Meghalaya High Court Rejects Plea That No Formal Reference Was Made, Holds Contempt Petition Maintainable

The Meghalaya High Court has held a contempt petition arising from alleged disobedience of arbitral tribunal directions to be maintainable, rejecting an objection that no proper reference had been made by the tribunal and holding that the process of reference stood completed in the facts of the case.

The Division Bench of Justice W. Diengdoh and Justice B. Bhattacharjee held that the tribunal's order directing that the matter be placed before the Chief Justice, followed by orders placing the case before the present bench, was sufficient to treat the reference as completed and that the petition could also be maintained at the instance of the aggrieved party under Rule 9 of the Contempt of Courts (High Court of Meghalaya) Rules, 2013.

Agreeing with the government advocate appearing for the state, the court noted,

“The learned GA has maintained that this petition has also been filed resorting to the provisions of Rules 9 of the Contempt of Courts (High Court of Meghalaya) Rules 2013, where it is also provided that the contempt proceedings can be initiated on the prayer of the person or party aggrieved. We find nothing wrong with the approach of the State petitioner in this regard.”.

Noting that the arbitral tribunal had directed that the matter be placed before the Chief Justice, the Court observed:

"Another aspect of the matter which has been pointed out by the learned GA is that a Single Judge of this Court vide order 04.07.2024 has acknowledged the order dated 19.02.2024 passed by the Arbitral Tribunal and has therefore directed that the matter be placed before the Hon'ble Chief Justice, which in effect, would mean that the reference by the Arbitral Tribunal has now been brought to the notice of the Hon'ble Chief Justice.”

It further held, “Under such circumstances, we are of the considered view that the process of reference by the Arbitral Tribunal to this Court has been completed and accordingly, we hereby acknowledge the same in this proceeding.”

The dispute arose from arbitral proceedings between the State of Meghalaya and Marbaniang Projects Pvt. Ltd., in which the State, as respondent before the tribunal, had sought interim directions alleging non-payment of lease rental amounts by the claimant company.

By orders dated November 8 and 10, 2023, the tribunal directed the claimant company to deposit certain amounts and furnish a ₹2 crore bank guarantee in favour of the state.

Alleging non-compliance with these directions, the State filed an application before the tribunal seeking initiation of contempt proceedings.

In an order dated February 19, 2024, the tribunal had observed that it lacked contempt jurisdiction and directed that the matter be placed before the High Court.

The State thereafter filed the present contempt petition under Section 12 of the Contempt of Courts Act, 1971, relying on Rule 9 of the 2013 Rules to contend that contempt proceedings may be initiated on a petition by an aggrieved party.

Opposing the plea, counsel for Mayven T. Marbaniang and Marbaniang argued that no formal reference as contemplated under the Arbitration and Conciliation Act, 1996, had been made and that the petition was therefore not maintainable.

Rejecting the objection, the court noted that the tribunal's order had been placed before the registry, after which a single judge on July 4, 2024 directed that the matter be placed before the Chief Justice, and by order dated July 9, 2024, the Chief Justice directed that the case be listed before the present Division Bench.

Holding that the process of reference stood completed and that the petition was maintainable, the Court directed that the matter be listed after two weeks for filing of show-cause replies by the contemnors. 

For Petitioner (State of Meghalaya): Advocates N. Syngkon, GA; Mr. J.N. Rynjah, GA.

For Respondents/Contemnors: Senior Advocate K. Paul with Advocates K. Decruse, B.F. Kharwanlang, and B. Snaitang,