Nagpur: The court of Principal District Judge, K K Sonawane, has upheld an arbitration award for $ 8 million 52 crore) issued against city businessman, Arundev Updhyay, by a Kansas city Arbitration Court in USA on Thursday.
The arbitration arose out of a business dispute Upadhyay”s firm Data Management Company had with Hong Kong based Integrated Sales Services, promoted by a US citizen named Terry Petitt (not to be confused with the famous American Volleyball coach of the same name).
In year 2000, DMCwhich was engaged in Medical Transcription (MT) business, entered into an arrangement with ISS under which, ISS used to procure MT business for DMCin USA and for that DMCused to pay a commission of 10 to 20 per cent to ISS. Till 2007, everything went well and disputes started cropping up between both partners as the MT business started going down in 2008.
The ISS later on filed arbitration proceedings through its office in Kansas city in USA against DMC claiming that the firm had violated its contract and demanded US $ seven million as compensation from DMC.
The ISS argued that DMC had opened three other firms namely, Gemini Bay Transcription based in Nagpur, DMCGlobal Services in Mauritius and Gemini Bay Consulting in British Vergin Island. The ISS also alleged that Updhyay and one Rattan Pathak were managing directors of these companies and both had breached the contract by diverting MT business to other three firms.
The Kansas city court upheld ISS” arguments and issued an arbitration award for recovery of eight million dollars (together with interest) against DMC.
Since DMC was based in Nagpur, the ISS approached the District and Sessions Court Nagpur for execution of the Arbitration Award in 2010 and now the PrincipalDistrict Judge has issued an order for execution of Kansas city court award against DMC.
When contacted Updhyay said that since the dispute was filed in distant USA and as the contesting a case there was too expensive, he could not properly contest the proceedings in Kansas city court and hence the order of th at court was an injustice to him.
He also said that his name was unnecessarily being dragged into a dispute between two companies. ” Yes, I was the director of these companies but it does not mean that I had stood personal guarantee for them by signing an agreement with ISS. My liability is limited strictly to my shareholding in these companies and so I can not be held personally responsible for the company”s liabilities.
He also revealed that he had walked out of the MT business long back.
Upadhyay also said that he had not received the copy of the judgement yet and after studying the judgement, he will file an appeal against it in the appropriate court.