Section 19(3) AA – Powers of Arbitrator to allow withdrawal of a claim to file a fresh claim.
By the notice dated 15.9.2023, Ketan Shah called the Petitioner to indemnify him for the loss caused to him due to the negligence of the petitioner and stock broker Anugrah with interest. He invoked arbitral proceedings as per the arbitration clause of the agreement under CDSL byelaws.
On 12.2.2024 the oral arguments were concluded.
By the email dated 28.2.2024, the post hearing clarifications were submitted. Ketan Shah stated that he had engaged a CA to analyse shares in his demat account and sought time to place his certificate on record. This was opposed.
On 20.3.2024, the claimants sought amendment of prayers. This was opposed.
The Arbitral Tribunal was of the view that since the time for passing Award expired in May, 2024, amendment was not possible and offered two options – either to withdraw arbitration and file fresh application.
On 21.3.2024, the claims were sought to be withdrawn with liberty to file fresh claim was sought.
By the order dated 18.4.2024, the arbitral proceedings were dismissed as withdrawn with liberty to file a fresh claim.
HELD that the Arbitral Tribunal is under no misconception of enjoying a continued mandate and to remain seized of the arbitral proceedings even after withdrawal of the claim. Section 32 is a consequence of termination of mandate and not a restriction on the power of the Arbitrator to permit withdrawal of claim.
There is no counter claim of the petitioner in the arbitral proceedings. The petitioner has no legitimate interest in claiming the final award. As such, the impugned order of permitting withdrawing of arbitration claims with liberty to file fresh does not cause any prejudice or irreparable damage to the petitioner.
Judgment dated 25.3.2025 of the High Court of Bombay in Writ Petition (L) No.15131 of 2024 of Central Depositories Services (India) Limited Vs. Ketan Lalit Shah with connected matters.
