STOCK EXCHANGE MUMBAI Vs. VINAY BUBNA

JUDGEMENT

(1.) APPELLANT before us is the Stock Exchange, Mumbai (hereafter for the sake of brevity referred to as "exchange" ). It is not a party to the lis which has arisen between respondent Nos. 1 and 2. However, it is adversely affected by the impugned order passed by the learned Single Judge and hence the present appeal.

(2.) RESPONDENT No. 1 was the original petitioner in the Arbitration Petition filed before the learned Single Judge. Differences having arisen between him and respondent No. 2 who was a broker with the exchange, a reference was made to Arbitrators under Bye-law 248 of the Exchange. Reference was to two arbitrators, one named by each party to the dispute. Before the arbitrators a contention was advanced on behalf of respondent No. 1 that reference to the Arbitral Tribunal consisting of two arbitrators was in contravention of section 10 of the Arbitration and Conciliation Act, 1996 (hereinafter for brevitys sake referred to as "the Arbitration Act" ). The arbitrators in consultation, with the Exchange held that the constitution of their panel of arbitrators was valid and was properly constituted. Opponent No. 1 was given an opportunity either to contest the interim order or proceed with the case. Opponent No. 1 decided to proceed ahead with the case. On 22nd January, 1998, an Award was passed rejecting the claim of respondent No. 1. Taking exception to the Award respondent No. 1 on 30th April, 1998 filed an arbitration petition being Arbitration petition No. 130 of 1998 for setting aside the Award.

(3.) BEFORE the learned Single Judge, by an interim order passed on 4th August, 1998, Exchange was directed to be impleaded as a party respondent to the petition for the purpose of effectively deciding the issue whether section 10 of the Arbitration Act is attracted to arbitrations under the rules bye-laws and regulations framed by the Exchange. The appellant Exchange was accordingly impleaded in the petition as any order passed on the aforesaid issue regarding the validity or otherwise of the constitution of the Arbitral Tribunals under the Rules. Bye-laws and Regulations of the Exchange was bound to have an adverse effect not only on the working of the Exchange but also on the numerous pending arbitration proceedings as also awards passed in respect of disputes pertaining to members or non members of the Exchange.