the powers to the managers of the Company (the “Delegation of Powers Policy”) all powers not delegated to the managers of the Company pursuant G to such Delegation of Powers Policy, shall be delegated jointly to the CEO and the Managing Director…” “12.6.6 Provided however, that subject to the overall supervision of the Board, after the efflux of the Integration Period, the Managing Director shall be directly responsible solely for managing H

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the internal audit as well as the strategy and business development A of the Company and present to the Board his findings and analysis for final determination by the Board. Accordingly all the powers which are not delegated to the managers of the Company pursuant to the Delegation of Powers Policy, as may be amended by the Board from time to time, shall be delegated to the Managing B Director to the extent such powers fall within his duties as aforesaid. 12.6.7 After the Integration Period, the Managing Director may appoint an internal auditor to assist the Managing Director in his responsibility towards the internal audit of the company. This internal auditor shall report directly to the Managing Director and functionally report to the internal audit department of Prysmian S.P.A.” “12.7 Chief Executive Officer 12.7.1 The CEO shall be appointed by and shall directly report to the Board. 12.7.2 Without prejudice to the aforesaid Clause 12.7.1, the CEO shall from the date of its appointment till the efflux of the Integration Period, be responsible for the day to day management of the Company jointly with the Managing Director. E 12.7.3 Provided however, that subject to the overall supervision of the Board, after the efflux of the Integration Period, the CEO shall be responsible for the day to day management of the Company excluding solely the internal audit and the strategy and business development of the Company for which the Managing Director F shall be responsible. Accordingly all the powers which are not delegated to the managers of the Company pursuant to the Delegation of Powers Policy, as may be amended by the Board from time to time, shall be delegated to the CEO to the extent such powers fall within his duties as aforesaid.” G “17. PROCEDURE FOR FAIR MARKET VALUATION 17.1 Notwithstanding anything contained in this Agreement, all references in this Agreement to Fair Market Value shall be the fair market value as determined, applying the definition of EBITDA, Net Financial Indebtedness (NFI) and Net Working H

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A Capital (NWC) set forth under Schedule X, by any one of the following four accounting firms settled in India: (a) KPMG (b) Ernst & Young; B (c) PriceWaterhouseCoopers; (d) Deloitte 17.2 The accounting firm shall be chosen from among those indicated under clause 17.1 above by the Party that, according to clauses 23 and 24, is called by the other Party to sell, in whole or in part its share participation in the Company to the other Party; or by the Party that, according to Clauses 11.5 (iv), 16 and 23, calls the other Party to buy, in whole or in part, its share participation in the Company (in either case the “Exiting Party”). If the Exiting Party fails to choose the accounting firm within thirty (30) calendar days from (i) the receipt of the notice by which the other Party has intimated it to sell, in whole or in part, its share participation in the Company to the other Party; or (ii) from the serving of notice to the other Party to buy, in whole or in part, its share participation in the Company, then the accounting firm shall be chosen by the Party (the “Non-Exiting Party”) that called the other Party to sell, in whole or in part, its share participation in the Company to the other Party or was called by the Exiting Party to buy, in whole or in part, the Exiting Party’s share participation in the Company.” “20. Mutual Covenants and Undertakings xxx xxx xxx F 20.1.2 The Parties further agree to cooperate and act in good faith, fairness and equity as between themselves.” “21. Business in India 21.1 The Parties agree that neither Prysmian nor Mr. Karia, G whether directly or through their Affiliates, shall invest, acquire or participate in the Cable Business in India, save and except through the Company in accordance with this agreement.” “21.5 Further, it is agreed that, within March 31, 2011, the Promoters shall either stop or cease to have any interest in any H

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activity they are currently or will be conducting in India, directly or indirectly through any Affiliates, which is in competition with the business of the Company. Such ceased activities shall then not be offered by Mr. Karia to the Company, pursuant to Clause 21.2 for a period of three years from the date of such cessation. For the sake of clarity, it is agreed that this Clause 21.4 shall apply, without being limited, to the activities carried out by (i) Vijay Industrial Electricals, a company incorporated under the laws of India and having its registered office at 302, Akruti Trade Centre, Third Floor, Road no. 7, MIDC, Marol, Andheri(east) Mumbai- 400093 (ii) Special Cable Industries, a company incorporated under the laws of India and having its registered office at A-1/404 GIDC C Estate, Ankleshwar 393002.” “23. Event of Default 23.1 If any party (“Defaulting Party”) is in material breach of any provisions, obligations, covenants, conditions and undertakings D under this Agreement , or in the event of insolvency or bankruptcy of the Defaulting Party or if the substantial undertaking or assets of the Defaulting Party is under receivership or any other equivalent status, it shall be considered as an event of default (“Event of Default”). E 23.2 In such an event, the other party (“Non Defaulting Party”) may give notice of the same (“Determination Notice”) to the Defaulting Party. 23.3 The Defaulting Party shall have a period of 60 (sixty) calendar days from the receipt of the Determination Notice (or Such further F period as the Non Defaulting Party may agree in writing) to rectify the Event of Default (“Rectification Period”). It is hereby clarified that this clause 23.3 is not applicable if the Event of Default is represented by the insolvency or bankruptcy of the defaulting Party in which case the Non Defaulting Party may forthwith serve the EOD Notice to the Defaulting Party. G 23.4 If upon expiry of the Rectification Period, the Event of Default has not been so rectified the Non Defaulting Party may require the Defaulting Party by written notice (“EOD Notice”) to either (i) sell to the Non Defaulting Party or such other Person as may H

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A be nominated by the Non Defaulting Party, all , but not less than all, the Shares held by the Defaulting Party (“Defaulting Party Shares”) at the 10% (ten percent) discount to the Fair Market Value (“Discounted Price”) or (ii) buy from the Non Defaulting Party all, but not less than all, the Shares held by the Non Defaulting Party at 10% (ten percent) over the Fair Market Value (“Premium B Price”). The Defaulting Party shall be then under the obligation to either (I) sell all, but not less than all, its Shares in the Company within 30 (thirty) calendar days of the EOD Notice or (II) buy all, but not less than all, the Non Defaulting Party Shares in the Company within 30 (thirty) calendar days of the EOD Notice, as C the case may be. 23.5 It is hereby agreed that: 23.5.1 If Prysmian is the Defaulting Party, then Mr. Karia only (and not the Existing Shareholders) will be entitled to either (a) buy all(but not less than all) Prysmian Shares at the Discounted D Price or (b) sell to Prysmian all (but not less than all its own shares) and those of the Existing Shareholders at the Premium Price. 23.5.2 If Mr. Karia or any of the Existing Shareholders is the Defaulting Party, then Prysmian will be entitled to either (a) buy E all ( but not less than all) the Shares held by Mr. Karia and Existing Shareholders at the Discounted Price or (b) sell to Mr. Karia all ( but not less than all) its own shares at the Premium Price. For sake of clarity, the Parties agree that for the purpose of this Clause 23.5 any reference to Mr. Karia Shares, Prysmian Shares F and Existing Shareholders Share shall be deemed to include any Shares transferred to any or their respective Affiliates pursuant to the provisions of Clause 10.4 above.” “27. ARBITRATION 27.1 Dispute Resolution G 27.1.1 The Parties agree to use all reasonable efforts to resolve any dispute under, or in relation to this Agreement quickly and amicably to achieve timely and full performance of the terms of this Agreement. H

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27.1.2 Any dispute, controversy or claim arising out of or relating to or in connection with this Agreement including a dispute as to the validity or existence of the Agreement or the arbitration agreement, or any breach or alleged breach thereof, shall be settled exclusively by arbitration under the Rules of Arbitration of the London Court of International Arbitration (“LCIA”) as amended from time to time. 27.1.3 The arbitral tribunal (“Tribunal”) shall consist of one (1) arbitrator, to be appointed by the LCIA. The arbitrator shall be from a neutral nationality, i.e. from a nationality and origin other than any of the Parties. C 27.1.4 The seat of the arbitration shall be London, United Kingdom. 27.1.5 The language to be used in the arbitration shall be English. 27.1.6 The law applicable and governing the arbitration agreement (proper law of the arbitration agreement) and in all respects including the conduct of the proceedings shall be English Law. If D the Institution above named ceases to exist or is unable for any reason to administer the arbitration proceedings then the arbitration shall be conducted in accordance with the (English) Arbitration ACT 1996 as amended from time to time or any statute that may replace the said Act. E 27.1.7 Parties expressly agree that Part I of the (Indian) Arbitration and Conciliation Act, 1996 (as amended from time to time and any statutory enactment thereof) shall have no application to the arbitration agreement or the conduct of arbitration or to the setting aside of any award made there under, and the provisions of Part F I ) including the provisions of section 9 of the Arbitration and Conciliation Act, 1996 is hereby expressly excluded…. 27.1.9 The arbitration award (the “Award”) shall be final and binding on the Parties. 27.1.10 The courts of London (United Kingdom) shall have G exclusive jurisdiction in respect of all matters arising in connection with the arbitration and Existing Shareholders submits to the jurisdiction of the said courts. Provided however that the Award may be enforced in any appropriate jurisdiction. If to be enforced in India the Award shall be a foreign award to which the legislative H

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A provisions incorporated in the applicable Indian Act to give effect to the New York Convention on foreign arbitral awards 1958 ( the New York Convention) shall apply(currently Part II of the (Indian) Arbitration and Conciliation Act 1996)…”

4Copy pinpoint4. By a separate ‘Control Premium Agreement’ of the same date, B Respondent No.1 paid €5 million to the Appellants as ‘control premium’ for the acquisition of the share capital of Ravin.

5Copy pinpoint5. On 10.08.2010, pursuant to clause 12 of the JVA - as the interim period of six months under the JVA had come to an end - one Mr. Luigi Sarogni was appointed as CEO of Ravin by Respondent No.1. Until the C expiry of the ‘integration period’, Ravin was to be jointly managed by the said CEO and the Managing Director for another period of six months. Factually, however, we are informed that the said ‘integration period’ carried on beyond December 2010 and continued until September 2011.

6Copy pinpoint6. In April 2011, Mr. Giancarlo Esposito was designated by D Respondent No.1 as the H.R. Director of Ravin. On 15.09.2011, the Board of Directors of Ravin conferred exclusive powers of the day to day management of the company on the CEO so appointed by Respondent No.1. It is the case of Respondent No.1 that the appointed CEO was thwarted in jointly managing the company during this ‘integration period’, as a result of which, in November 2011, one Ms. Cinzia Farise was E appointed as CEO in the place of Mr. Sarogni by the Board of Directors. Since the Board Resolution of 01.11.2011 conferred on Ms. Farise the power to employ and lay-off permanent staff, she imposed a temporary freeze and check on new hiring without her approval, which was alleged to be breached by the Appellants. Later, from December 2011 till February F 2012, Ms. Farise sought to convene a board-meeting to finalise one Mr. Brunetti’s appointment as CFO of Ravin, which was assented to by the Respondent’s Directors, but not signed by the Appellant’s Directors. Things reached a head on 31.01.2012 when the employees of the company went on a strike at Ravin’s Akruti office. By February 2012, the Appellants and Respondent No.1 were at loggerheads, as a result of G which Respondent No.1 issued a request for arbitration in terms of clause 27 of the JVA, claiming that the Appellants had committed ‘material breaches’ of the JVA, inter alia, by ousting Respondent No.1 from the control of Ravin altogether. On 26.03.2012, the Appellants responded to the request for arbitration and included several counter claims. Each H party claimed that the other had committed material breaches, as a result

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of which the successful party in the arbitration would be entitled under the JVA to buy out the other party at a 10% premium or discount (as the case may be). Given the fact that the JVA required service of a ‘Determination Notice’ which alleged material breaches, such notice was served by Respondent No.1 on the Appellants on 26.03.2012. Sixty days from this date, called a ‘Rectification Period’ under the JVA, notice was given by the Respondent No.1 to the Appellants to remedy/rectify the alleged breaches. Further time even beyond the sixty days, i.e. until 06.07.2012 was given, but according to Respondent No.1, none of the breaches were remedied. As a result, on 06.06.2012, the LCIA appointed a sole arbitrator - one Mr. David Joseph QC - to adjudicate the dispute between the parties. C

7Copy pinpoint7. An early skirmish was contained in a letter dated 07.06.2012, alleging that the learned arbitrator was conflicted, as he had been engaged as counsel by Respondent’s advocates, Bharucha and Partners, in another unconnected matter. However, on 08.06.2012, Bharucha and Partners wrote a letter making it clear there was no such conflict. The sole arbitrator also denied any such conflict. The LCIA Registry informed the Appellants that they could challenge the appointment of the sole arbitrator under the LCIA Rules if they so desired. The Appellants, however, gave up the right to any such challenge. As a result, on 04.07.2012, Respondent No.1 filed its Statement of Claim before the learned sole arbitrator. On 09.09.2012, the Appellants then filed their statement of defence and counter claims. On 28.09.2012, Respondent No.1 filed its rejoinder and opposition to the counter claim.

8Copy pinpoint8. Meanwhile, various procedural orders were passed by the learned arbitrator for production of documents etc. A hearing then took place in December 2012 on questions relating to the construction of various clauses of the JVA and jurisdictional issues raised by Respondent No.1 in respect of certain counter claims of the Appellants. Deciding these issues, by what was called the ‘First Partial Final Award’ dated 15.02.2013, the sole arbitrator delineated the scope of the first award stating that it was restricted only to issues of interpretation of the JVA G and questions of jurisdiction, and not to the merits of either the claims or counter claims made. In particular, the sole arbitrator construed clause 21.1 of the JVA as follows: “82. This then brings directly into question the scope and meaning of the words used in Clause 21.1 when each of the Claimant and H

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A the First Respondent agreed that it would not directly or through its Affiliates “invest, acquire or participate in the Cable Business in India save through the Company in accordance with this Agreement”.

83. The Tribunal concludes that these words themselves do not B prohibit the Claimant from selling cables directly in India. Such direct sales might still amount to a breach of Clause 8 or indeed Clause 20 of the JVA, but direct sales as a stand-alone activity is not an investment, acquisition or participation in the Cable Business in India.

C 84. It seems to the Tribunal that each of these expressions connotes different forms of long term engagement, arrangement or commitment involving either an injection or exchange of capital or know how on the part of the investor, acquirer or participator in the sphere of the activities identified by the compendious definition of Cable Business in India. D

85. A person who concludes a contract of sale of goods to another counter-party is not in accordance with ordinary parlance investing, acquiring or participating in the Cable Business in India.

86. Therefore, the Tribunal concludes that on a true construction E of the JVA simply by applying the ordinary meaning of the words deployed together with the contractual definition, the Respondents do not succeed in their primary submission namely that the conclusion of one or more contracts of sales of cables directly in India by the Claimant itself or through its subsidiaries constituted the investment, acquisition or participation in the Cable Business F in India contrary to the terms of Clause 21.1 of the JVA. xxx xxx xxx

93. In summary therefore contracts of sale for cables within the definition of Cable Business concluded directly by the Claimant or its affiliates and otherwise than through Ravin do not of itself G constitute a breach of Clause 21.1.

94. The conclusion of a series of such contracts might, however, depending on the facts, constitute a breach of Clause 8 or Clause 20 of the JVA. Yet further, the Tribunal does not rule out the possibility of the Respondents alleging and proving some kind of H

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investment or participation which consist of some kind of long A term contractual arrangement itself involving sale, export, import or distribution. Nothing stated herein, however, in any way decides or considers the materiality of any such allegation or the consequences of any such breach even if proven.”

9Copy pinpoint9. Insofar as the parent company of Respondent No.1 (one B Prysmian SA) had made a global acquisition of the ‘Draka Group’ in February/March 2011, which included - as one out of 60 companies belonging to the Draka Group - one ‘Associated Cables Private Limited’ (hereinafter referred to as “ACPL”), which was an Indian Company doing business in India, the learned arbitrator held: C “108. The Tribunal is once more careful to make it clear that these pleaded allegations have not been proved yet. The proof of these allegations is left to be explored at the substantive merits hearing. Nevertheless, on the basis of the parties’ respective pleaded cases, the Tribunal concludes that on a true construction of Clause 21, the wider acquisition by Prysmian Spa of Draka, D which in turn holds a 60% shareholding in ACPL, is capable of amounting to an acquisition in the Cable Business in India through an Affiliate of the Claimant in circumstances where it is not disputed that Prysmian Spa is another person which Controls the Claimant. Equally, the continued carrying on of business in India E through ACPL is capable of amounting to the participation in the Cable Business in India through an Affiliate of the Claimant; namely through another person, ACPL. Although there has not been any proof of this question, there would at least appear to be some evidence on which the Respondents might contend that ACPL is Controlled by the same person, namely Prysmian Spa, F who directly or indirectly Controls the Claimant so as to come within the parameters of sub-paragraph (c) of the definition of Affiliate.”

10Copy pinpoint10. The learned arbitrator then construed clause 23, which speaks of ‘material breaches’ by the parties, as follows: G “132. The Tribunal’s conclusions are as follows: 1) Clauses 23.1 and 23.2 do require the giving of a Determination Notice of an Event of Default by the Non Defaulting Party, if indeed the Non Defaulting Party wishes to make complaint, H

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A and if, ultimately, the Non Defaulting Party wishes to invoke the provisions of Clauses 23.4 and 23.7, even in circumstances where the Non Defaulting Party contends that the material breach is irremediable; 2) Clause 23.3 does require the Non Defaulting Party to give the B Defaulting Party a period of 60 days, the Rectification Period, to rectify the Event of Default even in a case where the Non Defaulting Party alleges that the Event of Default is irremediable. The only exception to this in Clause 23.3 is with respect to what might be called events of insolvency, which amount to Events of Default; C 3) Excluding the cases of insolvency events, which are expressly exempted, the service of a written EOD Notice pursuant to Clause 23.4 must be upon the expiry of the Rectification Period; 4) Adapting one of the principal hypothetical examples given by D the Claimant’s counsel in the course of its submissions, if a Non Defaulting Party gives a Determination Notice to the Defaulting Party identifying material breach (1) but the Defaulting Party has in fact concealed material breach (2) and in any event does not rectify one or both, then the Non Defaulting Party when it gives its EOD Notice under Clause E 23.4 and then subsequently seeks to justify its EOD Notice in arbitration can rely upon both the un-rectified material breach (i) and/or material breach (2) if it is subsequently discovered. This is because a concealed, but subsequently discovered, Event of Default which has not been rectified at the end of F the Rectification Period is still an un-rectified Event of Default for the purpose of Clause 23.4; 5) Equally, if a Defaulting Party has not rectified a concealed Event of Default at the end of a Rectification Period, then, it is a matter which can be relied upon by the Non Defaulting Party G under Clause 23.7, so to give rise to the deprivation or alteration of rights set out therein; 6) An Event of Default is defined as a material breach of any provisions, obligations, covenants, conditions, and undertakings. The definition of an Event of Default is not conditional upon H the giving of a Determination Notice. The consequences,

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however, under Clause 23 do depend upon the giving of a A Determination Notice and expiry of a Rectification Period; 7) Notwithstanding the provisions of Clause 23 and Clause 23.4, in particular with regard to Events of Default and Determination Notice, the Non Defaulting Party in addition possesses all the rights to damages and performance expressed in Clause 23.6; B 8) It remains open for argument, and the Tribunal makes no decisions as to whether a party can give a Determination Notice to the other party, if in fact at the time of the giving of the notice, the party giving the notice is itself in material breach. This question was raised by the Tribunal in the course of oral C submissions, but has not been fully addressed by the parties, and, indeed, is probably best addressed at the full merits hearing.”

11Copy pinpoint11. Insofar as the arbitrator’s ruling on jurisdiction was concerned, it was held that a dispute regarding the right to register the ‘Ravin’ D trademark falls outside the scope of the arbitration clause under the JVA. He further held that the trademark licence agreements contained arbitration clauses which provided for disputes to be referred to arbitration in Milan, Italy under Italian law, and this being the case, any dispute in relation to these agreements would be outside the ken of the arbitration clause contained in the JVA. E

12Copy pinpoint12. The ‘Second Partial Final Award’ dated 19.12.2013 then dealt with which of the parties materially breached the terms and conditions of the JVA. The claims, in this respect, made by Respondent No.1, were disposed of as follows: F “199. The Tribunal’s findings and conclusions in relation to the particulars of the Claimant’s allegations of material breach are set out below. The Tribunal finds that: 1) The Respondents interfered with the proper and effective functioning of the CEO by refusing to implement and/or by G preventing the implementation of the Board of Directors’ resolution empowering the CEO to operate Ravin’s bank accounts in material breach of JVA Clauses 12 and/or 8 and/ or 20.1.2; 2) in refusing to pass resolutions, whether at a Board meeting or by circulation, to appoint the Claimant’s nominee as the CFO H

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A of Ravin the Respondents were not in material breach of the JVA; 3) the Respondents employed Ms. Mathure and created a false record with regard thereto in material breach of JVA Clauses 12 and /or 8 and/or 20.1.2; B 4) the Respondents denied the HR Director and the CEO full and unconditional access to the HR and payroll data systems of Ravin in material breach of JVA Clauses 12 and/or 8 and/or 20.1.2; 5) the Respondents refused to report to the or attend management C meetings convened by the CEO in material breach of JVA Clauses 12 and /or 8 and/or 20.1.2; 6) when the incidents of 12 and 13 January 2012 and 4 February 2012 are considered in isolation there is insufficient evidence to conclude that there has been a material breach by the D Respondents. When the incidents are considered together and set in their proper context the Tribunal concludes that they form part of a pattern of the Respondent’s conduct which constituted a material breach of the JVA. As such, there is a material breach in relation to the Claimant’s combined E allegations that the Respondents incited staff to surround, sequester, heckle, humiliate and threaten Mr Esposito and Mr Kamdar on those dates; 7) the Respondents encouraged and failed to prevent Company employees from going on strike on 31 January 2012 and the F Respondents encouraged and incited indiscipline and breach of Company policies and procedures by supporting Mr. Dhall in his insubordination and defiance of direct orders of Mr. Esposito and Ms Farise in material breach of JVA Clauses 12 and/or 8 and/or 20.1.2; 8) see (7) above; G 9) the Respondents were not in breach of the JVA by refusing to convene a Board meeting at short notice; 10) Mr. Karia’s letters to the FRRO were hand-delivered on 29 February 2012 and therefore cannot be considered in relation H to the events constituting material breach as alleged in the

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Request dated 27 February 2012. Nevertheless, the Tribunal A finds that the letters to the FRRO are consistent with Mr Karia’s modus operandi and support the Tribunal’s other findings of material breach. (4) Rectification of the Events of Default found to have been committed by the Respondents B

200. The Claimant submits that none of the alleged material breaches were rectifiable and, in any event, by the end of the Rectification Period, i.e. 27 April 2012, and by the end of the extended period for rectification, i.e. 6 July 2012, the Respondents had not rectified any of their breaches. On the contrary, the C Claimant submits that during the period between 28 February 2012 and 6 July 2012, the Respondents continued to breach the JVA by conduct which was calculated to destroy the relationship of trust and confidence between the parties and completely remove or render redundant any element of Claimant control over Ravin. As stated above, however, these post-Request breaches are not D the subject of this Award (see, inter alia, Claimant’s CS §§730- 737).

201. The Respondents do not contend that they rectified any of the alleged breaches of the JVA by 6 July 2012. E

202. The Tribunal concludes that, in relation to the material breaches committed by the Respondents, the Respondents failed to rectify those breaches within the extended period for rectification, i.e. by 6 July 2012.”

13Copy pinpoint13. So far as the counter claims of the Appellants were concerned, F the arbitrator dealt with the effect of Prysmian SA acquiring ACPL, which was a competing business of Ravin [through Prysmian’s acquisition of the Draka group, of which ACPL was a subsidiary]. The sole arbitrator first dealt with the reaction of Shri Karia on the Draka takeover together with Shri Karia’s evidence as follows: G “233. The Tribunal finds the many changes to the story of Mr. Karia in this regard to be of considerable significance. In truth, Mr. Karia did know as long back as July 2009 of the ACPL/ Draka connection. When the merger between Draka and Prysmian was announced Mr. Karia did understand that Prysmian had acquired a controlling stake in ACPL as he fully accepted in H

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A cross examination. Mr. Karia had that knowledge in November

2010. Nevertheless, Mr. Karia did not complain of any material breach to the JVA under Clause 21. The Tribunal further accepts the truth of the evidence given by Ms. Farise that first of all when Mr. Karia heard of her appointment to the ACPL Board some time in late 2011 possibly December, Mr. Karia did not complain B but congratulated her (§18,EI/5/28). This fits in with his earlier congratulatory email to Mr. Battista. Nevertheless by the time one gets to February 2012 Mr. Karia had completely changed his tune and saw Ms. Farise’s appointment to the ACPL as a device, an excuse, to try to derail her carrying on as CEO on the Ravin C Board and thus further his campaign not to cede day to day control of Ravin to the Claimant. The Tribunal accepts the evidence given by the Claimant witnesses on this. Mr. Karia has changed his tune. The Tribunal rejects the veracity of the story originally being told by Mr. Karia as not only inconsistent with the documents before the Tribunal but also mutually inconsistent with his evidence in cross-examination.

234. The Tribunal has spent some time analysing this material because Mr. Karia’s contemporaneous reaction is highly instructive in determining whether this is really to be analysed as a serious or material breach with serious adverse effect or rather as a pretext, an excuse. The Tribunal concludes it is the latter not the former. The Respondents somewhat bravely in their Closing Submissions assert that the Tribunal is not allowed to have regard to this material because the Claimant has not pleaded waiver or affirmation. This submission is completely rejected. As is clear from the authorities referred to above whether a breach is material or not is determined by reference to all the relevant facts and this will include a parties’ reaction to the events at the time. xxx xxx xxx

237. The Tribunal ultimately concluded that the Respondent did not adduce any credible evidence of actual serious adverse impact.

238. It is true that there was some evidence (albeit mainly dating back to 2008-2009) of occasional instances of both companies tendering for the same business. Yet there was no reliable evidence that business had been lost from Ravin to ACPL post the Draka acquisition, or that there had been any diversion of

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business from Ravin to ACPL or that there had been any targeting of Ravin’s business by ACPL or indeed vice versa.

239. In the end the two companies operate in a very different space. ACPL is a small specialist cable business with a turnover of € 7-7.5m per annum. This is approximately 10% of that of Ravin. ACPL operates principally in the area of instrumentation cables. Ravin operates principally in the area of power and control cables. Yet further, a large part of the small turnover of ACPL constitutes exports from ACPL to its Omani shareholder. This renders the notion of serious adverse harm by reference to ACPL’s turnover even more remote. C

240. The contemporaneous management documents at Ravin did not show that Ravin considered ACPL as one of its competitors or indeed operating in the same space. When Mr. Karia was asked about this in cross examination, he said that when a company examines its competitors it does not make a list down to the 50th or 60th competitor (Day 9, p.82). This gives an eloquent indication of how far down the list Ravin would have considered ACPL.

241. Equally, the fact that a list of company names was identified and relied upon by the respondent to show that Ravin and ACPL sell cables to some of the same companies is stretching a point beyond where it can naturally go. This does not yield an answer of material breach. The evidence adduced by the Respondents is not of a quality which would enable the Tribunal to conclude that a breach had been committed with serious adverse effect.

242. The Tribunal further makes mention of the assistance it received from two distinguished experts of long standing participation in the market; Messrs Honavar and Hargopal. The Tribunal did get some benefit from this evidence in the clear explanation of different types of cables together with samples and this explanation was also helpfully provided in part by Mr. Karia himself. Nevertheless, once more this evidence somewhat missed the point. It is not enough to establish material breach to identify certain types of cables produced and sold by each company. There was no reliable analysis advanced by the Respondents’ evidence of serious adverse effect either on Ravin today or likely in the future. H

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A 243. Finally, the Tribunal for completeness makes it clear that it completely rejects the further allegation that ACPL had been acquired in bad faith by the Claimant with a view to destroying value in Ravin or that it has since pursued the operations of ACPL with that aim in view.

B 244. There is quite simply no credible evidence to support such an allegation and indeed the Tribunal is of the view that it is an allegation which should not have been advanced.”

14Copy pinpoint14. So far as the counter claim dealing with direct sales in India which competed with the business of Ravin, and agency/distribution agreements, the arbitrator held as follows: “252. Essentially the Respondents have not established that the Agency Agreements on which they place reliance, involved such an arrangement, commitment or engagement as stated in the First Partial Award. Indeed the Respondents have not even addressed the requirement identified in paragraph 84 of the First Partial Final Award but instead focused on the length or duration of the relationship and whether or not each relationship was exclusive or non-exclusive. This is not sufficient. For the avoidance of doubt the Tribunal concludes that there was no satisfactory basis on which it could be concluded that these Agency Agreements E involved an injection or exchange of capital or know how on the part of the investor, acquirer or participator. They are best analysed as classic sales distribution/agency agreements pursuant to which an agent receives a sales commission in return for the promotion and conclusion of identified types of sales in India. F xxx xxx xxx

273. Making every conceivable allowance in favour of the Respondents, the Tribunal concludes that the Respondents (perhaps for understandable reasons following the First Partial Final Award) have tried to alter their case and now advance a G case that the fact of direct sales amounts to a material breach of Clauses 8 and 20 of the JVA. That was not advanced in the Determination Notice or in its pleaded case and is not open to the respondents. (I) No material breach in any event. H

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274. Yet further, even ignoring the limitations of the Determination A Notice and pleadings, the Tribunal yet further concludes that the Respondents have not in any event succeeded in showing material breach of Clauses 8 or 20 on the facts of the case.

275. The Tribunal concludes that the Respondents’ analysis is too simplistic to be of any real utility in analysing the issue. B

276. The Respondents start by referring to a total 644m of sales which were made directly into India by various Prysmian affiliates.

277. Those sales, however, were for all practical purposes made up of sales of telecom cables, industrial special cables, automotive cables, network and component and services. Ravin did not C manufacture those types of cables. Indeed over 85% of the sales came from two affiliates manufacturing telecom cables, which Ravin did not manufacture and had no experience in selling either. Indeed the Tribunal accepts the evidence of Ms. Farise and Mr. Koch and Mr. Karve on this issue (see, inter alia, §§5-8, E(I)/ D 10/56-57, §23, E(I)/26/206, §23, E(I)/26/207, §§18-32. E(I)/23/ 184-186, 11 December 2012 hearing, pp. 134-140, §46, E(I)/17/ 92, Day 2, pp. 83-86, §18 of, E(I)/24/189).This renders the whole argument of diversion of sales or breach of good faith by virtue of these direct sales somewhat academic. E

278. Indeed these figures illustrate exactly why the Respondents placed so much emphasis on their argument that the mere fact of sales was a breach irrespective of anything else. This was once more how it was put by Mr. Salve SC in his oral closing argument (Day 10, pp. 183-185) the Tribunal has, however, found against the Respondents on this point. F

279. The Tribunal concludes that the Respondents have not shown any material breach on the part of the Claimant in the development of Ravin’s business in accordance with clause 8 or any breach of the good faith obligations under Clause 20 with respect to direct sales.” G

15Copy pinpoint15. So far as the breach of confidentiality by Respondent No.1 was concerned, the counter claim of the Appellants was rejected thus: “284. Ms. Farise was quite clear in her First Witness Statement of 20 July 2012 (E(I)/5/29) at paragraph 22 (j) – (I) that she was H

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A a non-executive director at ACPL, that she was quite aware of her responsibilities to both companies and did not at any time pass on confidential or other information to ACPL from Ravin or from ACPL to Ravin.

285. The Respondents did not cross examine Ms Farise on this important evidence. It is accepted by the Tribunal.

286. The Respondents instead in their Closing Submissions do not address the question of evidence of actual breach but instead try to build up a case of surmise or inference. The Respondents rely upon the fact that Prysmian referred to ACPL and Ravin as part of “Prysmian India”. They also rely upon the fact that they contend that the appointment of Ms Farise to ACPL was covertly carried out. The first point leads nowhere. It is not evidence of breach of the JVA. The second point is in any event rejected by the Tribunal. As has been referred to above in the context of the analysis of the Claimant’s allegations of material breach, the D Tribunal finds that Ms. Farise did inform Mr. Karia of her appointment at ACPL. In the first instance Mr. Karia congratulated her and only objected later as the power struggle grew and this was used as a weapon in order to try to have Ms. Farise excluded from the Ravin Board.”

16Copy pinpoint16. So far as multiple acts of alleged mismanagement by Respondent No.1 in breach of clauses 8 and 20 of the JVA were concerned, the learned sole arbitrator dealt with this as follows: “290. The remaining allegations can be seen as essentially the flip side of the Claimant’s allegations of material breach directed at the Respondents. Three examples will suffice for present purposes: i. the strike orchestrated by the Respondents in response to the suspension of Mr. Dhall; ii. the attendance or non-attendance of Claimant nominees at the Akruti offices; iii. the circumstances surrounding the appointment of the CEO and CFO of Ravin.

291. Given the findings made by the Tribunal in favour of the claimant’s allegations of material breach it naturally follows that

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the Respondents do not succeed in these allegations of mismanagement.

292. The Respondents were themselves in material breach with regard to the whole conduct surrounding Mr. Dhall’s appointment of Ms. Mathure and the so called authorisation form. The Claimant was not in material breach in suspending Mr. Dhall. Far from it. B The Respondents, however, were plainly in material breach by their reaction to this suspension effectively leading to a one day strike.

293. The question of the attendance of Claimant nominees at the Akruti office is another chapter of the saga in which the C Respondents do not emerge without serious criticism. As is clear from this Award the Respondents engendered a toxic atmosphere at Akruti in January 2012 (even in its fire stricken state) and such was the situation at the ground that it was not really possible for Claimant nominees to attend without fear of their own safety. D

294. Lastly, the circumstances surrounding the appointment of the CEO and CFO does not give rise to any conceivable material breach on the part of the Claimant. The claimant was entitled to nominate a CFO and the CEO. They did so. The Respondents did not oppose the appointment of Ms Farise. Nevertheless they did obstruct her at every turn once she was appointed because it E became apparent that she intended pursuant to the JVA to take day to day control of Ravin and the Respondents did not wish this to happen. As regards Mr. Brunetti, the CFO, the Respondents did veto his appointment. This was not a material breach on their part as it was their right to do so under Schedule IX to the JVA. F Nevertheless it cannot be said to be a material breach by the Claimant. That is unsustainable.”

17Copy pinpoint17. Holding thus, the learned sole arbitrator concluded that none of the counter claims were made out, as a result of which they were all dismissed. G

18Copy pinpoint18. The Third Partial Final Award was delivered on 14.01.2015. Prior to this award, on 23.06.2014, the Karias, through their legal counsel, informed the tribunal that they would no longer be represented by M/s Nishith Desai Associates. This was the prelude to Shri Vijay Karia writing to the LCIA Court on 28.09.2014, a few days before the hearing H

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A fixed before the arbitrator, seeking revocation of the appointment of the arbitrator, on the ground of alleged lack of impartiality or independence. At the hearing fixed on 1st-2nd October 2014, Shri Vijay Karia did not appear. On 10.10.2014, the LCIA Court communicated to the tribunal that it had dismissed the challenge made to the arbitrator on the ground that the said application was made out of time under the provisions of the LCIA Rules. The award then went on to address some of the written submissions dated 02.06.2014 of Shri Vijay Karia. The learned arbitrator explained how he was not ‘functus officio’ with respect to the relief sought. He further went on to state that he could not now review the Second Partial Final Award as he had no jurisdiction to do so, and made it clear that he did not go beyond the claims submitted by the claimant to him, or beyond the scope of the JVA. The award also recorded the fact that the present Appellants did not take the necessary steps to appoint a valuer, as a result of which KPMG refused to go ahead with the valuation. As Deloitte was the only other valuer, Deloitte was then requested to go ahead with the valuation. The Third Partial Final Award then declared as follows: “1. The Respondents are the Defaulting Party under clause 23.7 of the JVA;

2. All rights of whatsoever nature conferred on the Respondents E and specifically Mr. Karia under the JVA have ceased to be effective;

3. Any reference in the JVA to any rights of the Respondents and specifically Mr. Karia including the requirement of consent or approval of Respondents and specifically Mr. Karia stand omitted;

F 4. The Respondents are prohibited from exercising or attempting to exercise any rights under the JVA including in particular any representation on the Board of the Company;

5. The date for the assessment of the Discounted Price be 30 September 2014 and that this date be substituted for the finding in G paragraph 335(4) of the Second Partial Final Award, which date and finding the parties agreed would be remitted back to the Tribunal for further consideration;

6. The Tribunal reserves the matters set out in paragraph 31 above, which includes the costs of the arbitration. H

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7. Notwithstanding paragraph 6 above, the Tribunal records the A further costs of the arbitration (other than the legal or other costs incurred by the parties themselves and other than those costs recorded in the Second Partial Final Award) up to the date of this Award, which have been determined by the LCIA Court, pursuant to Article 28.1 of the applicable (1998) Rules, to be as follows: B LCIA’S administration charge £6,353.33 Tribunal’s fees £29,800.00 Total further costs of the arbitration £36,153.33

8. The Tribunal’s previous Procedural Orders and Interim Relief C as amended by Procedural Order No.12 are to continue in effect until further Order.”

19Copy pinpoint19. By the Final Award dated 11.04.2017, the learned sole arbitrator dealt with why and how Deloitte was appointed as the valuer of the shares; why Ravin’s 49% stake in ‘Power Plus’ was excluded for purposes of valuation as clause 17.1 of the JVA and the formula stated in Schedule X would have to be strictly followed; and as to what then is the fair market value of the shares of the Appellants in Ravin that was to be bought out by the Respondent No. 1.

20Copy pinpoint20. Ultimately, the final relief granted by the said award was as follows: “FINDS, HOLDS, ORDERS AND DECLARES as follows: 1) The Respondents do transfer to the Claimant 10,252,275 shares held by them to the Claimant the Discounted Price of INR 63.9 per share aggregating to INR 655,200,000. F 2) The Third Respondent, Mr. Karia (who holds Power of Attorney executed by each Existing shareholder) do forthwith and without delay execute the requisite transfer forms for transfer of 10,252,275 shares in favour of the Claimant. 3) The Third Respondent and the Twelfth Respondent, Mr. Piyush G Karia, who purport to be and continue to act as director of the Company, do forthwith and without delay: a) Convene and hold a meeting of the Board of Directors of the Company not later than 21 days after the date of this Final Award limited to noting and registering the transfer H

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A of 10,252,275 shares from the Respondents in favour of the Claimant; b) Table before that meeting the executed transfer forms; c) Vote in favour of the resolution / motion to register the transfer of the 10,252,275 shares in favour and in the name B of the Claimant; and d) On registration of the transfer of the shares as aforesaid to resign from the Board of the Company as Chairman and Managing Director and as Executive Director of the Company respectively. C 4) Each of the Respondents and particularly the Third and Twelfth Respondents, Mr. Karia and Mr. Piyush Karia, are restrained from acting themselves or through servants or agents, from: a) Claiming or attempting to exercise or exercising any rights D whatsoever under the JVA in relation to the Company including but not limited to representation on the Board of the Company or their consent or approval being required in any matter relating to the Company whether at the Board of the Company or at meetings of the shareholders of the Company. E b) Claiming or attempting to claim, or representing or attempting to represent, the Company in any matter and in any manner whatsoever. c) Using or attempting to use any assets, properties or facilities of the Company including but not limited to the Company’s F offices and communication facilities. 5) The third and Twelfth Respondents, Mr. Karia and Mr. Piyush Karia, themselves or through servants or agents are restrained from acting, or claiming or holding themselves out to be the Chairman or Managing Director and as Executive Director, G respectively, or directors of the Company (except for the limited purpose as set out in (3)(above)). 6) The Respondents jointly and severally do pay to the Claimant the legal and sundry disbursements costs of and relating to this Arbitration in the sum of US $ 2,317,199.82. H

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7) The Respondents are to bear and, insofar as not already paid, A to reimburse the Claimant the total costs of the Arbitration as determined by the LCIA Court pursuant to Article 28.1 of the LCIA Rules, which are £ 283,043.71. 8) All other claims of the Claimant and Respondents are dismissed.” B

21Copy pinpoint21. It is important to note that no challenge was made to the aforesaid award under the English Arbitration Law, though available. It is only when the aforesaid award was brought to India for recognition and enforcement that objections to the said award were made under Section 48 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the “Arbitration Act”).

22Copy pinpoint22. The learned single Judge, in the impugned judgment, recorded the arguments of both parties, dealt with the allegation of bias against the arbitrator and all other objections raised by the Appellants to the award, but finally found that the award must be recognised and enforced as the objections do not fall within any of the neat legal pigeonholes contained in Section 48 of the Arbitration Act.

23Copy pinpoint23. As Section 50 of the Arbitration Act does not provide an appeal when a foreign award is recognised and enforced by a judgment of a learned Single Judge of a High Court, the Appellants have appealed against the said judgment under Article 136 of the Constitution of India.

24Copy pinpoint24. Before referring to the wide ranging arguments on both sides, it is important to emphasise that, unlike Section 37 of the Arbitration Act, which is contained in Part I of the said Act, and which provides an appeal against either setting aside or refusing to set aside a ‘domestic’ F arbitration award, the legislative policy so far as recognition and enforcement of foreign awards is that an appeal is provided against a judgment refusing to recognise and enforce a foreign award but not the other way around (i.e. an order recognising and enforcing an award). This is because the policy of the legislature is that there ought to be only one bite at the cherry in a case where objections are made to the foreign G award on the extremely narrow grounds contained in Section 48 of the Act and which have been rejected. This is in consonance with the fact that India is a signatory to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958 (hereinafter referred to as “New York Convention”) and intends - through this legislation - to H

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A ensure that a person who belongs to a Convention country, and who, in most cases, has gone through a challenge procedure to the said award in the country of its origin, must then be able to get such award recognised and enforced in India as soon as possible. This is so that such person may enjoy the fruits of an award which has been challenged and which challenge has been turned down in the country of its origin, subject to grounds to resist enforcement being made out under Section 48 of the Arbitration Act. Bearing this in mind, it is important to remember that the Supreme Court’s jurisdiction under Article 136 should not be used to circumvent the legislative policy so contained. We are saying this because this matter has been argued for several days before us as if it was a first appeal from a judgment recognising and enforcing a foreign award. Given the restricted parameters of Article 136, it is important to note that in cases like the present - where no appeal is granted against a judgment which recognises and enforces a foreign award - this Court should be very slow in interfering with such judgments, and should entertain an appeal only with a view to settle the law if some new or unique point is raised which has not been answered by the Supreme Court before, so that the Supreme Court judgment may then be used to guide the course of future litigation in this regard. Also, it would only be in a very exceptional case of a blatant disregard of Section 48 of the Arbitration Act that the Supreme Court would interfere with a judgment which recognises and enforces a foreign award however inelegantly drafted the judgment may be. With these prefatory remarks we may now go on to the submissions of counsel.

25Copy pinpoint25. Dr. Abhishek Manu Singhvi, Senior Advocate, led the charge so far as the Appellants are concerned. Ably assisted by Shri Nakul F Dewan on the law, the learned Senior Advocates argued a large number of points which they sought to put into three legal pigeonholes, namely, the pigeonhole contained in Section 48(1)(b) of the Arbitration Act, and that the foreign award would be contrary to the ‘public policy of India’ [as under Section 48(2)(b) of the Arbitration Act] in two respects: (1) that it would be in contravention of the fundamental policy of Indian law; G and (2) that in several respects it would violate the most basic notions of justice.

26Copy pinpoint26. Dr. Singhvi’s arguments were as follows: (1) That the arbitral tribunal entirely failed to deal with the H Appellants’ counter claim pertaining to the incorporation of

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one Jaguar Communication Consultancy Services Private A Limited (hereinafter referred to as “Jaguar”), which would show that, in material breach of the non-compete provisions of the JVA, this company was set up in India by Respondent No.1 to do business in the manufacture and sale of cables, in competition with the joint venture company, i.e. Ravin. B (2) That the tribunal failed to make a determination on the Appellants’ counter claim that Respondent No.1’s efforts to oust the Appellant No.1 and his family from Ravin amounted to a breach of the JVA. (3) That the tribunal failed to make any determination on the C Appellants’ counter claim that Respondent No.1 made a surreptitious attempt to register the Ravin trademark in its own name, which would be a breach of the material clauses of the JVA. (4) That the tribunal has acted contrary to the admissions made by expert witnesses of both parties, both of whom stated that ACPL - a company acquired by the parent of Respondent No.1 - was in competition with Ravin, and that this would therefore vitiate the award. In addition, since the most material evidence with regard to the acquisition of ACPL was ignored by the tribunal, this would also vitiate the award. Insofar as ACPL was concerned, Respondent No.1’s failure to produce documents that were with ACPL ought to have led to an adverse inference being drawn against Respondent No.1, which was not done by the learned arbitrator. F (5) The tribunal was perverse in considering the issue of material breach in that it applied the maxim de minimus non curat lex to ACPL, being a small specialist cable business. (6) That a perverse interpretation of the JVA was given by the learned arbitrator in the First Partial Final Award of clause G 21.1, stating that it only prohibited long-term arrangements and engagements, which was a condition added by the arbitrator himself into the said clause. (7) So far as direct sales of Respondent No.1 in India were concerned, the tribunal ignored material evidence and H admissions of Respondent No.1.

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A (8) That the tribunal’s analysis of the contemporaneous conduct of the parties was both selective and perverse, that the consideration of the evidence of key witnesses was also selective and perverse. (9) That Deloitte was a conflicted valuer and should not have been appointed at all. The valuer adopted a course for valuation that is contrary to both parties’ position, in that, Ravin’s 49% shareholding in Power Plus which had been valued by another valuer ‘BDO’ at INR 563 crores was completely ignored. What is very important is that the tribunal had acted contrary to the parties’ submissions in arriving at the valuation date, as the said date should have been the date closest to the date of the actual sale of shares, instead of which, a 2017 award took a date of September 2014 which date in any case expired by the end of December 2014. (10) That the ruling contained in the First and Second Partial D Final Awards regarding interpretation of clause 21 of the JVA were inconsistent and irreconcilable. (11) That a private communication had been made of the outcome of the arbitration by the tribunal two months prior to the award, published through an agent of Respondent No.1, E one M/s Gilbert Tweed Associates, which would show that Respondent No.1 knew that the Second Partial Final Award would be in its favour. The mere undertaking to terminate the engagement of M/s Key2People as the agent, who in turn had employed M/s Gilbert Tweed Associates, and an apology made F by Respondent’s counsel, ought not to have been held to have been sufficient to condone this lapse by the learned sole arbitrator. (12) That the award is in contravention of the Foreign Exchange Management Act, 1999 (hereinafter referred to as “FEMA”) G in that it directed the sale of shares of Ravin at a 10% discount, which would be in the teeth of rule 21(2)(b)(iii) of the Foreign Exchange Management (Non-Debt Instrument) Rules, 2019 (hereinafter referred to as “the Non-Debt Instrument Rules”).

27Copy pinpoint27. Shri Nakul Dewan cited a large number of judgments largely from Singapore, Hong Kong and the U.K. to buttress his submission H

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that an award which fails to deal with or make any determination on the claim of a party ought to be set aside on the ground contained in Section 48(2)(b) of the Arbitration Act, as it would be in breach of the audi alteram partem principle, and also on the ground that it would shock the conscience of the court, being contrary to a basic notion of justice in this country. He also argued that where an award is directly contrary to admitted facts, it would be perverse, and hence liable to be set side. Also, where a party is unable to present its case on account of the opposite party’s wilful failure to produce documents ordered, and the tribunal’s failure to draw an adverse inference therefrom, on most material aspects of the case, would render such award unenforceable.

28Copy pinpoint28. He also cited judgments on awards which treat parties unequally in that they adopt disparate thresholds for determining material breach, as a result of which an award read as a whole would be vulnerable on account of egregious bias. Also, a private communication of the outcome of the arbitration by the tribunal to one party to the exclusion of another would fatally undermine the independence and impartiality of the arbitration process, rendering the award vulnerable on the ground of bias.

29Copy pinpoint29. Both Dr. Singhvi and Mr. Nakul Dewan, after setting out all the aforesaid grounds and case law supporting such grounds, have attacked the impugned High Court judgment, stating that a large number of these points were not answered by the High Court at all, and when answered would show that even where there was bias, perversity and breach of natural justice, all these grounds were merely brushed aside, and therefore no real determination of all the points argued before the High Court was at all undertaken by the learned Single Judge. As a ‘without prejudice’ argument, Dr. Singhvi exhorted us to modify the impugned award, in case he were to fail on all other arguments, to state that the valuation date of 30.09.2014 ought at least to be the date of the judgment delivered in this case, as otherwise the sale of the Karia block of shares in Ravin would be at a tremendous undervalue. This he exhorted us to do under Article 142 of the Constitution of India. G

30Copy pinpoint30. Shri Kapil Sibal, learned senior advocate appearing on behalf of the Respondent No.1, read to us in copious detail each of the four awards delivered by the arbitral tribunal. He argued that each and every aspect of the matter that was argued on both sides was considered in detail in each of the said awards. He stressed the fact that though H

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