TaxTMI 
TaxTMI 
2011 (5) TMI 1131
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....he Plaintiff has come up with the present appeal. 3. The Appellant before us filed in the Original Side of this Court a Civil Suit being No. 10 of 2011 thereby praying for the following reliefs: a) Decree for US$ 12,22,125.00 against the Defendant as pleaded in paragraph 22 above; b) In the alternative, an enquiry into the damages suffered by the Plaintiff caused by the Defendant's breach and appropriate decree for such sum as may be deemed to be found due and payable upon such enquiry; c) Perpetual injunction restraining the Defendant, its servants, agents and/or assigns from initiating and/or in any manner proceeding with any legal proceeding before any of the Courts in Illinois or in any other place in the United States of America or any forum other than this Hon'ble Court; d) Receiver; e) Injunction; f) Attachment; g) Costs and; h) Such further and/or other relief or reliefs as this Hon'ble Court may deem fit and proper. 4. The case made out by the Plaintiff in the said suit may be summed up thus: 1) At all material times, the Plaintiff was and still is engaged, inter alia, in the....
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.... said Mr. V.K. Pal at the Plaintiff's registered office within the aforesaid jurisdiction. The Defendant received the said offer, accepted the technical specifications supplied by the Plaintiff and never raised any objection with regard to the said drawings prepared and submitted by the Plaintiff. 5) Thereafter, between June 2008 and September 2008, protracted negotiations and discussions took place between the Plaintiff and the Defendant through the respective representatives of the parties, either at the workshop and factory of the Plaintiff or at the registered office of the Plaintiff. In all such discussions, the said Mr. V. K. Pal, represented the Defendant and the Managing Director and/or the Deputy Managing Director of the Plaintiff represented the Plaintiff. 6) In course of the aforesaid negotiations, there had been exchange of a series of e-mails between the Plaintiff and the Defendant through the said Mr. V. K. Pal during the period from April 2008 till the finalization of the said Agreement as stated herein below. 7) By an e-mail dated May 02, 2008, the Plaintiff forwarded to Mr. V. K. Pal the technical details of D78 traction motors, consi....
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....he Plaintiff and the Defendant (hereinafter referred to as "the said Agreement"). 10) The said Agreement dated October 01, 2008, was accepted, concluded and signed by the Plaintiff at the Plaintiff's registered office within the aforesaid jurisdiction. The said agreement, inter alia, stipulated as follows: 16.3 Entire Agreement. This Agreement constitutes the entire agreement and supersede all prior agreements and understandings, both written and oral, between the parties with respect to the subject matter thereof. Accordingly, all the prior agreements and understandings between the parties including the Standard Purchase Order Terms have been superseded, altered, rescinded and novated by the said Agreement. 11) In view of the urgency expressed by the Defendant, the Plaintiff had already commenced work on preparation of the said motors for type-testing and two motors were checked, inspected and their performance type-tested and approved by Mr. Will Burrows of the Defendant at the factory and works of the Plaintiff in Kolkata. The same were also found to be in conformity with the Plaintiff's drawings which were approved by the Defendant. T....
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.... India, Overseas Branch, Samriddhi Bhawan, 1, Strand Road, Kolkata- 700 001 situated within the aforesaid jurisdiction. 15) When the supply of the motors was substantially in progress, the Defendant raised a dispute with regard to the acceptability of the Axle Caps attached to the said motors. The said representative of the Defendant, Mr. V. K. Pal, alleged that the Axle Caps fitted to the motors having been found to be defective, the same were dismantled from the locomotives and that after removing the old Axle Caps, the locomotives were re-fixed with new locally sourced Axle Caps. It was further alleged that the Defendant got the new Axle Caps sourced from local vendors which were being fixed for the purpose of completing the locomotives. In doing so, the Defendant unconditionally accepted the said goods. Thereafter, correspondence ensued between the Plaintiff and the Defendant with regard to rebate/deduction that should be given by the Plaintiff to the Defendant in respect of the alleged defective Axle Caps. 16) Ultimately, towards the end of April 2009, it was, inter alia, agreed by and between the Plaintiff and the Defendant that as against the alleged cost o....
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....d payments and/or adjustments aggregating to approximately USD 79,000.00, the Defendant by letters dated August 25, 2009 and October 2, 2009 respectively sought to raise further disputes as an afterthought and attempted to reopen a closed chapter with a view to avoid its commitments for placing further orders. Various false and untenable allegations were made by the Defendant, inter alia, by contending that the Plaintiff was in breach of the said agreement. No such claim is tenable in view of the adjustment and/or credit afforded to the Defendant by the Plaintiff as mentioned hereinbefore. The said letters of the Defendant were replied to by the Plaintiff on October 12, 2009 denying the allegations made by the Defendant. The Defendant however continued with its false and untenable allegations by its letter dated December 10, 2009. In any event, the contents of the letters issued for and on behalf of the Defendant were false, frivolous and wholly motivated. 19) Though the Defendant was acting wrongfully and in violation of its commitments, the Plaintiff with a view to continuing the business relationship, sought to accommodate the Defendant and prolonged discussions were he....
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....nd make the same the basis of the termination, particularly when the motors had been admittedly opened and damaged by the Defendant itself in trying to bring the same to OEM/EMD standards which was never agreed upon between the parties herein. Significantly, the warranty obligations of the Plaintiff under the said Agreement had also lapsed in these circumstances. c) The Defendant made suggestions that it would place further orders in excess of US 1 million dollars not believing the same to be true so as to induce the Plaintiff to enter into the contract more fully mentioned hereinabove. d) The Defendant with the intent to deceive and/or defraud the Plaintiff made suggestions and/or representations which were not true and not believed by it to be true. In fact, it will be evident from the letter dated October 28, 2010 that the sole and mala fide intention of the Defendant was to defraud and deceive the Plaintiff. e) The purposed letter of termination dated October 28, 2010 issued for and on behalf of the Defendant is in breach of the said Agreement and in violation of the terms thereof. f) The purposed letter of termination dated October 28, 2010 ....
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....rawings 38,325.00 Preparation of special purpose jigs, fixtures, gauges, etc. 1,11,500.00 Preparation of Technical Specifications 9,600.00 Preparation of Quality Assurance Programme 4,800.00 Preparation of Shop Floor Inspection 7,200.00 Special purpose equipment installed exclusively for D78/D87 project of the defendant. 2,00,000.00 Cost incurred because of the failure of the defendant to furnish technical information, drawing, sample, critical items dimension and drawings from different sources for which the plaintiff had to make payments. 5,200.00 Shop floor rearrangement done exclusively for the manufacture of D78/D87 project of the defendant. 75,500.00 4,52,125.00 (ii) Compensation for failure of the defendant to place additional orders of D-78 and D-87B traction motors as contemplated a n d projected in the aforesaid Agreement. 4,90,000.00 (iii) Compensation for failure to p....
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....the State or Federal Courts in USA or in the State of Illinois, USA or elsewhere in USA, would be highly vexatious and exorbitantly costly. In fact, counsel fees itself would be approximately USD 450.00 to 600.00 (approximately Rs. 20,000/- to Rs. 27,000/-) per hour. Apart from this, all the Plaintiff's witnesses and evidence are all situated in Kolkata within the jurisdiction of this Hon'ble Court and this Hon'ble Court is the natural forum to maintain the instant suit. The balance of convenience warrants adjudication of disputes between the parties in India. Both the Plaintiff and the Defendant can be represented before this Hon'ble Court. The dealings and transactions between the parties took place primarily at Kolkata at and from the registered office of the Plaintiff situated within the jurisdiction aforesaid as also from the Plaintiff's works and factory at 1, Oil Installation Road also at Kolkata outside the jurisdiction aforesaid. In the course of negotiations, discussions and transactions between the parties concerning the said Agreement, the representatives of the Defendant including the said Mr. V.K. Pal and Mr. Will Burrows had visited Kolkata, in pa....
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....n'ble Court and a part of the cause of action has arisen outside the jurisdiction of this Hon'ble Court, the Plaintiff is entitled to get leave under Clause 12 of the Letters Patent to entertain, try and determine the present suit. 5. After filing of the aforesaid suit, on the basis of the aforesaid allegations made in the plaint, the Plaintiff came up with an application for injunction praying for restraining the Defendant, its servants, agents and/or assigns from initiating and/or in any manner proceeding with any legal proceeding before any of the Courts in Illinois or in any other place in the United States of America or in any forum other than the learned Trial Judge. 6. The learned Single Judge, by the order impugned in this appeal, dismissed the said application even without issuing any notice upon the Respondent and thereby holding that 1) the primary requirement of obtaining an order of anti-suit injunction has not been proved by the Plaintiff; 2) the parties having agreed to be governed by the laws of Illinois, even though there may not be any forum selection clause, having regard to the rule of comity, the court was not inclined to grant a blanket order of ....
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.... 2. Oil and Natural Gas Commission v. Western Company of North America, reported in AIR 1987 SC 674. 10. Mr. Anindya Mitra, the learned Senior Advocate appearing on behalf of the Respondent, however, opposed the aforesaid contention advanced by Mr. Jayanta Mitra and submitted without prejudice to his client's rights and contentions that this Court has no territorial jurisdiction to even entertain the present suit and the learned Single Judge on the facts and in the circumstances of the present case has rightly declined to grant any injunction against his client. Mr. Anindya Mitra further submitted that even it is a fit case for revocation of leave under Clause 12 of the Letters Patent as no part of cause of action arises within the jurisdiction of this Court. Mr. Mitra, therefore, prays for dismissal of this appeal. 11. Therefore, the only question that arises for determination in this appeal is whether the learned Single Judge was justified in dismissing the application for injunction filed by the Appellant in the facts of the present case. 12. The law relating to grant of anti-suit injunction has been laid down by the Supreme Court in the case of Modi E....
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....ajor or force majeure and the like; (5) where parties have agreed, under a non-exclusive jurisdiction clause, to approach a neutral foreign forum and be governed by the law applicable to it for the resolution of their disputes arising under the contract, ordinarily no anti-suit injunction will be granted in regard to proceedings in such a forum conveniens and favoured forum as it shall be presumed that the parties have thought over their convenience and all other relevant factors before submitting to non-exclusive jurisdiction of the Court of their choice which cannot be treated just an alternative forum; (6) a party to the contract containing jurisdiction clause cannot normally be prevented from approaching the Court of choice of the parties as it would amount to aiding breach of the contract; yet when one of the parties to the jurisdiction clause approaches the Court of choice in which exclusive or non-exclusive jurisdiction is created, the proceedings in that Court cannot per se be treated as vexatious or oppressive nor can the Court be said to be forum non-conveniens; and (7) the burden of establishing that the forum of choice is a forum non-convenien....
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....w a settled principle of the Private International law that the proper law of a contract will be the law of the country where it is made. But where a contract is made in one country and to be performed wholly or in part in another, the proper law may be presumed to be the law of the country where it is to be performed. (Auckland Corporation v. Alliance Assurance Co.(1937 AC 587). But these rules are only presumptive in nature and subject to the intention of the parties, whether expressly declared or inferred from the terms and nature of the contract and the circumstances of the case. The aforesaid principle has been approved by the Supreme Court in the case of M/s. Dhanrajamal Gobindram v. Shamji Kalidas and Co., reported in AIR 1961 SC1285. 19. Thus, by mutual agreement, the parties inevitably agreed that out of the Courts of the two countries having jurisdiction, the Courts in India should be excluded. As pointed out by the Supreme Court in the case of Rajasthan SEB v. Petro Chemicals Ltd., reported in 2009(3) SCC 107, where there may be two or more competent Courts which can entertain a suit consequent upon a part of the cause of action having arisen therein, if t....
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....conditions for grant of anti-suit injunction as pointed out in the case of Modi Entertainment Network and Anr. (supra) are absent as we fail to find any mala fide or vexatious claim of the Defendant even from the averments made in the plaint and the documents relied upon by it. 24. In the case of Oil and Natural Gas Commission (supra), strongly relied upon by Mr. Jayanta Mitra, the Appellant, ONGC, and the Respondent Western Company, had entered into a drilling contract. The contract provided for any differences arising out of the agreement being referred to arbitration. The arbitration proceedings were to be governed by the Indian Arbitration Act 1940 read with the relevant rules. A dispute had arisen between the parties. It was referred to two Arbitrators and an Umpire was also appointed. The Arbitrators entered on the reference in London which was the agreed venue for hearing as per the Arbitration Clause contained in the contract. On October 1, 1985 the Arbitrators informed the Umpire that they were unable to agree on the matters outstanding in the reference. Consequently, the Umpire entered upon the Arbitration, and straightway proceeded to declare his award (styled as inte....
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....uld also be obliged to spend large amounts by way of costs incurred for engaging counsel and for incidental matters and the losing party, in that event, would be obliged to initiate fresh proceedings in the USA Court for restitution of the amount already recovered from it, pursuant to the judgment rendered by the USA Court in enforcing the award which is set aside by the Indian Court. Both the sides would have to incur huge expenditure in connection with the attendant legal proceedings for engaging counsel and for incidental matters once again. 26. Secondly, according to the Supreme Court, while as per the contract, parties are governed by the Indian Arbitration Act and the Indian Courts have exclusive jurisdiction to affirm or set aside the award under the said Act, the Western Company is seeking to violate the very arbitration clause on the basis of which the award has been obtained by seeking confirmation of the award in the New York Court under the American Law. It will amount to an improper use of the forum in America in violation of the stipulation to be governed by the Indian law which by necessary implication means a stipulation to exclude the USA Court to seek an affirm....