THE HON’BLE SRI JUSTICE B.SESHASAYANA REDDY Arbitration Application No.161 of 2010 (Dated : 23-08-2011) Between: Ushodaya Enterprises Private Limited …Applicant A n d Mr.V Brahma Chary & Another …Respondents THE HON’BLE SRI JUSTICE B.SESHASAYANA REDDY Arbitration Application No.161 of 2010 ORDER: This application has been taken out by Ushodaya Enterprises Private Limited, a Television Division, under sub-sections (5) and (6) of Section 11 of the Arbitration & Conciliation Act, 1996 seeking appointment of arbitrator for resolution of the disputes relatable to Agreement dated 31.5.2008. 2(a). Ushodaya Enterprises Private Limited, a Television Division (in short, `the applicant’) is a Company incorporated under the provisions of the Companies Act, 1956 having its registered office at Ramoji Film City, Hyderabad, Ranga Reddy District. The applicant is engaged, inter alia, in the activity of marketing and telecasting of ETV channels all over the world through television network. The applicant offered the 1st respondent- V.Brahma Chary the position of Trainee Graphic Designer with a training period of one year on a monthly stipend of Rs.7,500.20 under letter dated 21-5-2008. The 1st respondent accepted the said offer and executed an agreement dated 31-5-2008. As per the terms of the agreement, the 1st respondent agreed to work with the applicant for a minimum period of two years after completion of the training, and accordingly, joined in the training in applicant’s organization on 2.6.2008. The 2nd respondent stood as guarantor of the 1st respondent. The respondents agreed to pay compensation of Rs.75,000/- in case the 1st respondent committing breach of the terms and conditions of the Agreement. 2(b) The 1st respondent while under 1st year of service, submitted letter dated 6-2-2010 tendering resignation from the services of the applicant’s organization. The applicant vide its letter dated 9-2-2010 directed the 1st respondent either to pay compensation of Rs.75,000/- as per Clause 9(ii) of Articles of Agreement executed by him or continue in the services of the applicant organization by withdrawing his resignation. In spite of the receipt of the said letter, the 1st respondent neither reported to duty by withdrawing his resignation nor paid any compensation. The applicant having no other option, accepted the resignation of the 1st respondent without prejudice to it’s rights to recover compensation of Rs.75,000/-, as per Clause 9(ii) of the Articles of Agreement and called upon the both the respondents to pay the same amount jointly or severally within ten days from the date of receipt of the notice. Despite notice, the respondents failed to pay compensation and thereby, dispute arose between the parties. The applicant issued notice dated 2-8-2010 nominating Sri K.Prakash, Adovcate, as Arbitrator and called upon the respondents to consider consent and agree for the said appointment within 30 days. The notice sent to the 1st respondent was returned unserved with a postal endorsement as ‘Unclaimed’ and the notice sent to the 2nd respondent was returned unserved with an endorsement ‘Addressee left, returned to sender’. Hence, this application seeking the prayer stated supra. 3. Notice to the respondents 1 to 3 came to be ordered on 8.10.2010. The applicant was permitted to take out personal notice to the respondents 1 and 2 by registered post acknowledgment due. Accordingly, the applicant took out notice and filed proof of service. Despite service being effected, the respondents did not choose to enter appearance either in person or through a counsel to resist the application. 4. Heard learned counsel appearing for the applicant and perused the material brought on record. 5. Learned counsel appearing for the applicant submits that as per the terms of the Agreement dated 31-5-2008, the 1st respondent agreed to work with the applicant for a minimum period of two years after completion of training and accordingly, joined in the training in the applicant’s organization on 2-6-2008. The 1st respondent left the applicant’s organization during the 1st year of service after completion of training. Notice has been sent to the 1st respondent either to report to duty or to pay compensation as agreed upon. There being no response from the respondents, the applicant invoked arbitration clause and proposed the name of Shri K.Prakash, Advocate, Hyderabad as arbitrator and communicated the same to the respondents for their consent. However, the respondents failed to respond. A further submission has been made that the disputes between the parties are required to be settled by a sole arbitrator as per Clause (16) of the Agreement, dated 31-5-2008. The arbitration clause in the agreement reads as hereunder:- “ In the event of any dispute (including any Industrial Dispute) or difference which may arise between the parties or their representatives with regard to the construction, meaning and effect of this deed or any part thereof or their respective rights and liabilities thereunder, the same shall be referred to the sole arbitration of an arbitrator to be nominated and whose award shall be final and binding on the parties. The provisions of the Arbitration and Conciliation Act, 1996 shall govern the Arbitration Proceedings”. 6. It is a matter of record that the 1st respondent accepted the terms and conditions and accordingly, executed the Agreement dated 31-5- 2008. The disputes between the parties are required to be settled by a sole arbitrator as per Clause (16) of the Agreement, dated 31-5-2008. In that view of the matter, I find that the applicant made out valid ground for appointment of arbitrator for resolution of the disputes between the parties relatable to Agreement dated 31-5-2008. 7. Accordingly, the arbitration application is allowed appointing Sri M.Bhaskar, a retired District Judge R/o H.No.16-2-753/C/1, Plot No.30, Revenue Board Colony, Malakpet, Hyderabad-36] as arbitrator for resolution of the disputes that have arisen between the parties, relating to Agreement dated 31-5-2008. He shall fix his own fee. _____________________ B.SESHASAYANA REDDY, J Dt.23-08-2011 *RAR