RITE APPROACH GROUP LTD. v. M-S. ROSOBORONEXPORT

Citation: [2005] SUPP. 5 S.C.R. 266

Court: Supreme Court of India

Bench: A.K. MATHUR

Case summary

RITE APPROACH GROUP LTD. v. M-S. ROSOBORONEXPORT.pdf

Judgment text

RITE APPROACH GROUP LTD. v. MIS. ROSOBORONEXPORT NOVEMBER 16, 2005 [A. K. MATHUR AND CHAMBERJUDGE. ] Arbitration and Conciliation Act, 1996; Section 11(6): Agency agreement between a Russian Company and a Singapore based company/an agent in India-Agent company providing its services to principal company in procuring a contract for supply of helicopter against payment ofcommission-Payment ofcommission denied-Filing ofarbitration petition before the Chief Justice of India for appointment of an Arbitrator-Held: Arbitration clause in the Agreement categorically states that dispute if any arises, the same shall be referred to Arbitratibn Court established under the Chambers of Commerce and Trade of the Russian Federation-Thus, jurisdictio~ of Courts other than the Court so specified in the agreement ousted-Hence, Supreme Court can not assume jurisdiction to appoint arbitrator.

The petitioner, a foreign company, is represented in India by Austrian Trade Commission, New Delhi, carrying on business, inter alia, as an Agent of various foreign companies for negotiating and concluding contracts on their behalf in India. Mis. Federal State Unitary Enterprise/Russian Technologies was a Russian public sector company which later merged with the Respondentcompany ROSOBORONEXPORT. Mis. Russian Technologies approached the petitioner for procuring orders in India for supply of helicopters to Border Security Force. The petitioner agreed to act as an Agent of the said Russian Enterprise, the pre~cessor-in-interest of the respondent. In terms of the written contract entered into between them, respondent was required to pay commission to petitioner in lieu of the service rendered by it. The petitioner helped the respondent in procuring the contract from Border Security Force for supply of six helicopters.

Respondent did not pay the commission, hence the petitioner filed an arbitration petition for referring the matter to Arbitrator. The Chief Justice of India has designated Justice A. K. Mathur, Chamber Judge for nomination of Arbitrator for disposal of the petition. RITE APPROACH GROUP LTD v. ROSOBORONEXPORT 267 The respondent submitted that Clause 6. 2 of the Agency Agreement provides that in case of dispute between the parties, they would resort to arbitration for resolution oftheir dispute and submit it to Arbitration Court to be established under the Chamber of Commerce and Trade of Russian Federation. Thus this Court has no jurisdiction to entertain this petition. Rejecting the petition, the Court HELD: I. I. On 26. 10. 2005, a Seven Judge Bench of this Court in the case of Mis. S. B. P. & Co. v. Mis. Patel Engineering Ltd & Anr. has overruled the judgment of five Judge Constitution Bench in the case of Kon/can Railway Corporation Ltd. & Anr. v. Rani Construction Pvt. Ltd.

by holding that the order passed by the Judge on designation by the Chief Justice shall be judicial order and not an administrative order. Therefore, the legal position as has been crystallize kani •.. :Constl"u~(ion. /'~t. Lid:, (2002]:8 S'CC 388) is overruled:;, ' . ' . . . ·, . · :_ . ht ! ~e, P. f~_sen,t -~a~~' ,a~ p~t: t~e ;~gerict:. \gr¢~~~n~ ~~t~4 -~f~}OO~, C•Clause ~.. ~ ~ateg~r! ~ally Jt~te. ~ t9. ~f if:ii~~ ~i. s~ti~~. ~a,t-is~s,,;? ~t\f. ~~il:lhe i~~tt! ~s, then the. sarne· shall be submitted . to Arbitration Court under, the;Ghamber. of • '. ·. •. ·~· "i • .. • . ':·~.. • . ~:. ,: ,. • · . ~ '. -~· ·'' . "f · '·r_. • . ·~ -~· ~-:··Y·>. ~: ;-. _,'. "' \_'·, ·... ,' . ' ;C. ommerc~ and Trad~ of*e Rus~ian 'Federation1 iher~fore thei:e~ is,,~ specific clause. rn! ln~ioned. i~ ~he Age~cy' Ag~ement' a~'to~-~t1-ic6 :At>tfri will have jurisdiction to try ,and . dispose "of the matter; ' . ), . ' . ,. .. ' . · '. . . ·.. .

D · In view of the speCific provisiOn specifying the jurisdiction ofth~ Court to decide the ,matter, this Court cannot ~ssume the jurisdiction. ·Whenever there is a specific clause conferri,ng jurisdiction on particular Court to decide the _matter then it autoinatically_ ~usts the jurisdiction of other Court, hi this agreement, the juris~iction has l? een. c~rtferred on. the qamper, ofC6mmerce 'E I and Trade of the Russl~n Federati~n as th¢ authority b~fore Wh9m the. dlspUte s'hall be resolved. In view of th~ SP!! Cific arbitration dliuse cdnferring power on the. Chamber ·of Coinmerce arid Trade of the Russian Federation, it is that llU. thority which alone will arbitrate the . rii~tter arid the finding of that arbitrai :tribunalshan be final an'd. ,obJigatory ·for both the pai:ties. •~;. • ' . . - . . . . . , ,.. . . . . . ' ~ . . ' - . . F·' . . Th~s, in this View.

of th~ matter, I am or'~he ~pi~ion that this Coμrt has no juri~diction and the Chamber ofCommerce a11d Trade of Russian Federation alone has jurisdiction to act. as an arbitrator. and resolve the dispute. 'Hence this application is rejected.. '. .. , . . .. . S. K. S. Pet. iti~n r~jected.