TCG is involved in a protracted legal battle with the West Bengal government, another major promoter, for these 155 million shares. TCG chief Purnendu Chatterjee had early last year filed the arbitration with the Paris-based International Chamber of Commerce (ICC)'s International Court of Arbitration. The move was challenged by HPL in the high court. In its reponse, Chatterjee had argued the court did not have jurisdiction to hear the matter and the suit of HPL was not maintainable.
However, a bench of the HC, comprising chief justice Arun Kumar Mishra and judge Joymalya Bagchi, today held the court did have jurisdiction to hear the suit and decide on the validity of the arbitration agreement. The bench also said the claims made by TCG before the ICC, Paris, had been made by TCG in the Company Law Board (CLB) proceedings earlier on the same issue, in which the Supreme Court had held against TCG.
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Thus, TCG could not claim the same relief again in arbitration.
The ICC's International Court of Arbitration is the world's leading institution for resolving international commercial and business disputes.
The tussle between the state government and TCG goes back to 2005. The latter had initiated proceedings before the CLB against the West Bengal government and West Bengal Industrial Development Corp (WBIDC) to gain controlling shareholding and management control of HPL. Though the CLB had passed an order in favour of TCG, the state and WBIDC appealed before the high court, which had set aside the CLB order on September 21, 2007.
TCG then moved the Supreme Court, which passed a judgment against it on November 30, 2011. Later, Chatterjee had sought to initiate arbitration before ICC in March 2012. The move was challenged by HPL in the high court.
The TCG chief, present at today's board meeting, said: "I am yet to see the order, so I cannot comment on it now." However, the option to move the Supreme Court by TCG is open. Meanwhile, after the board meeting, HPL chairman Partha Chatterjee said a bridge loan of Rs 25 crore had been approved for the ailing company. "To meet immediate requirements of the plant, WBIDC has decided to give Rs 25 crore (to HPL) and lenders are slated to meet on June 14 in Mumbai. If they give us a Rs 400-crore loan, then I will extend a further Rs 75 crore out of the assured Rs 100 crore," said the chairman.
Purnendu Chatterjee, however, said HPL did not need any financial support from him, as Rs 500 crore would be enough to provide full throughput performance of the plant.
"This company doesn't need so much money; what it needs is proper management," he said after the board meeting. According to the HPL chairman, the decision on selection of the new managing director for the company had still not been finalised.
Current managing director Sumantra Choudhury's tenure in HPL ends on June 18.
THE SAGA CONTINUES
A look at how the long-drawn Haldia stake sale case has dragged on
- In 2005, The Chatterjee Group (TCG) initiated proceedings before the Company Law Board (CLB) against West Bengal government and West Bengal Industrial Development Corporation
- CLB had ruled in TCG's favour
- State and WBIDC appealed before the Calcutta High Court, which set aside the Sept 21, 2007, CLB order
- TCG then moved the Supreme Court, which ruled against it on Nov 30, 2011
- TCG's Purnedu Chatterjee went before the International Court of Arbitration (ICA), Paris, in March 2012
- The move to Paris was challenged by Haldia Petrochemicals in the Calcutta HC
- In May 2012, a Calcutta HC bench restrained TCG from continuing with the arbitration proceedings
- Against the final order of judge I P Mukerji passed on December 20, 2012, TCG filed an appeal primarily on the ground the HC did not have jurisdiction
- The Calcutta HC bench bench on Tuesday barred TCG from moving ICA, Paris, for control over 155 million shares in Haldia Petrochemicals
- The judgment said the court did have jurisdiction to hear the suit and to decide on the validity and existence of an arbitration agreement