Piaggio8217;s plea dismissed

Piaggio8217;s contention was that Piaggio Vepsa BV was the registered owner of the shares in LML and since it was not a signatory to the JVA, the case be transferred to ICC.

Piaggio had moved the district judge8217;s court against the order ofsenior judge of Kanpur, who had earlier dismissed Piaggio8217;s petition to transfer the case to ICC.

The Kanpur-based Singhanias had moved the court earlier to acquire Piaggio8217;s share following the death of Giovanni Agnelli of the Italian company.

LML had moved court saying it was only exercising rights conferred on it by the JVA which empowered it to buy out the Italian partner8217;s stake.

Contending that the case be transfered to ICC Singapore for arbitration, Piaggio had alleged that Singhanias were unnecessarily dragging its subsidiary into the case with the sole intention of stalling any move to take the case to ICC.

They conditionally agreed to make the Netherlands-based subsidiary a party to the dispute as sought by the Singhanias only if they agreed to go to the ICC Singapore.

Matters came to a head with LML dragging Italian partner to ICC Paris, demanding Rs 300 crore damages for making 8220;vague and baseless allegations8221; agianst it in an arbitration plea filed by Piaggio at ICC Singapore.

lMLsought intervention of ICC, Paris, to know the basis of the allegations levelled against it by Piaggio amp; c.S.P.A., a 100 per cent subsidiary of the Italian firm, as it had not given any detail of the 8220;breach of various agreements8221; in its arbitration plea at Singapore.

The court said the fact that Piaggio Vespa BV was not a party to arbitration agreement was known to both Piaggio and Singhanias. 8220;The attempt of defendant has been to oust the jurisdiction of an Indian court of competent jurisdiction even by circumlocutory approach and stretching the things beyond permissible limits. It has been taking varied and shifting stands from the earlier,8221; the court stated.

Justice Jain further said when the dispute had arisen between the parties, the arbitration clause was found to be inapplicable.

There could not be any piecemeal reference and parties had to resolve the case through an Indian court of competent jurisdiction, instead of arbitration being referred to the ICC, he said.

Basic and primaryjurisdiction to adjudicate over the given dispute was of civil court at Kanpur, the judge observed. The court further observed when an Indian and foreign company enter into collaboration or joint venture with the country as the field of operation, it is not a statutory compulsion that redress of their disputes should be through arbitral references to some international body.

It would depend on the construction and interpretation of the arbitration agreement, if any, with reference to the nature of the dispute and the parties involved in the controversy.