Stay on Arbitration Award

[Sunil Bandi]

Dear Sir,

I’m Dr Sunil, a General Practitioner based in Hyderabad. I’ll give you a synopsis of the issue related to our school vs educomp solutions pvt ltd where they filed a suit against the school and won an arbitration award.

Our school was established by my father about 25 years ago. My father registered a society called SH educational society and acted as the president of the school and
a lady principal acted as secretary and correspondent of the society till 2002. Due to embezzlement of the school funds by the lady principal, the society removed her from the position of Secretary & Correspondent and my brother was appointed for the same post. The lady remained principal of the school till my father’s death in 2008. Later, she resorted to funds embezzlement yet again due to which we had to remove her from the post of principal also. But as she had been in the school for a long time, she took control of the staff and made them uncooperative to the management. My brother and I didn’t want to create a ruckus in the school and were looking for legal options to get an injunction against her. In the meanwhile, we gave public notice saying that the said lady doesn’t belong to the school or society in any manner. Nevertheless, one company called Educomp Solutions Pvt Ltd got into an agreement with her for providing smart classes. As case filing and arguments take time, it almost took about 2 years (2012) for us to get an injunction against her. The case was filed by me as president of the society and my brother remained secretary and correspondent. After the injunction, we restrained her from interfering with the activities of the school and the society. She went ahead and established another school in the town.

Later on in the year 2012 February we took over the management of the school and looking after its affairs. In the month of July 2012 they sent a legal notice stating that we paid 1.95 lakhs which we did not and according to the contract agreement we were due of more 2.925 lakhs. I replied to that dated 06/08/2012 saying that no authorized individual from our school or from the management of our school has signed any such kind of agreement and so asked them to send me a copy of that and i also sent them charges to send me that copy. But instead of sending me that copy they again after a year i.e during June 2013 sent 2nd notice asking to pay an amount of 6.825 lakhs. I again replied to them dated 06/08/2013 stating the facts as replied to the previous notice and again asked them for a copy of the alleged tripartite agreement, for which they did not respond. Later on again in February 2014 they sent another notice demanding 15.80 lakhs and if not done so they would proceed with arbitration. I replied to that also dated 18/03/2014 and then later on during december 2014 the arbitration proceedings started and the rest is on record.
I came to Delhi and appointed an advocate over there on the advice of my local advocate. That advocate at Delhi represented the case before the 1st arbitrator shri jn yadav. after a few adjournments my advocate there informed me that the files which have been done by the company’s official mr. venna suresh have come to a compromise and were dissolved after a meeting held at rajahmundry La Hospin Hotel, considering those all files to be manipulated and done fraudulently by the company’s executive suresh. I was informed through one of my friends that a meeting was going to be held at ramachandrapuram under the organisation of camps school head shri gopala krishna. accordingly the company’s Vice-President Mr. Chandrasekhar held a meeting, along with some of the company officials and some schools who are facing problem with this arbitration proceedings, at Ramachandrapuram near Kakinada of AP and in that course he told me that the arbitration proceedings on our school would be dropped off as it was done on a fraudulent manner and as there was no indulgence in the agreement from our management side. from then on i have been in continous correspondence with the said official shri chandra sekhar and have updated him with each n every notice through whatsapp and he assured me not to worry and there would be no problem from the company side and that he would take care of it. the 1st arbitrator has recused himself from the arbitration and there was notice from the 2nd arbitrator to appear for arbitration. i informed the same to chandra sekhar on phone and through whatsapp and he told me not to worry as he would stall the process. sometimes the notices were in such a way that we would not be able to attend there for the matter because the notice was served upon us just the previous day to appear. in the middle doubting the genuinity of the company official i also had written a letter to the arbitrator shri saroj bala stating all the facts that no one authorized has signed that alleged tripartite agreement as claimed by the educomp company from our school and moreover i am in correspondence with the company’s vice-president chandra sekhar and he said that the case would be withdrawn and relieve us and it will be turned towards the individual who signed that agreement fraudulently. before the announcement of award we even were not informed but in the award it was stated that we were served notice stating this, which is totally false. after the award is passed and i got the notice i contacted chandra sekhar about and he asked me not to worry as the EP has to be filed at a local court and he has to come down to do so and so he would not do that. even the call recording evidences prove the case as what mr. chandra sekhar said. now the company filed an EP in rajahmundry principal district court for an amount of 25lakhs. yet again mr. chandra sekhar is saying that he informed the rajahmundry lawyer to withdraw that EP case and he asked me to meet him on 7/2/2018 as he is coming here to rajahmundry. But he’s postponing the meeting on pretext or the other.

Now our lawyer here suggested us to file for stay on the proceedings of the EP and file for remand of the case again. The arbitration award was given in July 2017 and we received it in Aug 2017. At now, the EP hearing has been adjourned to 23 Mar 2018. Kindly suggest me as to how to proceed in this case.

Kind regards
DR Sunil

[Dr. Ashok Dhamija]

For getting a stay on the arbitration award, you’ll have to file an application before the court [as defined in Section 2(e)] under Section 34 of the Arbitration and Conciliation Act, 1996, for setting aside the award and seek stay of the award in the meanwhile during pendency of the proceedings.

As explained in detailed guidelines (quoted below) for asking questions on this Forum, please note that it is not possible for us to reply on detailed facts; so for opinion on detailed facts, please contact your local lawyer and show him all relevant papers:

“(5) What is replied here is “legal” questions or questions of “law”, and NOT detailed questions of “facts”. So, questions with detailed facts may not be answered, for which, in fact, it is in your own interests to contact some local lawyer who can study all relevant facts with the help of your detailed case papers (which is beyond the scope of this public forum). … …”

(6) Please try to keep the facts to the bare minimum, necessary to explain the legal question. Do not provide lengthy facts. As mentioned above, questions with lengthy facts will not be replied.”

     

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Dr. Ashok Dhamija is a New Delhi based Supreme Court Advocate and author of law books. Read more about him by clicking here. List of his Forum Replies. List of his other articles. List of his Quora Answers. List of his YouTube Videos.

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