2023 (6) TMI 1513 - AT - IBC

Appellant Directed To File Fresh Arbitration Claim Under Clause 22.6.1.1; Depository To Decide Dispute Promptly

The Tribunal addressed the appellant's grievance regarding non-initiation of arbitration by the depository (respondent no. 1). It held that, in view of ... Non-initiation of the arbitration proceedings by respondent Nos. 1 Central Depository Services India Ltd. - appellant had made an application though not in the prescribed format requesting respondent nos. 1 to refer the dispute for arbitration - HELD THAT:- Having perused Clause 22 and 22.6 of the bye-laws of the respondent Nos. 1, the matter is disposed off directing the appellant to file a fresh claim under the prescribed format as per clause 22.6.1.1 of the bye-laws within six weeks from today. If such a claim is made, respondent Nos. 1 will initiate arbitration proceedings and decide in accordance with law after granting an opportunity of hearing within four months thereafter. Appeal disposed off. The appeal concerned the 'non-initiation of the arbitration proceedings' by Central Depository Services (India) Ltd. (CDSL) despite the existence of an arbitration mechanism under bye-law 22.6. The appellant had requested CDSL to refer its dispute to arbitration, but the request was not made 'in the prescribed format' contemplated by the bye-laws, and CDSL did not act on it. On examining clause 22 and clause 22.6 of CDSL's bye-laws, the Tribunal held that disputes can indeed be referred to arbitration, but the procedural requirement of filing a claim 'under the prescribed format as per clause 22.6.1.1' must be complied with. The Tribunal therefore directed the appellant to file a fresh claim in the prescribed format within six weeks. Upon such filing, respondent no. 1 is obligated to 'initiate arbitration proceedings and decide in accordance with law' within four months, after granting an opportunity of hearing.