American food chain major McDonald’s today submitted before the Company law Board that the dispute with its Indian joint venture partner Vikram Bakshi should be referred for arbitration.
The ClB was hearing a petition filed by Vikram Bakshi challenging his removal as the Managing Director of the joint venture, Connaught Plaza Restaurants ltd (CPRl). McDonald’s has filed an application under section 45 of Arbitration and Conciliation Act 1996, seeking arbitration in the dispute. McDonald’s counsel senior advocate Sudipto Sarkar submitted before the ClB that Bakshi’s contention against the failure of McDonald’s to vote in favour of his reappointment as MD under article 35 of the JV agreement should be referred for arbitration.
“There were examples where the ClB has referred cases filed under section 397 of the Companies Act (alleging oppression) for arbitration”, Sarkar said, adding “Arbitrators have wide powers”. The Articles of Association of CPRl has clauses which mention that disputes arising between JV partners has to be settled through arbitration at The london Court of International Arbitration.
Bakshi’s counsel SN Mukherjee said: “The company (CPRl) has sent a letter asking him to pay Rs 40 lakh for equities and it was violative of ClB’s earlier order to maintain status quo.” “Bakshi has already paid Rs 6.35 crore to the company but shares have not been alloted due to the status quo granted by the ClB,” Mukherjee added.