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2007 Supreme(Bom) 1574
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
S. J. VAZIFDAR, J.
Shree Precoated Steels Limited — Plaintiff.
Versus
Macsteel International Far East Ltd., a Company — Defendants.
NOTICE OF MOTION NO. 3472 OF 2006, NO. 1343 OF 2007
IN SUIT NO. 2866 OF 2006
DECIDED ON : 2ND NOVEMBER, 2007.
Mr. Janak Dwarkadas, Senior Advocate with Mr. Sandip Parikh with
Mr.Amit Pradhan i/b. M/s.Wadia Gandhy & Co. for the Plaintiff.
Mr. F. E. DeVitre, Senior Advocate with Mr. D. D. Madon, Senior
Advocate with Mr. Zarir Bharucha i/b. Ashwin Shankar for Defendant
No.1.
Mr.O. Mohandas i/b. M/s. Little & Co. for Defendant No.2.
Headnote:
The court discussed the principles of antisuit injunctions, comity, and the principle of forum non conveniens in the context of a dispute over the existence and validity of two alleged contracts for the sale of steel. The court held that the plaintiff was not entitled to an antisuit injunction restraining the defendant from continuing proceedings in the English courts, as there was a good arguable case that the English courts had jurisdiction to determine the dispute and that the plaintiff had submitted to the jurisdiction of the English courts by virtue of having made an application challenging the English court's jurisdiction. The court also held that the suit filed by the plaintiff in the Indian courts should be stayed pending the outcome of the English proceedings, as the English courts were the more appropriate forum to determine the dispute.
Fact of the Case:
The plaintiff, an Indian company, entered into two alleged contracts with the defendant, a Hong Kong company, for the sale of steel. The plaintiff alleged that the defendant had breached the contracts and filed a suit in the Indian courts seeking damages. The defendant filed an application in the English courts for permission to serve the plaintiff with a claim form for service out of jurisdiction. The plaintiff challenged the jurisdiction of the English courts, but the challenge was dismissed. The plaintiff then filed an application in the Indian courts for an antisuit injunction restraining the defendant from continuing the English proceedings. The defendant filed a cross-application for a stay of the Indian proceedings.
Finding of the Court:
The court held that the plaintiff was not entitled to an antisuit injunction restraining the defendant from continuing the English proceedings. The court found that there was a good arguable case that the English courts had jurisdiction to determine the dispute, as the contracts contained a non-exclusive jurisdiction clause in favor of the English courts. The court also found that the plaintiff had submitted to the jurisdiction of the English courts by virtue of having made an application challenging the English court's jurisdiction. The court further held that the suit filed by the plaintiff in the Indian courts should be stayed pending the outcome of the English proceedings, as the English courts were the more appropriate forum to determine the dispute. The court found that the English courts were more familiar with the relevant law and that the defendant would be prejudiced if it were forced to defend the Indian proceedings.
Issues: 1. Whether the plaintiff was entitled to an antisuit injunction restraining the defendant from continuing the English proceedings. 2. Whether the suit filed by the plaintiff in the Indian courts should be stayed pending the outcome of the English proceedings.
Ratio Decidendi: 1. The court held that the plaintiff was not entitled to an antisuit injunction restraining the defendant from continuing the English proceedings, as there was a good arguable case that the English courts had jurisdiction to determine the dispute and that the plaintiff had submitted to the jurisdiction of the English courts by virtue of having made an application challenging the English court's jurisdiction. 2. The court held that the suit filed by the plaintiff in the Indian courts should be stayed pending the outcome of the English proceedings, as the English courts were the more appropriate forum to determine the dispute.
Final Decision: The court dismissed the plaintiff's application for an antisuit injunction and granted the defendant's application for a stay of the Indian proceedings.
It would be convenient to deal with both the notices of motion by a common order as the facts involved therein are the same.
2. Defendant no.1 is a company based in Hongkong and also has an office in Mumbai, India. Defendant no.2 is MSTC Limited, a Government of India enterprise.
3. The plaintiff has sought a declaration that there is no contract between defendant no.1 and itself in respect of two sets of documents, I will shortly refer to. The plaintiff has also sought a declaration that defendant no.1 is not entitled to claim from it any amount by way of damages or otherwise under the said documents. The plaintiff has further sought a perpetual order and injunction restraining defendant no.1 from claiming any amount under the said documents and from proceeding further with the proceedings filed by defendant no.1 in the High Court of Judicature, Queen's Bench Division, Commercial Court, Royal Court of Justice in the United Kingdom.
4. Notice of Motion No. 3472 of 2006 is taken out by the plaintiff seeking an injunction restraining defendant no.1 from proceeding and/or taking any steps in furtherance of the English proceedings. By an order dated 18th October, 2006, I had granted an adinterim order to this effect in favor of the plaintiff. Notice of Motion No.1343 of 2007 is taken out by defendant no.1 seeking a discharge / setting aside of the adinterim order and an order staying this suit until the hearing and final disposal of the suit filed by defendant no.1 in the United Kingdom.
5. The subject matter of this suit and of the proceedings instituted by defendant no.1 in the United Kingdom are two contracts for sale of steel by defendant no.1 to the plaintiff allegedly arrived at between the plaintiff and defendant no.1. Defendant no.1 contends that the plaintiff is in breach of the said contracts and has, therefore, claimed damages in the English proceedings. The plaintiff on the other hand contends that neither of the contracts was arrived at and further that the terms and conditions purportedly incorporated therein by reference were never forwarded to the plaintiff. Further in respect of one of the contracts, in any event, the plaintiff is not liable as it is addressed to defendant no.2.
6. There is and can be no dispute that ordinarily this Court would have jurisdiction and that no part of the cause of action has arisen in the United Kingdom. Defendant no.1 has based the English proceedings and the reliefs claimed in its Notice of Motion on an English nonexclusive jurisdiction clause contained in conditions of sale, the receipt whereof is denied by the plaintiff.
7. Before going further it is important to note that Mr.DeVitre, the learned Senior Counsel appearing on behalf of defendant no.1, expressly stated that he would not deal with the merits of the rival contentions including regarding the formation of the contracts and the terms and conditions thereof. I will therefore state the facts only briefly.
FACTS
8(A). In respect of the first alleged contract, an Order Confirmation dated 31st March, 2005 was sent by defendant no.1 to the plaintiff. The first two sentences thereof read: "Thank you for your firm proposal. We are pleased to accept the order as under". This is followed by certain terms and conditions including as regards quantity, price and mode of payment. It is necessary to note the term regarding payment, which reads: "Payment by irrevocable, confirmed, sight LC allowing TT reimbursement". The document concludes: "Please counter sign in acceptance. Our formal Sales contract will follow shortly". One Sanjay Ajmera of the plaintiff signed the documents for the plaintiff under the words: "Counter signed in acceptance". The plaintiff contends that Sanjay Ajmera signed the documents in token of receipt and not in acceptance of all the terms and conditions.
(B). Defendant No.1 thereafter on 6th April, 2005 sent a "Sales Contract" containing detailed terms and conditions. Admittedly, the plaintiff suggeste
