Decided on January 30,2017

Manoj Javeri Stock Broking Pvt. Ltd. Mumbai Appellant
Gopika S. Mehta Respondents


N.M.JAMDAR,J. - (1.) By this Arbitration Petition under Section 34 of the Arbitration and Conciliation Act, 1996, the Petitioner has challenged the Award of the Arbitral Tribunal and the Appellate Tribunal dated 17 September 2013 and 4 April 2014 of the Bombay Stock Exchange. The claim was made by the Respondent against the Petitioner which was treated as Arbitration Reference No. 10 of 2013. The claim was made in respect of 2,13,333 shares of Wipro Limited. It was the case of the Respondent that she is resident of Canada and constituent of the Petitioner. The Petitioner is the member of Bombay Stock Exchange have clearing No. 421 and SEBI Registration No. INB 010994933. The Respondent contended that from time to time she was buying and selling shares through the Petitioner and had deposited 22,000 equity shares of Wipro Limited for safe keeping and for delivery of the same in the market as per the directions of the Respondent. It was the case of the Respondent that this fact was acknowledged by the Petitioner from time to time. Subsequently, 44,000 bonus shares were received on 28 June 2004 and 66,000 shares were received on 23 August 2005, which fact was also contended by the Petitioner. By communication dated 23 August 2005, the fact that the Petitioner was holding 1,32,000 shares of Wipro Limited was confirmed by the Petitioner. According to the Respondent, interim dividend were paid on 14 January 2010. Some shares were returned to the Petitioner and also dividends were paid. According to the Respondent, this transaction between the parties went on till the Respondent decided not to sell share and addressed a letter to the Petitioner on 20 September 2011 which was replied to by the Petitioner seeking time to take steps in pursuance to the request. Since shares were not returned, the Respondent filed a complaint before the Investors Grievance Redressal Committee and Bombay Stock Exchange. To this complaint, the Petitioner filed a Reply and took stand that no such shares were received and even if received, they were in respect of some other transactions. Thereafter, the Respondent invoked the provisions of Arbitration under the Bye-Laws framed by the Bombay Stock Exchange and the matter was referred to the Arbitrator.
(2.) The Respondent filed statement of claim. The Petitioner filed the Written Statement and took up various grounds including that of jurisdiction of the Arbitrator and limitation in making a claim. It was stated that no transaction had taken place between the Respondent and the Petitioner on the Bombay Stock Exchange. It was also stated that the shares, which were received, were in respect of the transaction which had nothing to do with the Stock Exchange. Accordingly, the Petitioner sought dismissal of the claim of the Respondent.
(3.) The learned Arbitrator considered the issue of jurisdiction raised by the Petitioner and held that the Bye-Law No. 248 of the Bombay Stock Exchange is stated in wide terms and the dispute of the present nature between the Petitioner and the Respondent also fell within the ambit of the said Bye-Laws. As regard the issue of limitation is concerned, the learned Arbitrator held that the claim made was within the limitation and that after refusal of the Petitioner to return the shares, the claim has been filed within time. The learned Arbitrator, on merits, held that the correspondence would clearly show that the shares were given by the Respondent to the Petitioner for the purpose of selling the same and till instructions were issued for the purpose of safe keeping, they have been wrongfully not returned. The learned Arbitrator however, relying on the Bye-Law No. 244 limited the relief to be granted to the Respondent, holding that the closing price would be of 15 days in respect of the said shares and accordingly, calculated the damages to be paid to the Respondent. The learned Arbitrator granted monetary damages, as the Petitioner failed even to disclose as to the whereabouts of the shares. The Award was passed on 17 September 2013.;

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