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Our Corporate Bureau
New Delhi, Sept 28: A Kanpur civil court on Monday rejected Piaggio's application seeking transfer of its dispute with the Singhanias over shares of LML Ltd to International Chambers of Commerce for arbitration.
Senior civil judge AK Jain said in his 27-page judgment that no arbitration agreement existed between the Singhanias and Piaggio BV, according to a press release issued by LML. The judge fixed October 23 as the next date for proceeding with the trial of the suit.
Reacting to the court order, Piaggio stated that it would immediately file an appeal in the higher court. "Piaggio would like to reiterate that the ICC arbitration clause should be applied and the jurisdiction should be with the ICC," the Italian company said in a press release.
Piaggio stated that the call option issue raised by Singhanias was unfounded. "We would like to emphasise our concern for the shareholders of LML who have been affected most by the significant loss of value of shares of LML," Piaggio stated.
Singhanias hadfiled a suit in the civil court in Kanpur stating that after the death of G Agnelli they had a right to acquired shares held by Piaggio in LML as per the provisions of the Article 5.5 of the joint venture agreement. The Singhanias had contended that Piaggio was not a signatory to the joint venture agreement and that no arbitration agreement existed.
Piaggio subsequently moved an application under Section 45 of the Arbitration and Council Act, 1996 requesting that the dispute be referred to arbitration. The section states: "Notwithstanding anything contained in Part I or in the Code of Civil Procedure, 1908, a judicial authority, when seized of an action in a matter in respect of which the parties have made an agreement referred to in Section 44, shall, at the request of one of the parties or any person claiming through or under him, refer the parties to arbitration, unless it finds that the said agreement is null and void, inoperative or incapable of being performed."
Copyright © 1998 Indian ExpressNewspapers (Bombay) Ltd.
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