ERACH KHAVAR Vs. NIRMAL BANG SECURITIES PVT. LTD.

JUDGEMENT

(1.) This is an Appeal filed under Sec. 37 of the Arbitration and Conciliation Act, 1996 (the Act) challenging the judgment and order dtd. 30/4/2024 passed by the learned Single Judge of this Court allowing Arbitration Petition No. 742 of 2017 filed by the Respondent and dismissing Arbitration Petition No. 228 of 2018 filed by the Appellant. The Learned Single Judge has set aside Majority Award dtd. 8/8/2017 and has upheld the dissenting Award dtd. 14/8/2017.

(2.) Briefly stated facts of the case are that Respondent is a registered broker with the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) carrying on business of trading in shares and securities. Appellant opened a Depository Account with the Respondent. This is how Demat Account and Trading Account of the Appellant was opened with the Respondent. Appellant had transferred 1500 shares of Hero Moto Corporation Limited, 5,000 shares of Petronet LNG Limited and 7000 shares of ITC Limited with the Respondent towards security. During 30/6/2015 to 27/9/2015, transactions of purchase and sale of shares in the Account of the Appellant took place on the basis of instructions allegedly given by the Appellant through mobile phone and other means. Appellant suffered losses in the said transactions. Respondent sent Ledger Account to the Appellant which was not objected to by the Appellant. Respondent paid back the balance credit amount of Rs.37,829.69 standing in the Ledger Account paid back to the Appellant on 27/1/2016.

(3.) On 29/6/2016, Appellant objected to the transactions carried out by the Respondent and filed complaint with the Investors Grievance Redressal Panel (IGRP) of NSE and claimed the value of shares from the Respondent. On 9/1/2017, the IGRP passed order and granted claim of Rs.46,60,000.00 to the Appellant. Respondent challenged the order of IGRP by filing arbitration case with NSC. The Arbitral Tribunal passed Award dtd. 10/4/2017 and while dismissing Respondent's challenge, reduced the claim of the Appellant to Rs.35,77,412.00 with interest @ 12% p.a. from the date of the Award. Both the sides challenged the Award dtd. 10/4/2017 before the Appellate Panel of Arbitrators. The Presiding Arbitrator delivered dissenting award dtd. 14/8/2017 allowing the Appeal preferred by the Appellant and set aside the Award of the Arbitral Tribunal dtd. 10/4/2017, as well as the order of the IGRP dtd. 9/1/2017. The majority members of the Arbitral Tribunal however delivered separate Award dtd. 8/8/2017 dismissing the Appeal preferred by the Respondent and upholding the order dtd. 10/4/2017 but increased the claim amount from Rs.35,77,412.00 to Rs.46,60,000.00.