Analysis of- Marriott International Inc. vs Ansal Hotels Limited AIR 2000 Delhi 337
In this, the appellant, Marriott International Inc., sought to challenge an order passed by a single judge bench on March 8, 1999, based on Arbitration and Conciliation act 1996 under section 9.
FACTS OF THE CASE
Appellant entered into and no. of contact with respondent no. 1, i.e., Ansal hotels on 8 March 1997 as per the contract the appellant was appointed to operate the hotel as Marriot chain of hotels with the support to provide certain services like sales, pre-opening, marketing, advisory and technical services. Later on, respondent number one terminated contracts and entered into agreements with ITC hotels Ltd.
Appellant stated that the termination of the contract by respondent no 1 was illegal and proposed to resolve the differences through negotiation. Nevertheless, the appellant didn’t receive any assurance on resolving the dispute. Later on, as per the arbitration agreement between the parties arbitration hearing also proceeds at Kuala Lumpur regional centre for arbitration, Malaysia.
The appellant applied section 9 of the arbitration and conciliation act on that respondent raised to objections-
(i) That single petition for relief on various causes of action is not maintainable as each contract in which parties enter into were independent contracts with the purview of providing services, so each contract was terminated using different termination letters as each cause of action was different.
According to the arbitration agreement between the parties, arbitration proceedings took place in Kuala Lumpur, Malaysia, so this application is not maintainable under section 9. (ii) As part, I of the arbitration and conciliation act 1996 applies only when the place of arbitration is in India. Further respondent argued that contracts have the nature to be terminated. They had reasons to terminate the contract, so respondents cannot be asked to do something of those contracts and appellants; hence, the appellant was not entitled to any interim relief.
The appellant having no strong prima facie case to grant the interim relief, the single judge bench dismissed the petition.
Appellant in this appeal contended that Indian law of arbitration is based on the framework of UNCITRAL model law, which governs international commercial arbitration there for the arbitration and conciliation act apply to all of the cases where it is connected with India irrespective of the place of arbitration.
The court stated that while studying certain provisions of arbitration and conciliation act 1996, courts do have vested with jurisdiction and power to grant interim relief with that, this power of the court is also significant to strengthen the arbitration proceedings. However, the court further stated that as per subsection (2) of section 2 of the arbitration and conciliation act this court does not have any jurisdiction to pass an order as per section 9 of the act that is for an interim order, inherent powers that court have cannot be exercised as to exercise inherent powers the proceedings should be taken in court means the court should have jurisdiction over the proceedings. The court can exercise its inherent power under section 151 of the code of civil procedure only when the matter proceeds properly before the court and when there is a lack of jurisdiction of the court in the matter, so the court cannot exercise its inherent jurisdiction powers.
The court further stated that if the interpretation sought for Section 2(5) of the Act is accepted, the provisions of Section 2(2) of the Act will become obsolete. The way by which section 2(2) and section 2(5) can be read coordinately is that: Part I of the Act must apply to any arbitration held under an agreement between parties, under the provisions of rules and by-laws of certain associations such as associations of merchants, stock exchanges, and different chambers of commerce, as well as arbitration under certain statutes.
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