Case Law Details
Noy Vallesina Engineering SpA Vs Jindal Drugs Limited & ors. (Supreme Court)
1. The appellant, which was granted special leave, challenges a judgment of the Bombay High Court1. It urges that the impugned judgment is erroneous because it concludes that proceedings under Section 34 of the Arbitration and Conciliation Act, 1996 (hereafter ‘the Act’) can be maintained to challenge a foreign award, defined as one, under that enactment.
The facts
2. The appellant company (hereafter “NV Engineering” or “the appellant”) was at the relevant time, incorporated under Italian law and involved in the setting-up and construction of plants for production of synthetic fibers, polymers and ascorbic acid. The respondent (hereafter “Jindal”) is a public limited company incorporated under relevant Indian law. In1994, Jindal negotiated with a company – Engineering Chur AG of Sagenstrasse 97, 7001 Chur, Switzerland (hereafter,‘Enco’) and, on 30.01.1995 entered into four related agreements with Enco to set up an ascorbic acid plant in India. These were: (i) Engineering Contract for Ascorbic for Acid Plant (ECAAP, or “plant contract”); (ii) Supply contract for Ascorbic Acid plant (SCAAP or “supply contract”); (iii) Service agreement for Ascorbic Acid plant (SAAAP “service contract”); and (iv) License agreement for Ascorbic acid plant (LAAAP “license contract”).
3. Under the plant contract, Enco agreed to provide Jindal with technical information and basic engineering documentation for the construction, commission, operation and maintenance of the Ascorbic Acid Plant (“the plant”). In consideration of Enco’s obligations, Jindal was to pay a total fee of Swiss Francs 86,00,000/- in the manner provided in the Agreement. ECAAP as well as the other three agreements had an arbitration clause. In March 1995, with the consent of the respondent, Enco assigned ECAAP to NV Engineering. All the obligations of Enco towards Jindal were taken over by NV Engineering.
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