ANGLO AMERICAN METALLURGICAL COAL PTY LIMITED Vs. MMTC LIMITED
LAWS(SC)-2020-12-50
SUPREME COURT OF INDIA
Decided on December 17,2020

Anglo American Metallurgical Coal Pty Limited Appellant
VERSUS
MMTC LIMITED Respondents


Referred Judgements :-

ASSOCIATED PROVINCIAL PICTURE HOUSES VS. WEDNESBURY CORPN [REFERRED TO]
CHAO VS. BRITISH TRADERS AND SHIPPERS LTD [REFERRED TO]
FOREFRONT MEDICAL TECHNOLOGY (PTE) LTD. VS. MODERN-PAK PTE LTD [REFERRED TO]
SHRIRAM EPC LTD. VS. RIOGLASS SOLAR SA [REFERRED TO]
SOUTH EAST ASIA MARINE ENGG. AND CONSTRUCTIONS LTD. (SEAMEC LTD.) VS. OIL INDIA LTD [REFERRED TO]
ZURICH INSURANCE (SINGAPORE) PTE LTD VS. B-GOLD INTERIOR DESIGN AND CONSTRUCTION PTE LTD [REFERRED TO]
PATEL ENGG. LTD. VS. NORTH EASTERN ELECTRIC POWER CORPN. LTD [REFERRED TO]
MURLIDHAR CHIRANJILAL VS. HARISHCHANDRA DWARKADAS [REFERRED TO]
KAMLA DEVI VS. TAKLIATMAL [REFERRED TO]
SUDARSAN TRADING CO VS. GOVERNMENT OF KERALA [REFERRED TO]
H B GANDHI EXCISE AND TAXATION OFFICER CUM ASSESSING AUTHORITY KARNAL VS. GOPINATH AND SONS [REFERRED TO]
RENUSAGAR POWER CO LIMITED GENERAL ELECTRIC CO VS. GENERAL ELECTRIC CO :RENUSAGAR POWER COMPANY LIMITED [REFERRED TO]
KULDEEP SINGH VS. COMMISSIONER OF POLICE [REFERRED TO]
OIL AND NATURAL GAS COMMISSION VS. SAW PIPES LIMITED [REFERRED TO]
PURE HELIUM INDIA PRIVATE LIMITED VS. OIL AND NATURAL GAS COMMISSION [REFERRED TO]
D D SHARMA VS. UNION OF INDIA [REFERRED TO]
HINDUSTAN ZINC LTD VS. FRIENDS COAL CARBONISATION [REFERRED TO]
MCDERMOTT INTERNATIONAL IN VS. BURN STANDARD CO LTD [REFERRED TO]
BANK OF INDIA VS. K MOHANDAS [REFERRED TO]
P R SHAH SHARES AND STOCK BROKER P LTD VS. B H H SECURITIES P LTD [REFERRED TO]
RAJA BAGHUNANDAN PRASAD SINGH VS. RAJA KIRTYANAND SINGH BAHADUR [REFERRED TO]
OIL AND NATURAL GAS CORPORATION LTD VS. WESTERN GECO INTERNATIONAL LTD [REFERRED TO]
ASSOCIATE BUILDERS VS. DELHI DEVELOPMENT AUTHORITY [REFERRED TO]
M/S. CENTROTRADE MINERALS & METAL INC. VS. HINDUSTAN COPPER LTD. [REFERRED TO]
HRD CORPORATION (MARCUS OIL AND CHEMICAL DIVISION) VS. GAIL (INDIA) LIMITED (FORMERLY GAS AUTHORITY OF INDIA LTD.) [REFERRED TO]
VENTURE GLOBAL ENGINEERING LLC VS. TECH MAHINDRA LTD. & ANOTHER ETC. [REFERRED TO]
MAHARASHTRA STATE ELECTICITY DISTRIBUTION COMPANY LTD. VS. DATAR SWITCHGEAR LTD [REFERRED TO]
TRANSMISSION CORPORATION OF ANDHRA PRADESH LTD. AND OTHERS VS. M/S. GMR VEMAGIRI POWER GENERATION LTD. AND ANOTHER [REFERRED TO]
SUTLEJ CONSTRUCTION VS. UNION TERRITORY OF CHANDIGARH [REFERRED TO]
M P POWER GENERATION CO LTD & ANR VS. ANSALDO ENERGIA SPA & ANR [REFERRED TO]
MMTC LTD VS. M/S VEDANTA LTD [REFERRED TO]
SSANGYONG ENGINEERING & CONSTRUCTION CO LTD VS. NATIONAL HIGHWAYS AUTHORITY OF INDIA (NHAI) [REFERRED TO]
PARSA KENTE COLLIERIES LIMITED VS. RAJASTHAN RAJYA VIDYUT UTPADAN NIGAM LIMITED [REFERRED TO]
STATE OF JHARKHAND VS. HSS INTEGRATED SDN [REFERRED TO]



Cited Judgements :-

STATE OF RAJASTHAN VS. GEO MILLERS & COMPANY LTD. [LAWS(RAJ)-2021-9-24] [REFERRED TO]
RASHTRIYA ISPAT NIGAM LIMITED VS. BALAJI COKE [LAWS(APH)-2022-1-30] [REFERRED TO]
GODAVARI MARATHWADA IRRIGATION DEVELOPMENT VS. M/S. S. D. SHINDE AND SONS [LAWS(BOM)-2022-6-98] [REFERRED TO]


JUDGEMENT

R.F.NARIMAN,J. - (1.)Leave granted.
(2.)This appeal is at the instance of an Australian company, Anglo American Metallurgical Coal Pty. Ltd. ["Appellant"], which produces and exports certain types of coal. By a Long Term Agreement dated 07.03.2007 ["LTA"], between the Appellant and MMTC Ltd. ["Respondent"], the Appellant, referred to as the "seller" in the LTA, agreed to supply certain quantities of freshly mined and washed "German Creek", "Isaac" (Blend of 65% Moranbah North and 35% German Creek coking coals) and "Moranbah North" coking coal to the Respondent. Clause 1 of this LTA is material and states as follows:
"CLAUSE 1: MATERIAL, QUANTITY, QUALITY AND DELIVERY PERIOD:

The SELLER shall sell and the PURCHASER shall buy,

a) The base quantity during the currency of the contract shall be 466,000 (Four hundred Sixty Six thousand) metric tons (of one thousand kilograms each) firm.

b) During the First Delivery Period (1st July, 2004 to 30th June, 2005), a quantity of 464,374 (Four Hundred Sixty Four Thousand, Three Hundred and Seventy Four) metric tons (of one thousand Kilograms each) firm quantity of freshly mined and washed "Isaac", "Moranbah North" and "German Creek" coking coals.

c) During the Second Delivery Period (1st July, 2005 to 30 June, 2006) a quantity of 382,769 (Three Hundred Eighty Two Thousand, Seven Hundred and Sixty Nine) metric tons (of one thousand kilograms each) firm quantity of freshly mined and washed "Isaac", "Moranbah North" and "German Creek" cooking coals.

d) During the Third Delivery Period (1st July, 2006 to 30th June, 2007) a quantity of 466,000 (Four Hundred Sixty Six Thousand) metric tons (of one thousand Kilograms each) firm quantity of freshly mined and washed "Isaac", "Moranbah North" and "German Creek" coking coals.

e) During the subsequent Delivery Periods, in case of the PURCHASER exercising the option to extend the duration of the Agreement by two more years, at its sole discretion, as indicated at Para 1.3 herein below, a quantity of 466,000 (Four Hundred Sixty Thousand) metric tons (of one thousand kilograms each) of freshly mined and washed "Isaac", "Moranbah North" and "German Creek" coking coals hereinafter referred to as the MATERIALS, in conformity with the Technical Specifications incorporated in Annexure - MB (applicable for "Moranbah North" coking coal) and Annexure IIC (applicable for "German Creek" coking coal) to this Agreement and which shall constitute an integral part of this Agreement, for use of imported coking coals in the coke ovens in its integrated iron and steel works for production of metallurgical coke. The quality of the prime washed coking coals to be supplied under this Agreement shall under no circumstances be inferior to the Technical Specifications as contained in Annexure MA, Annexure MB and Annexure IIC to this Agreement as applicable.

1.1.1 Annual base quantity from 1st July, 2007 to 30 June, 2009, in case Purchaser exercises its option to extend the Agreement by 2 years, shall be 466,000 metric tonnes, subject to further discussions at the time of contract extension and the logical contract specification modifications to reflect the changing nature of existing reserves at the Moranbah North and German Creek mining operations will be mutually agreed.

1.2 For the purpose of this Agreement, the Delivery Period shall be reckoned as follows:

First Delivery Period 1st July 2004 to 30th June 2005

Second Delivery Period 1st July 2005 to 30th June 2006

Third Delivery Period 1st July 2006 to 30th June 2007

The shipments will be evenly spread during each Delivery Period. The PURCHASER reserves the right to prepone shipments against any Delivery Period based on its requirement and subject to availability with the SELLER.

The Purchaser reserved the right to postpone the deliveries to be effected under each Delivery Period by upto 3 months i.e. the month of September following each Delivery Period, without any additional financial liability to the PURCHASER.

1.3 The PURCHASER had the option to extend the duration of the Agreement by two more years, at its sole discretion and the Purchaser to exercise its option for extending the Agreement by two more years or otherwise by 31st January, 2007. In case the PURCHASER decides to exercise such option, at its sole discretion, the Agreement shall have two more Delivery Periods as follows:

Fourth Delivery Period: 1st July 2007 to 30th June 2008

Fifth Delivery Period: 1st July 2008 to 30th June 2009"

(3.)Under clause 2 of the LTA, which refers to "Price", for subsequent Delivery Periods, including the "Fifth Delivery Period", with which we are directly concerned, it is undisputed that when read with Annexure I of the LTA and a letter dated 14.08.2008, setting out the terms of the Fifth Delivery Period, the price was fixed at $300 per metric tonne. Clause 2.2 is important and states as follows:
"CLAUSE 2: PRICE

xxx xxx xxx

2.2 The Price for the Delivery of AGREEMENT quantity for subsequent Delivery Periods shall be fixed in accordance with Para I of Annexure-1 and shall be firm and shall not be subject to any escalation for any reason, whatsoever, until the completion of delivery of the AGREEMENT quantity due for delivery in the relevant Delivery Period with such extensions as might be mutually agreed upon between the PURCHASER and the SELLER."

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