The Company Law Board on Thursday allowed Unitech's plea to refer the dispute over its telecom joint venture with Norway's Telenor, Uninor, for arbitration to a Singapore court.
Unitech said in a statement, "We are pleased that the CLB has accepted our plea and respected the shareholders' agreement, which clearly defines the dispute resolution mechanism for settlement of the issues relating to the shareholders' agreement."
However, Telenor said it would challenge the order in a higher court.
"We are yet again surprised at the order of the CLB. We will certainly challenge this order in a higher court, as we have successfully done on matters earlier.
"There should be no doubt that we will do all that is necessary to secure the future of Uninor's employees, customers and partners.
Unitech said, "We are not surprised with Telenor's reaction on the CLB order, which is nothing but a continuation of its past conduct of complete disregard to the rights of minority shareholders and terms of the agreements signed between the shareholders."
Following the Supreme Court's order on 2G licence cancellation in February, Telenor had said it would set up a new company and transfer the assets of the existing JV, which offered services under the Uninor brand, to the new company.
Unitech opposed Telenor's move, saying the company could not scrap the JV agreement unilaterally and it had veto right to block any asset transfer.
Both sides approached the CLB separately over the dispute.