MAHANAGAR TELEPHONE NIGAM LIMITED Vs. CANARA BANK

JUDGEMENT

(1.) This application has been filed by the petitioner- Mahanagar Telephone Nigam Limited [hereinafter, "MTNL"] for stay of enforcement of an arbitral award dtd. 3/3/2022, which is under challenge in O.M.P.(COMM) 312/2022.

(2.) The transactions between the parties relate back to the period 1991-92. Pursuant to guidelines issued by the Government of India regarding flotation of bonds issued by Public Sector Undertakings [hereinafter, "PSUs"] in the telecommunications and power sectors, MTNL was granted permission for issuance of bonds on 17/12/1991.

(3.) MTNL and CanBank Financial Services Ltd. [respondent No. 2, hereinafter "CanFina"] entered into a Memorandum of Understanding dtd. 10/2/1992, under which Letters of Allotment ["LoAs"] were to be issued and CanFina was to subscribe to bonds issued by MTNL. It was provided that the consideration would not be paid by CanFina to MTNL immediately, but be invested with CanFina. The dispute between the parties revolves around the nature of the investment.