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TMI Blog2011 (5) TMI 1131X X X X Extracts X X X X X X X X Extracts X X X X ..... iled 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 manufacture, sale and repair of locomotive traction motors, spare parts and other ancillary commodities. The Plaintiff has its registe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cal 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, consisting of Technical Specifications, Outline Drawings, General Arrangement and Armature Coil Drawing. By an e-mail dated June 11, 2008, the Defendant through Mr. V. K. Pal s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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. The Defendant, through its representative Mr. Will Burrows, witnessed the type testing at the Plaintiff's said works and factory in Kolkata outside the aforesaid jurisdiction and was fully satisfied with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 171,000 2. EXP-034/08-09 dt. 23/12/08 114,000 114,000 3. EXP-035/08-09 dt. 31/12/08 285,000 285,000 4. EXP-045/08-09 dt. 27/02/09 285,000 285,000 5. EXP-047/08-09 dt. 20/03/09 285,000 285,000 6. REPL/EXP-11/09-10 dt. 15/5/09 171,000 171,000 7. REPL/EXP-12A/09-10 dt.29/5/09 1,14,000 60,000 1,425,000 1,371,000 The aforesaid payments were all received by the Plaintiff through its bankers, namely, the State Bank of India, Overseas Branch, Samriddhi Bhawan, 1, Strand Road, Kolkata- 700 001 situated within the aforesaid jurisdiction. 15) When the supply of the motors was substantia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the said Agreement, the Plaintiff in the honest and bona fide belief and with a view to keeping amicable business relations on a continuing basis was induced to giving credit for an approximate sum of USD 79,000.00 towards the alleged repairs and replacements carried out by the Defendant outside the jurisdiction aforesaid. The adjustment of USD 79,000.00 was unequivocally and unconditionally accepted by the Defendant without any objection and/or demur. In acting as aforesaid, the Defendant unequivocally agreed and accepted that no further claim would be made in respect of the said supplies made by the Plaintiff, save and except by way of the agreed adjustment against future orders to be placed by the Defendant. The Defendant had in any event waived its right to claim any compensation of any nature save and except by way of the agreed adjustment against future supplies to be made by the Plaintiff against future orders to be placed by the Defendant. 18) After having received the aforesaid 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 af ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n connivance with various other persons and/or its agents intentionally made misrepresentations to the Plaintiff and induced the Plaintiff to enter into the said Agreement and thereby acted wrongfully, illegally and fraudulently particulars whereof are set out herein below: a) The Defendant at all material times was fully aware of the fact that the Plaintiff is not an Original Equipment Manufacturer ( OEM ) and that the motors supplied by the Plaintiff were based on the drawings which had been duly examined, approved, concurred to and accepted by the Defendant. Accordingly, the subsequent demands by the Defendant for OEM compliance were not only contrary to the said Agreement but also ex facie, unlawful and illegal. b) The Defendant having wrongfully induced the Plaintiff to agree to its proposal mentioned hereinbefore and to make payment of USD 79,000.00 approximately on account of rectification of alleged defaults was not entitled to turn around and 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 par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... trated by the Defendant both within the outside the jurisdiction aforesaid. The aforesaid wrongful and fraudulent acts of the Defendant are actionable both under the laws of India as also that of Illinois. 23) In the light of the wrongful, illegal and fraudulent actions on the part of the Defendant as detailed hereinabove, the Plaintiff has suffered loss and damages at its registered office within the jurisdiction aforesaid, particulars whereof are given herein below: Sl. No . Particulars Amount (USD) Amount (USD) (i) Cost of preparation of drawings; developing special purpose equipment; manufacturing tools, inspection, Quality Assurance Programme, jigs and fixtures as per the following details : Manufacturing information, component drawings, sub assembly drawings and assembly drawings 38,325.00 Preparation of special purpose jigs, fixtures, gauges, etc. 1,11,500.00 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been appointed as one of the directors of the said Indian subsidiary of the Defendant and is at present posted in India and is looking after the Defendant's business in India. 25) The Defendant is wrongfully and illegally threatening and intends to initiate proceedings against the Plaintiff before the appropriate Courts of Illinois, USA. Accordingly, there is every possibility of the Defendant indulging in multiplicity of proceedings and in abuse of process. The initiation of any such proceedings by the Defendant would be vexatious, harassing, oppressive, fraudulent and mala fide. 26) The Plaintiff has no office outside India and has no representation whatsoever in the United States of America. This fact is well known to the Defendant. The Defendant on the other hand is carrying on business both within the United States of America and in India. It is well known that this Hon'ble Court would be pleased to take judicial notice of the fact that it would be inequitable, extremely inconvenient and prohibitively expensive for the Plaintiff to conduct litigation in the United States of America particularly in the facts and circumstances of the case and also be a drain on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... warded by the Defendant purporting to confer jurisdiction on Courts in Illinois to hear, mediate or litigate the disputes has been consciously and expressly excluded from the said Agreement, wherein the parties have only agreed that the same shall be construed and interpreted in accordance with the laws of the State of Illinois. In any event, there would also be no issue with this Hon'ble Court applying the laws of Illinois in respect of the subject matter of the dispute. 29) This Court is the natural forum for deciding the disputes between the parties particularly because Kolkata, having more than substantial connection with the cause of action in this suit, it would be more convenient for this Hon'ble Court to adjudicate the instant suit. This Hon'ble Court is the convenient forum considering all relevant factors and the interest of the parties both under Indian law as well as the laws of Illinois. 30) The Defendant is invading and/or threatening to invade the valuable rights of the Plaintiff by initiating and/or threatening to initiate proceedings in the United States of America. The invasion is such that compensation in money will not afford adequate relief. S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... learned Senior Advocate appearing on behalf of the Appellant, has strongly contended before us that in dismissing the application for injunction filed by his client even without calling for any explanation from Defendant, the learned Single Judge has totally misconstrued the law relating to grant of anti-suit injunction as laid down by Supreme Court. According to Mr. Mitra, in view of the averments made by his client in the plaint, the learned Single Judge should have held that it would be an abuse of law if his client was required to contest any claim made by the Defendant in the United States of America. Mr. Mitra contends that if the Defendant has any counterclaim, it can raise such counter-claim in the present suit. As regards the balance of convenience and inconvenience, Mr. Mitra tried to impress upon us that as the Defendant has a representative in India and in course of negotiation for the contract, the Defendant's representative came to Kolkata and even having inspected the goods manufactured by his client, it was a fit case for injunction restraining the Defendant from initiating any proceeding in the United States of America and to compel the Defendant to initiate su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... regard to proceedings which are oppressive or vexatious or in a forum non-conveniens; (3) Where jurisdiction of a Court is invoked on the basis of jurisdiction clause in a contract, the recitals therein in regard to exclusive or nonexclusive jurisdiction of the Court of choice of the parties are not determinative but are relevant factors and when a question arises as to the nature of jurisdiction agreed to between the parties the Court has to decide the same on a true interpretation of the contract on the facts and in the circumstances of each case; (4) a Court of natural jurisdiction will not normally grant anti-suit injunction against a Defendant before it where parties have agreed to submit to the exclusive jurisdiction of a Court including a foreign Court, a forum of their choice in regard to the commencement or continuance of proceedings in the Court of choice, save in an exceptional case for good and sufficient reasons, with a view to prevent injustice in circumstances such as which permit a contracting party to be relieved of the burden of the contract; or since the date of the contract the circumstances or subsequent events have made it impossible for the party seeki ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... From the aforesaid admitted facts, we are of the opinion that if Clause 16.6 quoted above was not there, it could be reasonably argued that the cause of action for getting the relief claimed in the suit has arisen both in India and in the State of Illinois and thus, the suit can be filed at any of the competent courts having territorial and pecuniary jurisdiction either in India or in the State of Illinois. 16. However, the moment the parties to a contract agree that the same should be construed and interpreted in accordance with the laws of the State of Illinois, it necessarily follows that the parties mutually agreed not to be governed by the Indian laws relating to contract. According to the Contract Act which is in force in India, an Indian court dealing with an agreement between the parties to which such Act applies must be guided by the same and there is no scope of dealing with any issue of a suit for breach of an agreement being guided by the law of contract prevailing in any other country. 17. In other words, the parties having mutually agreed to be guided by the law of Illinois in interpreting and construing the terms of the agreement, expressly decided not be subj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat country. Thus, the very first condition for grant of an anti-suit injunction pointed out by the Supreme Court in the case of Modi Entertainment Network and Anr. v. W.S.G. Cricket Pte. Ltd (supra) is not satisfied. 22. Further we find that although a vague allegation of fraud has been pleaded in the matter of execution of the said agreement, the circumstances mentioned therein in support of such fraud do not indicate that there was any fraud in the matter of arriving at the consensus that the parties would be governed by the law prevailing in the State of Illinois relating to the interpretation and construing the terms of the agreement. Thus, even no prima facie case of fraud as regards the exclusion of jurisdiction of this Court has been made out. 23. Moreover, we find from the averments made in the plaint itself that it was the Plaintiff who admitted its fault and promised to rectify its mistake but ultimately failed to convince the Defendant, which compelled the latter to terminate the agreement which has been accepted by the Plaintiff. Thus, no special case has even been made out to deviate from the agreed terms of exclusion of jurisdiction of this Court and restrainin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th the action instituted in the U.S. Court. The single Judge granted an ex parte interim restraint order on Jan. 20, 1986 but vacated the same after hearing the parties by his impugned order against which the matter went to the Supreme Court in an appeal by Special Leave. 25. In such a case, it was held that there was the possibility of the award rendered by the Umpire being set aside by the Indian Court and in that event, an extremely anomalous situation would arise inasmuch as the successful party (Western Company) might well have recovered the amount awarded as per the Award from the assets of the losing party in the USA after procuring a judgment in terms of the award from the USA Court. It would, according to the Apex Court, result in an irreversible damage being done to the losing party (ONGC) for the Court in USA would enforce a non-existent award under which nothing could have been recovered. It would result in the valuable Court time of the USA Court being invested in a non-issue and the said Court would have acted on and enforced an award which did not exist in the eye of law. The U. S.A. Court would do something which it would not have done if the Western Company had ..... X X X X Extracts X X X X X X X X Extracts X X X X
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