Order 1

Order Details: Notice of Motion
Pdf Text: 1 NM No.61118
CNR No. MHCC010023562018
IN THE BOMBAY CITY CIVIL COURT AT BOMBAY
NOTICE OF MOTION NO.611 OF 2018
IN
SUIT NO.9097 OF 1995
(HIGH COURT SUIT NO.3767 OF 1995)
Reliance Industries Limited ...Plaintiffs.
V/s.
Viraj Profiles Limited ...Defendants.
Appearances:
Ld. Adv Badiyani for plaintiff
Ld. Adv Deshpande for defendant.
CORAM : HER HONOUR JUDGE
SMT. KALPANA S. HORE
COURT ROOM NO.14
DATED : 25th SEPTEMBER, 2018.
ORDER
1. This is notice of motion taken by defendant for referring the
parties to arbitrator.
2. Defendant's contention is that plaintiff filed suit for recovery of
alleged outstanding sum of Rs.5,85,907.17/ together with interest.
Defendant's contention is that by a contract dated 18.05.1992, the
plaintiffs sold to defendant shredded steel scrap on the terms and
conditions mentioned in agreement. Defendant's contention is that the
suit of the plaintiff is in respect of alleged claim of the demurrage
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amount which is not disputed only by the defendants but also other
various buyers whose materials were shipped in the same vessel and
various grievances in writing were made to the plaintiffs. However, the
plaintiffs have not disclosed the same and as such, the suit for
demurrage which is not ascertained.
3. Defendant's contention is that as per agreement in the event of
any dispute general terms and conditions of the sale as per MSTC
guidelines would be applicable and under the said guidelines
specifically clause 25 provides for Arbitration. There exists a legally
valid and subsisting arbitration agreement between the parties and the
dispute are fully covered under the said agreement therefore, plaintiff
suit is not maintainable. The claim of the plaintiff is disputed by the
defendants. The defendants have not made any other submissions and
have made this application for reference of the dispute to be determined
by arbitration in the first instance, in full compliance of the provisions
of the said Section 8 of the Act. With this, defendants submitted that
matter be referred to arbitration as per Arbitration clause.
4. The plaintiff by filing say objected this notice of motion.
5. Plaintiff's contention is that defendant had filed an affidavit dated
24.06.1997 in Summons for Judgment No.234 of 1996 filed by the
original plaintiff, the same was not pressed for at the stage of final
hearing. The Hon'ble High Court was pleased to dispose of the said
Summons for Judgment by an order dated 13.04.1999 and was pleased
to grant the defendants leave to defend and had further directed the
defendants that the suit be transferred to commercial cause. The
Hon'ble High Court vide the said order, further directed the defendants
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to file their written statement within a period of 12 weeks from the date
of order dated 13.04.1999. The said order has not challenged by any of
th parties and has become final. The defendants have failed to file their
written statement as directed by the Hon'ble High Court and now has
raised the dispute relating to referring the suit for arbitration to delay
the suit proceedings. Thus, the present notice of motion is completely
malafide.
6. It further contended that sentence in the contract to the following
effect : “In case of any need for interpretation of the terms of this
contract, or in the event of dispute, the general terms and conditions of
sale as per MSTC guidelines as may be relevant to this contract shall be
the reference point” does not result in any arbitration agreement or
arbitration clause in the MSTC guidelines or in the general terms and
conditions of sale as per the MSTC guidelines being incorporated in the
said contract. With this, prayed for rejecting notice of motion.
7. I have heard Advocates for both the parties.
8. Advocate for defendants produced xerox copy of General Terms
and Conditions (GTC) of tender of MSTC Limited.
9. Advocate for defendants submitted that as per Clause 14.1, “in
the event of any dispute and difference arising between the tenderer,
purchaser, buyer and their agent as to the construction, interpretation
or execution of the contract and /or the respective rights and liabilities
of the parties, such disputes and differences shall be referred to the sole
Arbitration of the Chief Executive of the Principal for a company
registered under the Companies Act in case of a PSU or the Head of the
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Department in case of a Government Department / Ordnance Factory
Board Units / Defence Unit, who may act himself or nominate in his
stead any officer subordinate to him or of MSTC being not below the
rank of General Manager / Director in the Government Department /
General Manager in Defence Forces, who shall act as the sole arbitrator.
The provisions of the Indian Arbitration Act, 1940 and the Rules
thereunder shall apply to such arbitration. The award passed by such
sole arbitrator shall be final and shall conclusively bind all the parties”
so, he submitted that the dispute between the parties is to be referred to
arbitrator.
10. Advocate for plaintiff submitted that originally suit was filed in
Hon'ble High Court and Summons for Judgment No.3767 of 1995 was
taken. In that Summons for Judgment, the defendant appeared and
unconditional leave was granted to the defendant. The defendants was
directed to file written statement within 12 weeks from the date of
order dated 13.04.1999. Inspite of order, written statement is not filed
so, defendant cannot say matter be referred to arbitration. Advocate for
plaintiff submitted that as per agreement between the parties dated
18.05.1992 in case of need of interpretation of the terms of this contract
or in the event of dispute, the General Terms and Conditions of sale as
per MSTC guidelines as may be relevant to this contract shall be the
reference point so, only if there is interpretation of terms of the contract
then, arbitrator is to be appointed. Advocate for plaintiff submitted that
in the present case, there is no dispute about the interpretation of
terms. The defendants have only dispute that their liability for
demurrage so, arbitrator cannot be appointed.
11. I have gone through Hon'ble High Court order dated 13.04.1999
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in Summons for Judgment No.234 of 1996, it held that defendants have
also dispute that they are liable for demurrage. It is their contention
that demurrage has to be paid not account of their fault but on account
of certain act on the part of plaintiffs themselves therefore, cannot
prima facie be said a liquidated amount. In the light of the matter, it
will be an issue, it will have to try at the time of trial of the suit so,
unconditional leave was granted to the defendants. I find that the
dispute is not of interpretation of terms of contract. Dispute is only
whether the defendants are liable to pay demurrage as per contract
between the parties. Arbitrator is to be appointed, in case of
interpretation of terms and there is no dispute about interpretation of
terms and conditions therefore, I find that arbitration clause is not
applicable in the present case. It shows inspite of order dated
13.04.1999 defendants not filed written statement and at belated stage
has taken notice of motion, it shows that notice of motion is taken only
to delay the proceedings. With this, notice of motion is liable to be
rejected and accordingly, I proceed to pass the following order :
O R D E R
1. Notice of Motion No.611 of 2018 is hereby rejected.
2. Notice of Motion No.611 of 2018 stands disposed of accordingly.
( KALPANA S. HORE )
Judge,
Dated : 25/09/2018 City Civil Court, Gr. MUMBAI
Dictated on : 25/09/2018
Transcribed on : 25/09/2018
Signed on : 25/09/2018
“CERTIFIED TO BE TRUE AND CORRECT COPY OF THE
ORIGINAL SIGNED JUDGMENT/ORDER.”
Upload Date Upload Time Name of Stenographer
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6 NM No.61118
26.09.2018 4.07 p.m. ARUN ANNAMALAI MUDALIYAR
Name of the Judge (With Court
Room No.)
HHJ Smt. K. S. HORE (CR 14)
Date of Pronouncement of
JUDGEMENT /ORDER
25.09.2018
JUDGEMENT /ORDER signed by
P.O. on
25.09.2018
JUDGEMENT /ORDER uploaded
on
26.09.2018
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