Polaris to file arbitration proceedings against Indonesian bank

Tuesday, 31 December 2002, 08:00 Hrs
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NEW DELHI: The board of Polaris Software Ltd., one of India's leading software development companies, Monday decided to file for arbitration proceedings against an Indonesian bank to settle a bitter commercial row.

"Polaris will move the arbitration proceedings against Bank Artha Graha in Singapore as specified by the contract for commercial disputes," said a Polaris Software statement issued after a board meeting in Chennai.

The decision comes close on the heels of the release of Arun Jain, chairman of Polaris Software, and his senior executive Rajiv Malhotra from weeklong detention by Indonesian authorities over a commercial dispute with the bank.

Jain and Malhotra returned India on December 24 from Jakarta where they had been detained on December 13 following a row between the Chennai-based leading banking and financial sectors software services firm and the bank.

Their detention had caused a furore in India, with the government applying pressure on Indonesia to free them.

The Polaris board meeting was called Monday to "take on record and review the future course of action on the unlawful detention of Jain and Malhotra in Indonesia."

"The board, upon reviewing the complete episode, has agreed that the case was clearly a commercial dispute between Bank Artha Graha and Polaris Software and did not qualify, under any circumstances, as a criminal dispute," the statement said.

The company has also decided to "move legally in Indonesian courts to quash any criminal charges under the Indonesian law."

The board Monday also appointed a legal committee to oversee the actions of Polaris against Bank Artha Graha. Arvind Kumar, director on the Polaris board and a Supreme Court lawyer, will head the committee.

Jain went to Jakarta with a team of senior executives in charge of a software development project for the bank to resolve a commercial dispute. The Indonesian police, however, detained the Polaris officials on their arrival at the bank office.

The weeklong detention ended after New Delhi told Indonesia the issue could impair bilateral ties.
Source: IANS
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