23 September 2008
Supreme Court
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M/S SHAKTI BHOG FOODS LIMITED Vs KOLA SHIPPING LIMITED

Bench: TARUN CHATTERJEE,DALVEER BHANDARI, , ,
Case number: C.A. No.-005796-005796 / 2008
Diary number: 25227 / 2007


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REPORTAB LE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.               OF 2008 (Arising out of S.L.P.(C) No.16109 of 2007)

M/s Shakti Bhog Foods Limited           ……

Appellant

VERSUS

Kola Shipping Limited               ……Respondent

J U D G M E N T

TARUN CHATTERJEE, J.

1. Leave granted.  

1A. This is an appeal by special leave against the judgment

and order dated 15th of June, 2007 of the High Court of Andhra

Pradesh at Hyderabad in CRP No. 6618 of 2006, whereby the

High Court had affirmed the order dated 30th November, 2006

of the              III Additional District Judge, Kakinada in IA No.

3861 of 2005 arising out of OS No. 34 of 2005 allowing an

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application  filed  by  the  respondent  under  Section  45  of  the

Arbitration and Conciliation Act, 1996 (in short, “the Act”).    

2. The relevant facts leading to the filing of this appeal, as

emerging  from the  case  made  out  by  the  appellant,  may be

summarized as follows:

3. The appellant  is  a company dealing  in  the  business  of

manufacturing and exporting food products and cereals/grains

etc. The appellant was to export sorghum (hereinafter referred

to as the “cargo”) to the State of Niger. The appellant thereafter

negotiated with the head of the State of Niger through a lady

Principal  Officer  for  an  export  order.  In  that  process,  the

appellant  herein obtained an irrevocable  letter  of  credit  from

the State Bank of India, Overseas Branch, New Delhi, on 12th

of  July,  2005.          On  26th of  July,  2005,  the  appellant

addressed an e-mail to the respondent through its broker Brisk

Marine Services. As per the contents of the mail the appellant

promised to load 13,500 MT of the cargo at Kakinada Port for

transportation to Cotonou. The respondent herein, issued a bill

of lading. As per the terms and conditions of the Charter Party

Agreement, the appellant had to load the said cargo within nine

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days on or before                         6th of August, 2005. The

vessel M.V. Kapitan Nazarev arrived at Kakinada Port on 24th

of  July,  2005.  The  surveyor  of  the  appellant  inspected  the

vessel on 25th of July, 2005. For some reason or the other, the

proposal of the appellant did not fortify. On                   9th of

August,  2005,  the  appellant  informed the  respondent  that  he

could not get the export order from the State of Niger due to

some  unreasonable  conditions  imposed  by  it.  As  per  the

Charter  Party Agreement,  existence of which was alleged by

the respondent and denied by the appellant, the appellant had to

load maize to Colombo from Kakinada Port, in case he failed to

get the export order from Niger. On 19th of August, 2005, the

appellant addressed an e-mail to the respondent stating that he

was ready to compensate the respondent for the loss suffered

by it.  On 24th of  August,  2005,  the respondent  addressed  an

email back to the appellant stating that it was not satisfied with

the demurrage amount offered to be paid by the appellant.  A

perusal  of  the  facts  clearly  reveal  that  the  dispute  started

between the  appellant  and the respondent  with  regard  to  the

quantum of demurrage. The appellant herein loaded 1100 MT

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of the cargo in the vessel from 6th of August, 2005 to      9th of

August, 2005 as against 13,500 MT of the agreed cargo.      On

5th of  September,  2005,  the  appellant  sent  an  email  to  the

respondent requesting it  to unload the cargo from the vessel.

But  the  cargo  was  not  unloaded  from the  vessel  due  to  the

ongoing disputes between the parties. The respondent initiated

proceedings in the High Court of Delhi seeking interim orders

in  the  matter  of  discharge  of  1,100  MT of  the  cargo  under

Section 9 of the Act.  The said application came to be allowed

by the High Court on      28th of September, 2005. The appellant

carried  the  matter  in  appeal  and  subsequently  withdrew  the

same on 22nd of January, 2007. In the meantime the appellant

had also filed a suit claiming damages as by the time the cargo

unloaded from the ship had become unworthy of consumption.

The  appellant  also  filed  an  application  for  injunction  under

Order  XXXIX Rules  1  and  2  of  the  Civil  Procedure  Code,

seeking interim injunction directing the Port Officer, Kakinada

Port, to detain the vessel of M.V. Kapitan Nazarev at Kakinada

harbour till the disposal of the suit. The application came to be

dismissed by the III Additional District Judge, Kakinada, by an

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order dated 11th of November, 2005. The appellant thereafter

unsuccessfully  challenged  the  said  order  by filing  an  appeal

before  the  High  Court  of  Andhra  Pradesh.  The  respondents

then entered into appearance in O.S. No. 44 of 2005 and moved

an application under Section 45 of the Act to refer the dispute

between  the  parties  to  arbitration  in  London  under  the

provisions  of  the English  Arbitration  Act,  1996  and  stay all

further proceedings in the suit pending arbitration. The Learned

III  Additional  District  Judge,  Kakinada,  allowed  the

application by an order dated 30th of November, 2006.  Feeling

aggrieved, the appellant filed a Civil Revision Petition before

the High Court  of  Andhra  Pradesh  at  Hyderabad  which  was

dismissed  on  a  finding  that  there  was  a  Charter  Party

Agreement in existence and the appellant  could not deny the

existence of the same.

4. It  is  this  order  of  the  High  Court,  which  was  under

challenge by way of a Special Leave Petition, which on

grant  of  leave,  was  heard  in  presence  of  the  learned

counsel for the parties.  

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5.  Having heard  the  learned  counsel  for  the  parties  and

after  examining  the  impugned  judgment  of  the  High

Court and also the order of the trial court, we do not find

any reason to interfere with the concurrent orders of the

High Court as well as of the trial court in the exercise of

our  discretionary  power  under  Article  136  of  the

Constitution.   

6. The learned counsel appearing on behalf of the appellant

has  contended  that  the  trial  court  has  not  given  any finding

with regard to the existence of the Arbitration Agreement and

without  there  being  any  positive  finding  with  regard  to  the

same, invocation of the provisions of Section 45 of the Act was

unjustified. He has further contended that even if there is any

Charter  Party  Agreement,  it  does  not  cover  the  shipment  of

1,100 MT of bagged cargo and, therefore, the order passed by

the trial court as well as of the High Court was not proper and

legal  and  therefore,  the  same is  liable  to  be  set  aside.   He

further  contended  that  the  respondent  had  not  placed  any

record, prima facie, as to the existence of the arbitration clause

and  therefore,  the  decision  of  the  High  Court  to  allow  the

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application filed by the respondent under Section 45 of the Act

cannot be sustained.

7. It  was  next  contended  that  the  same issue  was  raised

before  the  Delhi  High  Court  and  also  before  the  Andhra

Pradesh High Court.   From the record,  it  appears  that  Delhi

High  Court  after  going  through  the  records  came  to  the

conclusion that there was a Charter Party Agreement existing

between the parties and it contained a clause with regard to the

arbitration and, therefore, the appellant could not be permitted

to contend that there was no arbitration clause in the Charter

Party Agreement. For this purpose, it is pertinent to refer to the

findings of the Delhi High Court in this respect:

“In the written reply field by the respondent, respondent has admitted loading of 1,100 MT of Sorghum  on  board  the  petitioner’s  vessel. According  to  the  respondent,  they  have  been persistently  requesting  the  petitioner  to  allow them to  discharge the  goods and even offered  a sum of US $ 90,000 but the petitioner, in order to blackmail  the  respondent,  came  out  with  an unfounded,  unrealistic,  and  illegal  claim  of over4.56 lac of  US $ as a  pre-condition  for  the release of the goods to which the respondent did not  agree.  Not only  that,  the  petitioner  has  sent emails to all shipping lines warning them not to deal with the respondent without first contracting the petitioner. This, according to the respondent, amounts to defamation for which the respondent

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claims damages to the tune of US $ 3,00,000.  As regards  the  agreement  namely  Charter  Par, respondent’s  versions  is  that  they  have  signed only  fixture  note  and  not  any  charter  party agreement.  Respondent  has  further  taken  a preliminary  objection  regarding  territorial jurisdiction of this Court to entertain this petition.

When  a  corporation/company  has  its subordinate  office  at  the  place  where  cause  of action  arose,  only  local  courts  will  have jurisdiction to try the suit notwithstanding the fact that  the  corporation/company  has  its  registered office somewhere else, where no part of cause of action  arose.  In  the  present  case,  petitioner’s contention that Delhi Courts have jurisdiction to try the suit is based on sub-clause ‘c’ and not sub- clause ‘a’ of section 20 of CPC. According to the petitioner  Charter  Party  was  signed  at  Delhi. Respondent  did not deny their  signatures on the first page of Charter Party, which shows that the agreement was signed at New Delhi and place of arbitration  as  London.  Thus,  a  part  of  cause of action arose in Delhi where the principal office of the respondent is also situated. In this case there is no agreement between the parties excluding the jurisdiction  of  Delhi  Courts.  Therefore,  Delhi Courts have jurisdiction to entertain the present petition.”

8. The Andhra Pradesh High Court had correctly noted that

it was explicit from the order passed by the Delhi High Court

that the contention advanced by the appellant herein had been

negatived. Against the said order the appellant had preferred an

appeal  but  subsequently  withdrew  the  same.  Therefore,  the

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appellant  cannot  be  permitted  to  contend  that  there  is  no

arbitration clause in the Charter Party Agreement. Once there is

an arbitration clause in the agreement, the matter is required to

be  referred  to  an  Arbitrator.  The  trial  court  considered  the

materials brought on record and allowed the application filed

by the respondent  under  Section  45 of  the  Act.  The Andhra

Pradesh High Court finding no infirmity in the order of the trial

court had affirmed the same.

9. Taking  all  the  matters  into  consideration  and  after

examining all the materials on record, it is necessary to

mention that all the facts regarding the existence of the

Charter  Party  Agreement  have  been  extensively

deliberated in the courts below and the said courts have

unilaterally  accepted  that  there  exists  a  Charter  Party

Agreement between the parties.  No grounds have been

raised in this appeal by the appellant satisfying us also

that from the records, it could be said that there was no

existence of  any Charter Party Agreement between the

parties.   We,  therefore,  do  not  find  any  reason  to

interfere with the concurrent orders of the courts below.  

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10.  In our view, we should give reasons for dismissing this

appeal.  We have already noted that by the Charter Party

Agreement dated 18th of July, 2005 the appellant agreed

to load and the respondent agreed to carry 13,500 tons of

the  cargo  from Kakinada  to  the  port  of  Cotonou.  We

have also observed that the said Charter Party Agreement

provided for arbitration in Box 25 and Clause 19 and that

the disputes pertaining to the same were to be referred to

arbitration in London under the English Arbitration Act.

The appellant herein has not refuted the signature on the

front  page of the Charter Party Agreement.  We cannot

entertain  his  claim  that  such  a  signature  would  not

amount  to  a  valid  arbitration  agreement.  For  this

purpose, it would be relevant to quote Section 7 of the

Act:

“Arbitration Agreement:  1)      In this part “Arbitration Agreement” means an agreement

by the parties to submit to arbitration all or certain disputes which  have  arisen  or  which  may  arise  between  them  in respect of a defined legal relationship,  whether contractual or not

. 2) An  arbitration  agreement  may  be  in  the  form  of  an

arbitration clause in a contract or in the form of a separate agreement.

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3) An arbitration agreement shall be in writing.

4) An arbitration agreement is in writing if it is contained in:- a) A document signed by the parties;

b) An  exchange  of  letters,  telex,  telegrams  or  other  means  of telecommunication which provide a record of the agreement; or

c) An  exchange  of  statements  of  claim  and  defence  in  which  the existence of the agreement is alleged by one party and not denied by the other.

5) The  reference  in  a  contract  to  a  document  containing  an arbitration clause constitutes an arbitration agreement if the contract is in writing and the reference is  such as to make that arbitration clause part of the contract.”

11. Therefore,  it  is  clear  from the  provisions  made  under

Section  7  of  the  Act  that  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. In the present case, the appellant had not denied the

fact  that  it  had  signed  the  first  page  of  the  Charter  Party

Agreement.  Moreover,  the  subsequent  correspondences

between  the  parties  also  lead  us  to  conclude  that  there  was

indeed a Charter Party Agreement, which existed between the

parties. We cannot accept the contention of the appellant that

under Section 7 of the Act the letter/faxes or mails or any other

communications will have to contain the arbitration clause in

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the absence of any agreement. The expressions of Section 7 do

not specify any requirement to this effect.

12. Clause  19  (a)  read  with  Box  25  of  the  Charter  Party

Agreement between the appellant and the respondent states as

follows:

“Clause 19- LAW AND ARBITRATION

(a) This  charter  party  shall  be  governed  and  construed  in accordance with the English Law and any dispute arising out of this charter party shall be referred to arbitration in London in accordance with the Arbitration Acts 1950 and 1979 or any statutory modification or re-enactment there of for the time being in force. Unless the parties agree upon a sole arbitrator, one arbitrator shall be appointed by each party and the arbitrators so appointed shall appoint a third arbitrator,  the  decision  of  the  three-man  tribunal  thus constituted  or  any  two  of  them,  shall  be  final.  On  the receipt  of  one  party  of  the  nomination  in  writing  of  the other’s arbitrator, that party shall appoint their arbitrator within  fourteen  days.  Failing  which  the  decision  of  the single  arbitrator  appointed  shall  be  final.  For  disputes where the total  amount  claimed by either  party  does  not exceed the amount stated in Box 25, the arbitration shall be conducted in accordance with the small claims procedure of the London Maritime Arbitrators Association.”

13. It  is  clear  from  the  above-mentioned  clause  that  the

venue of the arbitration chosen by both the parties is London in

the United Kingdom and the law chosen by both the parties is

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the English Law. In view of the mandatory provision of Section

45  of  the  Act,  the  Court  is  duty  bound  to  stay  all  further

proceedings in the suit and refer the matter to Arbitration as per

Clause 19 of the Charter Party Agreement.  

14. The appellant contended that the respondent did not file

the original Charter Party Agreement in any of the proceedings

before any of the lower courts. We would want to reiterate that.

As far as the provision of Section 7 of the Act is concerned, an

arbitration  agreement  may  be  in  the  form  of  an  arbitration

clause in a contract or in the form of a separate agreement and

furthermore an arbitration is considered to be in writing if it is

contained  in  a  document  signed  by  the  parties  or  in  an

exchange  of  letters,  telex,  telegrams  or  other  means  of

telecommunication which provide a record of the agreement or

an exchange of statement  of claim and defence in which the

existence  of  an  agreement  is  alleged  by  one  party  and  not

denied by the other. So from the provisions of Section 7, it is

clear  that  a Charter  Party Agreement  need not  be in  writing

signed by both parties and this could as well be made out from

the  acts  of  the  parties  to  the  agreement  by  way  of  their

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exchange of letters and information through fax, e-mails etc. It

is  clear  from  the  records  that  in  this  case  the  agreement

between  the  appellant  and  the  respondent  was  entered  into

through Brisk Marine Services, and a letter addressed to Kola

Freight for arranging a vessel for carrying the cargo of 13,500

MT  from  Kakinada  Port  to  Cotonou  was  delivered.  The

appellant had vehemently contended before us that there was

no  Charter  Party  Agreement  between  them.  Even  if  it  is

assumed that there was no such agreement between the parties,

it is the responsibility of the appellant to provide a reasoning as

to  how did  the  vessel  was  responsible  for  carrying  the  said

cargo arrived at the port  of Kakinada without  any agreement

present  between  the  appellant  and  the  respondent.  The

appellant also needs to explain as to what was the agreement

entered into upon it for which it loaded the ship with 1100 MT

of the cargo instead of the promised 13500 MT. Moreover the

appellant had agreed to pay compensation to the tune of US $

90,000 to the respondent on its own initiative due to the fact

that  it  was  unable  to  load  the  requisite  amount  of  cargo  of

13,500MT on board. The appellant needs to explain as to what

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were  the  circumstances  under  which  it  wanted  to  pay  such

compensation to the respondent. According to the explanations

provided by the  appellant,  it  had not  committed  any breach.

Therefore, the question to be asked is  why did the appellant

want to pay such a huge sum of compensation for no fault of it,

if there was no Charter Party Agreement to that effect between

the parties. If the loading of the cargo by the appellant which

commenced on 6th of  August,  2005 is  not  under any Charter

Party Agreement  as  contended  by the  appellant,  but  under  a

different agreement, then the appellant has to show the terms of

the other agreement under which the loading of the cargo was

done by the appellant, since the stock loaded is not of a small

quantity but worth one crore and odd in terms of Indian rupees.

For the loading and unloading of cargo as well as to carry it

from one port to another, an agreement is certainly required and

if the said agreement is not  a Charter Party Agreement,  then

there  has  to  be  some  other  agreement  to  that  effect.  The

appellant is supposed to provide the details of that agreement in

the alternative, which it had not done. We are afraid that the

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appellant has not provided any satisfactory explanations to the

above-mentioned questions.

15. The learned counsel appearing on behalf of the appellant

next contended that the loading of sorghum in the vessel was

done under a bill of lading and except that there was no other

contract between the parties. He also contended that the bill of

lading is nothing but a receipt issued as to what was the cargo

that was loaded in the vessel and it did not contain any terms of

the agreement.

16. It is clear from the documents produced before us that as

on the date of loading of  the cargo into the vessel  on 6th of

August, 2005 there was no final cancellation of the orders from

the Government of the State of Niger and that the appellant was

loading the said cargo with the hope that the Government of

Niger  would  accept  the  proposal.  The  appellant  during  that

time was not in a position to load the total amount of the cargo

as produced to  the  tune  of  13,500  MT as  the  deal  with  the

Government of Niger was not yet finalized. But then in such a

situation, if the so called Charter Party Agreement, relied upon

by the respondent, is absent,  then there has to be some other

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agreement  to  that  effect  under  which,  the  appellant  herein

agreed to load the vessel with a cargo of 1,100 MT of sorghum.

But such an agreement has not come to our notice.

17. The appellant contended that the loading of the sorghum

was done pursuant to a fixture note. A careful perusal of the

fixture  note  reveals  that  the  place  of  arbitration  has  been

mentioned as London. Moreover, with regard to Clause 14-19,

it  has  been  mentioned  in  the  said  fixture  note  that  it  is  re-

established as per the Charter Party. Thus it is clear to us that

even  the  fixture  note  as  pointed  out  to  us  by  the  appellant

contains  a  provision  as  to  the  place  of  arbitration  and  a

reference has been made to the charter party agreement.

18. We  would  further  wish  to  point  out  that  while

contending against the filing of an application under Section 9

of the Act for interim measures by the respondent before the

Delhi High Court in OMP No. 331 of 2005, the appellant had

never raised any objection as to the existence of  the Charter

Party  Agreement  between  the  parties.  On  the  contrary,  the

appellant  contended before the Delhi  High Court  saying that

Section 9 of the Act would not apply if the place of arbitration

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was not in India. Moreover, the appellant herein had preferred

an appeal against the said order of the Delhi High Court dated

28th of  September,  2005  and ultimately  withdrew the  appeal

reserving its rights only so far as to challenge the jurisdiction

of the High Court of Delhi. From the judgment and order dated

28th of September, 2005 and the order  dated 22nd of January,

2007, it  is  pellucid that  the  appellant  had not  challenged the

validity of the arbitration agreement between the parties.

19. The appellant has also contended that under Section 8 of

the Act it is necessary for the party making an application to

refer the matter to arbitration, to provide the original arbitration

agreement  or  a  duly  certified  copy  of  the  same.  But  this

contention  has  no  legs  to  stand  upon  in  the  context  of  the

present appeal.  The present appeal has been filed against the

impugned  judgment  of  the  Andhra  Pradesh  High  Court

affirming the order of the trial  court allowing the application

filed by the respondent herein under Section 45 of the Act.  We

may note that Section 45 of the Act deals with matters relating

to international  commercial  arbitrations  and Section 8 of  the

same  does  not  have  any  relevance  in  the  present  appeal.

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Section 45 of the Act does not require the respondent to file the

original  of  the  Charter  Party  Agreement.  In  any  event,  the

appellant  had  not  questioned  the  authenticity  of  the  Charter

Party  Agreement  filed  by  the  respondent  and  had  in  fact

admitted the signature appearing on the first page of the same

to  have  been  made  on  its  behalf.  The  Courts  below  had

thoroughly examined the said Charter Party Agreement and had

passed their orders after considering the clauses thereof.

20. The learned counsel appearing on behalf of the appellant

had drawn our attention to the fact that the appellant had sent

an email to the respondent on 26th of July, 2005 stating that it

had not signed any Charter Party. We have gone through the

said  email.  It  has  been  clearly  stated  in  the  email  that  the

appellant  had  received  the  Charter  Party  with  regard  to

Cotonou but had not received anything for Colombo. Therefore

he had not signed the same. The said portion of the email  is

quoted herein for convenience:

“I am in receipt of CP and Fixture Note for Cotonou  but  nothing  for  Colombo  therefore,  not signed so far.”

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To this effect it can be said that the appellant had not signed

the said charter party. But if we proceed towards the end of the

said email sent by the appellant, we may say that there is a clear

disparity as to the contention of the appellant that there was no

agreement  between  the  parties  regarding  the  loading  of  the

cargo. We feel it necessary to refer to the relevant portion of

the email pointing out to this disparity:

“Above  for  your  info.  And action  pls.  Am trying  my  best  to  engage  your  vessel  just  to honour the negotiations. Let’s hope for best.”

It is clear from a perusal of the above-mentioned statement that

there was on going negotiations between the parties regarding

the  loading  of  the  cargo  and  pursuant  to  such  negotiations,

1100 MT of the cargo had been loaded. It is difficult to believe

that  such  cargo  was  loaded  without  any  agreement  to  the

parties to that effect.

21. Further  the said email  clearly shows that  the appellant

had asked for  a fixture  note  for  the  delivery of  the cargo to

Colombo. The appellant had subsequently accepted that he had

sent the said cargo to Colombo pursuant to a fixture note. As

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has already been observed before, the said fixture note reveals

that  the  place  of  arbitration  has  been  mentioned as  London.

Moreover, with regard to Clause 14-19 it has been mentioned

in  the  said  fixture  note  that  it  is  re-established  as  per  the

Charter  Party.  Therefore  the  appellant  cannot  escape  its

liability  from complying  with  the  provisions  of  the  Charter

Party Agreement.

22. Fixtures  are  frequently  recorded  in  a  telex  or  fax

recapitulating the terms finally agreed (a “recap”). Thus a recap

telex  or  fax  may constitute  the  “charter  Party  referred  to  in

another contract. In the case of Welex A.G. vs. Rosa Maritime

Ltd. (The “Elipson Rosa Case”) [2002] EWHC 762 (Comm),

it  was  decided  by the Queen’s  Bench Division  (Commercial

Court)  that  a  voyage  charter  party  of  the  Elipson  Rosa  was

concluded on the basis of a recap telex which incorporated by

reference  a standard  form charter.  Before  any formal  charter

was signed, bills of lading were issued referring to the “Charter

Party”,  without  identifying  it  by  date.  It  was  held  that  the

charter  party  referred  to  was  the  contract  contained  in  or

evidenced by the recap telex.

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23. In  the  present  case  therefore,  we  conclude  that  there

existed a charter party between the parties to the suit which can

be identified from the correspondence between the parties  to

that effect as also from the fixture note and the bill of lading

signed by the parties.  

24. As per the provisions of the Section 45 of the Act, it is

clear  that  at  the  request  of  one  of  the  parties  or  any person

claiming through or under him the court shall refer the parties

to arbitration unless it finds that the said agreement is null and

void,  inoperative  or  incapable  of  being  performed.  In  the

present case, there appears to be no such thing to say that the so

called agreement entered into by the parties is in any way to be

termed as null  and void or inoperative or incapable of being

performed. It is further observed by us that the claims raised by

the appellant before us about the non-existence of the charter

party  agreement  can  also  be  raised  by  the  same  before  the

arbitral tribunal at London. Under the English Arbitration Act

1996, as per Sections 30 and 31 of the said Act, the arbitral

tribunal may rule on its own jurisdiction and also can decide on

the existence of a valid arbitration agreement. This is similar to

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the provisions under Section 16 of the Act, whereby the arbitral

tribunal can decide on its jurisdiction as also on the existence

or validity of the arbitration agreement.

25. In the light of the discussions above-mentioned, we are

convinced  that  there  is  a  charter  party  agreement  existing

between the parties and, that as per the provisions of Section 45

of the Act, the High Court as well as the trial court were fully

justified in allowing the application preferred by the respondent

and accordingly, impugned order must be affirmed.   

26. For  the  reasons  aforesaid,  we are  of  the  view that  the

High Court  was  justified  in  passing  the  impugned  judgment

and there is no infirmity in the impugned order in the same for

which  we  can  interfere.   The  appeal  is  therefore  dismissed.

There will be no order as to costs.

………………….J.      [Tarun

Chatterjee]

New Delhi;     …………………. J.

September 23, 2008.                [Dalveer

Bhandari]    

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