Before

THE HONBLE HIGH COURT OF DELHI, NEW DELHI

APPLICATION No _____/2013

Athletica Ganges....... Petitioner

v.

Government of India................................ Respondent

With

CONTEMPT PETITION No _____/2013

Athletica Ganges.Petitioner

v.

Government of India ........ Respondent

-MEMORANDUM for THE RESPONDENT-

-Table of Contents- -Respondent-

TABLE OF CONTENTS

Table of Contents...........................................................................................................................I
Index of Abbreviations..................................................................................................................II
Index of Authorities.....................................................................................................................III
Statement of Jurisdiction............................................................................................................VII
Statement of Facts....................................................................................................................VIII
Questions Presented....................................................................................................................XI
Summary of Pleadings...............................................................................................................XII
Pleadings and Authorities.........................................................................................................- 1 -
1. THE RESPONDENT IS JUSTIFIED IN RESCINDING THE CONTRACT AND INVOKING
ARBITRATION:......................................................................................................................- 1 -
1.1 The Petitioner has failed to make necessary disclosures to the Respondent:............- 1 -
1.2 The Petitioner has been involved in Crimes of Financial Impropriety:.....................- 2 -
1.3 The Respondent has not violated the Companys trade secret rights:.......................- 4 -
2 THE ARBITRAL AWARD IS NOT LIABLE TO BE SET ASIDE:.........................................- 4 -
2.1 The Petitioner has accepted the jurisdiction of the Arbitrator:..................................- 5 -
2.2 The Arbitrator is the sole judge of quality and quantity of Evidence submitted:......- 6 -
2.3 The Arbitrators view is in keeping with the Public Policy of India:........................- 7 -

3 THE RESPONDENT IS NOT GUILTY OF CIVIL CONTEMPT OF COURT ........................- 13 -

4. THE RESPONDENT IS NOT LIABLE FOR PERJURY......................................................- 15 -
Prayer......................................................................................................................................- 18 -

-MEMORANDUM for THE RESPONDENT-

I
-Index of Abbreviations- -Respondent-

INDEX OF ABBREVIATIONS

: Section

: Sections

: Paragraph

: Paragraphs

A.P. : Andhra Pradesh

A.C. : Appellate Cases

AIR : All India Reporter

Anr. : Another

Bom. : Bombay

Cri.L.J : Criminal Law Journal

K.B. : Kings Bench

Mad. : Madras

n. : Note

Ors. : Others

MMDR : Mines and Minerals (Regulation

and Development) Act, 1957

SC : Supreme Court

SCC : Supreme Court Cases

Sd/- : Signed

Supp. : Supplementary

U.P. : Uttar Pradesh

U.S. : United States

-MEMORANDUM for THE RESPONDENT-

II
-Index of Authorities- -Respondent-

INDEX OF AUTHORITIES

Cases

1974] AC 113.......................................................................................................................- 11 -

A.G. v. Walt Hamstow, UDC (1895) 11 TLR 533................................................................- 15 -

Adikanda Swain v. Emperor, AIR 1947 Pat 251, p 542; Kali Shankar Chatterjee v. Sarat

Chandra Dey, (1977) Cal HCN 538................................................................................- 17 -

All India Anna Dravida Munnetra Kazhagam v. l.K. Tripathi, (2009) 5 SCC 417.............- 15 -

Asgarall v. Emperor AIR 1942 Nag 80...............................................................................- 16 -

Ashish Kumar Kundu v. A.K.Tandon, 1994 (4) SLR 319....................................................- 16 -

Attorney General v. Guardian Newspapers Ltd [1988] AII ER 545....................................- 11 -

Babu Ram Gupta v. Sudhir Bhasin, AIR 1979 SC 1582......................................................- 14 -

Badat & Co v. East India Trading Co, AIR 1964 SC 538...................................................- 13 -

Bhagwati Foundation v. Commissioner MCD, Writ Petition (C) Nos. 146..........................- 2 -

BSNL vs. BWL Industries Pvt. Ltd., O.M.P. 415/2003...........................................................- 7 -

BWL Ltd. v. MTNL, 2007 (4) ARB LR 398 (Delhi)...............................................................- 8 -

Castrol Australian Pty Ltd v. EmTech Associated Pty Ltd, (1980) 51 FLR 184..................- 11 -

Coco v. A.N. Clark Ltd, [1969] RPC 41................................................................................- 4 -

Dharmavir Singh & Ors. v. Smt. Navraj Sindhu, 1997 AIHC 259......................................- 15 -

Edpuganti Bapanaiah v. Sri K.S.Raju & Ors, 2007 AP High Court, Contempt Case No.915 of

2002.................................................................................................................................- 16 -

Ganga Retreat & Towers Ltd. v. State of Rajasthan, (2003) 12 SCC 91...............................- 2 -

House of Spring Gardens Point Blank, [1983] FSR 213.......................................................- 4 -

In the Matter of the Application of Federation Internationale de Basketball for a Subpoena

Pursuant 28 U.S.C.S 1782.............................................................................................- 10 -

-MEMORANDUM for THE RESPONDENT-

III
-Statement of Jurisdiction- -Respondent-

Initial Services Ltd v. Pueterils, [1968] 1 QB 396...............................................................- 11 -

Konrad Wiedemann Gmbh v. Standard Castings Pvt. Ltd, [1985] (10) IPLR 243................- 4 -

Krishna Bhagya Jala Nigam Ltd. v. Harishchandra Reddy, AIR 2007 SC 817....................- 6 -

M.P. Sharma v. Satish Chandra, AIR 1954 SC 300.............................................................- 11 -

Moorgate Tobacco Co Ltd v. Philips Morris Ltd, [1991] AII ER 341.................................- 11 -

Municipal Corporation of Delhi v. Jagan Nath Ashok, (1987) 4 SCC 497................- 7 -, - 13 -

N., J., Y., W., v. FINA, CAS 98/208........................................................................................- 8 -

Narayana Panicker v. The Sub Divisional Magistrate, Fort Coshin & Ors, 1979 Ker LT 346

.........................................................................................................................................- 15 -

Nisha Kanta Roy Choudhary v. Smt. Saroj Bashini Goho, AIR 1948 Cal 294 (DB)..........- 14 -

ONGC v. Saw Pipes, (2003) 5 SCC 705................................................................................- 7 -

Padarath Singh v. Rattan Singh, (1920) Pat 419.................................................................- 16 -

Pooran Mal v. Director of Inspection (Investigation), (1974) 1 SCC 345, 364..................- 11 -

Queen v. Ahmed Ally, 11 WR 25, 27...................................................................................- 16 -

R.M. Malkani v. State of Maharashtra, (1973) 1 SCC 471.................................................- 11 -

R.S. Joshi v. Ajit Mills Ltd, (1977) 4 SCC 98........................................................................- 3 -

Rashtriya Ispat Nigam v. Dewan Chand Ram Saran, (2012) 5 SCC 306...................- 5 -, - 12 -

Ratansi Daya v. Emperor, AIR 1916 Sind 70 (2)................................................................- 16 -

Renusagar Pvt. Co. Ltd. v. General Electric Co., 1994 Supp (1) SCC 644..........................- 7 -

S C Gupta v. Emperor, AIR 1924 Rang 17..........................................................................- 16 -

S.N. Malhotra v. Airport Authority of India, 2008 (2) ARB LR 76 (Delhi)..........................- 6 -

S.R. Bommai v. Union of India, (1994) 3 SCC 1.................................................................- 16 -

Sachindra Nath Panja v. N.L. Basak, Principal Secretary, Govt of West Bengal, 2004 (4)

CHN 602..........................................................................................................................- 15 -

Saltman Eng'g Co. Ltd. v. Campbell Eng'g Co. Ltd., [1948] 65 RPC 203............................- 4 -
-MEMORANDUM for THE RESPONDENT-
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-Statement of Jurisdiction- -Respondent-

Shiv Raman Gour v. Madan Mohan Kanda, (1990) Cr LJ 1033.........................................- 16 -

Shyni Varghese v State (Govt. of NCT of Delhi), (2008) 147 DLT 691 (Del)......................- 11 -

State (NCT of Delhi) v. Navjot Sandhu, (2005)11 SCC 600...............................................- 11 -

State of M.P. v.Ramesh C.Sharma, (2005) 12 SCC 628......................................................- 11 -

State of Uttar Pradesh v. Allied Constructions, (2003) 7 SCC 396............................- 5 -, - 12 -

Sudarsan Trading Co. v. Government of Kerala, (1989) 2 SCC 38......................................- 5 -

Thirupathy Kumar Khemka v. CIT, (2007) 210 CTR (Mad) 287..........................................- 3 -

Thomas Marshall v. Guinle, [ 1979] 1 Ch 237......................................................................- 4 -

United States v. Conte, (N.D. Cal. 2004)...............................................................................- 9 -

USADA v. G., CAS 2004/O/649............................................................................................- 9 -

USADA v. M. and IAAF, CAS 2004/O/645...........................................................................- 9 -

Statutes

Indian Penal Code, 1860......................................................................................................- 16 -

The Arbitration and Conciliation Act, 1996..........................................................................- 5 -

The Arbitration And Conciliation Act, 1996.......................................................................- 13 -

The General Clauses Act, 1971...........................................................................................- 16 -

The Indian Evidence Act, 1872.................................................................................- 11 -, - 13 -

The Prevention of Money Laundering Act, 2002..................................................................- 3 -

Rules

The 2012 Prohibited List International Standard, The World Anti-Doping Code.................- 9 -

The Anti-Doping Rules, The National Anti Doping Agency, India.......................................- 9 -

The World Anti-Doping Code, 2009.....................................................................................- 8 -

-MEMORANDUM for THE RESPONDENT-

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-Statement of Jurisdiction- -Respondent-

James A.R. Nafziger, Circumstantial Evidence of Doping: BALCO and Beyond, 16 Marq.

Sports L. Rev. 45 (2005)....................................................................................................- 9 -

OP Malhotra and Indu Malhotra, The Law and Practice of Arbitration and Conciliation,

Lexis Nexis Butterwoerths Wadhwa, Gurgaon (2006)......................................................- 5 -

Patrick K. Thornton, Sports Law, Jones and Bartlett Publishers, (Boston) (2011)..........- 10 -

Henry Campbell Black, et.al, Blacks Law Dictionary, 6th Edition, p.1079, St. Paul Minn.

West Publishing Company, 1990.....................................................................................- 14 -

-MEMORANDUM for THE RESPONDENT-

VI
-Statement of Jurisdiction- -Respondent-

STATEMENT OF JURISDICTION

The Respondent humbly submits this memorandum in response to two petitions filed

before this Honourable Court, and clubbed together by the Honourable Court. The first

application invokes its territorial ordinary original civil jurisdiction under section 34(1) of

the Arbitration And Conciliation Act, 1996 read with section 5(1) and section 5(2) of The

Delhi High Court Act, 1966. The second Contempt Petition invokes its original jurisdiction

under section 11 of The Contempt of Court Act, 1971. It sets forth the facts and the laws on

which the claims are based.

-MEMORANDUM for THE RESPONDENT-

VII
-Statement of Facts- -Respondent-

STATEMENT OF FACTS

I.

Pan Atheletica Inc. is a company incorporated in the United States of America with the

purpose of providing a spectrum of services in the Sports Industry.. Pan Athletica set up a

research wing to investigate the local flora and fauna in the nearby Amazon forests in Brazil.

The company then set-up a research station near the Indo-Nepal border after incorporating a

subsidiary in Nepal (Athletic Everest) in 1989. Till now Pan Athletica did not have a food and

nutrition department.

In 1991, the company signed a local football team in Brazil, Desvalidos which, did very well.

Eventually 66% percent of the team members went on to become a part of the national

football team. Beginning in 1992 Athletica Machu signed them for a decade. Between 1992

and 2002, Brazil won the World cup twice and reached the final once. By now the company

had a fully functional food department.

II.

The means and methods employed by the company were kept completely secret and the

players were made to sign a 99 year non disclosure agreement. In 2000, Mr. Sumanto Hajela,

the Indian Minister for Sports and International Affairs, approached Mr. Laurie to help out

with the Indian Hockey Team. Pan Athletica incorporated a wholly owned subsidiary in the

Cayman Islands (Athletica Atlantica), and Athletica Ganges served as a wholly owned

subsidiary of Athletica Atlantica in India . Following negotiations between Pan Athletica and

the Indian Government (hereinafter, Government), wherein all the governments concerns

were taken care of, the parties entered into a contract on an as is where is basis through

Athletica Ganges (hereinafter, Company), in 2003. The Contract contained an Arbitration

Clause. During the negotiations, the Company made it clear that as per this contract, the

-MEMORANDUM for THE RESPONDENT-

VIII
-Statement of Facts- -Respondent-

government would not be allowed to compel the Company to reveal its means and methods.

Along with this contract, members of the Indian Hockey Team were made to sign an

agreement containing a non-disclosure clause. The Indian Hockey Team fared well between

2002 and 2012.

III.

In 2003, the Brazilian Government did not re-sign with Athletica Machu rather an enquiry

was launched to look into the practices of the company and the enquiry lasted over five years.

In February 2012, during the celebration in an after party, a drunk member of the Indian

Hockey contingent revealed the success to the magic biscuits the company gave. This caused

uproar in the country. A high level enquiry was launched by the Government, while The

Indian Hockey Federation engaged the services of a private detective company. The Indian

Government also invoked the Arbitration clause and served a notice on the company.

IV.

Athetica Ganges filed a petition for interim relief, to stop the Government from breaking the

contract. The Delhi High Court admitted the petition and during the course of proceedings,

the Addl. Solicitor General who appeared before the Court gave an undertaking that pending

proper resolution of the issue it would not break the contract. In the meantime the Brazillian

enquiry was published, and relying on that a local Brazillian Court held Atheletica Machu to

be guilty of environmental violations and paying several bribes. The United States

commenced investigations under the Foreign Corrupt Practices Act, 1977.

Bowing to increasing global pressure, the Indian Government rescinded the contract and

terminated all of the Companys contractual obligations.

V.

-MEMORANDUM for THE RESPONDENT-

IX
-Statement of Facts- -Respondent-

In the ongoing Arbitration proceedings, the Arbitrator took note of the above facts along with

Brazilian judgment, the intimation of the U.S. investigations, the WADA guidelines and

quotes all aspects of Indian law. The Government was also able to present the report of the

private investigators, which relied on several emails which was privileged communication

and excerpts of the Brazilian judgment. The Government also produced the affidavits of the

player, Sushant Singh Lakkarbagha. Amongst the evidence submitted for arbitration, there

were a large number of e-mails which dealt with very sensitive information about the formula

of the food and nutrition products administered to the athletes, information of bank A/cs, and

certain communication which were supposed to be lawyer-client privileged information. All

these e-mails were forwarded by an e-mail id aceventura@panatheletica.us. The company

went on record to say that there was no person in the employ of the company by the name of

Ace Ventura. In the affidavit submitted by the athlete, he spoke at length about the procedure

of the training and the diet. The Company raised many objections to the procedure of the

conduct of the proceedings and the rules to evidence attached, but each objection was

rejected. The Company also filed a Civil Contempt Petition against the Government.

VI.

At the end of the arbitration, the award held that the company was indeed engaged in doping

and that it had both illegal and unethical means to administer the team. The arbitrator

awarded unliquidated damages to the tune of $1 billion dollars to the Government. Aggrieved

by this award, the Company approached the Delhi High Court in the instant petition. The

company submitted that the entire arbitration was a farce as information obtained by the RTI

indicated that the decision to break the contract was already taken by the minister even before

the interim relief application.

-MEMORANDUM for THE RESPONDENT-

X
-Questions Presented- -Respondent-

QUESTIONS PRESENTED

The following questions are presented before the court in the instant matter-

1. WHETHER THE RESPONDENT IS JUSTIFIED IN RESCINDING THE CONTRACT AND

INVOKING ARBITRATION.
2. WHETHER THE ARBITRAL AWARD IS LIABLE TO BE SET ASIDE.
3. WHETHER THE RESPONDENT IS GUILTY OF CIVIL CONTEMPT OF COURT.
4. WHETHER THE RESPONDENT HAS COMMITTED THE OFFENSE OF PERJURY.

-MEMORANDUM for THE RESPONDENT-

XI
-Summary of Pleadings- -Respondent-

SUMMARY OF PLEADINGS

1. THE RESPONDENT IS JUSTIFIED IN RESCINDING THE CONTRACT AND INVOKING

ARBITRATION:

The Respondent submits that the contract was rescinded due to there being misrepresentation

of material facts by Athletica Ganges ( The Company), as well as the commission of

offences. This gives rise to a dispute with regard to the contract, and hence the Respondent is

justified in invoking arbitration. This submission is threefold: Firstly, the Company did not

make necessary disclosures. Secondly, the Company has been involved in financial

impropriety. Thirdly, the Respondent has not violated the Companys trade secret rights.

2. THE ARBITRAL AWARD IS NOT LIABLE TO BE SET ASIDE:

It is humbly submitted that the Award is not liable to be set aside under the provisions of

Section 34 of the A&C Act. This submission is threefold: Firstly, The Petitioner has accepted

the jurisdiction of the Arbitrator. Secondly, The Arbitrator is the sole judge of the evidence.

Thirdly, The Arbitrators view is in keeping with the Public Policy of India.

3. WHETHER THE RESPONDENT IS GUILTY OF CIVIL CONTEMPT OF COURT.

It is submitted to the Honble Court that the respondent is not guilty of civil contempt of

Court. This assertion is twofold. Firstly, the impugned order is a consent decree and hence

non compliance of order does not amount to contempt of court. Secondly, the respondent has

not committed the offence of contempt even if the decree has binding nature.

4. WHETHER THE RESPONDENT GUILTY OF PERJURY.

It is submitted to the Honble Court that the respondent has not committed the act of perjury.

Respondent has not submitted any false evidence there is also a lack of Intention on the part

of the respondent. Hence respondent is not guilty of perjury.

-MEMORANDUM for THE RESPONDENT-

XII
-Summary of Pleadings- -Respondent-

-MEMORANDUM for THE RESPONDENT-

XIII
-Summary of Pleadings- -Respondent-

PLEADINGS AND AUTHORITIES

1. THE RESPONDENT IS JUSTIFIED IN RESCINDING THE CONTRACT AND INVOKING

ARBITRATION:

The Respondent submits that the contract was rescinded due to there being misrepresentation

of material facts by Athletica Ganges (hereinafter, The Company) in entering into the

agreement, as well as the commission of offences relating to financial impropriety. This gives

rise to a dispute with regard to the contract, and hence the Respondent is justified in

submitting the matter to the arbitrator. This submission is threefold: Firstly, the Company did

not make necessary disclosures. Secondly, the Company has been involved in financial

impropriety. Thirdly, the Respondent has not violated the Companys trade secret rights.

1.1.1 The Petitioner has failed to make necessary disclosures to the Respondent:

It has been held by the Supreme Court 1 that a representation is deemed to have been false

and therefore a misrepresentation, if it was at the material date false in substance and in fact.

The Court also observed that Section 17 of the Contract Act defines fraud as act committed

by a party to a contract with intent to deceive another. Finally, the Court relied on the

landmark judgement on the issue in Derry v. Peek2 to determine that a fraud is proved when

it is shown that a false representation has been made (1) knowingly, or (2) without belief in

its truth, or (3) recklessly, careless whether it be true or false.

The Respondent humbly submits that as per the contract negotiations entered into by the two

parties, the Government had clearly expressed its concerns regarding the episodes in Brazil.

To facilitate contract negotiations, the Government had also asked the Company to submit

1
Shrisht Dhawan v. M/s. Shaw Brothers, (1992) 1 SCC 534, at 20.
2
Derry v. Peek, (1889) 14 App Cas 337.

-MEMORANDUM for THE RESPONDENT-

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-Pleadings and Authorities- -Respondent-

any pertinent information on these developments and that the same shall be considered under

the necessary disclosures to be made in the matter. To this the Company replied on 11-03-

2003 that nothing with regard to the issue was concrete. It is also established fact that the

Brazilian Government had decided not to pursue an extension of the Petitioners contract

after 2002, and had in fact launched an investigation. Hence, the Respondent submits that the

Petitioners stance that nothing with regard to this issue was concrete must be construed as a

fraudulent misrepresentation as per Section 17 of the Contract Act.

Moreover, even in case the contract were to be looked at by the Respondent on an as is

where is basis, the accepted legal principle is that as is where is cannot be extended to

include even large discrepancies.3 Hence, even if the Respondent in the instant case did enter

into the contract on an as is where is basis, it did not mitigate the obligation of the Petitioner

to act responsibly.4 The Respondent asserts that enquiries relating to economic crimes,

environmental law, and doping in Brazil did amount to large discrepancies that the

Petitioner was obliged to inform the Government about as per the above legal precedent.

The Respondent avers that, given the fraudulent misrepresentation on the part of the

Petitioner, the Respondent would have the option to rescind the contract and seek damages

through arbitration. This falls in line with the reasoning of the Supreme Court.5

1.1.2 The Petitioner has been involved in Crimes of Financial Impropriety:

The Prevention of Money Laundering Act6 lays down that a money laundering offender

directly or indirectly attempts to indulge in or knowingly assists in or is actually involved in

3
Manju Gupta v. Delhi Development Authority, 103 (2003) DLT 776, at 13.
4
Bhagwati Foundation v. Commissioner MCD, Writ Petition (C) Nos. 146, at 415.
5
Ganga Retreat & Towers Ltd. v. State of Rajasthan, (2003) 12 SCC 91, at 24.
6
The Prevention of Money Laundering Act, 2002, 3.

-MEMORANDUM for THE RESPONDENT-

1
-Pleadings and Authorities- -Respondent-

any process or activity connected with the proceeds of crime and projecting it as untainted

property. Also, it has been established by Indian courts7 that the burden of proof required to

prove mens rea in economic offences is not that of beyond reasonable doubt. Instead, courts

have imposed a burden of no fault/ strict liability in cases dealing with economic offences.

The Respondent submits that the Petitioners parent company has in the instant case, been

held guilty of perpetrating a range of illegal activities in Brazil, including violations of

Environmental Law and Bribery.8 Further, it is asserted by the Respondent that not only has

the parent company established a holding company in the Cayman Islands; but in a letter

dated 11-03-2003, the promoter of the Company stated, You see, we wanted to be sure that

all the financial transactions of the Company are discreet and handled properly, if you know

what we mean.9 Finally, it is noteworthy that the Petitioner Company has no assets located in

India10, so it can be reasonably inferred that the capital for its transactions is routed to it

through the Cayman Islands Holding Company. Based on the above facts, the Respondent

submits that the Petitioner has been involved in money laundering, and since activities

contrary to Indian law are being committed in pursuance with obligations arising out of the

standard contract11, it is the Respondents submission that the Government is entitled to

rescind the contract, and refer contractual disputes to the Arbitrator.

1.1.3 The Respondent has not violated the Companys trade secret rights:

7
Thirupathy Kumar Khemka v. CIT, (2007) 210 CTR (Mad) 287, at 4.6; R.S. Joshi v. Ajit Mills Ltd, (1977) 4
SCC 98, at 20.
8
Fact Sheet, at 12.
9
Fact Sheet, Annexure Two.
10
Fact Sheet, Annexure Two.
11
Fact Sheet, Annexure Two.

-MEMORANDUM for THE RESPONDENT-

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-Pleadings and Authorities- -Respondent-

Information, including a formula, pattern, compilation, program device, method, technique or

process can constitute trade secrete if it qualifies three other criteria. 12 Secondly, the

information has commercial value. Thirdly, it has been subject to responsible steps under the

circumstances by the person lawfully in control of the information, to keep it secret. Once a

trade secret is available in public domain then it has lost the status as well as the protection.13

In the instant case, the information that was there in the emails that were produced in front of

the arbitrator did not constitute trade secret as that information was available in the public

domain. After the Brazilian judgement, the training, food and nutrition used by the company

has come to public domain through the judgement and hence lost the status of trade secret.

Therefore the government has not breached the confidence of the company. By implication,

the government has not breached the contract.

2.1 THE ARBITRAL AWARD IS NOT LIABLE TO BE SET ASIDE:

This Court has recognized that the law with respect to challenge to an Award under

Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter, The A&C Act) is

now well settled. An Award can be challenged only if the same is against the contractual

provisions or is illegal or is so perverse that it shocks the judicial conscience. It is

noteworthy that laws governing Arbitration, internationally14 as well as in India, tilt the

balance in favour of finality of the Arbitral Award. This is in recognition of the Principle of

12
Indian Innovation Bill, Section 2(3); Coco v. A.N. Clark Ltd, [1969] RPC 41; Thomas Marshall v. Guinle,
[ 1979] 1 Ch 237; House of Spring Gardens Point Blank, [1983] FSR 213.
13
Konrad Wiedemann Gmbh v. Standard Castings Pvt. Ltd, [1985] (10) IPLR 243; Saltman Eng'g Co. Ltd. v.
Campbell Eng'g Co. Ltd., [1948] 65 RPC 203.
14
UNCITRAL Model Law, Article 5.

-MEMORANDUM for THE RESPONDENT-

3
-Pleadings and Authorities- -Respondent-

Party Autonomy that governs the law of Arbitration.15 Further, it is submitted by the

Respondent that it is a well established principle of law that while adjudicating a petition to

set aside an arbitral award, the Court cannot substitute its own evaluation instead of that of

the Arbitrator.16 Once it is found that the view of the arbitrator is a plausible one, the court

shall refrain itself from interfering with the award.17

Based on these presumptions, the Respondent submits that the Arbitral Award is not liable to

be set aside under the provisions of Section 34 of the A&C Act. This submission of the

Respondent is a threefold one: Firstly, The Petitioner has accepted the jurisdiction of the

Arbitrator. Secondly, The Arbitrator is the sole judge of the quality and quantity of evidence.

Thirdly, The Arbitrators view is in keeping with the Public Policy of India.

1.1.4 The Petitioner has accepted the jurisdiction of the Arbitrator:

The A&C Act lays down that an arbitral award may be set aside if the award deals with a

dispute not contemplated or not falling within the terms of the submission to arbitration. 18

Section 16 of the A&C Act further lays down a legislative acceptance of the kompetenz-

kompetenz principle, thereby declaring the Arbitral Tribunal competent to rule on its own

jurisdiction.19

15
OP Malhotra and Indu Malhotra, The Law and Practice of Arbitration and Conciliation, Lexis Nexis
Butterwoerths Wadhwa, Gurgaon (2006), at pg. 1086.
16
Sudarsan Trading Co. v. Government of Kerala, (1989) 2 SCC 38, at 31.
17
State of Uttar Pradesh v. Allied Constructions, (2003) 7 SCC 396, at 4; Rashtriya Ispat Nigam v. Dewan
Chand Ram Saran, (2012) 5 SCC 306, at 29.
18
The Arbitration and Conciliation Act, 1996, 34(2)(a)(iv).
19
The Arbitration and Conciliation Act, 1996, 16.

-MEMORANDUM for THE RESPONDENT-

4
-Pleadings and Authorities- -Respondent-

In S.N. Malhotra v. Airport Authority of India 20, a division bench of this Court held that

Sections 16 and 34 of the A&C Act need to be read together in dealing with a petition for

setting aside of an arbitral award. The Court in this case relied on precedent laid down by the

Supreme Court21 to establish that in the absence of an objection Section 16 of the A&C Act

being raised before the arbitral tribunal regarding the tribunals jurisdiction; the party waives

the right to make such an appeal against the tribunals jurisdiction before the Court under

Section 34 of the A&C Act.

In the above mentioned cases, the parties seeking to set aside the award had not raised

objections to the arbitral tribunals jurisdiction before the tribunal itself as per Section 16 of

the A&C Act. In fact, in these cases, these parties had submitted to arbitration, and had

directly raised the jurisdictional challenge before the Court. In such a scenario, Indian Courts

have held that the parties have waived their right to raise a jurisdictional challenge. In this

case, Athletica Ganges has not raised any jurisdictional challenge before the arbitrator

himself. Thus, it is submitted by the Respondent that the Petitioner has waived its right to

challenge the Arbitrators jurisdiction. Hence, the petition to set aside the award under

Section 34(2)(a)(iv) should not be entertained.

2.2 The Arbitrator is the sole judge of quality and quantity of Evidence submitted:

In BSNL v. BWL Industries Ltd.22 the Court noted that the A&C Act of 1996 has gone a step

further than the Act of 1940 in empowering the arbitrator. It was observed that the arbitrator

shall be the sole judge of the quality and quantity of evidence, and that the Court shall not be

20
S.N. Malhotra v. Airport Authority of India, 2008 (2) ARB LR 76 (Delhi), at 8.
21
Krishna Bhagya Jala Nigam Ltd. v. Harishchandra Reddy, AIR 2007 SC 817, at 7.
22
BSNL vs. BWL Industries Pvt. Ltd., O.M.P. 415/2003, at 5.

-MEMORANDUM for THE RESPONDENT-

5
-Pleadings and Authorities- -Respondent-

drawn into re-appraising the evidence. It has been reasoned that the parties have selected their

own forum and that, in doing so, they have conceded the power of appraisement of the

evidence to the arbitrator.23

In the instant case, the parties had agreed that the Procedure of arbitration would be decided

during the arbitration. Furthermore, the Petitioners claims with regard to the rules of

evidence have already been looked into and rejected by the arbitrator.24 Hence, it is submitted

that the Arbitrator has already considered the quality and quantity of evidence in determining

the arbitral award. The Respondent submits that the aforementioned legal principles limit the

scope of the Court in appraising evidence.

2.3 The Arbitrators view is in keeping with the Public Policy of India:

In ONGC v. Saw Pipes25 (hereinafter, The Saw Pipes Case), it was held by the Court that

in addition to the grounds laid down in the Renusagar Case26, the Court can set aside an

award when it finds that the award was patently illegal.

In the Saw Pipes judgement, the Court had held meaning of Patent Illegality to mean the

illegality must go to the root of the matter and if illegality was of a trivial nature, it cannot be

held that the award is against the public policy. The award could be set aside if it is so unfair

or unreasonable that it shakes the conscience of the Court.27

Moreover, since the Saw Pipes Case, the Courts in India have given a very restrictive

meaning to patent illegality, in an attempt to minimize the effect of the judgement. 28 In the
23
Municipal Corporation of Delhi v. Jagan Nath Ashok, (1987) 4 SCC 497.
24
Fact Sheet, at 14.
25
ONGC v. Saw Pipes, (2003) 5 SCC 705.
26
Renusagar Pvt. Co. Ltd. v. General Electric Co., 1994 Supp (1) SCC 644.
27
Supra Note 25, at 16.
28
BWL Ltd. v. MTNL, 2007 (4) ARB LR 398 (Delhi).

-MEMORANDUM for THE RESPONDENT-

6
-Pleadings and Authorities- -Respondent-

instant case, however, the Respondent submits that none of the conditions precedent are

satisfied. In order to substantiate this assertion, the Respondent shall deal with it in a two-

pronged manner. Firstly, The standard of proof required in cases of sports doping is not as

high as proof beyond reasonable doubt. Secondly, the evidence submitted before the

arbitrator makes the award a plausible one, thereby negating the need for Court interference.

2.3.1. The Burden of Proof to be discharged is one of Comfortable Satisfaction:

The Court of Arbitration in Sport, in its landmark decree in N., J., Y., W. vs. FINA 29, held that

the standard of proof applicable in proving a Case of doping in sport is not the high standard

of proof beyond reasonable doubt that is used in criminal jurisprudence, but merely one that

satisfies the allegations to the Comfortable Satisfaction of the hearing body. This standard of

proof has also been adopted under the World Anti Doping Agencys Code (hereinafter, the

WADA Code)30 in dealing with anti-doping rule violations. Moreover, the standard has also

been adopted in India by the revised Anti-Doping Rules of the National Anti-Doping

Agency31 (hereinafter, the NADA Rules), which have been adopted in conformance with

the WADA Code. Therefore, it is considered a rule of custom in International Sports Law.32 In

pursuance with this well established principle of sports law jurisprudence, the Respondent

has submitted the WADA guidelines and relevant aspects of Indian law for perusal by the

arbitrator33.

29
N., J., Y., W., v. FINA, CAS 98/208, at 13.
30
The World Anti-Doping Code, 2009, at Article 3.1.
31
The Anti-Doping Rules, The National Anti Doping Agency, India, at Article 3.1.
32
James A.R. Nafziger, Circumstantial Evidence of Doping: BALCO and Beyond, 16 Marq. Sports L. Rev. 45
(2005).
33
Factsheet at 14.

-MEMORANDUM for THE RESPONDENT-

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-Pleadings and Authorities- -Respondent-

Based on the above law, the Respondent asserts that in adjudicating whether the award is

liable to be set aside on the grounds of it conflicting with the public policy of India, the Court

must look at the arbitral award through the prism of whether the burden of Comfortable

Satisfaction of the hearing body (i.e. the arbitrator) has been discharged, and not whether the

allegations could be proved beyond reasonable doubt.

2.3.2 The Award, based on the evidence submitted, is a plausible one:

The Respondent submits that the position of law in relation to evidence admissible under

cases pertaining to anti-doping rule violations, especially where the drug administered is

difficult to detect, allows for the admissibility of Circumstantial evidence as opposed to

merely dope test results.34 Moreover, the WADA Code bans gene doping as a prohibited

practice under the 2012 Prohibited List, which has been accepted by the NADA. 35 Also, it is

well known that gene doping, as has been carried out by the Petitioner in the instant case, is

difficult to detect.36

In the instant case, the Respondent submits that there is enough circumstantial evidence in the

form of documents, internal records of the company, and testaments given by the players to

corroborate the allegations against the company of committing anti-doping rule violations as

per Article 2 of the NADA Rules.37 In this light, it is submitted that the arbitrators findings

with regard to specific offences including trafficking38, and the administering or attempted

34
USADA v. G., CAS 2004/O/649; USADA v. M. and IAAF, CAS 2004/O/645; Indictment, United States v.
Conte, (N.D. Cal. 2004).
35
The 2012 Prohibited List International Standard, The World Anti-Doping Code, at M3.
36
Supra note 32.
37
The Anti-Doping Rules, The National Anti Doping Agency, India, at Article 2.
38
The Anti-Doping Rules, The National Anti Doping Agency, India, at Article 2.7.

-MEMORANDUM for THE RESPONDENT-

8
-Pleadings and Authorities- -Respondent-

administering of performance enhancing drugs39 are justified. This view is further

substantiated by cases arising out of the BALCO Controversy, wherein the CAS and the US

District Court of Northern California relied on similar circumstantial evidence to establish

guilt of the parties.40

Thus, it is submitted by the Respondent that the arbitrator has carried out a just evaluation of

the evidence presented. This submission is dealt with under the following heads of evidence

that were administered in the arbitral proceedings:

a. Validity of the emails produced by the government.

Private interest of a party is not sufficient warrant for denial of application on the basis of

confidentiality.41 In Norwich Pharmacal Co v. Commissioners of Customs & Excise42, it was

held that public interest must be the criterion by which Equity determines whether it will

protect information which an individual claims as confidential.43

In the instant case, public interest of doing justice overweighs the confidentiality claim of the

petitioner. The emails form part of relevant facts and hence form documentary evidence in

order to attain justice in this case and therefore should be considered.

In Arguendo, Indian Evidence Act, 1872 permits relevance of evidence as the only test of

admissibility of evidence.44 The Courts have taken a view that there is no law that excludes

evidence on the ground that it was obtained illegally.45 The Supreme Court has said that It

will be wrong to invoke the supposed spirit of our Constitution for excluding such evidence.
39
The Anti-Doping Rules, The National Anti Doping Agency, India, at Article 2.8.
40
Supra note 34.
41
In the Matter of the Application of Federation Internationale de Basketball for a Subpoena Pursuant 28
U.S.C.S 1782 as cited in Patrick K. Thornton, Sports Law, Jones and Bartlett Publishers, (Boston) (2011).
42
[1974] AC 113 at 189; Castrol Australian Pty Ltd v. EmTech Associated Pty Ltd, (1980) 51 FLR 184.
43
The same was also upheld in Attorney General v. Guardian Newspapers Ltd [1988] AII ER 545; Moorgate
Tobacco Co Ltd v. Philips Morris Ltd, [1991] AII ER 341; Initial Services Ltd v. Pueterils, [1968] 1 QB 396.
44
The Indian Evidence Act, 1872, 5.

-MEMORANDUM for THE RESPONDENT-

9
-Pleadings and Authorities- -Respondent-

It, therefore, follows that neither by invoking the spirit of our Constitution nor by a strained

construction of any of the fundamental rights can we spell out the exclusion of evidence

obtained on an illegal search.46 The privilege of the clients to the communication with

lawyer only extends to non disclosure by lawyer or any of his subordinates. 47 This privilege

does not put a bar on consideration of the evidence if the same is procured by means other

than the lawyer or his subordinate.48

In the given facts, the emails have been produced through illegal methods, however they still

constitutes evidence and are admissible in the court of law. The emails were produced in front

of the arbitrator by the private investigator. There is nothing in the fact sheet to support that

the lawyer disclosed it to him directly or indirectly. Therefore company cannot claim

protection against such evidence.

b. Validity of the foreign judgment produced by the government.
The arbitrator has exercised the discretion as to the laws of evidence. He has relied on the

foreign judgement correctly. The facts of the case when analysed clearly shows that the

company has used the same practices to enhance the performance of the players as done by

the subsidiary in Brazil. This can be construed from the fact that the company was importing

rare bacteria that was available in Amazon jungle and the one in the Himalayas to Nepal. The

research station in Nepal was used to fuse the DNA of the two and form a genetically

modified organism. Presumption lies in favour of the arbitral award 49, so it must be assumed
45
Shyni Varghese v State (Govt. of NCT of Delhi), (2008) 147 DLT 691 (Del); M.P. Sharma v. Satish Chandra,
AIR 1954 SC 300;State of M.P. v.Ramesh C.Sharma, (2005) 12 SCC 628; R.M. Malkani v. State of
Maharashtra, (1973) 1 SCC 471; State (NCT of Delhi) v. Navjot Sandhu, (2005)11 SCC 600.
46
Pooran Mal v. Director of Inspection (Investigation), (1974) 1 SCC 345, 364, para 23
47
The Indian Evidence Act, 1872, 127
48
Id.
49
State of Uttar Pradesh v. Allied Constructions, (2003) 7 SCC 396, at 4; Rashtriya Ispat Nigam v. Dewan
Chand Ram Saran, (2012) 5 SCC 306, at 29.

-MEMORANDUM for THE RESPONDENT-

10
-Pleadings and Authorities- -Respondent-

that the arbitrator would have corroborated this information with the information of the

formula of food present in the emails. The arbitrator has relied on these evidences to award

damages to the government. Therefore it can be inferred that the Athletica Ganges has used

the same genetically modified bacteria and hence is liable for doping.
In Arguendo, a certified copy of a foreign judgment by the original legal keeper with a

certificate by the Indian Consul is admissible in the court of law.50 The presumption lies in

favour of the judgment if the opposition has not raised any objection as to its content.51
In the given facts there is no objection raised as to the content of the relevant parts of the

judgment. Secondly, the facts are silent on the issue of it being certified. Hence the arbitrator

has correctly relied on the judgment.

c. Validity of the affidavit of the player.
Arbitrator is not bound by the law of evidence of India.52 Objection as to manner of adducing

evidence is a matter of procedure and it is an established principle that parties to arbitration

have selected their own forum and that in doing so, they have conceded the power of

appraisement of the evidence to the arbitrator.53 The affidavit in question gives corroborative

evidence of the relevant facts.54 In the given facts, the company has not challenged the

content of the affidavit. Therefore affidavit containing relevant facts should be taken into

account by the arbitrator as it gives relevant evidence as to the manner of doping and other

procedures taken up by the company for enhancing the performance of the players. Hence his

reliance on the affidavit is valid.

Based on all the above law, the Respondents submit that the arbitrators view is plausible,

and hence, not liable to be set aside.

50
The Indian Evidence Act, 1872, . 78(6)
51
The Indian Evidence Act, 1872, 86 ; Badat & Co v. East India Trading Co, AIR 1964 SC 538
52
The Arbitration And Conciliation Act, 1996, 19
53
Municipal Corporation of Delhi v. Jagan Nath Ashok, (1987) 4 SCC 497.
54
The Indian Evidence Act, 1872, 156

-MEMORANDUM for THE RESPONDENT-

11
-Pleadings and Authorities- -Respondent-

2.4 THE RESPONDENT IS NOT GUILTY OF CIVIL CONTEMPT OF COURT.

It is submitted that the respondent is not guilty of contempt. This assertion is twofold. Firstly,

the order is a consent decree and hence non compliance of the order is not contempt of court.

Secondly, the respondent has not committed the offence of contempt even if the decree has

binding nature.

3.1. The impugned order is a consent decree.

In a case of consent decree passed by a court, disobedience of the undertaking recorded in the

decree given by a party to the other does not amount to contempt. 55 Consent decree is in the

nature of a solemn contract of the parties, made under the sanction of the court with a mutual

consent of the parties.56 In the given facts, the order of the court is formed by the consent of

the parties and is in nature of a contract to perform the terms of the contract with each other.

Therefore any disobedience of the said decree does not amount to contempt of court.

3.2. The respondent has not committed the offence of contempt even if the decree has

binding nature.

In Arguendo, The respondent has not committed the offence of contempt even if the decree

has binding nature. This assertion is three fold. Firstly, there was no wilful disobedience on

their part. Secondly, there was partial compliance with the order. Lastly, the subsequent

changes made it difficult to comply with the orders.

3.2.1. There was no wilful disobedience.

55
Nisha Kanta Roy Choudhary v. Smt. Saroj Bashini Goho, AIR 1948 Cal 294 (DB). Babu Ram Gupta v.
Sudhir Bhasin, AIR 1979 SC 1582.
56
Henry Campbell Black, et.al, Blacks Law Dictionary, 6th Edition, p.1079, St. Paul Minn. West Publishing
Company, 1990.

-MEMORANDUM for THE RESPONDENT-

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-Pleadings and Authorities- -Respondent-

There is no straight jacket formula for the meaning of wilful and it differs from case to

case.57 The court has observed that wilful means an act done voluntarily and intentionally

and with the specific intent to do something which a law forbids or with the intent to fail to

do something which law requires to be done. 58 In the given fact situation, the respondent did

not voluntarily terminated the contract. From the given facts, it can be inferred that the

global pressure had forced the respondent to terminate the contract.

3.2.2. There was partial compliance on the part of the respondent.

Partial compliance of an order has been considered as a reason for holding that there was no

wilful violation.59 In the given case, the respondent upheld its responsibility till there was no

global pressure. Therefore, it clearly shows that there was no wilful violation and that the

respondent had complied with the order for some time resulting in partial compliance.

3.2.3. The subsequent changes made it difficult to comply with the orders.

If a party charged of contempt without fault on his part is unable to comply with the

undertaking then, there is no contempt. 60 Concept of wilful disobedience and contempt does

not cover acts beyond ones own power. This requires a situation in which the party is not

able to comply with the order.61 Subsequent developments may create difficulties in

implementation and compliance of the order.62 In the instant case, the global pressure after the

57
Sachindra Nath Panja v. N.L. Basak, Principal Secretary, Govt of West Bengal, 2004 (4) CHN 602.
58
All India Anna Dravida Munnetra Kazhagam v. l.K. Tripathi, (2009) 5 SCC 417.
59
Dharmavir Singh & Ors. v. Smt. Navraj Sindhu, 1997 AIHC 259.
60
Narayana Panicker v. The Sub Divisional Magistrate, Fort Coshin & Ors, 1979 Ker LT 346; A.G. v. Walt
Hamstow, UDC (1895) 11 TLR 533.
61
S.R. Bommai v. Union of India, (1994) 3 SCC 1.
62
Ashish Kumar Kundu v. A.K.Tandon, 1994 (4) SLR 319.

-MEMORANDUM for THE RESPONDENT-

13
-Pleadings and Authorities- -Respondent-

order had created difficulties for the respondent to comply with the order. Hence it humbly

submitted that the respondent should not be held liable for civil contempt of court.

4. THE RESPONDENT IS NOT LIABLE FOR PERJURY.

Undertaking given to court is an affidavit.63. An "affidavit" includes affirmation and

declaration in the case of persons by law allowed to affirm or declare instead of swearing. 64

Whoever in any declaration made by him to any court of justice, makes any statement which

is false, and which he believes to be either false or does not believe to be true, touching any

point material to the object for which the declaration is made shall be punishable in a grave

manner as if he gave false evidence.65 To establish false evidence, it must be shown that the

false statement charged against the accused is literally false. There must be statement of fact

which is false. It is no offence if the fact stated is true but some circumstance is suppressed,

with a result that the wrong inference can be deduced. 66 Intention is an important ingredient

for prosecution of perjury. 67 If there was a reasonable possibility that the defence story is

true, then the essential ingredient of the prosecution case would not be established and hence

will not be guilty of perjury.68 In the instant case, the facts stated by the respondent were true

that they were upholding the contract till then. Intention of the respondent before the court

order can be taken as to terminate the contract. But there is nothing to construe the same

63
Edpuganti Bapanaiah v. Sri K.S.Raju & Ors, 2007 AP High Court, Contempt Case No.915 of 2002.
64
The General Clauses Act, 1971 3(3).
65
Indian Penal Code, 1860, 199 Read With 200.
66
Ratansi Daya v. Emperor, AIR 1916 Sind 70 (2), p 71; Queen v. Ahmed Ally, 11 WR 25, 27; Padarath Singh
v. Rattan Singh, (1920) Pat 419; S C Gupta v. Emperor, AIR 1924 Rang 17
67
Shiv Raman Gour v. Madan Mohan Kanda, (1990) Cr LJ 1033, p 1034 (P&H).
68
Adikanda Swain v. Emperor, AIR 1947 Pat 251, p 542; Kali Shankar Chatterjee v. Sarat Chandra Dey,
(1977) Cal HCN 538, p 542.

-MEMORANDUM for THE RESPONDENT-

14
-Pleadings and Authorities- -Respondent-

intention to continue after the order. A court order can be presumed to change the intention of

the respondent causing fear for liability, unless proven to the contrary. It is humbly submitted

to the Honble court that respondent shouldnt be held guilty of perjury.

-MEMORANDUM for THE RESPONDENT-

15
-Prayer- -Respondent-

PRAYER

In the light of arguments advanced and authorities cited, the Respondent humbly submits

that the Honble Court may be pleased to adjudge and declare that:

1. The Respondent was justified in rescinding the contract and invoking

Arbitration
2. The Impugned Arbitral Award is valid, and is not liable to be set aside

under Section 34 of the Arbitration and Conciliation Act, 1996.

3. The Respondent is not guilty of Civil Contempt of Court.

4. The Respondent is not liable for perjury.

Any other order as it deems fit in the interest of equity, justice and good

conscience.

For This Act of Kindness, the Respondent Shall Duty Bound Forever Pray.

Sd/-

(Counsel for the Respondent)

-MEMORANDUM for THE RESPONDENT-

16