The 1st to 4th Applicants are applying to the Court for the following orders:

1.  The partial award dated 2 October 2024 (SIAC Award No. 121 of 2024) (the “Partial Award”) made in SIAC Arbitration No. 080 of 2024 (the “Arbitration”) under the International Arbitration Act 1994 (the “IAA”) as corrected by the Memorandum of Correction to the Partial Award dated 31 October 2024 (SIAC Award No. 121(a) of 2024) (“Memorandum of Correction”) be set aside in full on the grounds that: -

a. there was a breach of the rules of natural justice in connection with the making of the Partial Award (as corrected by the Memorandum of Correction) by which the rights of the 1st to 4th Applicants have been prejudiced, within the meaning of section 24(b) of the IAA; and

b. the 1st to 4th Applicants were unable to present their case, within the meaning of Article 34(2)(a)(ii) of the UNCITRAL Model Law on International Commercial Arbitration (“Model Law”) read with section 3 of the IAA.

2.  Consequent to (1) above, the Final Award as to Interest and Costs dated 31 October 2024 (SIAC Award No. 134 of 2024) (“Costs Award”) as corrected by the Additional Award and Memorandum of Correction to Final Award As to Interest and Costs dated 12 December 2024 (SIAC Award No. 134(a) of 2024) be set aside in full;

3.  The costs of and/or relating to this application be paid by the Respondents to the 1st to 4th Applicants;

15.1  This Agreement shall come into effect on the Effective Date and shall remain valid and binding on the Parties unless terminated in accordance with this Article 15.

15.2  This Agreement may be terminated by Ebix and the Existing Shareholder ⁸ upon their mutual written consent.

15.3  This Agreement may be terminated by a Party upon giving 30 (thirty) days written notice to the other Party in the following events:

 (a) ….

(b) any breach by a Party of the provisions of Article 3.10 or Article 4.2 or Article 10 or Article 11 of this Agreement which is not caused due to any act or omission of the other Party, which breach if: (i) capable of being cured, has not been cured within 90 (ninety) days; or (ii) incapable of being cured, within 15 (fifteen) days following written notification to such breaching Party by the non-breaching Party.

15.4  In the event that Ebix or the Existing Shareholder exercise their respective rights to terminate this Agreement (“Terminating Shareholder”) pursuant to their respective rights under this Article 15 (the (“Terminating Event”), they shall do so by serving written notice (“Termination Notice”) on the other Shareholder(s) (“Non-Terminating Shareholder”).

15.5 …

15.6  The Parties Agree that where the Terminating Shareholder is the Existing Shareholder, Ebix or its nominated Affiliate will purchase all (but not less than all) of the Existing Shareholder Shares, at a price that is 30% (thirty per cent) higher than the price which is determined by the Independent Valuer appointed by the Existing Shareholder in this regard (“Enhanced Call Price”). The Company will bear the fees and associated costs charged by the Independent Valuer, and will also bear statutory costs associated with this Article 15.6. If the Terminating Event occurs during the Restricted Period, then Ebix shall be liable to pay to the Existing Shareholder an amount equal to the Earn-out Threshold (as defined under the SPA).

15.7  The Independent Valuer shall determine the Call Price or the Enhanced Call Price (as the case may be) within 15 (fifteen) Business Days of its appointment by Ebix or the Existing Shareholder (as the case may be) and in no event later than 30 (thirty) Business Days from the date of the Termination Notice (“Determination Date”). A Transfer under this Article 15, will be completed within 15 (fifteen) Business Days of the Determination Date. The Company will do all things necessary to effect and record such Transfer.

15.8  Any sale of Shares in accordance with this Article 15 will be subject to the Applicable Pricing Guidelines. [Emphasis in italics and bold in original, emphasis added by underlining.]

Independent Valuer means any one of EY, KPMG, PwC or Deloitte or any of their network firms in India.

51.  The basic issue which divides the parties is whether, as the Claimants contend, the PwC Valuation, as effected by Mr Jain, was an effective determination of the Enhanced Call Price of the Shares for the purposes of Article 15.6, and is therefore enforceable against the Respondents by the Claimants.

52.  The Respondents contend that the PwC Valuation is not such an effective determination, and this contention is based on two arguments, namely:

(a)  PwC, not Mr Jain, is the valuer for present purposes, and they were not independent, primarily because they had acted or advised the Claimants or persons associated with the Claimants, in particular on matters connected with the PwC Valuation, and/or

(b)  The PwC Valuation suffered from a number of flaws, which at any rate if taken together, impugn it to such an extent that it is not an effective determination for the purposes of Article 15.

53.  If the Respondents succeed on either or both these arguments, there is a further issue, namely whether it is open to me, in the light of the evidence, to determine the Enhanced Call Price for the Shares, and, if not, whether I can appoint a fresh Independent Valuer.

54.  If the Respondents fail on both the aforesaid arguments, then it would follow that they are bound to pay the Claimants the sum of INR 181,73,97,405.14, but there is an issue as to whether the Claimants are entitled to interest on that sum, and if so from what date and at what rate.

[emphasis in original]

71.  More generally, Mr Jain’s answers revealed that:

(a)  PwC and its associated companies are a large group with a number of branches across India;

(b)  All its “engagements are housed in a central database, which collates all the engagements undertaken by any entity of PwC in India”;

(c)  “A conflict process is a standard process for all PwC entities operating in India”

(d)  “There is an internal team who has access to the central database”, and “[t]hey pull out the name of the engagement, the Client, the nature of services being offered, when it was offered…”;

(e)  When a check was made for “Ashok Kumar Goel” “as an individual” and for “Vyoman” as clients, “nothing came up”;

(f)  There was also a search for “Ashok Goel” as a client, but it does not appear that there was a wider search;

(g)  “The tax team never does a valuation” and “there were no valuation services being provided or no services being provided to” either of the Claimants;

(h)  Mr Jain had never met Mr Goel or “anyone from Vyoman”.

[emphasis in original]

The Tribunal was referred to two principal authorities on the issue whether a professional valuer, who is appointed pursuant to a contract to determine a price which is then binding on the contracting parties, is “independent”. Those two authorities, which were cited by both counsel, were Hopkinson v Hickton [2016] EWCA Civ 1057 and Secretariat Consulting PTE Ltd and ors v A Company [2021] EWCA Civ 6, [2021] 4 WLR 20. The leading judgments of Patten LJ in Hopkinson and of Coulson LJ in Secretariat seem to me each to lay down and apply an approach which is both practical and in accordance with principle.

[emphasis in original]

76.  Having said at [17] that “the valuer must be independent when appointed”, Patten LJ went on to say at [19] that

The requirement that the valuer be independent is one that he should be capable of carrying out the expert valuation without there being any real risk of his approaching his task with a closed mind or a particular objective [and that] [t]he circumstances in which this might arise are not … limited.

77.  At [28] Patten LJ explained that:

An expert valuer does not satisfy the requirement that he be independent if he has a connection with one of the parties, an interest in the outcome of the valuation or some other connection with the property which, objectively viewed, creates a real risk that he may act partially in carrying out the valuation.

And at [33] he adopted a test which he laid down for apparent bias of tribunals, namely, “[t]he question is whether the fair-minded and informed observer, having considered the facts, would conclude that there was a real possibility that the tribunal was biased”.

[Emphasis in italics in original, emphasis added by underlining]

83.  It is, of course, Indian law, not English law, which applies to this dispute, but neither party suggested that Indian law would adopt a different approach from that adopted in Hopkinson and Secretariat. Indeed, by referring to these two English decisions without criticism, I understood both parties to accept that they represent the law of India: in case one of the parties did not do so, I should, for the avoidance of doubt, formally state that I consider that they do represent the Indian law on the topic of independence in a case such as this.

87.  Even if PwC had advised either or both of the Claimants, that would not automatically have meant that PwC was not independent. The mere fact that a valuer had advised a person who is one of the parties to the contract under which the valuer’s valuation is to be made, does not by any means necessarily mean that the valuer cannot be independent. The point was made clear in Secretariat at [98] in a passage cited above, and it appears to me to be self-evidently correct. Clear words would be needed before it could be assumed that parties to a valuation contract such as the present can have intended that a valuer would be disqualified if they had ever advised or acted for one party in any connection, however unrelated. Independence in this context is to be assessed as a matter of judgment by reference to the particular facts of the case: again this is clear from the judgment on the facts in Secretariat as well as that in Hopkinson. [Emphasis added by underlining]

98.  The Tribunal accordingly concludes that none of the arguments raised by the Respondents in order to justify their contention that PwC were not independent when valuing the Shares pursuant to Articles 15.6 and 15.7, is made out. PwC were validly appointed as an Independent Valuer for the purposes of carrying out the Valuation Exercise.

[Emphasis in original]

31. The rules of natural justice (giving rise to the Court’s discretion to set aside the Partial Award) were breached in three aspects.

32. First, the Arbitrator failed to consider the Applicants’ case that Indian law, as expressed in the Valuation Rules, Annexure I, Sections 13 and 15, adopts a fundamentally different approach to the position in Hopkinson and Secretariat when determining what amounts to ‘independence’ under Article 15 of the SHA (“Independent Valuer Breach”).

33. Second, the Arbitrator denied the Applicants reasonable notice and/or a reasonable opportunity to address him that Hopkinson and Secretariat did not represent the Indian law on the issue of the independence of a valuer in a case such as this. The Arbitrator proceeded on the basis that the Applicants did not suggest that Indian law took a different approach on the issue or that the Applicants had accepted that there was no difference in the positions. This was not the Applicants’ pleaded case and disregarded the Applicants’ case on the Valuation Rules in the Arbitration. This, in turn, led him to believe he was entitled to find that Hopkinson and Secretariat did represent Indian law on the material issue, which deprived the Applicants a reasonable opportunity to address the divergence from Indian law. If such arguments had been made by the Applicants and considered by the Arbitrator, the circumstances in which the Arbitrator disregarded Indian law requirements and/or the Applicable Pricing Guidelines that were breached in PwC’s valuation exercise could have been avoided (“Unpleaded Issue Breach”).

34.  Third, the Arbitrator failed to consider the Applicants’ case that the PwC Valuation, as effected by Mr Jain, was not a valid or effective determination of the Enhanced Call Price of the Shares for the purposes of Article 15.6 of the SHA because it breached Article 15.7 of the SHA (“Invalidity Breach”).

[Emphasis in original]

Rule 1 - Short title and commencement

…

(2) They shall come into force on the date of their publication in the Official Gazette.

2[(3) These rules shall apply for valuation in respect of any property, stocks, shares, debentures, securities or goodwill or any other assets or net worth of a company or its liabilities under the provision of the Act or these rules.

Explanation.- It is hereby clarified that conduct of valuation under any other law other than the Act or these rules by any person shall not be affected by virtue of coming into effect of these rules.]

…

Rule 2 – Definitions

…

(h) "registered valuers organisation" means a registered valuers organisation recognised under sub-rule (5) of rule 13;

(i) "valuation standards" means the standards on valuation referred to in rule 18; and

(j) "valuer" means a person registered with the authority in accordance with these rules and the term "registered valuer" shall be construed accordingly.

[emphasis in original]

Independence and Disclosure of Interest

12. A valuer shall act with objectivity in his/its professional dealings by ensuring that his/its decisions are made without the presence of any bias, conflict of interest, coercion, or undue influence of any party, whether directly connected to the valuation assignment or not.

13. A valuer shall not take up an assignment if he/it or any of his/its relatives or associates is not independent in terms of association to the company.

14. A valuer shall maintain complete independence in his/its professional relationships and shall conduct the valuation independent of external influences.

15. A valuer shall wherever necessary disclose to the clients, possible sources of conflicts of duties and interests, while providing unbiased services.

25. This application is rooted in 34(2)(a)(ii) of the Model Law and Section 24(b) of the IAA, which are co-extensive in scope and effect. As such, they are addressed together in this section.

26. To successfully invoke these provisions, the Applicants must establish: (i) which rule of natural justice was breached; (ii) how it was breached, (iii) how the breach was connected to the making of the Partial Award; and (iv) how the breach prejudiced the Applicants’ rights.

27. The relevant rule of natural justice that has been breached is the fair hearing rule. The fair hearing rule is breached in the circumstances where: (i) the tribunal fails to apply its mind to the essential issues arising from the parties’ arguments; or (ii) the tribunal adopts a chain of reasoning that a reasonable litigant could not have foreseen.

28. Where a tribunal decides a case on a basis that has not been raised or contemplated by the parties, this amounts to a breach of natural justice. A tribunal cannot adopt a chain of reasoning which one party has not been given a reasonable opportunity to address.

29. In respect of a challenge to an award on the basis of the Arbitrator’s failure to consider essential issues arising from the parties’ arguments, four conditions must be satisfied in order to successfully establish a challenge: (i) the point must have been properly brought before the tribunal for determination; (ii) the point must have been essential to the resolution of the dispute; (iii) the tribunal must have completely failed to consider the point; and (iv) there must have been real or actual prejudice.

30 Prejudice will be established so long as the breach is not “merely technical and inconsequential”, but has “actually altered the final outcome of the arbitral proceedings in some meaningful way”.

[Emphasis in original in italics, emphasis added by underlining]

5.  The appointment of and procedure to be followed by an Independent Valuer, are set out in Articles 15.6 to 15.8 of the SHA along with the definitions of the phrases referred to therein. A reading of these provisions reveals:

(1)  Independent Valuer means any one of EY, KPMG, PwC or Deloitte or any of their network firms in India

…

(5)  Applicable Pricing Guidelines means the guidelines or valuation norms prescribed by the Government of India from time to time for determining the value of shares of an Indian company.

(6)  The mere selection of any of the firms [sic] names in the definition of “Independent Valuer” does not ipso facto make such firm an “independent” valuer. Therefore, in addition to being one of the firms named in the definition of Independent Valuer, the firm so appointed as an Independent Valuer must also be independent.

(7)  The use of the adjective “independent” before valuer under Article 1.1 of the SHA must be emphasised. The Claimants contend that since Article 1.1 defines Independent Valuer as any one of EY, KPMG, PwC or Deloitte or any of their network firms in India, there is no “additional criteria” to be complied with. This fails to appreciate the agreed wording of the SHA, which advisedly employs the term “independent” instead of simply using the phrase “Valuer” or “Listed Valuer”. If the Claimants’ contention were true, there would be absolutely no requirement of independence of a valuer at all. Ipso facto, there would be no ground for Deloitte to have been held to be not an Independent Valuer in the previous arbitration. The requirement for independence is a fundamental condition for the four listed valuers, and not an “additional criteria”, as argued by the Claimants.

(8)  While there is no contractual definition of “independent”, the Companies (Registered Valuers and Valuation) Rules, 2017 (“Valuation Regulations”) – which are one of the Applicable Pricing Guidelines – state as under:

6.  In the present case, PwC is not and cannot be an Independent Valuer because:

…

(9)  Under the definition of Independent Valuer under the SHA14 and the Valuation Regulations, it is irrelevant if a different individual within the same firm is conducting a valuation. The term Independent Valuer is attached to the firm and not the person. Further, even the Valuation Regulations require that a valuer shall not take up an assignment if his associates have, at any point, been associated with the Company.

…

9.  In the Partial Award, one of the questions before the Hon’ble Tribunal was whether Mr. Rustomjee could be considered an independent valuer when he belonged to the same firm (viz., Deloitte) as Mr. Amit Bansal, who was also produced as an expert witness in the same arbitration on behalf of the claimants therein. While the Hon’ble Tribunal noted that it was “risky to instruct individuals in the same firm”, it did not delve into the question of whether Mr. Rustomjee’s independence was tainted by the involvement of Mr. Bansal or anyone working at Deloitte with Mr. Bansal. The Hon’ble Tribunal, however, stated that there may be judicial decisions on this aspect.

10.  These judicial decisions include the decision of the English Court of Appeal in Secretariat Consulting, where the Court of Appeal held that there was a conflict of interest when an individual from Secretariat Consulting was engaged as an expert while another individual from a group company of Secretariat Consulting was engaged previously by the other party. The Court of Appeal held that it would make no difference if the two individuals were part of different companies, although under the same banner, i.e. the Secretariat group, since they always represented as being part of one single group.

[emphasis in italics and bold in original, emphasis added by underlining]

9.  In any case, the legal threshold for challenging the independence of a valuer is not as low as the Respondents would prefer it to be. The English Court of Appeal at Paragraph 28 of its decision in Hopkinson v. Hickton determined the appropriate threshold of independence of a valuer by the ‘tribunal test’ – that is the test of apparent bias assessed at the date of the valuer’s appointment:

“It seems to me that the question of what has to be shown in order to be able to challenge the appointment of an “independent” valuer is really determined by the construction of the word “independent” which I discussed earlier at [17]. Consistently with that, an expert valuer does not satisfy the requirement that he be independent if he has a connection with one of the parties, an interest in the outcome of the valuation or some other connection with the property which, objectively viewed, creates a real risk that he may act partially in carrying out the valuation.”

10.  The English Court of Appeal further held that the requirement of independence entails that a valuer is capable of carrying out the valuation without there being any real risk of his approaching his task with a closed mind or a particular objective. Even if there is a professional relationship with one of the parties (which is not the case here), that alone will not be sufficient to impeach the valuation or other expert determination unless it can be shown that the “expert was actually partial in making that determination”. The Respondents do not even remotely suggest that, objectively viewed, their group companies’ alleged connections to PwC, has caused Mr Neeraj Jain to act partially in carrying out the valuation.

11.  Instead, the Respondents incorrectly place reliance on the Companies (Registered Valuers and Valuation) Rules 2017 (Valuation Rules) to ascertain the meaning of ‘independent’ in the term ‘Independent Valuer’ under the SHA. Without commenting on the contents of the Valuation Rules, it is submitted that the Valuation Rules are inapplicable in the present case for at least three reasons:

[Emphasis in original]

“None of this should be taken as saying that the same expert cannot act both for and against the same client. Of course, an expert can do so. Large multinational companies often engage experts on one project and see them on the other side in relation to a dispute on another project. That is inevitable. But a conflict of interest is a matter of degree. In my judgment, the overlaps to which I have referred – of parties, of role, of project, of subject matter - make it plain that in the present case, there was a conflict of interest.”

[Emphasis in original]

11.  With respect to the reliance on the Valuation Rules, it is irrelevant whether the said Rules form part of the Applicable Pricing Guidelines. The Respondents have referred to and relied on these Rules as an indicator of the test of independence – just like the Claimants are referring to the decision of the English Courts in Hopkinson v. Hickton. [Emphasis added by underlining.]

15.  Additionally, and in any event, the legal threshold for challenging the ‘independence’ of an independent valuer is a high one, and this has not been met in the present case.

16.  First, as stated above, the Respondents have failed to make out any actual bias on Mr Neeraj Jain’s part.

17.  Second, the Respondents’ submissions fall far short of satisfying the test of apparent bias as formulated by the English Court of Appeal in Hopkinson. A fair-minded observer would reject the Respondents’ blanket assertions that (i) the whole of PwC or PricewaterhouseCoopers, a multinational accounting and audit firm with 650 member firms employing upwards of 350,000 employees worldwide, lacks independence in valuing the Company’s shares because some of its member firms have provided services to certain entities within the Ebix group, which services do not pertain to the Company’s shares or the SHA, or that (ii) the ‘involvement’ in the valuation of the Company’s ultimate holding company (that is 2 levels removed from Ebix India in the group hierarchy) by PwC or certain other member firms within PwC would give rise to a risk that Mr Neeraj Jain (who was not involved) would be biased in carrying out the current assignment.

18.  Third, the Respondents’ reliance on Secretariat Consulting is grossly misplaced. In Secretariat Consulting, the Court of Appeal cautioned against the judgment being used as authority to say that the same expert cannot act both for and against the same client, observing that “[l]arge multinational companies often engage experts on one project and see them on the other side in relation to a dispute on another project…conflict is a matter of degree”. There is no overlap of role, project, or subject matter in the present instance, and none has been established by the Respondents.

[Emphasis in original]

13.  The Respondents submit that PwC is not and cannot be an “Independent Valuer” because:

…

(6)  While there is no contractual definition of “independent”, guidance is provided by the Companies (Registered Valuers and Valuation) Rules, 2017, which states that a valuer shall not take up an assignment if his associates have, at any point, been associated with the company.

… The question then is whether the disclosures by Mr. Jain give rise to the conclusion that PwC lacks independence and I say, Sir, that the answer is - No. There is no present or prior engagement which divides PwC's loyalties. No reason has been suggested for why the prior tax related services might incentivise PwC to act one way or another or to act otherwise than in their normal, professional, independent manner. So there's one other point I wanted to make relating to Respondents' written opening submissions at paragraph 13, this time at sub (6). If we have that on the screen 13(6), this is where there's a reference to the Company's registered Valuers and valuation rules. And you have seen, Sir, from my opening, that we say that that really is a provision, those are rules that deal with very specific provisions of the Indian Companies Act in insolvency legislation. But if we look over the page, the point that's being made by the Respondent is that these rules, according to them, say that a Valuer shall not take up an assignment if his associates have at any point been associated with the company. But Sir, there's just no evidence of any of the Expert's associates being associated with the Company that's being valued. So that doesn't take the Respondents anywhere. So with respect, this lack of independence argument that they have pleaded is without any merit whatsoever.

Now in my respectful submission, Sir, all the facts that are presented and all the submissions are made conclusively establish that PwC were or are advisors to the Respondents. PwC were or are advisors to the Claimants. PwC purported to an independent valuation the Claimant shares in Respondent 4, a Company belonging to Respondents 1 to 3. Effectively, as I said a few minutes earlier, PwC was advising one set of clients past, present, present in the Claimants in the dispute against another set of clients namely the Respondents. They cannot be a more stark case of conflict of interest. PwC was undoubtedly conflicted and is disqualified to act as an Independent Valuer.

The next point that I want to respond to is, my learned friend says that says, "about the conflict situation." He says he makes this point when he's talking about the 2019 transaction. The Blackstone transaction. My learned friend says that whether valuation services were provided then by PwC or not does not matter, all that is important is whether the client was the Claimant. So, the argument was the type of engagement. The role of PwC is not important. All that's important is the identity of the client. That's not correct. I cited the case of Secretariat Consulting. Actually, it was cited by the Respondents. So, both of us rely on it. And in the portion that I showed Your Honour, earlier in that very paragraph 98, it says that there are a range of factors that one has to take into account and included in that range of factors are "the role, the project and the subject matter." The role obviously, means the role of the expert in question. And so, the role, whether or not it was valuation or not is clearly relevant contrary to Respondents' submissions.

[Emphasis in original]

73.  The Tribunal was referred to two principal authorities on the issue whether a professional valuer, who is appointed pursuant to a contract to determine a price which is then binding on the contracting parties, is “independent”. Those two authorities, which were cited by both counsel, were Hopkinson v Hickton [2016] EWCA Civ 1057 and Secretariat Consulting PTE Ltd and ors v A Company [2021] EWCA Civ 6, [2021] 4 WLR 20. The leading judgments of Patten LJ in Hopkinson and of Coulson LJ in Secretariat seem to me each to lay down and apply an approach which is both practical and in accordance with principle.

…

83.  It is, of course, Indian law, not English law, which applies to this dispute, but neither party suggested that Indian law would adopt a different approach from that adopted in Hopkinson and Secretariat. Indeed, by referring to these two English decisions without criticism, I understood both parties to accept that they represent the law of India: in case one of the parties did not do so, I should, for the avoidance of doubt, formally state that I consider that they do represent the Indian law on the topic of independence in a case such as this.

[Emphasis added by underlining]

In the present case, PwC was not and cannot be an Independent valuer because:

…

(9)  PwC has not submitted its report within the timelines prescribed under the SHA. Even though the Article 15.7 of the SHA requires that the “Independent Valuer” must complete his valuation within 15 days of his appointment and no later than 30 days (even though the 30 day period is with respect to the date of termination), the Respondents submit that in view of the previous arbitration, this period will be the outer limit from the date of the appointment. On the contrary, PwC took more than 5 months to complete its valuation.