Case Note & Summary
The appellant, Anheuser Busch Inbev India Limited (formerly SABMiller India Limited), a beer manufacturing and brewing company, appealed under Section 13(1-A) of the Commercial Court Act, 2015 read with Section 37(1)(b) of the Arbitration and Conciliation Act, 1996 against the judgment dated 24.06.2021 passed by the LXXXV Additional City Civil and Sessions Judge, Bengaluru. The commercial court had dismissed the appellant's application under Section 34 of the Arbitration Act seeking to set aside the majority arbitral award dated 02.11.2020. The dispute arose from a Customer Information and Service Provider (CISP) agreement dated 21.03.2012, originally between Skol Breweries Limited and Elios Business Solutions Private Limited, which was later assigned to the respondent, Scarpe Marketing Pvt Ltd. The appellant terminated the agreement on 05.03.2018, alleging breach of anti-corruption clauses (Clauses 17.2, 20A and 20B) after the director of the respondent was implicated in a CBI FIR concerning corrupt practices. The respondent invoked arbitration, and the arbitral tribunal by majority held the termination invalid, awarding actual damages of Rs.3,98,81,995 for unpaid invoices, notional damages of Rs.16,04,41,281 for business loss, and costs. The commercial court declined to interfere, holding that under Section 34, the court cannot re-appreciate evidence or set aside an award merely on an erroneous application of law, and found no ground for interference. The appellant then filed the present appeal, contending that the award was patently illegal and against public policy. However, the judgment excerpt provided is incomplete and does not contain the court's analysis or final decision.
Issue of Consideration
Whether the LXXXV Additional City Civil and Sessions Judge's judgment dated 24.06.2021 dismissing the appellant's objections under Section 34 of the Arbitration and Conciliation Act, 1996 to the arbitral award dated 02.11.2020 is liable to be set aside
Case Details
2021 LawText (KAR) (12) 23
Alok Aradhe, Anant Ramanath Hegde
Aditya Sondhi, Prasanth V.G., Salman Khurshid, Irfana Nazeer, Duvva Pavankumar, Zafar Khurshid, Lubna Naaz, Mohd. Wasay Khan, Sakshi Kotiyal, Shraddha Gupta
Anheuser Busch Inbev India Limited (formerly known as SABMiller India Limited)
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Nature of Litigation
Appeal under Section 13(1-A) of Commercial Court Act, 2015 read with Section 37(1)(b) of Arbitration and Conciliation Act, 1996 against dismissal of objections to arbitral award.
Remedy Sought
Appellant seeks to set aside judgment dated 24.06.2021 in Com.A.P. No.42/2021 passed by LXXXV Additional City Civil and Sessions Judge, Bengaluru, and the arbitral award dated 02.11.2020.
Filing Reason
Appellant terminated CISP agreement with respondent alleging breach of anti-corruption clauses (Clauses 17.2, 20A, 20B) due to involvement of respondent's director in corruption-related FIR and complaint. Respondent invoked arbitration, and tribunal by majority set aside termination and awarded damages. Appellant challenged award under Section 34, which was dismissed by commercial court, leading to this appeal.
Previous Decisions
Arbitral tribunal majority award dated 02.11.2020 set aside termination and awarded damages. Commercial court judgment dated 24.06.2021 dismissed appellant's Section 34 petition.
Judgment Excerpts
This appeal under Section 13(1-A) of the Commercial Court Act, 2015 read with Section 37(1)(b) of the Arbitration and Conciliation Act, 1996 ... emanates from judgment dated 24.06.2021 passed by the Commercial Court by which objections preferred by the appellant under Section 34 of the Act have been dismissed.
The arbitral tribunal by majority (2:1) inter alia held that termination notice dated 05.03.2018 ... is bad in law and the same was set aside. The respondent was held entitled to a sum of Rs.3,98,81,995/- along with interest ...
The commercial court by judgment dated 24.06.2021 dismissed the objections preferred by the appellant and has held that in a proceeding under Section 34 of the Act, the commercial court cannot re appreciate the evidence and cannot set aside an award merely on an erroneous application of law.
Procedural History
CISP agreement executed 21.03.2012 between SKOL and ELIOS; first addendum 03.06.2014; second addendum 09.09.2015 renewed and assigned rights to respondent; appellant acquired SABMiller in 2017; FIR dated 06.02.2017 implicated respondent's director; appellant terminated agreement on 05.03.2018; respondent invoked arbitration on 08.03.2018 and obtained status quo order on 14.03.2018 under Section 9; Section 9 petition disposed 05.03.2019; arbitral tribunal constituted, statement of claim filed 24.08.2018, amended 28.05.2019; no oral evidence; award passed 02.11.2020; appellant's Section 34 objection dismissed by commercial court on 24.06.2021; present appeal filed.
Acts & Sections
- Arbitration and Conciliation Act, 1996: 37(1)(b), 9, 23(3), 34
- Commercial Court Act, 2015: 13(1-A)
