: 1 : IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION NOTICE OF MOTION NO.1988 OF 2008 IN SUIT NO.1734 OF 2008 Oil Natural Gas Corpn.Ltd. ....Plaintiff V/s. M/s.Amur Shipbuilding Plant & Ors. ....Defendants Mr.S.U. Kamdar, Senior Counsel i/b M/s.Vyas & Bhalwal for the Plaintiff. None for the Defendants. CORAM : S.J. VAZIFDAR, J. DATED : 4TH AUGUST, 2008. P.C. : 1. The Defendants are absent despite being served. Mr.Kamdar, the learned Senior Counsel appearing on behalf of the Plaintiff in fact states that the Defendants have been served more than just once. 2. The suit is filed for a perpetual injunction restraining the Defendants from pursuing or participating in or prosecuting the proceedings initiated before the Arbitral Tribunal of Khabarovskiy Krai, Khabarovsk, in Russia and a declaration that initiation of the said proceedings is illegal, null and void. : 2 : 3. It appears that the proceedings initiated by Defendant No.1 before Defendant No.3, Arbitral Tribunal in Russia is a statutory arbitration. The rules that would apply to an anti-suit injunction would therefore apply to such proceedings. Keeping in mind the principle of comity an anti-suit injunction is granted sparingly. However, in the facts and circumstances of the case, the Plaintiff has, in my opinion, made out a case for the injunction sought. 4. The Plaintiff invited tenders for construction of vessel in the year 2004. It was a global tender. Defendant No.1 was the successful tenderer. 5. An agreement dated 24.3.2005d was entered into between the Plaintiff and Defendant No.1, Clauses 22 and 23 whereof read as under :- "22.0 22.0 22.0 APPLICABLE APPLICABLE APPLICABLE LAWS AND JURISDICTION LAWS AND JURISDICTION LAWS AND JURISDICTION The CONTRACT, including all matters connected with this CONTRACT shall be governing by the Indian Law both substantive and procedural, for the time being in force and shall be subject to the exclusive jurisdiction of Indian Courts at Mumbai, India. 23.0 23.0 23.0 ARBITRATION ARBITRATION ARBITRATION Except as otherwise provided elsewhere in the CONTRACT, if any, dispute, : 3 : difference, question or disagreement arises between the parties hereto or the respective representatives or assignees at any time in connection with construction, meaning, operation, interpretation or out of CONTRACT or breach thereof shall be decided by an Arbitral Tribunal consisting of three arbitrators. Each party shall appoint one arbitrator and the Arbitrators so appointed shall appoint the third arbitrator, who will act the presiding arbitrator. The party desiring the settlement of dispute shall give notice of its intention to go for arbitration clearly stating all disputes to be decided by arbitral tribunal and appoint its own arbitrator and call upon the other party to appoint its own arbitrator within 40 days. In case a party fails to appoint an arbitrator within 30 days from the receipt of request to do so by the other party or the two arbitrators so appointed fail to agree on the appointment of the third arbitrator from the date of their appointment, upon request of a party, the Chief Justice of High Court or any other person or institution designated by him within whose jurisdiction the subject CONTRACT has been made, shall appoint the arbitrator/presiding arbitrator upon request of one of the parties. If any of the arbitrators so appointed dies, resigns is incapacitated or withdraws for any reasons from the proceedings, it shall be lawful for the concerned party/arbitrators to appoint another person in his place in the same manner as aforesaid, such person shall proceed with the reference from the stage where his predecessor had left if both the parties consent for the same, otherwise he shall proceed de-novo. It is a team of the CONTRACT that the party invoking arbitration shall specify all disputes to be referred to arbitration at the time of invocation of arbitration and not thereafter. : 4 : The Arbitral tribunal shall give a reasoned award and the same shall be final, conclusive and binding on the parties. The fees of arbitrators shall be borne by the parties nominating them and the fee of the presiding arbitrator, cost and other expenses incidental to the arbitration proceedings shall be borne equally by the parties. Subject to aforesaid, the provisions of Indian Arbitration Act and Conciliation Act, 1996 and any statutory modifications or re-enactments in lieu thereof shall apply to the arbitration proceedings under this clause. 6. At the request of Defendant No.1 the Plaintiff extended the time for completion of the contract from time to time. The last extension was till November, 2006 without levying the liquidated damages. 7. By a letter dated 15.8.2007, the Defendants refused to deliver the vessel unless certain payments were made. By a letter dated 30.8.2007, the Plaintiff refused to extend the contract any further. By a letter dated 12.3.2008, the Plaintiff invoked the arbitration clause and filed an application under Section 11 which is pending before the Supreme Court. 8. Defendant No.1 on 27.3.2008 denied the existence of the arbitration agreement and refused to : 5 : act in furtherance of the arbitration clause. 9. On 15.4.2008, Defendant No.1 filed a claim before Defendant No.3. From the translation of the statement of claim filed before Defendant No.3, it appears that Defendant No.1 has contended inter-alia that there were errors in the tender documents and that the parties had not agreed to the price. It is stated ; "this constitutes one more basis for loss of contract". It is alleged that the contract is an international agreement between a Russia and an Indian Corporation and that as the dispute related to loss of contract is not covered by the said arbitration clause 22. For that reason, it is also contended that disputes relating to "loss of contract" do not fall within the clause regarding the rights being governed by the Indian law Thus it is contended that "loss of contract" results in, there being no contract in existence. I presume that by the expression "loss of contract", what Defendant No.1 really means is that the contract is not in existence. 10. Prima-facie atleast even the nature of the dispute raised by the Respondent is arbitrable as per the provisions of the said agreement dated 24.3.2005. The contentions raised in the statement of claim appear to be covered by the arbitral clause. : 6 : 11. This by itself however would not justify an anti-suit injunction. In Modi Entertainment Network and another v. W.S.G. Cricket Pte.Ltd. (2003) 4 Supreme Court Cases 341, the Supreme Court held in paragraph 24 as under :- "24. From the above discussion the following principles emerge : (1) In exercising discretion to grant an anti-suit injunction the court must be satisfied of the following aspects : (a) the defendant, against whom injunction is sought, is amenable to the personal jurisdiction of the court ; (b) if the injunction is declined, the ends of justice will be defeated and injustice will be perpetuated ; and (c) the principle of comity - respect for the court in which the commencement or continuance of action/proceeding is sought to be restrained - must be borne in mind. (2) In a case where more forums than one are available, the court in exercise of its discretion to grant anti-suit injunction will examine as to which is the appropriate forum (forum conveniens) having regard to the convenience of the parties and may grant anti-suit injunction in 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 non-exclusive jurisdiction of the court of choice of the parties are not determinative but are relevant factors : 7 : 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 seeking injunction to prosecute the case in the court of choice because the essence of the jurisdiction of the court does not exist or because of a vis major or force majeure and the like. (5) Where parties have agreed, under a non-exclusive jurisdiction clause, to approach a neutral foreign forum and be governed by the law applicable to it for the resolution of their disputes arising under the contract, ordinarily no anti-suit injunction will be granted in regard to proceedings in such a forum conveniens and favoured forum as it shall be presumed that the parties have thought over their convenience and all other relevant factors before submitting to the non-exclusive jurisdiction of the court of their choice which cannot be treated just as an alternative forum. (6) A party to the contract containing jurisdiction clause cannot normally be prevented from approaching the court of choice of the parties as it would amount to aiding breach of the contract ; yet when one of the parties to the jurisdiction clause approaches : 8 : the court of choice in which exclusive or non-exclusive jurisdiction is created, the proceedings in that court cannot per se be treated a vexatious or oppressive nor can the court be said to be forum non-conveniens. (7) The burden of establishing that the forum of choice is a forum non-conveniens or the proceedings therein are oppressive or vexatious would be on the party so contending to aver and prove the same." 12. It has been categorically averred in the plaint inter-alia that the proceedings before Defendant No.3 are vexatious and/or oppressive. It is also averred that the same are nothing but a counter-blast to the Plaintiff taking recourse to the remedies under the said agreement. None of these averments have been denied. There is no doubt that considering the plaint as filed, the Defendants are amenable to the jurisdiction of this Court. Prima-facie it appears that this Court is the most appropriate forum having regard to the convenience of the parties. The contract was entered into in India. The parties have agreed to be bound by the Indian law and procedure. They have subjected themselves to the jurisdiction of this Court. The nature of the dispute also indicates that the mere fact that the vessel may have been constructed elsewhere would not indicate that Defendant No.3 is a more convenient forum. : 9 : 13. The Defendants have not denied any of these allegations. Having refused to appear despite being served several time, I am not inclined therefore to doubt the submissions made on behalf of the Plaintiff. 14. In the circumstances, the Notice of Motion is made absolute in terms of prayers (a) and (b).