Gujarat High Court
Mena Energy Dmcc vs Mt Queen Helena ( Imo No 9341354 ) on 27 December, 2018
Author: R.M.Chhaya
Bench: R.M.Chhaya
C/AS/44/2018 IA ORDER
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
CIVIL APPLICATION NO. 1 of 2018
IN
R/ADMIRALITY SUIT NO. 44 of 2018
===================================================
MT QUEEN HELENA ( IMO NO 9341354 ) Versus MENA ENERGY DMCC =================================================== Appearance:
MR UNMESH SHUKLA assisted by MR MANAV A MEHTA for the applicants MR SAURABH N SOPARKAR, SENIOR ADVOCATE assisted by MS PAURAMI B SHETH for the opponents =================================================== CORAM: HONOURABLE MR.JUSTICE R.M.CHHAYA Date : 27/12/2018 IA ORDER
1. The applicants herein - original defendants no.1 and 3 have filed this application for setting aside the order of arrest dated 25.10.2018 passed by this Court in Admiralty Suit no.44 of 2018, whereby this Court was pleased to order arrest of the defendant -
vessel - MT QUEEN HELENA, at present lying at Mundra Port.
2. Heard Mr. Unmesh D. Shukla, learned counsel assisted by Mr. Manav A. Mehta, learned advocate for the applicants and Mr. Saurabh N. Page 1 of 47 C/AS/44/2018 IA ORDER Soparkar, learned Senior Advocate assisted by Ms. Paurami B. Sheth, learned advocate for the opponents.
3. The applicants herein have contended that the order of arrest for vessel - MV FOLK BEAUTY was obtained by opponent no.1 - original plaintiff for recovery of balance purchase consideration of AED 17,392,801.13 under the sales contract dated 17.05.2018 at Fujairah Court. Before the Temporal Judge of Fujairah Court, the learned Judge granted order of arrest of the said vessel - MT FOLK BEAUTY. However, as the vessel had moved before the order of arrest could be served, opponent no.1 filed another application before Sharjah Federal Court of First Instance and obtained the order of arrest of the vessel - MT FOLK BEAUTY for recovery of the very said amount.
4. It is also contended by the applicants that as the vessel - MT FOLK BEAUTY was heavily mortgaged and could not satisfy the entire claim, opponent no.1 filed an application for arrest of the present vessel and contended that opponent no.1 had a right to proceed against the present vessel for recovery of unpaid sale consideration. Such application was rejected by an order dated 19.09.2018. It is further alleged that the said order is Page 2 of 47 C/AS/44/2018 IA ORDER purposely not produced along with the application and it is also alleged by the applicants that such material facts have been suppressed. It is contended that having failed once, it is not open for opponent no.1 to once again approach this Court and reagitate the same issue. It is further contended by the applicants that permitting opponent no.1 to continue with the present proceedings would give a leeway to unscrupulous litigants like it to initiate one action after the other before different Courts till a favourable order is not obtained. It is contended by the applicants that such practice ought to be deprecated and opponent no.1 should be saddled with heavy cost.
5. The applicants have also averred that having failed before the Court at Fujairah, opponent no.1 approached this Court and filed Admiralty Suit no.38 of 2018. It is averred by the applicants that the Suit was filed in respect of a sale purchase contract dispute between opponents no.1 and 2 and arrest of the defendant - vessel was primarily sought on ground that she is sister vessel of MT FOLK BEAUTY owned by opponent no.2 herein and this Court, by an order dated 24.09.2018, arrested the present vessel. It is further alleged by the applicants that opponent no.1 had an Page 3 of 47 C/AS/44/2018 IA ORDER option to exercise its right to repose the cargo and sue for damages. However, instead of that, opponent no.1 opted to sue for recovery on unpaid sale consideration under sale purchase contract dated 17.05.2018 and thus, having elected to recover unpaid sale consideration, opponent no.1 waived its right to repose or resale the cargo and sue for damages.
6. The applicants have further stated that during pendency of Admiralty Suit no.38 of 2018, opponent no.2 secured complete claim of opponent no.1 before the Fujairah Court by providing bank guarantee dated 21.10.2018 of AED 17,392,801.13. On that basis, the Court at Fujairah released the present vessel from its order of arrest and attached the bank guarantee by an order dated 20.10.2018. The applicants thereafter filed an application being O.J. Civil Application no.2 of 2018 in Admiralty Suit no.38 of 2018 seeking release of the present vessel and by an order dated 25.10.2018, this Court permitted release of the present vessel considering the fact that complete claim made by opponent no.1 herein was secured before the Court at Fujairah. It is further contended by the applicants that on the same day, the present Suit came to be filed before this Court on the basis of the Page 4 of 47 C/AS/44/2018 IA ORDER averments made in the plaint which is filed for claiming loss of profit suffered by the opponent no.1 as seller and cost of arbitration. It is further contended that such claim was never made and it is made for the first time before this Court in the present Suit. It is further alleged that the applicants had consciously relinquished and/or abandoned its claim for loss of profit and cost of arbitration and opponent no.1, having omitted, cannot be permitted to file the Suit claiming such reliefs. It is contended that having chosen to recover unpaid sale consideration under sales contract dated 17.05.2018 and having secured the complete sale consideration before the Court at Fujairah, opponent no.1 cannot be permitted to claim for loss of profit that it could have made by selling the cargo in open market. It is also alleged that having chosen to file a substantial Suit for recovery of unpaid sale consideration, the plaintiff cannot be permitted to invoke arbitration clause under the sales purchase contract and recover loss of profit. On the aforesaid factual basis, the applicants have prayed that the application be allowed and this Court may be pleased to release the defendant-vessel - MT QUEEN HELENA from the order of arrest dated 25.10.2018 passed in the present Suit.
Page 5 of 47C/AS/44/2018 IA ORDER
7. In response to the service of copy of this application, opponent no.1-original plaintiff has filed an affidavitinreply. Opponent no.1-original plaintiff has denied the contentions raised in the application. It is mainly contended that the applicants have made out no case for setting aside the arrest order and that the plaintiff has strong prima facie case which would be defeated if the arrest order is vacated. It is also contended that the application is not maintainable as it is completely misconceived. It is also alleged that the application is exfacie contrary to the catena of judgments of this Court and the applicable international conventions and it is also alleged that the applicants are trying to mislead this Court. It is also contended by opponent no.1 that all the issues raised on behalf of the applicants would require finding of fact and law and would necessitate full fledged trial and therefore, it would not be in the interest of justice for this Court to set aside the order of arrest dated 25.10.2018 at an interlocutory stage. It is also contended that the application raises triable issues, which cannot be decided at an interlocutory stage and therefore, make a strong case for which the present suit to be tried at an early date. The factual averments Page 6 of 47 C/AS/44/2018 IA ORDER made in the application are denied in toto by opponent no.1. It is, therefore, contended that the application deserves to be dismissed.
8. The applicants have also filed an affidavit and have produced the alleged claim statement dated 10.10.2018 filed by opponent no.1 herein before the Arbitral Tribunal, which is in form of a request for arbitration.
9. Mr. Unmesh D. Shukla, learned counsel for the applicants has contended that the present Suit is barred as provided under Order II Rule 2 of the Code of Civil Procedure, 1908. It was contended that having elected to sue for price, the plaintiff cannot be permitted to sue for loss of profit. It was therefore contended that the plaintiff cannot be permitted to approbate and reprobate. It was also contended that the plaintiff cannot be permitted to take mutually destructive pleas and had only two options. After having affirmed the contract and sued for balance sale consideration, the plaintiff cannot repudiate the contract and sue for loss of profit. It was further contended that the loss of profit is a claim for unliquidated damages and cannot be secured by way of arrest of a vessel or otherwise. It was also contended that the Suit to secure claim pending Page 7 of 47 C/AS/44/2018 IA ORDER arbitration is not maintainable as per the provisions of the Admiralty Act, 2017. On facts, it was further contended that even though the claim statement was submitted before the Arbitral Tribunal on 10.10.2018, no amendment was carried out in Admiralty Suit no.38 of 2018. It was also contended that in fact, the Fujairah Court had already rejected a similar claim and therefore, the present Suit is not maintainable.
10. Mr. Shukla further submitted that there is an absolute prohibition for filing the present Suit as provided under Order II Rule 2 of the Code of Civil Procedure, 1908. It was also contended that the present claim is not a maritime claim as defined under Section 4 of the Admiralty Act, 2017. It was contended that the opponent no.1-original plaintiff does not require any protection pending the arbitration and having sued for price and having elected to affirm the contract, opponent no.1-original plaintiff cannot be allowed to approbate and reprobate as the reliefs claimed for are mutually destructive and cannot be claimed. It was further contended that therefore, the legal position would be that when a contract is broken, the party is not bound to accept the breach and either of the two remedies are available; firstly, to accept and sue for Page 8 of 47 C/AS/44/2018 IA ORDER remedy; or can insist for performance of the contract. It was submitted that the plaintiff, by their conduct, has affirmed the contract and having affirmed the contract, they are not entitled to pursue the goods in hands of the buyer. Referring to the relevant provisions of Sales of Goods Act, it was contended by the learned counsel for the applicants that two remedies are envisaged under the said Act; one, being real remedy; and other being personal remedy. It was contended that once delivery is given, real remedies are lost. Referring to Sections 45, 46, 53, 54 and 55 of the Sales of Goods Act, the learned counsel also contended that what are the rights of an unpaid seller are provided under the said provisions. However, right to recall the goods is not provided and it was reiterated that once the delivery is given, real remedies are lost and right to pursue goods stands lost once the delivery is given and hence, claim raised in the Suit is not available under the Sales of Goods Act. It was further contended that if the purchaser does not pay the price, the seller has two options; one, to keep contract alive; and second, to accept the breach. It was contended that when they sued for invoice they elected to continue the contract alive and subsisting and having made this election, second Suit is not Page 9 of 47 C/AS/44/2018 IA ORDER maintainable. Relying upon the judgment of the Hon'ble Apex Court in the case of State of Kerala v. Cochin Chemical Refineries Ltd., AIR 1968 SC 1361, it was contended that having exercised the option by conduct and having done so, they cannot fall back to the other options. Relying upon the judgment in the case of White and Carter (Councils) Ltd. v. McGREGOR, 1961 AC 413, it was contended that both the remedies are not available. Mr. Shukla also referred to the relevant contentions raised in Admiralty Suit no.38 of 2018 i.e. earlier Suit and the present Suit and contended that opponent no.1 has affirmed the contract and thus, mutual destructive claims are raised. It was further contended that the claim of loss of profit is based on value based opinion which is required to be proved and tried subject to crossexamination, so in such case, even on merits, for loss of profit, it cannot be said that it is a maritime claim under Section 4 of the Admiralty Act, 2017. Mr. Shukla also further relied upon the decision of the Hon'ble Apex Court in the case of Union of India v. Raman Iron Foundry, (1974) 2 SCC 231 and the decision in the case of Board of Trustees for the Port of Kolkata v. Haldia Bulk Terminals Private Limited, 2013 SCC OnLine Cal 5660. Mr. Page 10 of 47 C/AS/44/2018 IA ORDER Shukla has also relied upon the following judgments to buttress his contentions: [a] Gajanan R. Salvi v. Satish Shankar Gupte & Ors., AIR 2004 Bombay 455 : (2005) 1 Maharashtra Law Journal 966 [b] Kamal Kishore Saboo v. Nawabzada Humayun Kamal Hasan Khan, AIR 2001 Delhi 220 [c] Shiv Kumar Sharma v. Santosh Kumari, AIR 2008 SC 171 [d] Steel Authority of India Ltd. v. Union of India & Ors., (2006) 12 SCC 233 [e] Virgo Industries (Eng.) Private Limited v. Venturetech Solutions Private Limited, (2013) 1 SCC 625 [f] State Bank of India v. Gracure Pharmaceuticals Limited, (2014) 3 SCC 595 [g] Ashok Aggarwal v. Bhagwan Das Arora, AIR 2001 Delhi 107 It was thus contended by Mr. Shukla, learned counsel for the applicants that the application may be allowed as prayed for.
Page 11 of 47C/AS/44/2018 IA ORDER
11. Per contra, Mr. Saurabh N. Soparkar, learned Senior Advocate for opponent no.1 - original plaintiff has contended that the plaintiff is the seller and defendant no.2 is the buyer and both the parties entered into a contract of sale for 8,600 MTs (+/ 10%) Marine Gas Oil and the said cargo was to be discharged at the port of Yemen. Mr. Soparkar contended that the parties were bound by the contract and its covenants.
12. Mr. Saurabh N. Soparkar, learned Senior Advocate for opponent no.1-original plaintiff, at the outset, contended that the present Suit is maintainable and arrest pending arbitration proceedings can be prayed for. It was submitted that as such opponent no.1-original plaintiff has not filed any claim statement, but has only invoked the arbitration and it was further contended that the judgment of the Hon'ble Bombay High Court in the case of Siem Offshore Redri AS v. Altus Uber, 2018 SCC OnLine Bom 2730 has a persuasive value and the same applies to the present case.
13. It was contended that Order II Rule 2 of the Code of Civil Procedure, 1908 is not pleaded in the application and cannot be orally made Page 12 of 47 C/AS/44/2018 IA ORDER in this proceedings and even if it is permitted, the second Suit is maintainable. It was further contended that the plaintiff agreed to sell goods to the defendant no.2. However, the goods were not to be delivered at the same port, but were to be delivered at Yemen and therefore, the goods have to reach Yemen, as stated in the plaint. It was further contended that as per the memo of sale, goods were to be sent to Yemen, for which, opponent no.1 - original plaintiff could have hired any vessel for transporting the goods from Hamriya to Yemen. However, as the applicants also own the vessel, instead of finding another vessel, opponent no.1 - original plaintiff entered into a different agreement i.e. charterparty agreement with the defendants no.2 and 3. It was also contended that the first Suit i.e. Admiralty Suit no.38 of 2018 is for financial claim. It was also contended that the goods were misappropriated in breach of Clause 8 of the sales contract and the basis of the Suit is illegally conversioned by owner of the vessel. It was contended that as charterparty, it was not duty bound to hand over the goods and the claim is against the owner of the vessel. It was contended that first Suit is based on charterparty agreement of May, 2018;
whereas, the present Suit is based on
misappropriation of goods and to cover the
Page 13 of 47
C/AS/44/2018 IA ORDER
losses suffered due to fluctuating market. It was contended that the first Suit is as a charterparty and the second Suit is as a buyer. It was further contended that the second Suit was necessitated for return of the goods and if the goods have been returned, opponent no.1 could have sold it at a higher price and opponent no.1 being an unpaid seller, no title has passed in favour of unpaid buyer and the second Suit being as a buyer, title would not pass unless full payment is made. It was contended that capacity of both the Suits are different and the cause of action is also different. It was also contended that merely as the transaction is one, it cannot be said that the cause of action is the same. It was contended that basis of the first Suit is the charterparty agreement and opponent no.1 - original plaintiff could not have raised the same plea as regards sale agreement and loss of profit cannot be raised against the charterparty and therefore, it was contended that both the cause of action are totally different. The evidence would be different. It was contended that the first Suit is relating to misappropriation and the second Suit relates to nonpayment of sale price and further loss occurred due to variation in price. It was contended that some facts may be common, Page 14 of 47 C/AS/44/2018 IA ORDER however, the same would not attract the provisions of Order II Rule 2 of the Code of Civil Procedure, 1908. Mr. Soparkar contended that the judgments relied upon by the applicants would not apply to the present case. It was contended that the capacity in first Suit relates to breach of charterparty and the second Suit relates to breach of sale agreement. Relying upon the judgment of the Hon'ble Apex Court in the case of Deva Ram & Anr. v. Ishwar Chand & Anr., (1995) 6 SCC 733, it was contended that opponent no.1 could not have pleaded the same thing in the same Suit as the first Suit is regarding the price and second Suit is regarding possession of the goods. It was, thus, contended that the cause of action in both the Suits is separate, distinct and different and both the Suits will require separate set of evidence to prove the claim and unless the defendant pleads bar under Order II Rule 2 of the Code of Civil Procedure, 1908 and an issue is framed focusing the parties on that bar to the Suit, the Court cannot examine or reject the Suit on that ground. It was also contended that if defendant no.3 admits that the pleas are inconsistent with each other, this gives one more reason to the plaintiff to maintain and file two different Suits as two inconsistent pleas cannot be decided in one Suit. It was Page 15 of 47 C/AS/44/2018 IA ORDER also contended that the conditions as provided under Order II Rule 2 of the Code of Civil Procedure, 1908 are not satisfied in the instant case and the defendant must satisfy such conditions. Mr. Soparkar specifically denying the contentions raised by the applicants as regards bar of the second Suit under Order II Rule 2 of the Code of Civil Procedure, 1908, contended that the sale contract between the plaintiff and defendant no.2 is an independent from charterparty entered into between the same parties. It was also contended that both the contracts contemplate different obligations and only because the parties are same, the cause of action cannot be said to be the same and rights and liabilities of both the parties under the agreement and rights and liabilities of both the parties under the said agreements are independent of each and/or separate consideration and exclusive. It was contended that first Suit being Admiralty Suit no.38 of 2018 was filed as the cargo belonging to opponent no.1 - original plaintiff was wrongfully misappropriated and discharged without obtaining requisite permission from the plaintiff which was one of the mandatory condition in the charterparty agreement. It was also contended that even though opponent no.1 - original plaintiff, being the charterer Page 16 of 47 C/AS/44/2018 IA ORDER of the vessel, the cargo was dealt with by defendants no.2 and 3 in breach of charterparty. Mr. Soparkar further contended that second Suit being Admiralty Suit no.44 of 2018 has been initiated to secure claim in arbitration which covers the losses suffered due to fluctuation in the cargo under the sale contract and the said Suit is filed after opponent no.1 invoked arbitration and filed the request for arbitration for appointment of the arbitrator. It was also contended that as it is evident from the plaint itself, the second Suit has been filed for loss of profit under the sale contract to secure the plaintiff's claim in a pending arbitration. It was therefore contended that the cause of action in both the Suits are separate and distinct. It was also contended that the defendant - vessel has already been released in the first Suit and therefore, there is no multiplicity of the proceedings as alleged by the applicants. It was also contended that the contention of the applicants that the earlier Suit could have been amended to include the present claim is wrong as both the Suits are premised on separate causes of action and thus, it was contended that the cause of action in both the Suits are different and distinct. It was contended that only because in the first Suit, it is mentioned that Page 17 of 47 C/AS/44/2018 IA ORDER opponent no.1 - original plaintiff seeks leave of this Court to add or amend the plaint as the same was filed in great urgency, would not give any right to the plaintiff to join a separate cause of action and the first Suit could not have been amended and the plaintiff was required to file a separate Suit. Relying upon the judgment of the Hon'ble Apex Court in the case of Deva Ram & Anr. (supra), it was contended that even though the present Suit is between the same parties as the cause of action is different, first Suit based on charterparty agreement and second Suit under the sales contract agreement, the same are maintainable. It was contended that both the Suits will require a separate evidence to prove the claim and if the test of maintainability based upon Order II Rule 2 of the Code of Civil Procedure, 1908 is examined, the set of facts of both the Suits are different and are required to be proved in both the Suits. Relying upon the judgment of the Hon'ble Bombay High Court in the cases of Kashinath Ramchandra v. Nathoo Keshav, AIR 1914 Bom 130 and Sonu Khushal Khadake v. Bahinibai Krishna & Ors., 1915 SCC OnLine Bom 118, it was contended that as two sets of facts are different, the same are required to be proved in both the Suits in order to enable Page 18 of 47 C/AS/44/2018 IA ORDER opponent no.1 - original plaintiff to succeed in both the Suits. It was also contended that thus, the cause of action in both the Suits are different and distinct. It was further contended that in order to make Order II Rule 2 of the Code of Civil Procedure, 1908 applicable, the defendants must satisfy the following conditions: [A] The previous and second Suit must arise out of the same cause of action;
[B] Both the Suits must be between the same parties; and [C] The earlier Suit must have been decided on merits.
It was further contended that the vessel in the first Suit was released because of the claim amount was secured in UAE proceeding and therefore, the first Suit initiated herein cannot be said to have been decided on merits. It was therefore submitted that the decisions relied upon by the applicants are not applicable to the present case.
14. Mr. Soparkar also contended that defendants no.2 and 3 are having common interest and the ownership of the defendant - vessel was Page 19 of 47 C/AS/44/2018 IA ORDER fraudulently changed to defeat the claim of the plaintiff. Relying upon the averments made in Paragraphs 4 and 5 of the plaint, it was contended that the ownership of the defendant- vessel was changed fraudulently to defeat the claim of the plaintiff and it was also contended that the plaintiff has produced enough evidence to establish that the vessels- MT FOLK BEAUTY and MT QUEEN HELENA are sister vessels. It was contended that though an attempt has been made to canvass that the vessel - MT FOLK BEAUTY and MT QUEEN HELENA are not sister vessels and that the ownership of the defendant - vessel had changed before the arrest, the applicants have not produced any document to establish change in ownership of the vessel and even the memorandum of agreement by which both the defendants agreed to sale the defendant - vessel have not been produced. It was also contended that even the bill of sale which is issued at the time of sale of vessel or protocol of delivery issued at the time when the vessel is handed over to defendant no.3 has not been produced. It was also contended that as such no sale has taken place and therefore, it was asserted that the defendant - vessel is the sister vessel of MT FOLK BEAUTY. It was further contended that defendant no.3 has not produced any document to support his argument regarding Company is Page 20 of 47 C/AS/44/2018 IA ORDER not being common Company and therefore, the plea of the ownership of the vessel has changed, cannot be sustained.
15. Mr. Soparkar further contended that the conduct of the defendants no.2 and 3 clearly shows that they are related Companies having commonality of interest, control and operation. It was contended that they have acted in breach of the charterparty and discharged cargo without authorization from the plaintiff. Similarly, defendant no.2 did not make payment under sale contract pricing of which was agreed as per the Platts quotations. It was also contended that email correspondence clearly shows that defendant no.2 did not hand over the cargo to the plaintiff neither did they allow the plaintiff to board the vessel when they repeatedly requested and even the inspection team was not permitted to board the vessel. It was thus alleged that the conduct of both the defendants in changing the ownership/names of the vessel fraudulently acting in breach of the charterparty not handing over possession of the cargo back to the plaintiff has necessitated to claim for security in arbitration proceedings. It was contended that any award that may be passed in arbitration proceedings, will be rendered infructuous in Page 21 of 47 C/AS/44/2018 IA ORDER absence of any security to enforce their arbitration award.
16. Mr. Soparkar relied upon the judgment of the Hon'ble Bombay High Court in the case of Siem Offshore Redri AS (supra). It was contended that the change in Section 9 of the Arbitration and Conciliation Act, 1996 does not affect an action in rem and so also the provisions of the Admiralty Act, 2017 does not affect the view taken in Golden Progress and it was contended that the said judgment clearly applies to the present case and deserves to be followed. Mr. Soparkar reiterated that the document which is produced along with the additional affidavit by the applicants is not a claim statement submitted before the Arbitral Tribunal, but mere request for appointment of an arbitrator. It was submitted that Clause 7.3 of the said request would clarify beyond doubt that the plaintiff has two claims; one for AED 17,392,801.13 under the charterparty; and another for USD 510,000 under Clause 7.4. It was contended that as a matter of fact, the sole arbitrator has been appointed by DIFC-LCIA on 27.11.2018. However, defendant no.2/3 has not paid the cost involved and therefore, the DIFC is not able to issue further directions on completion of proceedings before the Tribunal.
Page 22 of 47C/AS/44/2018 IA ORDER 17. It was contended that as per the sales
contract, the title in goods will not pass to defendant no.2 unless entire purchase condition is paid and therefore, it cannot be contended that the sale is complete and title has passed, as provided under the provisions of the Sale of Goods Act.
18. It was also contended that the plaintiff has a maritime claim as provided under Section 4(f) and (g) of the Act.
Relying upon the judgment of the Hon'ble Supreme Court in the case of Videsh Sanchar Nigam Ltd. v. M.V. Kapitan Kud & Ors., (1996) 7 SCC 127, it was contended that the Hon'ble Supreme Court has held that even if the claimant has arguable case, even though difficult case, the matter ought to proceed and arrest should not be vacated.
19. Mr. Soparkar also contended that the contention raised by the applicants that the plaintiff accepted the sale contract and never demanded delivery of cargo back to it, is also contrary to the evidence on record. Referring to emails dated 22.07.2018, 23.07.2018, 24.07.2018, 25.07.2018, 26.07.2018, 27.07.2018, 30.07.2018, 31.07.2018 (Pages 75 Page 23 of 47 C/AS/44/2018 IA ORDER to 82 of the Suit), it was contended that opponent no.1 - original plaintiff repeatedly requested for inspection of cargo on board the vessel for quantification, however, it was prevented to take possession of the cargo. It was therefore contended that the contention raised by the applicants that opponent no.1- original plaintiff gave up a claim for loss suffered is wrong and misleading. It was contended that the opponent no.1 - original plaintiff was willfully prevented in dealing with the cargo even when defendant no.2 admitted that the title in cargo still remain in the plaintiff. It was also contended that the intention of the parties can only be proved at the time of trial by leading evidence. It was therefore contended that the application deserves to be dismissed and arrest is required to be continued for security pending arbitration.
20. Mr. Shukla, learned counsel for the applicants, in his further reply, contended that the very contention of the opponent no.1- original plaintiff that Admiralty Suit no.38 of 2018 is based on charterparty agreement; whereas, Admiralty Suit is based on breach of sale contract, is contrary to the very pleadings in Admiralty Suit no.38 of 2018. Referring to Paragraphs 6, 10, 11, 14, 19, 20, Page 24 of 47 C/AS/44/2018 IA ORDER 21, 23 to 26 and 39A of Admiralty Suit no.38 of 2018, it was contended that even as per the own pleadings of opponent no.1 - original plaintiff, Admiralty Suit no.38 of 2018 is filed for breach of sale contract. It was also reiterated that the arrest based on sale purchase contract does not constitute a maritime claim under Section 4 of the Admiralty Act, 2017. It was further contended that the present application is filed praying for release of the defendant - vessel and not for dismissal of Admiralty Suit no.44 of 2018 and therefore, the question of framing an issue of Order II Rule 2 of the Code of Civil Procedure, 1908 does not arise. It was reiterated that the application deserves to be allowed.
21. No other or further contentions and/or submissions are made by the learned counsel appearing for the respective parties.
22. Before reverting to the submissions made by both the sides, it would be appropriate to refer to the averments made in the first Suit i.e. Admiralty Suit no.38 of 2018, which are as under: "25. Since Defendant No.2 did not return the cargo back to the Page 25 of 47 C/AS/44/2018 IA ORDER plaintiff as required by the Sale contract/charter party, the plaintiff lost an opportunity to sell the cargo at more favorable prices and realize higher revenues from third parties. Not only did the Defendant No.2 not pay the purchase consideration to the plaintiff, their action of not returning the cargo caused great monetary loss to the plaintiff which was a direct consequence of fraud played by Defendant No.2.
26. Since the cargo was not returned to the plaintiff, they could also not offer the same cargo to the market as the product was not available with the plaintiff. If the plaintiff were in possession of their cargo, they would have sold the cargo to third parties/other customers as per the Platts quotations published and made a substantial profit as detailed in above paragraphs.
27. It is submitted that the above actions by Defendant No.2 by acting in breach of the Charter Party and Sales Contract and Bills of lading without knowledge of the plaintiff constitute an unlawful interference by defendant no.2 with the plaintiff's title in the cargo as the entire purchase consideration has admittedly not been paid till date under the Sales Contract. Further, discharge of cargo without payment of purchase consideration under the Sales Contract, without production of original bill of lading under the Charter Party amounts to conversion of the plaintiff's cargo by defendant no.2.
Page 26 of 47C/AS/44/2018 IA ORDER 28. The title in cargo has not passed to defendant no.2 and
therefore, they cannot in any manner deal with the plaintiff's cargo. Defendant No.2 in their email dated 31st July 2018 has admitted that they have not paid for the cargo and title in the cargo remains with the plaintiff. Further, the act of them dishonestly and fraudulently changing the ownership, name and the flag of the defendant vessel has deprived the plaintiff of means to secure their claim and is causing irreparable harm and grave prejudice to the plaintiff. In view of the same, the defendant vessel is the only asset of defendant no.2 within jurisdiction of this Hon'ble Court to entirely secure claim of the plaintiff.
29. Thus, the plaintiff has a claim of USD 446,057 being the loss in profit suffered by the plaintiff, plus costs of the the DIFC arbitration amounting to USD 150,000 and USD 50,000 for cost of litigation in India aggregating to USD 646,057 plus interest at the rate of 2% per month from date of suit till its realization as per particulars of claim.
30. The plaintiff's claim arises by reason of breach of terms of Charter Party, fraudulent removal of the plaintiff's cargo from the possession of the plaintiff and unlawful act of defendant no.2 to interfere with ownership of the plaintiff in the cargo and loss occasioned to the plaintiff due to nonreturn of the cargo. Defendant No.2 has fraudulently changed ownership, name, Page 27 of 47 C/AS/44/2018 IA ORDER flag of the defendant vessel to defeat the plaintiff's claim. The defendant vessel and defendant no.3 are 100% owned, controlled and operated by defendant no.2. The same therefore gives rise to and/or constitute a maritime claim. The plaintiff is entitled to look to the defendant vessel for security, which is now in possession of defendant no.2/3. In the circumstances, the plaintiff is entitled to proceed in rem against the defendant vessel for security for its claim pending DIFC arbitration and is entitled to an order of arrest of the defendant vessel."
23. Similarly, the averments made in the present Suit are as under: "23. It is therefore submitted that in the proceedings pending before the UAE courts can only secure plaintiff's claim to the extent of AED 4 million. The plaintiff's entire claim cannot be entirely secured from the proceedings pending before the UAE Courts. In view of the same, plaintiff's claim of AED 17,392,801.13 (balance purchase consideration under the Sales Contract and Charter Party) minus AED 4 million (maximum estimated recoveries to be made from the proceedings pending before the UAE Courts) is still unsecured and outstanding. Therefore, the plaintiff's claim in the present suit is AED 13,392,801.13, equivalent to USD 3,646,284.
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24. It is submitted that the above actions by defendant no.2 by acting in breach of the Charter Party and Sales Contract and Bills of lading without knowledge of the plaintiff constitute an unlawful interference by defendant no.2 with the plaintiff's title in the cargo as the entire purchase consideration has admittedly not been paid till date under the Sales Contract. Further, discharge of cargo without payment of purchase consideration under the Sales Contract, without production of original bill of lading under the Charter Party amounts to conversion of the plaintiff's cargo by defendant no.2.
25. It is an undisputed fact that defendant no.2 has paid only 20% of the purchase consideration and the balance 80% remains to be paid under the Sales Contract. The title in cargo has not passed to defendant no.2 and therefore, they cannot in any manner deal with the plaintiff's cargo. Defendant No.2 in their email dated 31st July 2018 has admitted that they have not paid for the cargo and title in the cargo remains with the plaintiff. Further, the act of them dishonestly and fraudulently changing the ownership, name and the flag of the defendant vessel has deprived the plaintiff of means to secure their claim and is causing irreparable harm and grave prejudice to the plaintiff. The vessel MT FOLK BEAUTY is heavily mortgaged and therefore, from the certificate of valuation, it is evident that plaintiff's claim cannot be satisfied from the vessel MT FOLK BEAUTY. Assuming without admitting, Page 29 of 47 C/AS/44/2018 IA ORDER the plaintiff's claim only to the tune of AED 4 million can be secured by the UAE Courts. In view of the same, the defendant vessel is the only asset of defendant no.2 within jurisdiction of this Hon'ble Court to entirely secure claim of the plaintiff.
26. Thus, the plaintiff has a claim of USD 3,646,284 being the balance purchase consideration for the cargo covered under the Sales Contract and the Charter Party, plus USD 30,000 for cost of litigation in India aggregating USD 3,676,284 to plus interest at the rate of 2% per month on USD 3,646,284 from date of suit till its realization as per particulars of claim.
27. The plaintiff's claim arises by reason of breach of terms of Charter Party, fraudulent removal of the plaintiff's cargo from the possession of the plaintiff and unlawful act of defendant no.2 to interfere with ownership of the plaintiff in the cargo. The plaintiff submits that they have not been paid the entire purchase consideration for the cargo. Defendant No.2 has fraudulently changed ownership, name, flag of the defendant vessel to defeat the plaintiff's claim. The defendant vessel and defendant no.3 are 100% owned, controlled and operated by defendant no.2. The same therefore gives rise to and/or constitute a maritime claim. The plaintiff is entitled to look to the defendant vessel for security, which is no win possession of defendant no.2/3. In the circumstances, the plaintiff is Page 30 of 47 C/AS/44/2018 IA ORDER entitled to proceed in rem against the defendant vessel for security for its claim pending UAE proceedings and is entitled to an order of arrest of the defendant vessel.
28. Furthermore, the plaintiff's claim is a recognized maritime claim/ lien within The Admiralty (Jurisdiction and Settlement of Maritime Claims) Act, 2017, and the Administration of Justice Act, 1956 and the Supreme Court Act, 1981 and the various International Maritime Conventions. The Indian Courts has also recognized such a claim as constituting a valid maritime claim. The plaintiff is entitled to proceed in rem and this Hon'ble Court has jurisdiction to entertain try and dispose of the Suit under the provisions of The Admiralty (Jurisdiction and Settlement of Maritime Claims) Act, 2017 and the provisions and principles of admiralty law as applicable and having force of law in India. The plaintiff is entitled to seek satisfaction of its claims against the defendants by the arrest, sequestration, detention and condemnation of the defendant vessel. This is a course recognized by law. The plaintiff therefore prays that the defendant vessel together with her hull, tackle, engines, machinery, apparel, equipment, stores, articles, things and other paraphernalia be arrested and detained by Warrant of Arrest of this Hon'ble Court. It is to be noted that change of ownership, if any, would not affect the plaintiff's entitlement to proceed against the defendant vessel to Page 31 of 47 C/AS/44/2018 IA ORDER entirely secure their claim.
29. The plaintiff is entitled to proceed against the defendant vessel in rem and in personam against defendant no.2 and 3 as the plaintiff has a maritime claim and maritime lien against the defendant vessel and is entitled for the arrest, condemnation and sale of the defendant vessel for the satisfaction of its claims."
24. If the contentions raised in both the Suits are taken into consideration, at the outset, it deserves to be noted that opponent no.1 - original plaintiff has dual relationship with the original defendants. As observed hereinabove, in Admiralty Suit no.38 of 2018, what is prayed is an order and decree in favour of the plaintiff in sum of USD 3,646,284 being the balance purchase consideration for cargo covered under the sales contract plus USD 30,000 for cost of litigation in India, aggregating to USD 3,676,284 plus interest at the rate of 2% per month and Admiralty Suit no.44 of 2018 is for loss of profit to the tune of USD 446,057 suffered by the plaintiff plus the cost of DIFC arbitration amounting to USD 150,000 and USD 50,000 for cost of litigation in India, aggregating to USD 646,057 plus interest at the rate of 2% per month. Thus, both the Suits relate to one commodity as a whole i.e. sale Page 32 of 47 C/AS/44/2018 IA ORDER of gas oil by opponent no.1 - original plaintiff. However, the fact remains that the applicants and opponent no.2 i.e. original defendants were separately bound by two different contracts; one of the charterparty; and another of the sales contract. It is the say of the applicants that the present application is not filed for dismissal of the second Suit i.e. Admiralty Suit no.44 of 2018, but the application is filed merely for vacation of the arrest order. However, in opinion of this Court, even though at first blush, pleadings of both the Suits are interchangeable, the rights and liability of both the parties under the said agreements are different and distinct. In the charterparty contract, the owner of the vessel was to receive the amount of freight, etc. At the same time, in the sales contract, the purchaser was to pay for the goods sold by opponent no.1 - original plaintiff. Thus, though there is description of sales contract in Admiralty Suit no.38 of 2018 because of dual relationship, the cause of action of Admiralty Suit no.38 of 2018 and Admiralty Suit no.44 of 2018 are separate and distinct and therefore, though in both the Suits, parties are same, the agreements are different and the obligations which come out from the said agreements are different and distinct qua Page 33 of 47 C/AS/44/2018 IA ORDER all the parties to both the Suits and the contention of Order II Rule 2 of the Code of Civil Procedure, 1908 which is raised, even orally needs to be examined by framing an issue to that effect. Opponent no.1 has rightly contended that the first Suit i.e. Admiralty Suit no.38 of 2018 is pending for its adjudication on merits and is not decided on merits and in such an event, at this stage, it cannot be finally concluded that the second Suit is barred by provisions of Order II Rule 2 of the Code of Civil Procedure, 1908. The obligation of a charterparty and obligation of a purchaser are also different and distinct, which would require interpretation of charterparty agreement and sales contract independently with though overlapping separate set of evidence. Hence, considering the ratio laid down by the Hon'ble Apex Court in the cases of Deva Ram & Anr. (supra), Kashinath Ramchandra (supra) and Sonu Khushal Khadake (supra), at this stage, it cannot be said that the second Suit i.e. Admiralty Suit no.44 of 2018 is barred under the provisions of Order II Rule 2 of the Code of Civil Procedure, 1908, though at first blush, the said argument appears to be very attractive. It is not the case that the goods have not been purchased and delivered. It is also not the case that there is any defect or complaint in relation Page 34 of 47 C/AS/44/2018 IA ORDER to quality of goods supplied by opponent no.1- original plaintiff. Even at the cost of repetition, it deserves to be noted that because of dual relationship; one as a charterparty; and another as a purchase seller relationship, two different Suits have been filed; one for breach of the conditions of the charterparty; and another for loss of profit as a security pending arbitration and filing of both the Suits does not amount to multiplicity of Suits. Only because the parties are one, the cause of action are prima facie different and distinct in both the Suits. The fact situation considered by the Hon'ble Apex Court in the case of State Bank of India v. Gracure Pharmaceuticals Limited (supra) was on the premise that the cause of action is the same. Therefore, the said judgment would not be applicable to the present case. Similarly, the ratio laid down by the Hon'ble Apex Court in the case of Virgo Industries (Eng.) Private Limited (supra) would not be applicable to the facts of the present case. The other contention as regards mutually destructive pleas is concerned, as observed hereinabove, the first Suit is filed for the breach of condition of the charterparty agreement between both the parties. It is a matter of record that the Page 35 of 47 C/AS/44/2018 IA ORDER charterparty agreement was entered into on 21.05.2018 between opponent no.1 - original plaintiff and the owner of the vessel - MT FOLK BEAUTY i.e. original defendant no.2 - opponent no.2 herein. Clauses 8 and 10 provide thus: "Clause 8 - Vessel shall not proceed to discharge berth without written permission of the charterer. Only upon receipt of the full balance payment due to Mena Energy DMCC as per the commercial invoice, vessel shall be allowed to proceed to berth for discharge the cargo without the written permission of the charterer.
Cargo to be discharged against the presentation of the original bills of lading. If original BLs are not available, then charterer will issue on LOI for discharge of cargo without OBL, on their letterhead stamped and signed by the competent authority. Unless such LOI is provided by the Charterer, owners and vessel is not authorized to discharge the cargo.
Clause 10 - Without written permission of the Charterer, vessel Page 36 of 47 C/AS/44/2018 IA ORDER shall not be allowed to deviate from the agreed voyage."
25. It is a matter of fact that the plaintiff was informed that the cargo has been discharged without production of bill of lading and in breach of the terms of the charterparty and even though the attempts were made to repossess the cargo, opponent no.2 - original defendant no.2 did not allow the original plaintiff to even board the vessel - MT FOLK BEAUTY and it is in this context that the cause of action has arisen in Admiralty Suit no. 38 of 2018, which directly relates to breach of Clauses 8 and 10 of the charterparty agreement. The present applicants have been made defendants in the Suit as they have common interest. Therefore, the contention that mutually destructive pleas are taken in both the Suits, is not correct. Similarly, the contention as regards the sale of goods also deserves to be negatived as it is an admitted position that the sale price is not completely paid and even though the charterparty agreement clearly provides that the goods were to be discharged and delivery was to be given with written permission of the charterer and only on receipt of full balance of payment due to opponent no.1, the seller, as per the commercial invoice without there being any Page 37 of 47 C/AS/44/2018 IA ORDER written permission or without payment of the balance amount of sale consideration and even in absence of original bill of lading, the cargo was discharged without production of bill of lading which is in breach of terms of the charterparty. Thus, the first Suit is based on the alleged misappropriation of cargo under the charterparty and the second Suit is for loss of profit for nonreturn of the goods which were delivered by the charterer in breach of the conditions of the charterparty. Only because the parties are same, it cannot be said that mutually destructive pleas are taken and therefore, the principles of Sales of Goods Act are not attracted at all as the title has not passed because of nonpayment of full sale price. Having taken delivery of goods without payment of full price, the applicants cannot be permitted to argue that the title has passed as if it was passed by opponent no.1 - original plaintiff itself as if opponent no.1 - original plaintiff was performing his part of the contract. The emails dated 22.07.2018, 23.07.2018, 24.07.2018, 25.07.2018, 26.07.2018, 27.07.2018, 30.07.2018, 31.07.2018 (Pages 75 to 82 of the Suit) prima facie establish the fact that opponent no.1 - original plaintiff did make an attempt to repossess the cargo which was not permitted by opponent no.2 and Page 38 of 47 C/AS/44/2018 IA ORDER even the team of inspectors were not permitted to board the said vessel. The document which is produced with the additional affidavit is not the claim statement as contended by the applicants, but it is only a request for arbitration to DIFC-LCIA. As defined under the Admiralty (Jurisdiction and Settlement of Maritime Claims) Act, 2017, maritime claim means claim referred to in Section 4. Section 4(f) of the Act provides for loss or damage to or in connection with any goods and similarly, Section 4(g) provides for agreement relating to the carriage of goods or passengers on board a vessel, whether contained in a charter party or otherwise. As observed hereinabove, there is a charterparty agreement between opponent no.1 and 2-original defendants and the goods i.e. gasoline is delivered in breach of the charterparty agreement. Similarly, there exists a sale contract for purchase of gasoline and therefore, the same would constitute the maritime claim as provided under Section 4(f) and/or Section 4(g).
26. The Hon'ble Bombay High Court in the case of Siem Offshore Redri AS (supra) has considered the provisions of the Admiralty Act, 2017, Section 9 of the Arbitration and Conciliation Act, 1996 as well as the aspect of action in rem and security pending arbitration. The Page 39 of 47 C/AS/44/2018 IA ORDER Hon'ble Bombay High Court has observed thus: "54. It is thus clear from the above judgments in M.V. Smart (Supra) and M.V. Mariner IV (Supra) read with M.V. Elizabeth (Supra) that an action in rem gets converted into an action in personam only after the owner or party liable in personam enters appearance and submits to jurisdiction and furnishes security. It is only after this happens that the arbitration provisions are required to be considered and given effect to. As held in M.V. Monchegorsk (Supra), in personam proceedings are no bar to an action in rem. Consequently, applying the principles set out in the aforesaid three judgment s and the judgment in M.V. Elizabeth (Supra) to the facts of Gauri Gaekwad 39/52 NMCDL1392 2018.doc the present case, it is clear that it was open to the Plaintiff to commence in personam proceedings by way of arbitration in respect of its claim and also to commence an action in rem for arrest of a defendant vessel. It is only after the owner or party liable in personam enters appearance and submits to jurisdiction and furnishes security that the action would continue as an action in personam and it is at that stage that this Hon'ble Court would apply the procedure devised by the full bench in Golden Progress (Supra) to retain security for the benefit of the arbitration commenced by plaintiff.
55. Golden Progress (Supra) is only devising the procedure based upon Page 40 of 47 C/AS/44/2018 IA ORDER legal principles as set out by various judgment s referred to above including M.V. Elizabeth (Supra) to ensure that the cause of justice is served and based upon principles of justice, equity and good conscience which are a hallmark of the administration of justice.
Jurisdiction to arrest a vessel to secure a maritime claim is also an equitable jurisdiction to do justice to a Claimant and ensure that he is able to realize the fruits of a judgment , decree or award that he may eventually obtain whether by way of arbitration or in Court proceedings. The overriding principle there is that the High Court being a Court of equity, it is equitable principles that must guide the Court in the matter of interlocutory orders. The procedure devised by the Full Bench is consistent with these principles and can be adopted in the facts and circumstances of the present case to secure the maritime claim Gauri Gaekwad 40/52 NMCDL1392 2018.doc of the Plaintiff by the action in rem and arrest of the Defendant vessel.
56. A right in rem is a valuable right that a party has for the purpose of obtaining security in respect of a maritime claim. To debar a party from approaching the Court on the ground that the party has agreed to arbitration would tantamount to depriving a party of his vested right to file an action in rem under the Admiralty Act, 2017. This right cannot be taken away unless there is a statutory bar or an express provision denying such a right to a Page 41 of 47 C/AS/44/2018 IA ORDER Claimant. There is no such bar or prohibition under existing law. Neither is there any bar to the exercise of this right merely because in personam proceedings have been commenced by way of arbitration or in Court. On the contrary considering the distinction between in rem and in personam proceedings, it is manifestly clear that a right in rem is available to a Claimant notwithstanding commencement of in personam proceedings in respect of the same claim and cause of action. This is because a right in rem in admiralty jurisdiction is essentially available to secure a maritime claim by arrest of a ship. It is only after the owner of the ship enters appearance and submits to jurisdiction and provides security that the action in rem would proceeds as an action in personam. It is only at that stage that the Court will apply the arbitration clause in the Contract between the parties and require the parties to arbitrate their claims. By this the right in rem is preserved and any security that the Claimant is able to obtain by exercising this right, is retained and made available to the Gauri Gaekwad 41/52 NMCDL13922018.doc Claimant for the purposes of satisfying his claim in the in personam proceedings whether by way of arbitration or in Court."
27. In the case on hand also, the right in rem is available to opponent no.1 - original plaintiff which, as held by the Hon'ble Bombay High Court in the case of Siem Offshore Redri Page 42 of 47 C/AS/44/2018 IA ORDER AS (supra), is available to secure a maritime claim by arrest of a ship. The Hon'ble Bombay High Court has also relied upon the Full Bench judgment of the Hon'ble Bombay High Court in the case of J.S. Ocean Liner LLC v. M.V. Golden Progress, 2007 (2) Bom C.R. 1. Thus, the action in rem pending arbitration is maintainable.
28. In facts of this case, which relates to a foreign arbitration, the present Suit for security pending arbitration would be maintainable and the provisions of Admiralty Act, 2017 would not affect. The ratio laid down by the Hon'ble Bombay High Court in the case of Siem Offshore Redri AS (supra) would squarely apply to the facts of this case.
29. Though the applicants have raised the contention that the vessel MT QUEEN HELENA is not sister vessel of MT FOLK BEAUTY and that the ownership of the defendant - vessel has undergone a change before the order of arrest, nothing is produced on record to even point out that the defendant - vessel is sold and that it is not the sister vessel of MT FOLK BEAUTY and therefore, such a plea cannot be conclusively considered by this Court in the present application.
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30. Thus, opponent no.1 - original plaintiff, who is an unpaid seller, has preferred this Suit for recovery of loss of profit and following the ratio laid down by the Hon'ble Apex Court in the case of Videsh Sanchar Nigam Ltd. (supra), opponent no.1 - original plaintiff has an arguable case and various triable issues arise in the Suit and therefore, the order of arrest cannot be vacated in facts of this case.
31. The record of the Suit prima facie establishes the fact that the payment was not made as provided under the sales contract and even though the plaintiff made attempts to repossess the cargo which was delivered in breach of the charterparty agreement and without authorization from opponent no.1 - original plaintiff in toto speaks of the conduct of the applicants and opponent no.2. It also prima facie comes out from the record that opponent no.2 - original defendant no.2 and applicant no.2 - original defendant no.3 are related Companies and if the order of arrest is vacated which is in form of a security pending arbitration, such proceedings would become infructuous and following the judgment of the Hon'ble Bombay High Court in the case of Siem Offshore Redri AS (supra), such claim deserves to be secured by way of Page 44 of 47 C/AS/44/2018 IA ORDER the present order of arrest.
32. The facts prima facie bornes out that there is a breach of charterparty agreement, whereby delivery was given without payment of full sale consideration which was one of the Clauses of the charterparty agreement which is the subject matter of the first Suit i.e. Admiralty Suit no.38 of 2018, prima facie, it is also established that opponent no.1 - original plaintiff made attempts to repossess the cargo on coming to know that the charterer has committed breach of Clauses 8 and 10 of the charterparty agreement. However, inspite of the request being made, the same was not acceded by the applicants and so also opponent no.2 herein. Such conduct, on the contrary, requires a security pending arbitration. As orally submitted by learned counsel for opponent no.1 - original plaintiff, the request for arbitration is already made on 10.10.2018 and even the sole arbitrator has been appointed on 27.11.2018. The parties are at liberty to raise all contentions before the arbitrator and any observation made in this order would not prejudice the rights of either parties before the arbitrator. Considering the aforesaid facts therefore, the opponent no.1 - original plaintiff has made out a strong prima facie case and balance of convenience and Page 45 of 47 C/AS/44/2018 IA ORDER irreparable loss are entirely in favour of the opponent no.1 - original plaintiff and therefore, the order of arrest dated 25.10.2018 deserves to be continued. In facts of the case, it cannot be said that the jurisdiction exercised by this Court is de hors of any statutory law. The judgment of the Hon'ble Bombay High Court in the case of Gajanan R. Salvi (supra) would not apply to the case on hand. The test which is provided for in Paragraph 6 of the said judgment, if applied to the present case, would lead to the conclusion as observed hereinabove that the cause of action in the first Suit and the second Suit is distinct and the set of evidence, though overlapping, would be different and hence, the said judgment would be of no help to the applicants. Similarly, the judgment of the Hon'ble Delhi High Court in the case of Ashok Aggarwal (supra) as well as the judgment of Hon'ble Delhi High Court in the case of Kamal Kishore Saboo (supra) would not be applicable to the present case. The issue considered by the Hon'ble Bombay High Court in the case of State of Kerala v. Cochin Chemical Refineries Ltd. (supra) and the case on hand are different and therefore, the said judgment does not carry the case of the applicants any further. The decisions in the Page 46 of 47 C/AS/44/2018 IA ORDER case of White and Carter (Councils) Ltd. (supra), Steel Authority of India Ltd., (supra) and Board of Trustees for the Port of Kolkata would not be applicable to the case on hand.
33. In view of the aforesaid, the issues raised in the application are triable issues, which would warrant fullfledged examination at the trial and as observed hereinabove, opponent no.1-original plaintiff has made out a strong prima facie case and balance of convenience is also in its favour and is likely to suffer irreparable loss if the order of arrest is vacated.
34. Consequently, all the contentions raised by the applicants fail and the application deserves to be dismissed and is hereby dismissed.
(R.M.CHHAYA, J) mrp Page 47 of 47