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IN THE HIGH COURT OF DELHI
Sanjeev Narula, J.
Shanghai Electric Group Co. Ltd. - Appellant
Versus
Reliance Infrastructure Ltd. - Respondent
O.M.P. (I) (COMM.) 433 of 2020, & I.As. 131 of 2021, 757-58 of 2021, 5762 of 2021, 7056-57 of 2021, 9045-46 of 2021 and 9068-69 of 2021
Decided On : 19-07-2022
| Table of Content |
|---|
| 1. identification of parties involved in the dispute. (Para 2 , 3) |
| 2. factual background of contracts and financial obligations. (Para 4 , 5 , 6 , 9) |
| 3. arguments against objections regarding section 9 applicability. (Para 12 , 13 , 14 , 15) |
| 4. contentions regarding maintainability based on jurisdiction. (Para 20 , 21 , 22 , 23) |
| 5. jurisdictional objections and their implications for the case. (Para 30 , 31 , 32 , 33) |
| 6. merits of segcl's claims and challenges raised by reliance. (Para 79 , 80 , 81 , 82) |
| 7. recommendations against granting interim relief. (Para 86 , 87 , 88) |
JUDGMENT
Sanjeev Narula, J. The present petition under Section 9 of the Arbitration and Conciliation Act, 1996 [hereinafter, "the Act"] seeks interim measures for securing the amount in dispute in arbitration payable in terms of a Guarantee Letter dated 26th June, 2008 issued by the Respondent as well as injunctive reliefs restraining the Respondent from selling, transferring or otherwise disposing of and/or creating any encumbrances on its assets during the pendency of the arbitration proceedings.
TABLE OF CONTENTS
PARTIES TO THE DISPUTE
FACTS
CONTENTIONS ADVANCED
I. ON BEHALF OF SEGCL
A. Reliance's allegation that Section 9 has been impliedly excluded is false and misconceived
B. Reliance's allegation that SEGCL has other efficacious remedies is misconceived
C. Respondent's allegation that the Delhi High Court is not a "Court" under Section 9 is incorrect
D. Reliance's allegation that the instant petition is not maintainable since the Guarantee Letter is Unstamped and Unregistered is III- Conceived
II. ON BEHALF OF RELIANCE
A. Objections on Jurisdiction
B. Objections on maintainability
C. Additional objections to maintainability of claims/petition
ANALYSIS
I. INTERIM ORDERS IN FORCE
II. JURISDICTIONAL OBJECTIONS
A. Whether the applicability of Section 9 has been excluded.
B. Whether the present petition is not maintainable under Section 9(3). 23
C. Whether jurisdiction can be invoked on the basis of location of assets
III. MERITS
PARTIES TO THE DISPUTE
2. The Petitioner-SEGCL Electric Group Co. Ltd. [hereinafter, "SEGCL"] is a company incorporated and having its registered office in the People's Republic of China, and is inter alia, engaged in the business of supplying equipment and services relating to the design, engineering, manufacturing, installation of the main body of turbines and generators and the supervision of erection and commissioning of boilers, turbines and generators, including associated accessories and spare parts.
3. The Respondent-Reliance Infrastructure Limited [hereinafter, "RELIANCE"] is a company incorporated having its registered office in India, and is inter alia, engaged in the business of operating and carrying out engineering, procurement and construction services for various power projects, including thermal power plants.
FACTS
4. SEGCL entered into an `Equipment Supply and Service Contract' dated 26th June, 2008 [hereinafter, "Contract"] with a subsidiary of RELIANCE viz. Reliance Infra Projects (UK) Limited [hereinafter, "Reliance UK"] - under which, SEGCL was engaged as the contractor to, inter alia, supply equipment, erect the main body of the turbines and generators, and provide supervision services to Reliance UK in relation to erection and commissioning of six units of boilers, turbines and generators, including associated accessories and spare parts, for construction of the coal-fired super critical thermal ultra-mega power project at Sasan, Madhya Pradesh, India [hereinafter, "Sasan UMPP"].
5. Under the Contract, Reliance UK was obliged to, inter alia, pay SEGCL a lump sum contract price of US$ 1,311,000,000 (approx. INR 9,641 crores), which comprised the equipment supply price of USS 1,286,000,000 (approx. INR 9,457 crores) and the services price of US$ 25,000,000 (approx. INR 184 crores).
6. With a view to secure performance of obligations of Reliance UK, RELIANCE issued a Guarantee Letter dat
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