1 arbplod1001-11.doc IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION ARBITRATION PETITION LOD.NO.1001 OF 2011 Sky Gourmet Catering Pvt. Ltd. & Anr. .. Petitioners Versus Mars Enterprises & Anr. .. Respondents Mr.Arif Bookwala, Senior Advocate with Ms.Jyoti Singh and Ms.Shruti Sardesai i/b. Phoenix Legal for petitioners Mr.R.Narula with A.Dasgupta i/b. J.Narula & Associates for respondents. CORAM : S.C.DHARMADHIKARI, J. 9th September 2011. P.C.: 1] Mentioned not on board. This is an arbitration petition under section 9 of the Arbitration and Conciliation Act, 1996. The petitioners are seeking ad-interim order in terms of prayer clauses (a) to (c). 2] Mr.Bookwala, learned Senior Counsel appearing for petitioners firstly invites my attention to the agreement dated 13th March 2006 and the subsequent MOU dated 21st July 2009 and 2 arbplod1001-11.doc particularly clauses 4 and 5 thereof and submits that the use of common areas pertaining to AOH Building, office and GHS arrangement and common utility building are covered by these clauses. As far as common utility building is concerned, the agreement was that the respondent shall continue to provide the petitioners with services mentioned in the CUB Agreement and the petitioners shall pay charges of Rs.10,000/- per month for a minimum period of one year from the date of said agreement. After the expiry of one year from the date of the said agreement any party may terminate the CUB Agreement by issuing other party six months prior notice. Mr.Bookwala submits that clause 5.2 and 5.6 come into effect post termination. However, the proviso to clause 5.1 states that if there is any default under the agreement, then, the respondent shall be entitled to terminate CUB agreement forthwith, if such default is not remedied within 90 days of the respondents notifying the said default. It is submitted that as far as the disputes are concerned, it is in relation to the alleged defaults. However, the termination that was sought to be effected by the respondents has been given a go by and my attention is invited to consent minutes of order dated 9th December 2010 which have been executed in 3 arbplod1001-11.doc Suit Lod.No.3433 of 2010. It is submitted that the respondents have since 31st August 2011 discontinued the services and that has caused great inconvenience to the petitioners. Even if there was a notice issued, the termination was not to be effected as discussions were going on. There was a MOU which was even kept ready to be signed by parties. It is not as if there is any non compliance with the terms and conditions of the agreement but the abrupt withdrawal of services, inconvenienced the petitioners who are engaged in providing flight services and particularly kitchen services to the flight operators. For all these reasons the ad-interim orders be granted. 3] On the other hand, Mr.Narula appearing for respondents invited my attention to the consent minutes and stated that the petitioners were aware that the termination was effected on 5th August 2010. Assuming that it was postponed and there was another notice issued on 1st August 2010, beyond 1st March 2011, the petitioners were not entitled to continue. They were thus aware that the obstruction or objection for the re-installation and continuation of services would become operative atleast from this 4 arbplod1001-11.doc date. Even otherwise, it has been notified and it is not as if the respondents are complying with their part of obligation. They have already forwarded a cheque for 75% of the amount constituting deposit. However, without prejudice to their rights and contentions in Arbitration, the respondents are ready and willing to secure the claim of petitioners by bringing in bank guarantee in the sum of Rs. 6.25 Crores, if directed by this Court. 4] After hearing both sides, to my mind, no case is made out for any urgent ad-interim reliefs. Services have been discontinued on the own showing of petitioners. However, even if it is argued that the suit was in relation to some other grievances, yet, both clauses which have been referred to by the learned Senior Counsel appearing for petitioners, state that there is no interest in the property nor in the land or the structures. What has been agreed between parties is that these respondents shall continue to provide the services mentioned in the agreement and the charges thereof shall be paid. There may be an arrangement with regard to certain machinery or equipment which is described in the Annexures, yet, both sides have understood the arrangement to mean that prima 5 arbplod1001-11.doc facie on certain sums being paid, the facilities would be extended. Further, they were aware as to how the termination will be effected. In fact the termination appears to have been effected already, but, there has been some arrangement for the period for it actually coming into force. In such circumstances and when prima facie the petitioners do not have any interest in the property but they were only to be provided facilities, then, to my mind, post termination of the same the revival thereof cannot be directed. More so, when parties are not ad idem and there is dispute with regard to obligations under the clauses referred to above of the agreement in question. That is a matter for the Arbitrators to decide. Presently, the services have been terminated and all that is pleaded is that there were some negotiations and discussions but admittedly no agreement could be reached, then, allowing the petitioners to continue with the services would mean granting of reliefs at this stage itself. In the light of the fact that the respondents are ready and willing to secure the claim towards equipments and any rights flowing allegedly for the use of said facilities under the said agreement, the reliefs prayed cannot be granted. 6 arbplod1001-11.doc 5] However, Mr.Narula on instructions makes a statement that without prejudice to the rights and contentions of both sides, the respondents will secure claim towards facilities by a bank guarantee of Rs.6.24 Crores. Such bank guarantee should be furnished within four weeks from today. The bank guarantee will be in the name of Prothonotary & Senior Master/ Registrar (OS) and shall be of a nationalised bank. It shall be kept alive till the arbitral proceedings are concluded. Mr.Bookwala on instructions makes a statement that the petitioners have not yet encashed the cheque for Rs.70 lakhs given by respondents and they shall handover the same to the respondents within a week from today. Both statements are accepted as undertakings to this Court. Petition is disposed off in terms thereof. (S.C.DHARMADHIKARI, J)