Delhi High Court - Orders
Gmm Pfaudler Ltd vs Air Liquide Global Ec Solutions India on 10 December, 2021
Author: Yogesh Khanna
Bench: Yogesh Khanna
$~21
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ CS(COMM) 637/2021
GMM PFAUDLER LTD ..... Plaintiff
Through : Mr.Sandeep Sethi, Senior Advocate
with Mr.Vivek Jain, Mr.Manish
Shekhari, Mr.Swapnil Srivastava,
Mr.Nitin Sharma, Advocates.
versus
AIR LIQUIDE GLOBAL EC SOLUTIONS INDIA ..... Defendant
Through : None.
CORAM:
HON'BLE MR. JUSTICE YOGESH KHANNA
ORDER
% 10.12.2021 I.A.No.16381/2021
1. Exemption allowed, subject to all just exceptions.
2. The application stands disposed of.
CS(COMM) 637/2021 & IA No.16380/2021
3. This suit is filed for recovery of Rs.3.59 crores as well as return of bank guarantees amounting to Rs.4.30 crores.
4. It is submitted by the learned senior counsel for the plaintiff the defendant had sent an Invitation to Bid dated 08.12.2020 and also an email enquiry for the design, engineering and supply of two sets of special reactors. The defendant confirmed the plaintiff's offer vide an email dated 27.01.2021 and in acceptance of the terms and conditions of the offer made by the plaintiff, sent the purchase order for purchase of supplies destined for a unit production of bio diesel in Korea i.e., Hyundai Oil Bank Company Limited. The said purchase order dated 12.02.2021 is annexed at page 30 of the paper book, wherein the delivery date is mentioned as 31.10.2021 and the value of the purchase order is Rs.17.20 crores. The scope of work is also Signature Not Verified Digitally Signed By:VIJAYA LAKSHMI DOBHAL Signing Date:10.12.2021 16:39 mentioned in para 4 the purchase order dated 12.02.2021. The payment schedule per para 7.2 says 15% of the total value of the contract needs to be paid in advance by the defendant to the plaintiff and in return the plaintiff has to give a bank guarantee of 15% of the value of the contract in favour of the defendant and further 10% of the value of the contract as performance guarantee.
5. Clause 5.2 of General Conditions of Contract talks about modification/alteration of the contract/purchase order. Certain terms were then modified and hence the price of the altered purchase order was negotiated between the parties. It was revised by the plaintiff to Rs.24.15 crores per email dated 22.05.2021 but not accepted by the defendant and then was revised to 21.90 crores and lastly to 13.75 crores vide an email dated 21.06.2021. As price was not acceptable to the defendant it went on to cancel the order.
6. It is the submission of the learned senior counsel for the plaintiff there is no default from the side of the plaintiff and even the advance payment never came to the plaintiff. It is argued the bank guarantees were based on a condition of advance payment of 15% of the value of the contract and could not be encashed in the event of non-payment of advance.
7. Reference is made to bank guarantee dated 25.03.2021 which specifically mentions in consideration of the beneficiary/defendant having paid an amount of Rs.2.58 crores to the sub contractor under the terms and conditions of the sub-contract, subject to the bank guarantee given, the bank unconditionally, irrevocably and absolutely agrees and undertakes to pay the defendant the amount of Rs.2.58 crores on demand without any demure or protest.
Signature Not Verified Digitally Signed By:VIJAYA LAKSHMI DOBHAL Signing Date:10.12.2021 16:398. It is submitted by the learned senior counsel for the plaintiff the defendant has no right to encash the bank guarantees since it failed to pay Rs.2.58 crores in advance per contract dated 12.02.2021. The plaintiff filed this suit as it was apprehensive of its encashment per reply of defendant to the legal notice of plaintiff and it says:
"24. The legal Notice sent by GMM has been issued based on misconceived assumption and frivolous allegation that Air Liquide E&C India has refused to return the bank guarantees and pay compensation. Air Liquide E&C India has already informed GMM by Air Liquide E&C India's letter dated 16.08.2021 that it will return the bank guarantees once both parties mutually agree and settle all issues pertaining to the cancellation/termination of the Purchase Order. Hence, GMM's legal Notice is ex-facie illegal, arbitrary and denied in totality."
9. The plaintiff filed this suit for recovery of an amount of Rs.3.59 crores viz. 70% of the value of the contract allegedly payable by the defendant on termination of the contract and for the return of bank guarantees.
10. Issue notice to the defendant through all modes including email/whatsapp returnable on 11.03.2022 before the learned Joint Registrar and in the meanwhile the bank guarantees as mentioned in para 17 A of the plaint be not encashed.
11. Compliance of Order 39 Rule 3 CPC be made by plaintiffs within 10 days.
12. Upon completion of service/pleadings, the matter be listed before this Court.
13. Order dasti.
YOGESH KHANNA, J.
DECEMBER 10, 2021/DU Signature Not Verified Digitally Signed By:VIJAYA LAKSHMI DOBHAL Signing Date:10.12.2021 16:39