Sagar International Limited v. Tianjin Huilitong Steel Tube Co. Ltd.
2017-07-26
SOUMEN SEN
body2017
DigiLaw.ai
JUDGMENT : 1. The defendant no.2 has opened a letter of credit in favour of the defendant no.1. The proceeds of the letter of credit receivable from the bank of the defendant no.2 was restrained on the earlier occasion since the plaintiff contended that the defendant no.1 has no asset within the jurisdiction of this Court and the debt is admitted. 2. The defendant no.1 pursuant to the notice has appeared and submitted that in terms of Clause 2 of the exclusive agency agreement the defendant no.1 had agreed to pay commission of 0.75% of ONGC Contract value upon receipt of the Letter of Credit from ONGC Bank to M/s. Sagar International Limited and to pay 0.75% more upon receipt of payment from ONGC Bank. 3. The agreement records that the plaintiff would try to its best to assist the defendant no.1 to get the tender floated by Oil and Natural Gas Corporation Limited, with its knowledge and expertise. It is not in dispute that the respondent no.1 was found to be a successful tenderer. However, dispute arose with regard to the payment of commission. Clause 2 of the agreement required the defendant no.1 to pay commission of 0.5% of the contract value upon receipt of letter of credit from the banker of ONGC to the plaintiff and to pay a further commission of 0.50% upon receipt of payment from the banker of ONGC. It is an admitted position that the respondent no.1 has made some payments to the plaintiff upon receipt of the letter of credit from the banker of ONGC. 4. The defendant no.1 does not seem to dispute its liability to pay commission of 0.75% of the contract value upon receipt of the letter of credit, but has argued that the plaintiff is entitled to claim only US$ 11349.50. However, it is submitted that so far as the balance payment is concerned, it is only upon the receipt of payment from the ONGC Bank. The said payment could not be made because of the order of injunction. Moreover, the defendant no.1 has a claim against the plaintiff towards demurrage. 5. The defendant no.1 is a foreign company. The defendant no.1 does not have any asset within the jurisdiction of this Court. Prima facie, it appears that the defendant no.1 may not have any defence with regard to US$ 11349.50.
Moreover, the defendant no.1 has a claim against the plaintiff towards demurrage. 5. The defendant no.1 is a foreign company. The defendant no.1 does not have any asset within the jurisdiction of this Court. Prima facie, it appears that the defendant no.1 may not have any defence with regard to US$ 11349.50. The defendant no.1 does not dispute that the plaintiff was instrumental in getting the tender in favour of the defendant no.1 and the fact that the plaintiff had assisted the defendant to have the contract awarded in its favour. The plaintiff has been able to make a strong prima facie case. However, in view of the stand taken by the defendant that the defendant no.1 could have some claim against the plaintiff on account of demurrage instead of directing the defendant to pay the amount, in my view, the defendant no.1 should be directed to secure US$ 11349.50. The defendant no.1 has also assured that upon receipt of payment under the letter of credit, the defendant no.1 would also secure 0.75% more. 6. Under such circumstances, the defendant no.1 shall deposit Indian money equivalent to US$ 11349.50 with the Registrar, High Court, Original Side, and shall also deposit the amount representing 0.75% more of the contract value upon receiving payment from the ONGC Bank with the Registrar, High Court Original Side. The advocate on Record of the defendant no.1 shall intimate receipt of payment to the advocate on record of the plaintiff and within two weeks from the date of receipt from the banker of ONGC shall deposit the said amount with the Registrar, High Court Original Side in the same manner as the previous one. 7. It is made clear that this Court has not gone into the merits of the claim of the defendant with regard to its claim on account of demurrage which sound in damages and it may be tried as an issue if raised at the trial of the suit. 8. It is needless to mention that the aforesaid deposit by the defendant no.1 shall be without prejudice to the contention of the defendant no.1. The Registrar, High Court Original Side shall upon receipt of the said fund deposit the said amount in a suitable fixed deposit with a Nationalized Bank and shall keep the said fixed deposit renewed until further orders. 9.
The Registrar, High Court Original Side shall upon receipt of the said fund deposit the said amount in a suitable fixed deposit with a Nationalized Bank and shall keep the said fixed deposit renewed until further orders. 9. The defendant no.1 wanted to file affidavit in opposition in GA No.2038 of 2017. However, in view of the fact that the defendant no.1 has filed an application for vacating of the interim order being GA No.2426 of 2017, the said application is treated as an affidavit in opposition to GA No.2038 of 2017 and upon consideration of both the petitions the aforesaid order is passed. Since no separate affidavit in opposition is filed by either of the parties, the allegations made in the respective petitions are deemed to have been denied. GA No.2038 of 2017 and GA No.2426 of 2017 are disposed of.