Chamber Summons No. 163 of 2009 in Suit No. 3513 of 2001. Case: Garware Marine Industries Limited Vs Integrated Finance Co. Ltd.. High Court of Bombay (India)
| Case Number | Chamber Summons No. 163 of 2009 in Suit No. 3513 of 2001 |
| Counsel | For Appellant: Mr. Rohan Cama and Mr. Sayed Mulani i/by Mulalni & Co. and For Respondents: Mr. Narayan Sahu and Mr. R.P. Carvalho i/by M/s. Federal Rashmikant |
| Judges | R. D. Dhanuka, J. |
| Issue | Arbitration Act, 1940 [Repealed] - Sections 20, 41; Arbitration and Conciliation Act, 1996 - Sections 2(e), 9; Code of Civil Procedure, 1908 (CPC) - Sections 120, 16, 17, 20, 20(a), 20(c); Indian Contract Act, 1872 - Sections 23, 28; Indian Evidence Act, 1872 - Section 92 |
| Judgement Date | August 20, 2013 |
| Court | High Court of Bombay (India) |
Judgment:
R. D. Dhanuka, J.
1. By this chamber summons filed by the defendant, it is prayed that the plaint in this suit be returned to the plaintiff for presentation in appropriate court at Chennai and in the alternative to reject the plaint on the ground that the suit is barred by law of limitation and that the plaint does not disclose cause of action for the reliefs claimed in the suit. Some of the facts relevant for the purpose of deciding this chamber summons are summarized as under:
(a) By an Equipment Lease Agreement dated 30th June, 1992 entered into between Plaintiff and defendant, the defendant gave on lease one Himson scragg SDS-8 Texturising machine (hereinafter referred to as the said machine) for the period of five years on the terms and conditions mentioned in the said agreement. The said machine was installed at the factory premises of Garware Nylons Limited, an associate company of the plaintiff at Ahmednagar and the said associate company was using the said machine. The registered office of the defendant company is at Chennai. Defendant has one of its subordinate office at Mumbai. It is the case of the plaintiff that in the month of August, 1996, the said Garware Nylon Ltd. suspended its operation. One of the creditor of the said Garware Nylon Limited filed petition in this court being Company Petition No. 5 of 1992 inter alia praying for winding up of the said company. The Plaintiff vide letter dated 19th June, 1997 requested the defendant to take necessary steps to recover possession of the said machine. On 5th September, 1997, the official Liquidator attached to this court came to be appointed as provisional liquidator of the said Garware Nylons Limited and took charge and control of the assets of the said company including machine which was given on lease to the plaintiff by the defendant. It is the case of the plaintiff that the plaintiff though repeatedly told defendant to file appropriate proceedings in this court to get the machine released, defendant did not take any steps promptly. Only in the month of October, 1997, defendant filed company application praying for direction against the provisional liquidator to hand over the said machine to the defendant. Plaintiff thereafter requested the defendant vide letter dated 9th March, 1998 to take steps to obtain necessary court orders to take possession of the said machine. Plaintiff also alleged that due to such attitude of the defendant, the endeavour of the plaintiff of putting the said machine to use were being lost. By letter dated 9th March, 1998, defendant demanded amount of Rs. 43,70,346/- from the plaintiff as arrears of the lease rentals. The plaintiff by letter dated 17th March, 1998 denied its liability. On 18th December, 1998, this court appointed official liquidator of the assets of the said company. The defendant thereafter demanded arrears of Rs. 46,39,657/- from the plaintiff vide letter dated 4th April, 1998. Plaintiff once again denied the liability by letter dated 29th April, 1998 and called upon the defendant to take steps to take possession of the said machine.
(b) Defendant vide its advocates letter dated 16th June, 1998, called upon the plaintiff to pay Rs. 88,28,637/- and stated that it was obligation of the plaintiff to keep the lease equipments at all times in its possession and control. Plaintiff vide letter dated 30th June, 1998, denied the said allegations of the defendant and denied the liability.
Plaintiff vide letter dated 19th December, 1998 once again alleged that the defendant had not taken any steps to get possession of the said machine. The defendant vide its advocate's letter dated 6th January, 1999, denied the said allegations and stated that the defendant had taken the steps to recover possession of the said machine. Defendant called upon the plaintiff to pay Rs. 88,28,637/- with further interest. Defendant vide advocates' letter dated 29th January 1999 reiterated that plaintiff had failed to pay the outstanding amount of the defendant. On 1st April, 1999, defendant called upon the plaintiff to make payment of Rs. 1,06,25,329/-. Plaintiff vide letter dated 5th May, 1999 alleged that the defendant was liable to pay to the plaintiff damages suffered by the plaintiff due to loss of income resulting from the irresponsible attitude of the defendant. Defendant by advocate's letter dated 31st January. 2001 called upon the plaintiff to make payment of Rs. 3,51,22,041.62 by referring to agreement dated 13.11.1995. Plaintiff vide advocates letter dated 8th March, 2001 denied the allegations. On 30th April, 2001, plaintiff filed suit in this court for declaration that defendant is liable to pay to the plaintiff an amount of Rs. 1,93,78,667/- together with further interest on the said sum at the rate of 18% p.a. with quarterly rests from the date of the suit till payment and/or realization. The writ of summons in the suit was served upon the defendant on 7th August, 2008, at the registered office of the defendant. On 28th January, 2009, defendant filed this chamber summons.
2. Learned counsel for the defendant in support of the Chamber summons submits as under:
(a) That the registered office of the defendant is at Chennai. The loan application was made by the plaintiff to the defendant at its registered office at Chennai. The lease agreement was entered into at Chennai. Learned counsel submits that the defendant along with their letter dated 30th March, 1996 had forwarded three sets of hire purchase/lease agreement dated 30th November, 1995 to the plaintiff having its office at Mumbai for due execution at their end and requested to return the same along with various payments. It is submitted that Plaintiff thereafter forwarded all these documents referred therein along with original lease agreement to the defendant at its registered office at Chennai and the said agreement was accepted at Chennai. The learned counsel invited my attention to clause 31 of the said agreement which reads as under:
31. CURRENCY:
All monetary reference in this agreement refer to Indian Currency and all payments are to be made in Indian Currency at the office of integrated Finance Company Limited, Madras.
(b) Reliance is also placed on clause 16(i) and (ii) which is extracted as under:
16. EXCLUSIONS:
(a) The lessee acknowledges and agrees with the lessor:
(I) that the lessor shall not be liable to the Lessee for any liability, claim, loss, damage or expense of any kind of nature.
(I) caused directly or indirectly by the Equipment or any inadequacy thereof for nay purpose, or any defect therein or by the use thereof, or
(II) in relation to any repairs, servicing, maintenance, or adjustments thereto, or to any delay in providing or failure to provide the same, or in relation to any interruption or loss of use thereof or any loss of business or any damage whatsoever and howsoever caused.
(c) Reliance is also placed on Clause 17(a) to (c) which read as under:
17. The Lessee will indemnify the Lessor and keep the Lessor indemnified at all times against:
(a) Loss by seizure under distress for rent, execution or other legal process;
(b) loss destruction of, or damage to the Equipment by Fire, Accident or any other causes whatsoever.
(c) any clams arising out of the use, operation or keeping of the Equipment.
(d)....
(e)....
(d) Clause 38 of the said agreement which is relevant for the purpose of deciding this Chamber summons reads as under:
38. In the event of dispute under this or any of the agreements entered into between the Lessor and the Lessee in connection with the Lease of the Equipment mentioned in the Schedule A the Courts in Madras alone will have jurisdiction.
(e) Learned counsel for defendant submits that all the correspondence exchanged by parties were at the registered office of the defendant situated at Chennai. The supervision, control and management of the said equipment was carried out by the defendant from its registered office at Chennai. All the consideration payable by the plaintiff to the defendant was at its registered office at Chennai. It is submitted that the dispute raised in the suit is regarding the lease agreement which was executed at Chennai. Claims made by the plaintiff for damages are not independent of the lease agreement. It is submitted that in the absence of lease agreement, such claim would not have arisen. Learned counsel submits that in view of section 92 of the Evidence Act, no evidence can be permitted contrary to the written contract which provides that the payments were to be made at registered office of the defendant at Chennai. It is submitted that the correspondence would indicate that the actual administration of the property was done by the defendant from Chennai. The learned counsel submits that the original agreement entered into between the parties was revised by entering into supplementary agreement on 30.11.1995 which agreement was also executed at Chennai. It is submitted that in the said agreement, the schedule of payment was revised. Clause 39 of the said agreement also provided that in the event of dispute under that agreement or any of the agreements entered into between the lessor and the lessee in connection with the lease of equipment mentioned in schedule A, the courts at Madras will alone have jurisdiction. Learned counsel submits that there is no other lease agreement entered into between the parties except these two agreements referred aforesaid. Learned counsel submits that since the agreement in question was executed at both the places i.e. at Mumbai and Chennai and it was sent to Chennai by the plaintiff where it was accepted, part of cause of action had also arisen at Chennai and in view of the agreement recorded in clause 39 of the lease agreement, Chennai court alone will have jurisdiction to entertain the suit.
(f) Learned counsel submits that the payment was made by the defendant to M/s. Garware Nylons Limited at the instance of the plaintiff...
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