Case Note & Summary
The petitioner, Gujarat Chemical Port Terminal Co. Ltd., constructed port terminal facilities at Dahej, Gujarat, including tanks for handling and exporting chemical and petroleum products. In December 2006, the respondent, Indian Oil Corporation of India, approached the petitioner for dedicated tanks to store and export naphtha. A Terminalling Service Agreement was executed for an initial five-year term, later extended through an amendment in March 2012 for a further five years until December 2016. The agreement contemplated the respondent providing annual, quarterly, and monthly plans of naphtha handling to enable the petitioner to plan jetty utilization, with consideration based on actual throughput. Disputes arose when the respondent allegedly reduced naphtha exports and failed to provide plans, using the storage tanks without sufficient export. The petitioner terminated the agreement in August 2014. The respondent filed an arbitration petition under Section 9 of the Arbitration and Conciliation Act, 1996, and this Court on 11 September 2014 appointed a sole arbitrator and directed the respondent to pump sufficient naphtha to create an exportable parcel. The parties were directed to attempt amicable resolution. Subsequent negotiations and correspondence ensued, but the disputes persisted. In the arbitral proceedings, the respondent filed an application under Section 17 seeking interim measures. The arbitral tribunal, by order dated 17 December 2015, granted relief to the respondent, directing the petitioner to allow export of up to 300 TMT of naphtha, granting temporary injunction against interference, and directing port clearance pending arbitration or the contract term. The petitioner filed the present petition under Section 37 of the Act challenging the tribunal's interim order. The matter was heard by Justice R.D. Dhanuka and reserved on 28 April 2016. The text of the judgment provided does not include the court's reasoning, findings, or final decision.
Issue of Consideration
ARBITRATION PETITION NO.25 OF 2016
Case Details
2016 LawText (BOM) (05) 42
Arbitration Petition No. 25 of 2016
Dr. Milind Sathe, Mr. Birendra Saraf, Mr. Amey Nabar, Ms. Melanie D'Souza, Ms. Swati Jain, Mr. Rishit Badiani, Mr. V.R. Dhond, Ms. Neeta Jain, Mr. Sunil Gangan, Mr. Hemang Raythatta, Mr. Jayesh Mistry, Mr. Shantanu Kalekar
Gujarat Chemical Port Terminal Co. Ltd.
Indian Oil Corporation of India
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Nature of Litigation
Arbitration Petition under Section 37 of the Arbitration and Conciliation Act, 1996 challenging the interim order passed by the arbitral tribunal under Section 17 in a dispute arising out of a Terminalling Service Agreement.
Remedy Sought
Petitioner sought setting aside of the arbitral tribunal's order dated 17 December 2015 granting interim measures to the respondent, including directions to allow naphtha export and temporary injunction.
Filing Reason
Petitioner alleged respondent breached the agreement by reducing naphtha exports, using storage without sufficient throughput, and obtained ex-parte interim relief from the tribunal.
Previous Decisions
Earlier, the respondent's petition under Section 9 was disposed of on 11 September 2014 by appointing a sole arbitrator and directing the respondent to pump sufficient naphtha for an exportable parcel within 8 weeks, with a direction for mutual resolution.
Judgment Excerpts
By this petition filed under Section 37 of the Arbitration and Conciliation Act, 1996 ... the petitioner has impugned the order dated 17th December 2015 passed by the arbitral tribunal in the application filed under Section 17 of the said Act thereby granting various interim measures in favour of the respondent
It is the case of the petitioner that the respondent drastically reduced the quantum of export of naphtha and only used to pump naphtha in the designated storage tanks of the petitioner without any export being made.
the petitioner was constrained to terminate the said agreement by its notice dated 14th August 2014.
by Amendment/Extension of Agreement, the parties renewed the period of agreement for a further period of five years from 29th December 2011 till 28th December 2016
Procedural History
The respondent filed Arbitration Petition (L) No.1347 of 2014 under Section 9, which was disposed of on 11 September 2014 with the appointment of a sole arbitrator and directions to pump naphtha. The respondent filed an application under Section 17 before the arbitral tribunal. The tribunal passed an interim order on 17 December 2015 granting reliefs to the respondent. The petitioner filed the present Arbitration Petition No. 25 of 2016 under Section 37 challenging that order.
Acts & Sections
- Arbitration and Conciliation Act, 1996: Section 37, Section 17, Section 9
