The discretion to choose fee structures in a financial advisory contract lies with the bank, and the plaintiff's claim for higher fees was rejected based on the clear terms of the mandate letter.

JUDGMENT :

1. Plaintiff has filed the present Suit seeking a money decree against the Defendant in the sum of Rs.7,55,96,767/- together with interest.

A. FACTS

2. Plaintiff is a Company registered under the Companies Act, 1956 and is engaged in the business inter alia of providing financial advice and other consultation to banks and financial institutions. Defendant is a Nationalised Bank engaged in the business of providing banking services in India. On 21 June 2017, Defendant- Bank issued an advertisement/Expression of Interest (EOI) inviting applications for empanelment as Financial Advisor for sale of its Non- Performing Assets (NPA). Under the EOI issued by Defendant-Bank, the bidders were supposed to submit their commercial bids in Format in Annexure-E by providing separate quotes for “success based fee on cash received from the bidder (excluding Bank SRs)” and “success based fee for sale amount received from the bidder (including Bank SRs)”. The advertisement was titled “expression of interest” for empanelment as Financial Advisor (FA) for sale of NPAs to Asset Reconstruction Companies (ARCs), Banks, Financial Institutions, NBFCs, etc.

3. Plaintiff applied in pursuance of the advertisement dated 21 June 2017. Its bid was accepted by the Defendant-Bank and Mandate Letter dated 1 July 2017 was issued to the Plaintiff engaging it as Financial Advisor for carrying out the activities relating to the preparation of portfolio of NPAs such as due diligence, evaluation and related matters for bank’s proposed sale of NPA to ARCs and others. The empanelment was valid for one year from the date of approval. The Mandate Letter reflected the commercial bid quoted by the Plaintiff and accepted by Defendant-Bank, under which Plaintiff was to be paid 0.50% success based fee on cash received from the bidder (excluding Bank SRs) and 0.0749% success based fee on sale amount received from the bidder (including Bank SRs).

4. Plaintiff accordingly provided its services as Financial Advisor for sale of Defendant-Bank's NPAs from July 2017 onwards. The tenure of the empanelment was extended by email dated 2 January 2019. This is how Plaintiff provided services as Financial Advisor to the Defendant-Bank from July 2017 to March 2019.

5. It is Plaintiff's case that it raised invoices to the Defendant- Bank at the rate of 0.0749% in respect of ‘cash plus SR bids’ during the period from June 2017 to March 2018. That after March 2018 till about February 2019, the Defendant-Bank chose to accept only ‘100% cash bids’ and towards performance of its services as Financial Advisor, Plaintiff raised invoices at the rate of 0.50% in respect of ‘100% cash bids’. Accordingly, Plaintiff raised four invoices on 2 April 2019 in respect of 100% cash bids by demanding its fees @ 0.50% of cash amount as under:

6. Plaintiff addressed email dated 3 April 2019 explaining to the Defendant as to why the sale amounts were invoiced at 0.50%. Plaintiff received reply dated 5 April 2019 from the Defendant-Bank stating that raising of invoices by Plaintiff at 0.50% was erroneous and called upon the Plaintiff to raise invoices at the rate of 0.074