HARYANA TOURISM LTD. V/S KHANDARI BEVERAGES LTD.   

FACTS OF THE CASE 

In the given case there are two Private Limited Corporations. One is Haryana Tourism Ltd. and other is Khandari Beverages Ltd. The Haryana Tourism invited tenders for the supply of Aerated Cold Drinks at its Tourist Complexes. The tender submitted by the respondent was accepted by the Appellant. Now as per the agreement, the respondent company was supposed to pay a sum of Rs. 20 lakhs for brand promotion. 

The Appellant organised a Mango Mela. The Appellant spent a sum of 1 lakh and the Respondent spent 13.92 lakhs. However, the Appellant asked the Respondent to deposit a sum of 19 lakhs as sponsorship money. Dispute arose between the party and the matter was referred to the arbitrator. The arbitrator directed the Respondent to a sum of 9.5 lakhs.  

The Respondent thereafter filed a petition before Additional District Judge, Chandigarh under section 34 of Arbitration Act against the order passed by the arbitrator but this petition was dismissed. Then the Respondent preferred a further appeal in the High Court under section 37 of Arbitration Act. The High Court allowed the appeal and quashed and set aside the award passed by the arbitrator and the Additional District Judge. The Appellant then filed petition in the Supreme Court. 

ISSUES 

• Whether the High Court can hear the appeal under section 37 of the Arbitration Act? 
• Whether the High Court has exceeded its jurisdiction under Section 37 of the Arbitration Act?  

ARGUMENTS  

Appellant’s Argument: The Haryana Tourism Ltd. argued that the respondent has to pay them a sum of 19 lakh as sponsorship money.  

Respondent’s Argument: The Khandari Beverages argued that they have spent a sum of 13.95 lakhs and as the appellant has terminated the agreement, they want their 13.96 lakh back.  

JUDGEMENT 

The Supreme Court of India stated that the High Court has exceeded its jurisdiction. It has no authority to accept the appeal under Section 37 of Arbitration Act. And also has no authority to quash the award of arbitrator. It quashed the judgement given by High Court and set aside. The award passed by arbitrator and the order passed by Additional District Judge under Section 34 of the Arbitration Act overruling the objections are hereby restored. 

REFERENCES  

https://indiankanoon.org/doc

This Article is written by Shubhi Singh of Lloyd School Of Law, intern at Legal Vidhiya.   

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