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The Delhi High Court has permitted GVK Airport Holdings to approach the duly constituted Arbitral Tribunal for any interim relief in connection with the sale of Bid Services Division (Mauritius) Limited’s sale of stake in the Mumbai International Airport.
The order was passed by a Division Bench of Justices S Muralidhar and Talwant Singh in an appeal moved by GVK against a Single Judge Bench order under Section 9 of the Arbitration Act. The Single Judge Bench had refused to restrain Bid Services from offering or selling its 13.5% shareholding in Mumbai International Airport Limited to any person other than GVK.
The Division Bench was informed that during the pendency of litigation before the Single Judge Bench, the parties had nominated their respective arbitrators and a three-member Arbitral Tribunal was already in place. It was further stated that the Arbitral Tribunal was slated to meet for the first time on July 9.
In view of this submission, the Court decided not to deal with the merits of the appeal preferred by GVK. It also noted that the findings of the Single Judge Bench were only prima facie in nature and not binding on the Arbitral Tribunal.
It, therefore, asked GVK as well as other parties to approach the Arbitral Tribunal for any interim relief under Section 17 of the Arbitration Act. The order states,
“In view of the matter while permitting the Appellant and the other parties, if they choose to, to file an application under Section 17 of the Act before the AT for appropriate interim reliefs in accordance with law.”
It further added that the Arbitral Tribunal would “endeavour to take” any such applications filed under Section 17 on July 9 itself and also dispose them of expeditiously.
The Court also recorded Airport Authority of India’s statement that till July 9, no possible decision to accept or reject Bid Services’ offer could possibly be taken.
The Court thus refused to pass any specific direction in the case.
GVK Airport Holdings and Bid Services Division, along with ACSA Global Ltd and the Airports Authority of India (AAI), are the shareholders of Mumbai International Airport Limited in terms of a Shareholders Agreement (SHA) dated April 4, 2006.
As per Clause 3.7.1 of the SHA, GVK had a right of first refusal (ROFR) in respect of Bid Services’shares. Pursuant to the ROFR clause, Bid Services Division offered its entire shareholding of 16,20,00,000 shares i.e. 13.5% stake in the MIAL for sale to GVK for an aggregate consideration of not less than Rs 1248,75,00,000.
It is GVK’s stance that the offer was accepted resulting in a binding agreement between the parties for the sale of shares. Yet, the shares were subsequently offered to the AAI by Bid Services Division.
GVK was represented by Senior Advocates Abhishek Manu Singhvi and Sandeep Sethi, along with Advocates Ruby Singh Ahuja (Karanjawala & Co), Kartik Nayar, Sarthak Malhotra, Rishab Kumar, Vishal Gehrana, Ashwati Balraj and Anmol Jassal.
Bid Services was represented by Senior Advocate Amit Sibal with Advocates Saurabh Kirpal, VP Singh, Arvind Ramesh, Roopali Singh, Nafisa Khandeparkar, Muqueet Dabru, Ansheela Loroiya, Bhargavi Kannan, and Nadhav.
Advocate Kaustubh Prakash appeared forACSA Global.
AAI was represented by Senior Advocate Abhinav Vashisht with Advocates Digvijay Rai, Aman Yadav, and Ankita Sachdeva.
Read the Order: