THE HON’BLE SRI JUSTICE B.SESHASAYANA REDDY Arbitration Application No.122 of 2010 Date:29th September, 2011 Between: Newstoday (P) Ltd., T.V. Division, a company incorporated under the provisions of the Companies Act, 1956, having its office at Eenadu Complex, Somajiguda, Hyderabad, rep. by its authorized signatory Sri Nagaiah Choudary. …Applicant A n d 1.Mr.P.Rajesh & Ors. …Respondents *** THE HON’BLE SRI JUSTICE B.SESHASAYANA REDDY Arbitration Application No.122 of 2010 ORDER: This Arbitration Application has been taken out by Newstoday (P) Ltd., under sub-sections (5) and (6) of Section 11 of the Arbitration and Conciliation Act, 1996, (for short, “the Act”), seeking appointment of an arbitrator for resolution of the disputes between the parties relatable to the training-cum-service agreement, dated 20.09.2004. 2. The applicant is engaged, inter alia, in the activity of collection and dissemination of news all over the world through television network etc. The 1st respondent applied to the applicant Organization to undergo Diploma Course in Journalism in Eenadu Journalism School, Ramoji Film City, Hyderabad. The applicant agreed to sponsor the 1st respondent to impart training to him in the said school, for which, the 1st respondent agreed to work as a Sub Editor/Reporter with the applicant Company for a continuous period of four years including the period of diploma course and advanced training on such terms and conditions. Having agreed for the same, the 1st respondent executed a Training-cum-Service Agreement, dated 20.09.2004, with the applicant’s organization along with two sureties. The respondents 2 and 3 are the sureties of the 1st respondent. As per the said agreement, if 1st respondent fails to perform his obligations during the training period, he shall compensate the applicant organization, a sum of R.1,00,000/- vide clause 10(b) of the said Agreement. As per the agreement, after completion of Diploma Course in Eenadu Journalism School, the 1st respondent was appointed as Trainee Copy Editor/Reporter vide Letter of Appointment, dated 02.01.2006, for a training period of nine months, and after completion of training, the 1st respondent was offered Probationary Employment w.e.f. 01.10.2006 vide Letter of Employment Probationary, dated 01.10.2006 and he accepted the same. The 1st respondent while under 2nd year of service, abstained from duties without sanctioned leave or intimation from 03.01.2008. The applicant issued a letter, dated 17.01.2008, advising the 1st respondent to report to duties. Despite receipt of the said letter, the 1st respondent failed to report to duty. Thereupon, the applicant issued a notice, dated 29.02.2008, directing the 1st respondent, to show-cause as to why he shall not be discharged from probationary employment for his continuous and unauthorized absence from 03.01.2008 considering as he left the services on his own accord. A copy of the notice has also been marked to the respondents 2 and 3 for information. As the said notices were returned unserved, another show-cause notice dated 09.05.2008 was issued to the 1st respondent. Despite receipt of the said notice, the 1st respondent failed to give any explanation. Thereby the 1st respondent committed breach of Clause 10(b) of the training-cum-service agreement, dated 20.09.2004 and therefore, the 1st respondent along with respondents 2 and 3, liable to pay compensation of Rs.1,00,000/- to the applicant. As per Clause 15 of the agreement, dated 20.09.2004, disputes are required to be referred to the sole arbitrator. The applicant invoked the arbitration clause and issued a notice, dated 25.11.2009 nominating Sri K.Prakash, Advocate, 12-1-1150, Old Mallepally, Hyderabad, as arbitrator and called upon the respondents 1 to 3 to give their consent and agree for the said appointment. The notice sent to the 2nd respondent was served and the notices sent to the respondents 1 and 3 returned unserved with the postal endorsements “unclaimed” and “not residing there” respectively. The legal notice sent to the respondents 1 and 3 by ‘registered post with acknowledgment due’ to their correct addresses as per records and therefore, it shall be deemed to have been served on them. Hence, this application by the applicant seeking the relief stated supra. 3. Notice to the respondents came to be issued on 06.09.2010. Notice sent to the 2nd respondent served. Notice sent to the respondents 1 and 3 returned unserved with an endorsement ‘no such person’. The applicant filed Application No.695 of 2011 seeking permission to take out notice to the respondents 1 and 3 by way of publication in “ANDHRA PRABHA” Telugu Daily Newspaper. The said application came to be allowed on 18.08.2011 permitting the applicant to take out notice to the respondents 1 and 3 by way of publication in “ANDHRA PRABHA”, Telugu daily newspaper. The applicant carried out the publication and filed proof of the same. Despite notice being served on the respondents 1 and 3 by way of publication, they failed to enter appearance either in person or through a counsel. 4. Heard learned counsel appearing for the applicant and perused the material brought on record. 5. The 1st respondent joined as a Trainee Copy Editor/Reporter in the applicant’s organization after completion of the Diploma Course in Eenadu Journalism School, after duly executing the training-cum- service agreement, dated 20.09.2004. He discontinued the services and failed to join the duty and serve with the applicant. Thereby he committed breach of the terms of the agreement. The disputes between the parties are required to be resolved by taking recourse to arbitration as provided under Clause 15 of the training-cum-service agreement, dated 20.09.2004. Clause 15 of the said agreement, reads as hereunder: “In the event of any dispute (including any Industrial Dispute) or difference which may arise between parties or their representatives with regard to the construction, meaning and effect of this deed or any part thereof or their respective right and liabilities there under, 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. In that view of the matter, I find that the applicant made out valid ground for appointment of an arbitrator for resolution of the disputes between the parties relatable to the training-cum-service agreement, dated 20.09.2004. 7. Accordingly, the Arbitration Application is allowed. Sri M.Bhaskar, Retd. District Judge, is appointed as an arbitrator for resolution of the disputes between the parties relatable to the training- cum-service agreement, dated 20.09.2004. He shall fix his own fee. No order as to costs. ______________________ B.SESHASAYANA REDDY, J. Date:29th September, 2011. cs THE HON’BLE SRI JUSTICE B.SESHASAYANA REDDY Arbitration Application No.122 of 2010 Date: 29th September, 2011