1 vks IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION ARBITRATION PETITION NO.572 OF 2009 Networth Stock Broking Ltd. .. Petitioner -versus Mannam Mohan Rao s/o Chinnaa Kotaiah .. Respondents Mr. Dipen Merchant, with Dilip Rai i/b Aruna Singh, for the Petitioner CORAM: ANOOP V. MOHTA, J. DATED: 1st February, 2010 P.C. 1. Heard finally. 2. None for the respondent though duly served. The challenge is revolving around Rules, Bye laws and Regulations of National Stock Exchange of India Ltd (NSEIL). 3. There is no dispute and/or much controversy on record about the relationship and the transactions in questions. The learned Arbitrator, however, has reduced/deducted an amount of Rs.l,97,519/- from the amount claimed by the petitioner and awarded claim amount of Rs.57,411/- only by observing as under. 2 ”On a perusal of the Ledger account submitted by the applicant it has been observed that they have transferred Rupees 67,733 on 6.10.2007, Rupees 24,l22 on 5.l.2008 and Rupees, 1,05,664 on 4.2.2008 from N. S. E. to B. S. E. before arriving at the Net balance of Rupees 2,57,620/- claimed by them. Since this Arbitration proceedings is confined to the transactions that has taken place under the aegis of N.S.E., any credit balance transferred from the Ledger of N.S.E. To B.S.E, to adjust the debits for transactions carried out in B.S.E. , under a separate agreement cannot be reckoned or verified under this Arbitration process and has to be excluded. Therefore, a total amount of Rs.1,97,5l9/- has to be deducted from the amount claimed by the applicant on this account apart from the Rs.2,690 agreed by the applicant to be deducted for the error committed by him. Therefore the net amount of claim that can be admitted under this Arbitration Award is Rs.57,4ll only. There is no basis for any counter claim put up by the respondent against the applicant and is therefore dismissed”. 4. There is no dispute in regard to Authorization for Adjustment of Amount/Balances and Retaining and Utilisation of Credits of Funds & Securities. Apart from other requisite documents required to be signed by the parties before entering into this type of transaction, this agreement provides as under: “To effect transfer of my/our credit balance in the 3 Capital or Cash market segment of NSE and/or BSE to the ledger or credit of the Derivatives segment of NSE and/or BSE and vice versa to meet the margin and/or settlement obligations on my/our account(s) as necessitated” 5. Therefore, the observation recorded by the Arbitration by deducting amount of the petitioner in view of the clause itself is incorrect. If the parties voluntarily entered into such agreement and signed accordingly and also acted and as observed, in the present case, there is even no dispute raised of whatsoever nature in regard to this adjustment. Therefore, in my view the learned Arbitrator wrongly deducted the said amount. It is very clear from other reasoning that there was no such dispute and/or issue raised about this adjustment. In absence of such issue, therefore, without giving any opportunity to the parties and overlooking this specific clause if award is passed, in my view, that is also against the principle of natural justice, apart from contrary to the agreed terms between the parties, therefore, the award as passed by the Arbitrator by overlooking the agreement between the parties and without giving full opportunity to the parties without giving sufficient reason is liable to be quashed and set aside. 6. The award already passed remained unchallenged by the respondent. The amount as deducted wrongly as observed above need to be considered again in view of the clause recorded above 4 by giving full opportunity to both parties. 7. Considering the above and in view of the clauses of the agreement as there is always issue of limitation, therefore, to avoid further delay, it is necessary that the Arbitrator to re-hear the matter and reconsider afresh on the limited issue. 8. I have already held based upon the Supreme Court Judgments that an arbitral award can be modified, as it is permissible and/as the part is severable. I am inclined to modify the award. The award dated 24th April,2009 is modified to the extent of not granting an amount of Rs.1,97519/- as mentioned above. The rest of the award is maintained. The petition is partly allowed. 9. The parties to appear before the Tribunal within 8 weeks. The arbitrator to take steps or pass order after giving due notice and hearing to both the parties. The petition is accordingly disposed of. No costs. ( ANOOP V. MOHTA, J.)