PUTRAJAYA (Aug 24): The Court of Appeal on Wednesday (August 23) has dismissed the appeal by Tune Group Sdn Bhd, and three others against Singaporean Padda Gurtaj Singh over the enforcement of an arbitration award against them with regards to the sale of 850,934 shares of Tune Talk Sdn Bhd to Padda Gurtaj.
A three-member bench led by Judge Datuk P Ravinthran unanimously upheld the decision by the High Court in 2022 concerning the award.
Judge Datuk Lim Chong Fong, who read the unanimous decision, ruled there was no error in the High Court decision that warranted appellate intervention.
“The bench also did not find that the arbitrator denied the parties, particularly Tune Group and others, natural justice to justify setting aside the award pursuant to Section 37(1)(b) read together with Section 37(2) of the Arbitration Act 2005,” Lim said.
“On the specific facts and circumstances here, we do not therefore find that the arbitrator embarked and decided on a new difference; thereby acted in excess of jurisdiction, contrary to that as alleged by Tune Group and others.”
Ravinthran, Lim and Datuk Seri Mariana Yahya delivered the judgment on Wednesday, but the grounds were only made available now.
They also ordered Tune Group and three others to pay total costs of RM65,000 to Padda Gurtaj.
Tune Group, Datuk Seri Kalimullah Masheerul Hassan, Datuk Lim Kian Onn, and Christopher Mark Anthony Lankester were appealing against the High Court decision on Aug 4, last year, that upheld the arbitrator's decision.
The parties went into arbitration in February 2022, and in March 2022, Padda Gurtaj’s application was granted, with the conclusion of his purchase of 850,934 shares in Tune Talk at RM3 per share as follows:
a) Tune Group Sdn Bhd: 666,563 units of Tune Talk shares for RM1,999,689;
b) Kalimullah’s 83,568 units of Tune Talk shares for RM250,704;
c) Lim Kian Onn: 83,568 units of Tune Talk shares for RM250,704; and
d) Lankester: 17,235 units of Tune Talk shares for RM51,705.
No breach of natural justice
Tune Group and the trio, through their counsel Logan Sabapathy, claimed that the arbitrator had dealt with a dispute which was not contemplated or fell within the terms of submission to the arbitration. They argued that it went beyond the scope of the submission.
“This also constituted a breach of natural justice,” Logan said.
However, the COA ruled on the specific facts and circumstances, and therefore did not find that the arbitrator had embarked and decided on a new dispute, thereby acting in excess of its jurisdiction.
“It follows that the learned High Court judicial commissioner’s findings in her grounds of judgment are not in error to warrant appellate intervention,” he added.
“We (the bench) also do not find that the arbitrator denied the parties, particularly Tune Group and others natural justice to justify setting aside the award,” the COA judge said.
The above dispute is over a 2019 agreement between Padda Gurtaj, Tune Group and the trio who are said to be part of a group led by Tan Sri Tony Fernandes concerning the sale of the Tune Talk shares at RM3 apiece.
Under the deal, Padda Gurtaj was supposed to give a cheque to them to close the deal within 30 days from the signing of the agreement. However, at the time, Celcom said it was against the RM3 offer and had wanted the sellers to come up with the fair market value of Tune Talk shares.
When the Covid-19 pandemic hit in early 2020, Celcom withdrew the request for the determination of fair market value. After that, Padda Gurtaj wanted to enforce the 2019 agreement, but Fernandes’ group refused, saying that Padda Gurtaj had failed to pay within 30 days from the point of signing the acceptance and the agreement had therefore been invalidated.
Following the dispute, the proceedings initially went to court before it went to arbitration that led to the March decision by the arbitrator.
Tang Choon Hao appeared for Padda Gurtaj in Wednesday's matter.