JUDGMENT
Anil Kumar, J.
1. The respondent in this application has claimed that the order directing the Managing Director of the respondent corporation to be present, be recalled and his personal appearance be dispensed with. The application seeking exemption from personal appearance of the Managing Director of the respondent is supported by an affidavit of Shri K. Mukhopadhyaya, Chief General Manager, Northern Region. The ground which is taken in the application for exemption is as under:
8. That the Managing Director of the respondent is the executive head of the respondent corporation and normally he is very busy from early morning till late in the evening and he has to meet number of officers from different offices situated all over India besides number of outside visitors. It is stated a number of meetings were already fixed for on December 20, 2007 and he has to attend the same and it would be extremely difficult for the Managing Director to be personally present in the Court on December 20, 2007 and it is therefore respectfully submitted that his personal appearance be very kindly dispensed with.
2. The presence of Managing Director was sought because by letter dated 20th July, 2007 it was intimated to the petitioner that the amount of Rs. 30.60 lakhs will be refunded subject to petitioner submitting Bank Guarantee valid for six months for the same amount. This letter was sent almost after six months in reply to the letter dated 8th December, 2006 by which the petitioner had protested against levy of penalty of Rs. 41,78,000/-. By this letter dated 20th July, 2007 it was also communicated that the records of the petitioner have been rechecked for the period 1.4.2005 to 15.04.2006 and the respondent has decided to levy another amount of Rs. 11,14,000/- as penalty. It was also intimated to the petitioner that the penalties for the entire period will be rechecked.
3. By letter dated 4th July, 2007 addressed to the Managing Director of the respondent, the petitioner had contended about illegal deductions made from his bills and as his various letters had not been replied by the officials of the respondent, therefore, he has sought for appointment of an arbitrator. The relevant allegations made in the said communication are as under:
…We had been working for you also as Road Transport Operator (RTO) at DCT Okhla since 16.8.1999. The contract expired on 15.08.2003. The same was extended for next four months up to 15.12.2003 as per contract Clause No. 4.2 and again extended for two years up to 15.12.2005 as per contract Clause No. 4.1 and after that we were asked to continue till finalization of next contract, in viewing our long time relationship the work was continued till 20.11.2006 (Ad-hoc basis).
But we regret to inform you that despite our best of services during the contract period a sum of Rs. 24,68,000/- towards Non deployment, Rs. 17,10,000/- towards Non compliance and 4,96,850/- towards both way loading containers i.e total of Rs. 46,74,850/- was deducted from our freight bill during the period of April, 2005 to 15th April, 2006 without any justified reason nor considering the practical aspects in RTO operation at DCT.
We request your kind attention to our earlier letters dated 22.11.2005; 21.012006; 31.01.2006; 03.02.2006 ; 10.4.2006; 19.06.2006; 23.08.2006; 23.09.2006; 25.10.2006; 27.11.2006; 8.12.2006, 26.12.2006 and 22.01.2007. Copy of our letter dated 8.12.2006 and 22.01.2007 is enclosed.
We brought to your kind notice that a sum of Rs. 46,74,850/- (Ruppes Forty six lacs Seventy four thousand Eight hundred Fifty only) was deducted from our freight bill in the name of non deployment of vehicles, non compliance of job order and both way loading containers for the period mentioned above.
In this regard, we wrote several letters to General Manager and Chief General Manager-NR (details already sent to you) for waiver of the unjustified deductions in the name of non deployment of vehicles, non compliance of job order and both way loading containers. However, we did not receive any response in this matter and your official concerned kept on imposing deductions. The facts and evidence in this connection already submitted to all of you as below:
1. There is no provision in the aforesaid contract for wrong deductions in the name of “penalty due to non-deployment of vehicles”
2. The aforementioned Penalties had no justified basis e.g. the so called penalties were imposed on the day also, while the vehicles remained standing idle in the yard or nearby the yard.
3. Though there is mentioning of the 10 vehicles having the size of 40′ length and 40 vehicles having the size of 20′ length to be deployed for the work of CONCOR, For smooth working of the terminal, your concerned officials had been ‘directing us regularly not to park empty trailers in the yard (as the same remained deployed for your work as per clause mentioned in the contract failing which we as a RTO might be considered as violator of this clause). This compelled us to keep the aforesaid empty trailers away from the yard at our cost, risk & expenses. We facilitated you to utilize the vacated space. We must not have been penalized for honoring the directions issued to us from time to time orally as well as written by your various concerned officials e.g refer your letter dated 02.05.2005, 03.06.2005 and 13.04.2005. We completely fulfillled the spirit of terms and conditions of the agreement.
4. We used to deploy more than 50 trailers for your work in any given day as the trailers go away for delivery/destination having the distance of more than 75 kilometers ( some time more than 300 kilometers) and the same did not use to come on return on the next day. However, we used to execute the job order for the next day also without waiting for the aforementioned trailers yet to be returned on the next day and we had to deploy the additional vehicles without much waiting the aforesaid vehicle yet to be returned on the next day.
5. After the execution of the aforesaid agreement, certain unforeseen legal implications caused the trailers could enter in Delhi only from Badarpur Border, this new legal binding on the trailers caused certain trailers not to reach at your yard on the same day from NCR area. The turnaround time for the vehicle became more time consuming and expensive.
6. The trailers were unnecessarily delayed by the customers by detaining vehicles at their factory/premises after assurances of unloading on the same day.
7. No advance letter/notice as per the contract clause was ever served upon us to increase or decrease the number of vehicle to be deployed for your work.
We suffered very badly and incurred huge losses. Due to increase of the operational cost like – increase in tyre price, toll tax, long distance turn cuts of the road to reach the destination, resulting in more fuel and other expenditures.
4. The said letter dated 4th July, 2007 to the Managing Director was also not replied. Various other letters dated 22.11.2005; 21.012006; 31.01.2006; 03.02.2006; 10.4.2006; 19.06.2006; 23.08.2006; 23.09.2006; 25.10.2006; 27.11.2006; 8.12.2006, 26.12.2006 and 22.01.2007 addressed to General Manager and Chief General Manager copies of some of which were sent with this letter were also not replied. Rather a letter dated 20th July, 2007 from Sr. General Manager/Domestic Div. was sent intimating that an amount of Rs. 30,64,000/- is to be refunded after adjusting another amount of Rs. 11,14,000/- imposed as penalty on rechecking of the bills which will be refunded subject to furnishing bank guarantee for a period of six months. It is pertinent to note that the petitioner has challenged the levy of Rs. 46,74,850/- as penalty deducted from his bills which letter was sent by the petitioner on 8th December, 2006. The letter dated 4th July, 2007 demanding appointment of arbitrator in terms of arbitration agreement was also not replied. In reply to letter dated 20th July, 2007, the petitioner sent letter dated 3rd August, 2007 to the Managing Director protesting against re-checking of penalties on the ground that the bills were raised on monthly basis and were found to be in order after due verification and even security deposits had been refunded after issuance of ‘NO DUES CERTIFICATE’ and contended that rechecking is nothing but harassment to the petitioner and attempt not to pay the amount due to him and again prayed for release of Rs. 30,64,000/- which according to the petitioner was liable to be released as per the admission of the respondent.
5. The petitioner thereafter, filed the petition under Section 9 of the Arbitration and Conciliation Act, 1996 seeking refund of Rs. 30,40,000/- and another petition under Section 11 (6) of the Arbitration and Conciliation Act, 1996 for appointment of arbitrator as the respondent had failed to appoint an arbitrator within thirty days of demand being made by letter dated 4th July, 2006 and before filing of the petition for appointment of an arbitrator which was filed on 7th August, 2007.
6. In these circumstances, on 4th December, 2007 the respondent’s counsel was directed to take instructions to deposit the amount which the petitioner may be allowed to withdraw subject to furnishing security.
7. On 17th December, 2007 the counsel for the respondent was asked as to for what period prior to April, 2005 the records have been rechecked in order to ascertain whether the penalties are leviable for period prior to 1st April, 2005. The allegation of the petitioner was that rechecking has been ordered merely to deny him the amount which is already due to him and to harass him. The counsel for the respondent stated that penalties for one year had been definitely checked, however, he again stated that the penalties for two years have been rechecked. Thereafter, he again stated that he is not certain as to for how many years the penalties have been rechecked and therefore, he took instructions from Mr. Pankaj Sahani who was present, who, however, stated that the penalties have been rechecked for entire period and an amount of about Rs. 5.53 lakhs more has been found due.
8. In the present application which is signed by the counsel for the respondent Mr. Joshi, some of the facts have been twisted. On 17th December, 2007 when the counsel was unable to answer with certainty as to for how many years prior to April, 2005 penalties have been rechecked, he turned back, called the person, Mr Pankaj Sahani, senior supervisor who stated that penalties have been checked and an amount of about Rs. 5.53 lakhs more have been found due. In the present application it is contended that said senior supervisor meant clearly that about Rs. 5.53 was due in respect of the records which have been verified and in regard to the records which have yet to be verified the amount is still not known and Mr. Sahani is a very low official in the hierarchy and the respondent has not checked the penalties for all the years.
9. This is nothing but persistence of the respondent to mislead this Court. If Mr. Sahani was a very low official in the hierarchy, the counsel for the respondent Mr. Joshi should not have taken instruction from him nor should have produced him on 17th December, 2007 and should have stated that he does not know the correct position. Even in this application, it is not stated as to up to which period prior to April, 2005 the penalties have been rechecked in five months after 20th July, 2007. The application is not supported by the affidavit of Mr. Sahani and/or Mr. Joshi, learned Counsel for the respondent, who has also been making contradictory statements.
10. The present application seeking exemption from appearance of Managing Director also states facts contrary to what transpired in the Court on 17th December, 2007 and is an attempt to improve the version of the respondent and is supported by an affidavit of the Chief General Manager. The Chief General Manager, Northern Region who was not present on 17th December, 2007 has given an affidavit in support of this application on the basis of his personal knowledge. As he was not present he could not swear an affidavit on the basis of his personal knowledge. The said official could not give an affidavit in respect of what transpired on 17th December, 2007 as the copy of the said order was not available to the respondent and therefore on the basis of alleged record, the averments could not be made in the application seeking exemption from personal appearance of the Managing Director. Apparently the officials of the Respondent are consistently trying to mislead this Court and their counsel Mr. Joshi has also taken different stands and has tried to improve the version of the respondent in present application which is signed by him. The behavior of Mr. Joshi, learned Counsel for the respondent is also not appreciable in the facts and circumstances who has tried to cover up the irregularities of the respondent and its officials.
11. The plea that the Managing Director of the respondent is the executive head of the respondent corporation and normally he is very busy from early morning till late in the evening and he has to meet number of officers from different offices situated all over India besides number of outside visitors and so he cannot appear is also reflective of utter disregard which the respondent corporation and its official and counsel for the respondent has for the Court. The plea is almost contemptuous.
12. The Learned Additional Solicitor General Mr. Singh in these circumstances further contends that this Court does not have jurisdiction to direct the Managing Director to appear under Section 9 of the Arbitration and conciliation Act. Section 9 of the Arbitration and Conciliation Act, 1996 is as under:
9. Interim measures etc. by Court.- A party may, before, or during arbitral proceedings or at any time after the making of the arbitral award but before it is enforced in accordance with Section 36, apply to a court-
(i) for the appointment of a guardian for a minor or person of unsound mind for the purposes of arbitral proceedings; or
(ii) for an interim measure or protection in respect of any of the following matters, namely:
(a) the preservation, interim custody or sale of any goods which are the subject-matter of the arbitration agreement;
(b) securing the amount in dispute in the arbitration;
(c) the detention, preservation or inspection of any property or thing which is the subject-matter of the dispute in arbitration, or as to which any question may arise therein and authorising for any of the aforesaid purposes any person to enter upon any land or building in the possession of any party or authorising any samples to be taken or any observation to be made, or experiment to be tried, which may be necessary or expedient for the purpose of obtaining full information or evidence;
(d) interim injunction or the appointment of a receiver;
(e) such other interim measure of protection as may appear to the Court to be just and convenient,
and the Court shall have the same power for making orders as it has for the purpose of, and in relation to, any proceedings before it.
13. From the perusal of the relevant provisions it is apparent that this Court can direct for the security of the amount which is in dispute in the arbitration and can pass such other interim measures which may appear to the Court to be just and convenient. This Court has power to ascertain whether the penalties have been imposed on rechecking with a view to harass the petitioner or the rechecking is being done with a view to delay the payment of amount which was found due to the petitioner by the respondent itself. For any of the measures as contemplated under Section 9 of the act, the court has the power to direct any petitioner or respondent to appear in person. The argument of the learned Additional Solicitor General that the presence can be directed only in exercise of jurisdiction under article 226 of the constitution of India in the present facts and circumstances is without any legal and factual basis.
14. The learned Counsel for the respondent has also relied on , State of Gujrat v. Turabali Gulamhussain and Anr. to contend that the Managing Director of the respondent should not be summoned. Perusal of the case relied on by the respondent reflects that it is apparently distinguishable. In this case the Chief secretary and the law secretary of the State government were summoned to explain the delay of 25 days in filing the appeal. The Apex court had held that no doubt that the High Court has power to someone the officials but it should be done in exceptional cases when there are compelling circumstances to do so. In the present facts and circumstances of this case various letters to the various officials and the managing director were not replied rather proceedings for imposing the penalty by rechecking were initiated and an amount of rupees than11,14,000/- was again imposed as an amount of Rs. 45,74,850/- had already been deducted on account of penalties. For refund of the amount found Rs. 30,64,000/- due, the condition of bank guarantee was imposed. The rechecking of bills prior to April, 2005 was apparently decided to harass the petitioner as the security amount for this period had been refunded after issuance of “NO DUES CERTIFICATE” by the manager of DCT. Though in July, 2007 it was stated that the rechecking shall be done for the period prior to April, 2005, till December, 2007 the counsel Mr. Joshi was giving different versions and after he took instructions from an official on 17th December, 2007 it was stated in the court that the bills prior to April, 2005 had been rechecked and an the amount of about Rs. 5.30 lakhs more was found due on account of the penalties. Now by this application a new version is being propounded that the official did not have the correct knowledge. Even in this application it is not disclosed as to for what period the accounts have been rechecked and what amounts have been found due on account of penalties. The application is supported by the affidavit of another official who could not have personal knowledge about the order passed on 17th December, 2007. There is consistent effort by the officials of the respondent corporation to mislead and even by the counsel to given different versions. Whether these acts are within the knowledge of the Managing Director or even managing director is a party to it, can be ascertained only if he is present. The letters written to Managing Director has not been replied consistently. Perhaps he does not have the time to deal with the complaints made against the officials of the corporation and the other officials feels that he is too busy and more important jobs with him than to appear in this Court. It is also not clear whether almost contemptuous application for exemption for appearance of managing director was filed at the instance of Managing Director himself or it has been filed by other officials to conceal their misdeeds and apparent harassment to the petitioner. In the circumstances, this is one of the exceptional cases where the Managing Director must appear before this Court. In any case a managing director of a corporation can not equate himself with the Chief Secretary or any other secretary of a State. Even the Chief Secretary and Secretaries can be directed to appear in appropriate cases and they cannot plead that they are too busy or above law.
15. In Ambica Quarry Works v. State of Gujarat and Ors. the Supreme Court had observed:
The ratio of any decision must be understood in the background of the facts of that case. It has been said long time ago that a case is only an authority for what it actually decides, and not what logically follows from it.
In Bhavnagar University v. Palitana Sugar Mills Pvt. Ltd. , the Supreme observed:
It is well settled that a little difference in facts or additional facts may make a lot of difference in the precedential value of a decision.
16. When this Court is considering the application for appointment of arbitrator as the respondent had not appointed the arbitrator till the time of filing of the petition under Section 11 (6) of the Act and after expiry of thirty days and regarding the interim protection granted to the petitioner, it is not discharging administrative functions only and acting mechanically but is discharging its judicial functions. If this Court is discharging the judicial functions, the presence of the parties can be secured especially the managing director of the Corporation whose officials has consistently misled this Court and has not disclosed the complete facts and have filed an application with almost contemptuous pleas and grounds. This is nothing but sheer abuse of process of Courts by the respondent.
17. For these reasons and in the present facts and circumstances the application for exemption of appearance of the managing director of the respondent is, therefore, dismissed. The presence of the managing director for today is however, exempted as the copy of the order dated 17th April, 2007 was not available to the respondent. The managing director of the respondent is now directed to appear before this Court on 25th January, 2008. A copy of this order be given dusty to the counsel for the parties. List on 25th January, 2008 as a part heard matter along with AA 343 OF 2007, Indo Arya Central Transport Ltd. v. Container Corporation of India which is also a part heard matter.