Court Upholds Arbitration Award Against Jayshree Chemicals in Dispute with Grasim Industries Ltd
The Civil Judge (Senior Division), Commercial Court in Bhubaneswar has upheld an Arbitral Award dating back to April 2024, ruling against M/s Jayshree Chemicals Limited regarding a long-standing dispute over a business transfer and indemnification claim by M/s Grasim Industries Limited. The judgment was delivered on August 3, 2026.The litigation involves the status of a Business Transfer Agreement signed by Jayshree Chemicals Ltd. in 2014 to M/s Aditya Birla Chemicals (India) Limited. This agreement concerned the transfer of the Caustic Soda Plant located at Ganjam, Odisha, for a lump sum consideration of Rs. 212 Cr. The business transfer was completed on September 21, 2015.
The dispute arose when the Odisha State Pollution Control Board (OSPCB) directed Jayshree Chemicals to deposit a sum of Rs. 2.11 Cr as per an order dated May 1, 2015, under the Environment Protection Act. Although Jayshree filed a Writ Petition at that time and received an Interim Order directing the OSPCB and CPCB not to take coercive action, the matter evolved.
After the completion of the Business Transfer, during the merger between M/s Grasim Industries Limited and M/s Aditya Birla Chemicals (India) Limited—which was approved by the Jharkhand High Court—the respondent entity was directed by the OSPCB to deposit Rs. 2,11,36,662/-. The respondent subsequently called upon Jayshree to reimburse this amount under an Indemnity clause of the Business Transfer Agreement.
As Jayshree Chemicals declined payment, the dispute moved into arbitration (Arbitration Proceeding No. 54 of 2021). The learned Arbitral Tribunal passed an award on April 12, 2024. Subsequently, the company filed a petition against this Award before the Commercial Court in Bhubaneswar.
The Commercial Court dismissed Jayshree Chemicals’ application against the Arbitral Award, thereby upholding the findings of the tribunal. Consequently, the Arbitral Award dated April 12, 2024 stands upheld.
Financial Implications of the Adverse Ruling
The judgment dictates that Jayshree is liable to pay the respondent reimbursement of costs amounting to Rs. 2.11 Cr. This amount is subject to interest at a rate of 9% per annum (p.a.) starting from the date of filing the claim petition until actual payment.In addition to the cost reimbursement, the Arbitral Award requires Jayshree Chemicals Ltd. to pay the respondent Rs. 28.70 Cr towards remediation costs and an additional reimbursement of arbitration costs totaling Rs. 25 lakhs.
The financial obligations stemming from this ruling are detailed below:
| Item | Amount / Rate | Details |
|---|---|---|
| Costs Reimbursement | Rs. 2.11 Cr | Liable to Grasim Industries Limited |
| Interest on Costs | 9% p.a. | Calculated from filing date of claim petition until actual payment |
| Remediation Costs | Rs. 28.70 Cr | Payment due as per the Arbitral Award |
| Arbitration Costs Reimbursement | Rs. 25 lakhs | As mentioned in the Arbitral Award dated 12.04.2024 |
While Jayshree Chemicals stated it would explore appropriate legal options to challenge this Order, the Company noted that the ruling is prima facie negative on its financial position.
Stock Price Movement
Jayshree Chemicals Ltd saw its shares settle at ₹6.04 on Thursday, registering a decline of 0.98%. The stock traded throughout the day, with prices ranging between an intraday low of ₹5.92 and a high of ₹6.20.Disclaimer: Due care and diligence have been taken in compiling and presenting news and market-related content. However, errors or omissions may arise despite such efforts.
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