- (1.) The plaintiff claims to have introduced NSK bearings of the defendants manufacture in India and developed a market for the products for over thirty years. The plaintiff is not the sole selling agent of NSK bearings in the country or even in any specified region. It wishes to view its dealership agreement that is borne out from the correspondence exchanged between the parties as an agency coupled with an interest. The immediate cause for the plaintiff to bring this action was the defendants decision last summer to prune the number of customers of NSK bearings that the plaintiff could exclusively deal with. The plaintiff's contention that the principle embodied in Section 202 of the Contract Act, 1872 would be applicable to the transaction between the parties hereto is reflected in some of the reliefs claimed in the suit: "a) Perpetual injunction restraining the defendants, their agents, servants and assigns from interfering with the plaintiff's exclusive agency of NSK bearings in respect of the customers/industry segments mentioned in Schedule "A", till such time as: i) the un-executed contracts/work orders already subsisting and/or which are likely to be awarded as mentioned in paragraph 22 above are fully executed; ii) the existing stock of bearings more fully stated in Schedule "BB" are disposed of to the customers/industry segments mentioned in Schedule "A"; b) Perpetual injunction restraining the defendants from giving any effect or further effect to the notice dated June 10, 2009 or any other similar notice of the defendants purporting to terminate directly or indirectly either wholly or in part the plaintiff's exclusive agency in respect of the plaintiff's customers/industry segments mentioned in Schedule "A". c) Decree for Rs.150,00,00,000/- as pleaded in paragraph 39 above; d) Declaration that the plaintiff's exclusive agency for NSK bearings in respect of the customers/industry segments mentioned in Schedule "A" is not terminable till such time as: i) the un-executed contracts/work orders already subsisting and/or which are likely to be awarded as mentioned in paragraph 22 above are fully executed; ii) the existing stock of bearings more fully stated in annexure "BB" are disposed of to the customers/industry segments mentioned in Schedule "A"; e) Mandatory injunction directing the defendants to discharge their obligations towards the plaintiff for due functioning of the plaintiff as the defendants agent in the manner as indicated in paragraph 10 above; f) Mandatory injunction directing the defendants to supply bearings and discharge all other obligations mentioned in paragraph 10 against the existing orders and orders likely to be awarded as mentioned in paragraph 22; g) Mandatory injunction directing the defendants to continue supply to NSK bearings to the plaintiff for due discharge of the plaintiff's function as the defendants exclusive agent for the customers/industry segment mentioned in Schedule "A"; h) Receiver; i) Injunction; j) Costs; k) Such further and/or other relief." In this interlocutory petition the plaintiff has sought an injunction restraining the defendants from supplying bearings to or dealing with the customers referred to in Schedule "A" to the petition; mandatory injunction commanding the defendants to undertake a host of duties that have been set out; injunction restraining the defendants from interfering with the plaintiff's exclusive agency of NSK bearings in respect of the Schedule "A" customers till such time that the unexecuted contracts and the contracts likely to be awarded are fully executed and the existing inventory of bearings at the plaintiff's disposal is exhausted; and, injunction restraining any effect to be given to a notice of June 10, 2009 or any steps being taken by defendants to terminate the exclusive agency in respect of the Schedule "A" customers.
(2.) The plaintiff says that the association between the plaintiff and its predecessors-in-interest on the one hand and the defendants and others controlled by the manufacturers of NSK bearings on the other dates back to 1975-76 when the third defendant Japanese manufacturer sought to enter the fledgling Indian market without establishing any infrastructure or incurring costs for setting up any distribution or service centre. At paragraph 7 of the petition the plaintiff claims that the plaintiff has been exclusively entrusted to effect supplies of NSK bearings to the customers listed in Schedule "A" to the petition. The customers listed in Schedule "A" include several units of the National Thermal Power Corporation Limited, various units of State electricity boards and related entities, divisions and units of the Indian Railways, all plants of the Steel Authority of India Limited and 20 other public and private sector industries. At paragraph 9 of the petition it has been averred that the task of shipment of NSK bearings in the Asian market was first assigned by the Japanese manufacturer to the fourth defendant and, from 2005, the second defendant was exclusively assigned the work of shipment of NSK bearings to India. Paragraph 9(c) of the petition is of some significance: "9(c). With the growth of Indian market the respondent no. 3 in 1998 set up a Liason (sic, liaison) Office at Chennai which was later upgraded to a branch office in 2003. With further growth of business in India, the respondent no. 3 promoted the respondent no. 1, which is a wholly owned subsidiary of respondent no. 3, on July 24, 2007. Thereupon the respondent no. 3 changed the modality of its operation in India by issuing customer allocations to its agents including the petitioner through the respondent no. 1. The respondent no. 1 is under the control of the respondent no. 3. " ¦"
(3.) It is the plaintiff's case that there was no "written agency agreement" and that the terms and conditions of the agency would be "borne out and corroborated by the conduct in course of the last decades." The plaintiff's version of the terms has been recorded at paragraph 10 of the petition. The six clauses of paragraph 10 read as follows: "a) The petitioner would operate as the exclusive agent of the respondents for the clients, particulars whereof have already been given in Schedule "A". b) The petitioner would procure orders for supply of NSK bearings from customers named in Schedule "A" either in the name of the petitioner in its capacity as agent or in the name of a company of the NSK Group for supply through the petitioner as their Indian Agent. c) In respect of orders placed upon the concerned NSK Group company, the petitioner is paid agency commission. The usual rate of commission is 6% of the sales price but in some cases the petitioner reduced its commission rate as a goodwill measure and only to procure large lucrative orders for the respondents. d) In case where the orders are placed by the customers on the petitioner directly, the concerned NSK Group company would issue manufacturer's test and warranty certificate for each supply. The concerned respondent also whenever required, would provide an authorization certificate stating that the petitioner is the duly authorized agent for NSK bearings. Copies of a few such authorization letters including that dated July 02, 2008 issued by the respondent no.1 to NTPC Limited are annexed hereto and collectively marked with the letter "B". The petitioner also annexes hereto a few manufacturers test and warranty certificates issued by the concerned respondent against the orders placed by the customers upon the petitioner and these are collectively marked with the letter "C". In the case of orders in the name of the petitioner, the petitioner would buy NSK bearings from the concerned respondent and thereafter supply the same to the customers after retaining a margin on the sales price. e) The petitioner would be required to maintain a stock of reasonable quantity of NSK bearings to meet the urgent needs of customers. This would be evident from letters issued by customers, copies whereof annexed hereto and marked with the letter "D". f) The petitioner would carry out pre-despatch inspection in India on behalf of the respondents. For this, the respondents have duly authorised the petitioner as would appear from the documents being Annexure "E" hereto.";