Madras High Court today stayed the proceedings pending before the Multi Commodity Exchange of India (MCX) at Chennai regarding arbitration.
While passing orders on a petition filed by Mary Roseline and Stephen, who sought to declare the Rule 15.22 of MCX as ultra vires, Justice K K Sasidharan granted interim injunction on all further proceedings of arbitration before the MAX at Chennai, in which a retired High Court judge E Padmanabhan was a member.
Rule 15.22 prohibited the appearance of advocates before the MCX.
The petitioners submitted when the orders passed by the arbitrators could be challenged in the High Court under Section 34 of Arbitration and Reconciliation Act, the rule of MCX, which prohibited to appear through advocates before the exchange was not valid.
The judge observed that the contentions raised by petitioners needed to be considered by giving an opportunity to the members of MAX, who included a retired Madras High Court judge and other two members were also well versed with law.
As the petitioners apprehended that unless they were permitted to appear with the councils it would not be possible to project their case before the arbitration, the judge said that there would be an order of interim stay of the proceedings of arbitration pending before the MAX till September 16.
The petitioners were induced by Geojit Comtrade Limited in Kochi to join hands to do multi commodity business. The company indulged in activities detrimental to the interest of petitioners, without their consent.
The loss occurred was debited to the account of the petitioners without their knowledge, which was questioned by the petitioners.
Immediately, the company approached the MCX for the arbitration proceedings. The petitioners were prohibited by the MCX to represent their case through their councils. Hence the present petition.