Alleging digital signature misuse isn’t denying arbitration agreement’s existence

The Hon’ble Calcutta High Court has held that the allegation of misuse of digital signature does not amount to denial of existence of arbitration agreement.

The Court held,

“25. The plaintiffs have only taken the ground of fraud that the defendant no.3 has misused the OTP provided by the plaintiffs and the said OTP was used for digital signatures of the plaintiffs and the plaintiffs had never consented for the said signatures. The defendant no.3 is not denying the agreement. The defendant no.3 has paid an amount of Rs. 2,00,00,000/- during pendency of the application under Section 9 of the Arbitration and Conciliation Act, 1996. The agreement and other documents contained digital signatures of the plaintiffs. The stand taken by the plaintiffs that the defendants have frequently and without the consent of the plaintiffs obtained the digital signatures of the plaintiffs and the plaintiffs are not the beneficiaries of the loan can be raised before the arbitrator. As regard that the CIBIL is not the party to the agreement but the plaintiffs have made the CIBIL as the defendant no.2 in the present suit, this Court finds that the only claim made by the plaintiffs against the CIBIL is for removing the name of the plaintiffs as defaulters of any loan of the defendant no. 1. If the plaintiffs succeed in the arbitration proceeding, automatically, the plaintiffs can request the CIBIL for removal of their name as defaulters of the loan of the defendant no.1. This Court finds that the plea raised by the plaintiffs in the present suit, the same can be agitated before the Arbitrator. This Court also finds that the plaintiffs have not initiated any criminal proceeding on the allegation of fraud against the defendants.”