Indian Kanoon - Search engine for Indian Law

42. The learned Advocate for the Defendant No.2 has argued that the above facts and evidence makes it clear that the contract was only between the Defendant No.1 and the Plaintiff and that the Defendant No.2 was not a party to the contract, that it is also admitted by the Plaintiff that in response to its e-mail, the Defendant No.2 had mentioned that it will supply OLTCs after the finalization of the price and payment terms with the Defendant No.1, that there was no obligation on the part of the Defendant No.2 to make any supply to the Plaintiff and it was only through the Defendant No.2 any supply could have been made subject to receiving payment, that in the absence of any contract with the Defendant No.2 and no Com.O.S.No.4848/2017 consideration having been paid, the Defendant No.2 cannot be made liable to the suit claim, that the provisions of the Companies Act also does not provide for any such liability foisted by the Plaintiff against the Defendant No.2, that in view of the same the Defendant No.2 is neither a necessary nor a proper party, that also no cause of action has arisen for the Plaintiff to file the suit against the Defendant No.2 and if allegedly any breach is committed by the Defendant No.1, by no stretch of imagination can the Defendant No.2 be held responsible, that the Defendant No.2 is neither an Associate Company nor the Defendants No.1 hold any shareholding in it, that there are two directors in common and 49% of its shareholding is held by a German Company namely, Maschinenfabrick Reinhausen Gmbh, Regensburg, Germany, that in view of the above facts and circumstances, the Defendant No.2 who has been unnecessarily arrayed as a party to this suit needs to be deleted from the array of parties, that mere exchange of e-mails between the Plaintiff and the Defendant No.2cannot give rise to a cause of action either to make it a party or to claim any amount, that there is admittedly no privity of contract as against the Defendant No.2 to file this suit. In support of said contentions, the Advocate for the 2nd Defendant has relied on a decision reported in LAWS (DLH) - 2009 (5) - 195 (K.K. Modi Investment and Com.O.S.No.4848/2017 Financial Services Private Limited vs. Apollo International Inc).

57. E-Contracts can be entered into through modes of communication such as e-mail, internet and fax. The only essential requirement to validate an E-Contract is compliance with the necessary pre-requisites provided under the Indian Contract Act, 1872.

58. The evidenciary value of e-contracts can be well understood in the light of the Sections 85A, 85B, 88A, 90A and 85C deals with the presumptions as to electronic records whereas Section 65B relates to the admissibility of electronic record. In the present case, there is no dispute about the admissibility of various e-mails exchanged between the parties.

60. In the said case, the Hon'ble Supreme Court after going through the various E-mails exchanged between the parties including an E-mail attaching the draft contract, which remained unsigned, opined as follows:-

"44. From the materials placed, it has to be ascertained whether there exists a valid contract with the arbitration clause. It is relevant to note that on 15- 10-2007 at 4.26 p.m. the petitioner submitted a commercial offer wherein Clause 6 contains the arbitration clause i.e. "this contract is governed by Indian law and arbitration in Mumbai courts". At 5.34 p.m. though the respondents offered their comments, as rightly pointed out by Mr K.K. Venugopal, no comments were made in respect of the "arbitration clause". It is further seen that at 6.04 p.m., the petitioner sent a reply to the comments made by the respondent. Again, on 16-10-2007 at 11.28 a.m., though the respondents suggested certain additional information on the offer Com.O.S.No.4848/2017 note, here again no suggestion was made with regard to the arbitration clause...........".

62. In another decision reported in (2009) 2 - S.C.C. - 134 (Shakti Bhog Foods Ltd. vs. Kola Shipping Ltd.), the Hon'ble Supreme Court has held as follows:-

Com.O.S.No.4848/2017 "The existence of an arbitration agreement can be inferred from a document signed by the parties, or an exchange of letters, telex, telegrams or other means of telecommunication, which provide a record of the agreement".

63. Therefore, the correspondence through Ex.P.8/E-mail can be considered as a valid binding agreement/contract between the parties and hence, the contention of the Advocate for the 2nd Defendant that there is no privity of contract between the Plaintiff and 2nd Defendant, cannot be accepted at all. Hence, I answer Point No.1 in the Negative.