Mrs. Sujata V. Manohar, J. - (1.) Leave granted.
(2.) Application for impleadment allowed.
(3.) This is an appeal from a judgment and decree of the High Court dated 9th of October, 1996 in Arbitration Petition No. 22 of 1996 whereby the High Court has allowed the petition and passed a decree, under the provisions of the Foreign Awards (Recognition and Enforcement) Act, 1961, in terms of the foreign award dated 3rd of October, 1995, given by the second respondent-arbitrator at Odessa, Ukraine. In 1983 the 1st respondent-Black Sea Shipping Co. was a division of M/s. Sovfracht a wholly owned company of the then Government of the USSR. Under an agreement dated 26-8-83 the 1st respondent appointed, inter alia, the appellants-M/s. Transocean Shipping Agency (P) Ltd. as their shipping agents for the 1st respondent's business of shipping and carriage of goods to and from various Indian ports. The engagement of the appellants by the 1st respondent was done under various agreements, the last of which was dated 26-8-1983. Under Clause 5.30 of the agreement of 26-8-1983 all payments between the owners i.e. the 1st respondent and the agents were to be effected in accordance with the terms of a payment agreement existing between the USSR and India otherwise than in free convertible currency. All remittances from the appellants to the 1st respondent were, therefore, to be made in accordance with the rupee-rouble payment agreement between the USSR and India. Clause 7 of the agreement of 26-8-1983 contains an arbitration clause requiring the disputes, if not settled amicably, to be referred to the Maritime Arbitration Commission of the USSR with the Chamber of Commerce and Industry in Moscow for arbitration in accordance with the Rules and Procedure of this Commission. In or around December, 1991, dissolution of the USSR took place. Several Socialist Republics which had formed a part of the USSR became independent Sovereign States. The State of Ukraine also thus became an independent Sovereign State. The 1st respondent company became a company owned by the State of Ukraine. In January, 1992 the Reserve Bank of India issued a directive that henceforth all trade and non-trade transactions with the State of Ukraine and the other Soviet countries would be effected only in freely convertible currencies. All disbursements in respect of Ukrainian vessels and collection of rates will in convertible rupees in dollar terms only. At this time a sum of approximately Rs. 28.11 crore was lying with the appellants to the credit of the 1st respondent in the form of non-convertible rupees. Because of the directive issued by the Reserve Bank of India, this amount could not be used by the appellants to meet disbursements in respect of the vessels of the 1st respondent. The 1st respondent, therefore, decided to utilise this non-convertible rupee amount for purchasing different items and commodities like tea, containers, garments etc. in India after obtaining the requisite permission from the Reserve Bank of India. In this matter, a sum of Rs. 21.7 crores was utilised by the 1st respondent and was disbursed by the appellants on the instructions of the 1st respondent after obtaining the requisite Reserve Bank of India's permission.;