2141D

IN THE LEARNED COMMERCIAL COURT OF RAJARHAT

AT KOLKATA

IN THE MATTERS OF

CIVIL SUIT NO._ 2141/2023

STATE OF WEST BENGAL (REPRESENTED BY CHIEF DIRECTOR OF CONSTRUCTION

DEPARTMENT).………………………………PETITIONERS

v.

ELSEVIER CONSTRUCTION PVT. LTD. (REPRESENTED BY CEO OF ELSEVIER)

……………………………………………………………………RESPONDENT
[Under Article of the Supreme Court Rules, 2013]
INDEX OF AUTHORITIES.....................................................................................................iv

STATEMENT OF FACTS......................................................................................................vii

STATEMENT OF JURISDICTION.........................................................................................ix

ISSUES FOR CONSIDERATION............................................................................................x

SUMMARY OF ARGUMENTS..............................................................................................xi

ARGUMENTS ADVANCED...................................................................................................1

I. The bank guarantee............................................................................................................1

A. The State Under 162 Has The Requisite Power To Pass Ordinance..................................1

B. Article 15 of the constitution empowers the state to make laws “in favor” of women and
children.......................................................................................................................................1

II. The Practice Of Talaq E Hasan Is Violative Of Fundamental rights under Articles 14, 15
and 21 of the constitution...........................................................................................................2

A. The Practice Is Violative Of Art 14 As The Ordinance Is Manifestly Arbitrary...............2

i. Talaq-e-Hasan is unreasonable..........................................................................................2

ii. Practice Is Manifestly Arbitrary.........................................................................................2

B. The Practice is violative of Article 15................................................................................3

C. The Practice Of Talaq E Hasan Harms The Dignity Of Muslim Women under Article 21
4

III. The Practice Is Not An Essential Religious Practice Of Islam And cannot be granted
constitutional immunity.............................................................................................................4

A. Divorce is not encouraged by Islamic Laws......................................................................4

B. Practice of talaq e hasan is not a compulsory practice.......................................................5

C. The practice of talaq e hasan cannot be granted constitutional protection/immunity........7

D. Criminalization is valid under Article 25...........................................................................7

IV. International Conventions disapprove of Unilateral Divorces........................................8

ii
V. The Terms Of The Contract Were Clear And There Is No Need To Add Implicit Terms
As The Contract Itself Was Not Ambiguous.............................................................................8

VI. Precontractual Negotiations Should Not Be Relied Upon For Evidence......................12

VII. The Principle Of Expressio Unius Est Exclusio Alterius Should Be Applied For Apt
Interpretation Of The Terms....................................................................................................14

VIII. Even If Precontractual Correspondence Were To Be Considered, They Explicitly

Specify That Maintenance Will Be Provided On An Annual Fee...........................................14

IX. Ejusdem Generis Finds No Applicability In This Case................................................15

PRAYER FOR RELIEF...........................................................................................................16

iii
 INDEX OF AUTHORITIES

Cases

Bangalore Electricity Supply Company Limited (BESCOM) v. E.S. Solar Power Pvt. Lt.....21
BP Refinery (Westernport) Pty Ltd v Shire of Hastings..........................................................20
China Cotton Exporters v Beharilal Ramcharan Cotton Mills Ltd..........................................19
Danial Latifi & Anr vs Union Of India....................................................................................16
Homburg Houtimport BV v Agrosin Private Ltd....................................................................19
Indian Young Lawyers Association vs State of Kerela...........................................................16
Investors Compensation Scheme Ltd v West Bromwich Building Society.............................22
Joseph Darmanin v Carmel Micalle.........................................................................................22
Khardah Company Ltd. v. Raymon and Co. (India) Private Ltd.............................................21
Madhu Kishwar v State of Bihar..............................................................................................16
Miryala Venkateswarlu & Co v Battula Venkataperaiah and Venkateswarlu and Co............22
Nabha Power Limited vs Punjab State Power Corporation Limited........................................19
Ptc India Ltd. v. Tamil Nadu Electricity Board.......................................................................22
Sec 94 of the Indian Evidence Act 1872..................................................................................22
Shayara Bano Vs Union of India and Ors................................................................................11
Shirlaw v Southern Foundries..................................................................................................20
Solle v Butcher.........................................................................................................................19
The Commissioner, Hindu Religious Endowments, Madras v Shri Lakshmindar Tirtha
Swamiyar of Shri Shirur Mutt..............................................................................................15
Trollope & Colls Ltd v N.W. Metropolitan Regional Hospital Boards...................................23

Statutes

Article 14 of the Indian Constitution, 1950.............................................................................11

Article 15 of the Indian Constitution, 1950.............................................................................12
Article 15(3) of the Indian Constitution, 1950.........................................................................10
Article 21 of the Indian Constitution, 1950.............................................................................13
Article 246 of the Indian Constitution, 1950...........................................................................10
Article 25 of the Indian Constitution, 1950.............................................................................16
Article 253 of the Indian Constitution, 1950...........................................................................17

iv
Article 51 of the Indian Constitution, 1950.............................................................................17
List III entry 1 of 7th Schedule of the Indian Constitution, 1950 ............................................10
Section 10(a) of Information Technology Act, 2000...............................................................18
Section 2 of the Indian Contract Act........................................................................................18
Section 95 of the Indian Evidence Act.....................................................................................21

Other Authorities

Article 3 of the Universal Declaration of Human Rights...........................................................9

Black’s Law Dictionary (8th edition, 2004)............................................................................16
Ballentine's law dictionary…………………………………………………………………...15

Convention on the Elimination of All Forms of Discrimination Against Women (CEDAW)..9

https://www.metmuseum.org/learn/educators/curriculum-resources/art-of-the-islamic-world/
unit-one/the-five-pillars-of-islam...........................................................................................6
Vienna Declaration.....................................................................................................................9

Treatises

Abeda Sultana Patriarchy and Women’s Subordination: A Theoretical Analysis....................4

Book 6, Number 2173................................................................................................................4
Sura IV verse. Holy Quran.........................................................................................................5

v
 STATEMENT OF FACTS

Contracts of housing project

Elsevier Constructions Pvt. Ltd. has entered into a contract with State of West Bengal to
complete a residential housing project in the Kolkata city extension of New Town Action
Area 4. According to the contract executed on February 1, 2020, Elsevier was obligated to
complete the project by December 31, 2022.

ICICI Bank furnishes a performance bond

ICICI Bank furnished a performance bond to the state government for an amount of Rs. 10
crores.

Interruptions caused by unanticipated condition

At the beginning of 2020 COVID 19 caused loss of supply of labour and raw material
aggravated further by Russia Ukraine war at the end of 2022, inflation mushroomed which
made Elsevier make more incompetent to make payments and disruption of work.

Additional extension was demanded

Elsevier demanded additional time to which ICICI bank was ready to guarantee, but state
government refused to budge from its demand of 10 crores. Elsevier ran into financial
difficulties and was subject to liquidation proceedings before NCLT, Kolkata. ICICI Bank
pleaded that the unanticipated developments surrounding the pandemic and the war amounted
to ‘special inequities’ which was sufficient ground to provide at least a temporary discharge
to the surety. The state government however filed a suit before the Commercial Court,
Rajarhat, Kolkata, against ICICI Bank and claimed that the obligation under the performance
bond was absolute.

vi
 STATEMENT OF JURISDICTION

The appellants most humbly submit that this Hon’ble Supreme Court of Rarya has the
jurisdiction to hear and adjudicate upon the present matters of:

Civil suit No. 2141/2023 filed under Article 139(a) of the Constitution of Rarya, 1950, read
with Rule 8 of Order XXXVIII of the Supreme Court Rules, 2013.

All of which is urged in detail in the written submission and submitted most respectfully.

vii
 ISSUES FOR CONSIDERATION

I. WHETHER BANK GUARANTEE PROVIDED BY ICICI BANK TO ELSEVIER IS

UNCONDITIONAL AND IRREVOCABLE OR NOT?

II. WHETHER CONTRACT OF ?

III. WHETHER GIVEN SET OF FACTS RELATING TO COVID 19 CRISIS AND RUSSIA
UKRAINE WAR PROVIDES SUFFICIENT CAUSE TO CLAIM AN INJUNCTION TO

RESTRAIN BANK GUARANTEE OR NOT?

viii
 SUMMARY OF ARGUMENTS

BANK GUARANTEE PROVIDED BY ICICI BANK TO ELSEVIER IS NOT UNCONDITIONAL AND

IRREVOCABLE.

I. THE RULE THAT DUTY OF BANK TO MAKE PAYMENT ON FIRST DEMAND IS SUBJECT

TO SOME EXCEPTION.

It is well settled that a bank guarantee is an independent contract between the bank and the
creditor and the bank is always obliged to honour the demand, the amount of liability
undertaken in the guarantee, but there are two exception to this rule, one being situation of
‘special equities’ caused due to exceptional circumstances.

II. THE COVID 19 OUTBREAK AND RUSSIA UKRAINE CRISIS COMPLY WITH

EXCEPTION TO THE GENERAL RULE OF BANK GUARANTEE .

The current situation of COVID 19 and Russian Ukraine war satisfies prima facie that it is a
situation of extraordinary ‘Special equity’. Hence ICICI is not oblige under performance
bond of 10 Crores and is entitled to the injunction to restraint invocation of bank guarantee.

GIVEN SET OF FACTS RELATING TO COVID 19 CRISIS AND RUSSIA UKRAINE WAR
PROVIDES SUFFICIENT CAUSE TO CLAIM AN INJUNCTION TO RESTRAIN BANK GUARANTEE

OR NOT

ix
 ARGUMENTS ADVANCED

I. THE Bank guarantee provided by ICICI bank to Elsevier is not unconditional and
irrevocable.

The rule of construction of bank guarantee is that the terms of a guarantee must be strictly
construed. In recent decision of Supreme court of India in BSES Ltd. v. Fenner India Ltd.,
(2006) 2 SCC 7281 .The law relating to invocation of bank guarantees is well settled. The
jurisprudential disposition has carved out two exceptions when an injunction can be granted
to restraint invocation of bank guarantee:

1. Fraud of an egregious nature, which goes to the root of the bank guarantee (and
not the underlying contract: A clear evidence, both as to the fact of fraud and as
to the bank’s knowledge of such fraud, which would vitiate the very foundation
of such a bank guarantee can go a long way in restraining invocation of a bank
guarantee; or

2. Irretrievable injury/harm or injustice: If the harm or injustice is of such an

exceptional and irretrievable nature as would override the terms of the
guarantee and cause adverse effect of such an injunction on commercial
dealings in the country, the courts can treat such situations as exceptional and
accordingly grant an injunction; or

Special equities: Relief on account of injuries caused due to exceptional

circumstances.

The COVID-19 outbreak has created a void in terms of performance of commercial contracts
and has in many cases left the parties on edge. The orders passed by the judiciary during
COVID-19, dealing with an otherwise settled issue i.e. the invocation of bank guarantee.

It is well settled that a bank guarantee is an independent contract between the bank and the
creditor and the bank is always obliged to honour on demand, the amount of liability
undertaken in the guarantee, irrespective of any dispute raised by the debtor, as long as it is

1
BSES Ltd. v. Fenner India Ltd., (2006) 2 SCC 728
1
unconditional and irrevocable. It is independent of the underlying contract between the
beneficiary and the person at whose instance the bank guarantee is given.

What happens in an unconditional bank guarantee is that the bank has to pay the guarantee
amount to the beneficiary in whose favour the bank guarantee has been issued on demand,
irrespective of any pending disputes, whereas in a conditional bank guarantee, the bank has to
pay the guarantee amount, only after the specific conditions for invocation in the contract are
fulfilled.

The first order dealing with the invocation of bank guarantee during COVID-19 was passed
by the Hon’ble Delhi High Court in M/s Halliburton Offshore Services Inc.(“Halliburton”)
v. Vedanta Limited and Anr. (“Vedanta”)2. Halliburton had entered into a contract with
Vedanta for development of certain blocks and had furnished bank guarantees as security.
Due to the complete lockdown prevailing in the country and consequent restrictions on
industrial activities as well as movement of persons, Halliburton has not been able to
complete its part of the contract. Apprehending the contract likely to be terminated by
Vedanta and the consequential invocation of bank guarantees, it had filed an application for
interim protection. Vedanta’s argument is that Halliburton has failed to establish the
existence of “egregious fraud”, which is the prima facie requirement of seeking an injunction
against invocation of bank guarantee. However, Halliburton relied on numerous cases to
argue that there is a second exception to invocation of bank guarantee, which is “special
equities”, where refusal to grant a stay would result in injustice to them and it is indeed what
the court upheld.

The Hon’ble Delhi High Court observed that the countrywide lockdown, which came into
place on March 24, 2020 was prima facie in the nature of force majeure and such a lockdown
was unprecedented and was incapable of having been predicted. Taking cognizance of the
fact that Halliburton continued to work on the project till the imposition of lockdown on
March 22, 2020, or at least shortly prior thereto and that the government has also been issuing
instructions, from time to time, to mitigate the difficulties that have resulted, as a result of the
lockdown, the Hon’ble Delhi High Court held that it would justify an ad-interim injunction,
restraining invocation or encashment of the bank guarantees.

2
Halliburton Offshore Services Inc. v. Vedanta Limited, 2020 SCC OnLine Del 542.
2
The court observed, where “special equities” exist, it is empowered, in a given set of facts
and circumstances, to injunct invocation, or encashment, of a bank guarantee. In the present
case, special equities did exist, and it was justiciable to injunct Vedanta from invoking the
bank guarantees, forming subject matter of these proceedings, till the expiry of a period of
one week from May 3, 2020, till which date the lockdown has been imposed.

On the question of irretrievable injury/injustice which is the second exception to the rule
against grant of injunction when unconditional bank guarantees are sought to be encashed,
the Supreme Court in the judgment of Svenska Handelsbanken vs. Indian Charge Chrome
Ltd3 while discussing the expression to prevent irretrievable injustice' held that in the case of
confirmed bank guarantees/ irrevocable letters of credit, cannot be interdicted unless it is a
case of established fraud or irretrievable injustice.

The expression to prevent irretrievable injustice' has been taken from the decision of the
Court of Appeal in England in the case of Elian & Rabbath (Trading as Elian & Rabbath) vs.
Matsas & Matsas.26 In this case, Lord DENNING observed that it can well be argued that the
guarantee was given on the understanding that the lien was raised and no further lien was
imposed, and that when the ship-owners imposed a further lien, they were disabled from
acting on the guarantee. Here, irretrievable injustice which was made the basis for grant of
injunction was on the ground that the guarantee was not encashable on its term when the
buyers had paid the amount to lift the original lien.

It was held by the Supreme Court in the case of U.P. State Sugar Corporation vs. Sumac
International Ltd.4 that the irretrievable injury must be of the kind which was the subject-
matter of decision in the Itek Corporation case [reported as 566 Feb Supp. 1210]. The
Supreme Court in the said case discussed the nature of irretrievable injury discussed in the
case of Itek Corporation, and observed thus

3
Svenska Handelsbanken v. Indian Charge Chrome, (1994) 1 SCC 502
4
U.P. State Sugar Corpn. v. Sumac International Ltd., (1997) 1 SCC 568
3
II. THE COVID 19 OUTBREAK AND RUSSIA UKRAINE CRISIS COMPLY WITH EXCEPTION
TO THE GENERAL RULE OF BANK GUARANTEE.

Article 145 talks about equality before law and equal protection of law.

Here the phrase used is “shall not” which impliedly poses an obligation on the State to
prevent denial of equality before law and equal protection of law. As per submissions, the
practice is unreasonable [I] and manifestly arbitrary [II].

These grounds fulfil the test under the Doctrine of Manifest Arbitrariness.

5
Article 14 of the Indian Constitution, 1950
4
 THE PRACTICE IS VIOLATIVE OF ARTICLE 15
Article 156 talks about prohibition of discrimination solely based on gender, religion etc.
Marriage being a sacred institution having a ubiquitous influence in all domains of a couple,
must be built on mutual consent and coexistence. The fact that the consent of the wife is of
no significance, puts them on an inferior pedestal as that of a man and makes this practice
discriminatory on the grounds of gender, thereby violating Article 15.

i. It is gender discriminatory

The Practice of Talaq-e-Hasan prime facie may look gender equal but, in its core, it is
discriminatory for women. The procedure of dissolution can be moved unilaterally by a man.
Women have no say in the dissolution of their marriage that constitutes such an important
aspect of their life.

ii. Talaq-e-Hasan exposes women to the tyranny of men

In Islam, marriage is considered a contract, and the act of unilaterally divorcing your wife,
makes women an object whose lives are subservient and dependent on men. Instead of
establishing a bond of mutual coexistence and mutual dissolution of marriage, this practice
leaves women at the mercy of the whims and caprices of men. In a social structure like that
of Rarya where men are generally the breadwinners for their family and the custodian of the
family purse, this unilateral dissolution leaves women both socially and economically
helpless.

A. THE PRACTICE OF TALAQ E HASAN HARMS THE DIGNITY OF MUSLIM WOMEN

UNDER ARTICLE 21
Article 217 talks about life and liberty. The fact that the socio-economic conditions of women
are dependent on men in a patriarchal society 8, unilaterally divorcing them in an arbitrary
nature leaves them to the streets. Moreover, their plight gets heightened if they are mothers
and they face constant struggle to find food and shelter and ultimately start a new way of life
for themselves and their children. Their dignity gets harmed as they are looked down upon by
the society as discarded garments of their husband and questions embellished with slangs are
put on their character. This in turns harms their dignity, violating Article 21.
6
Article 15 of the Indian Constitution, 1950
7
Article 21 of the Indian Constitution, 1950
8
Abeda Sultana, Patriarchy and Women’s Subordination: A Theoretical Analysis
5
 III. THE PRACTICE IS NOT AN ESSENTIAL RELIGIOUS PRACTICE OF ISLAM AND
CANNOT BE GRANTED CONSTITUTIONAL IMMUNITY

A. DIVORCE IS NOT ENCOURAGED BY ISLAMIC LAWS.

Of all the lawful acts the most detestable to Allah is divorce.9

As per Sura IV10 verse 35 of the Holy Quran, there is a prerequisite that must be met before
the talaq can take place. The prerequisite is that if the husband and wife's relationship is tense
and the husband intends to give his wife "talaq," he must select an arbitrator from his side
and the wife must select an arbitrator from her side. The arbiters must then attempt to
reconcile the parties after a reasonable amount of time has passed for the parties' passions to
subside and reconciliation to be successful. If reconciliation is ultimately unsuccessful, the
husband will be permitted to issue a "talaq."

B. PRACTICE OF TALAQ E HASAN IS NOT A COMPULSORY PRACTICE

In the case of Shayara Bano11, the SC considered that just because a practice is permissible
under a religion does not make it an essential part of that religion. The court evaluated triple
talaq practice on the grounds of the category of action it was divided under.

Islam divides all actions into five kinds which figure differently in the sight of God-

First degree: Fard. Whatever is commanded in the Koran, Hadis or Ijma must be obeyed;
Second degree: Masnun, Mandub and Mustahab: These are recommended actions; Third
degree: Jaiz or Mubah: These are permissible actions as to which religion is indifferent;
Fourth degree: Makruh: That which is reprobated as unworthy. Fifth degree: Haram: That
which is forbidden.

Even if Talaq E Hasan were to be found in the Hadis, Ijma, or the Koran, it would not fall
under the first degree because it is not something that is "commanded." In addition, the act of
talaq itself is not advised and will not be considered second degree. At most, Talaq E Hasan
belongs in the third degree, but it most likely belongs in the fourth degree. It is an allowed
action for which religion is irrelevant under the third degree.

9
Book 6, Number 2173
10
Sura IV verse. Holy Quran
11
Supra 7
6
 The practice of Talaq e Hasan is not something that is compulsory for a Muslim to follow.
Divorce via Talaq e Hasan does not form a part of the basic tenets of Islam namely-

Profession of Faith (shahada), Prayer (salat), Alms (zakat), Fasting (sawm), Pilgrimage
(hajj)12
As propounded in The Commissioner, Hindu Religious Endowments, Madras v Shri
Lakshmindar Tirtha Swamiyar of Shri Shirur Mutt 13 “Essential part of a religion means the
core beliefs upon which a religion is founded. Essential practice means those practices that
are fundamental to follow a religious belief. Test to determine whether a part or practice is
essential to a religion is to find out whether the nature of the religion will be changed
without that part or practice. If the taking away of that part or practice could result in a
fundamental change in the character of that religion or in its belief, then such part could be
treated as an essential or integral part”

Divorce in Islam consists of Talaq-e-Biddat, Talaq-e-Ahasan, Talaq-e-Hasan, Khula and

Mubarat (mutual dissolution of marriage)

Criminalization of Talaq-e-Hasan would not leave Muslim men without any recourse, as they
will still be left with Talaq-e-Ahasan and mutual dissolution of marriage.

This ordinance merely aims at criminalizing one way to dissolve a marriage which is
arbitrary and unreasonable.

C. THE PRACTICE OF TALAQ-E-HASAN CANNOT BE GRANTED CONSTITUTIONAL

PROTECTION/IMMUNITY

In Madhu Kishwar v State of Bihar 14, the Supreme Court had held that customs are subject to
fundamental rights.

Justice D.Y. Chandrachud in the case of Indian Young Lawyers Association vs State of
Kerela15 stated that “Custom, usages and personal law… that are inherently connected with

https://www.metmuseum.org/learn/educators/curriculum-resources/art-of-the-islamic-
12

world/unit-one/the-five-pillars-of-islam
13
The Commissioner, Hindu Religious Endowments, Madras v Shri Lakshmindar Tirtha
Swamiyar of Shri Shirur Mutt AIR 1954 SC 282
14
Madhu Kishwar v State of Bihar AIR 1996 5 SCC 125
15
Indian Young Lawyers Association vs State of Kerela (2019) 11 SCC 1; 2018 (8) SCJ 609
7
 the civil status of individuals cannot be granted constitutional immunity merely because they
may have some associational features which have a religious nature.”

Relevant observations can be found in Danial Latifi16. The Court ruled that because our
society is male dominated both economically and socially, it is important to take into account
social conditions when interpreting provisions involving matrimonial relationships. This is
because there is a significant difference in a man's and a woman's economic resourcefulness,
regardless of whether they are members of the majority or minority group.

D. CRIMINALIZATION IS VALID UNDER ARTICLE 25

The fact that Article 2517 starts with Subject to, shows the importance of this condition. It
reads (1) Subject to public order, morality and health …. right freely to profess, practice and
propagate religion

(2)  Nothing in this article shall affect the operation of any existing law or prevent the State
from making any law

(a)  regulating or restricting any economic, financial, political or other secular activity which
may be associated with religious practice.

As established earlier, Talaq-e-Hasan is not an essential practice of Islam and therefore it

paves way for performance of a secular activity based on its criminalization.

IV. INTERNATIONAL CONVENTIONS DISAPPROVE OF UNILATERAL DIVORCES

The Muslim community has suffered due to personal laws that violate the Constitution's
fundamental protections, and it is claimed that this Court is the only hope for Muslim
women as well. The development of international laws as well as these modifications to the
legislation in various Islamic nations that restrict extra-judicial talaq.

Article 5118 obligates respect for international treaties.

16
Danial Latifi & Anr vs Union Of India 7 SCC 740
17
Article 25 of the Indian Constitution, 1950
18
Article 51 of the Indian Constitution, 1950
8
Article 25319 of Constitution of India confers power upon parliament “to enact laws …to
give effect to such treaties”

Article 3 and 7 of the Universal Declaration of Human Rights 20 , the Vienna Declaration21
and the Convention on the Elimination of All Forms of Discrimination Against Women
(CEDAW)22 uphold the importance of consent and gender equality.

V. THE TERMS OF THE CONTRACT WERE CLEAR AND THERE IS NO NEED TO ADD
IMPLICIT TERMS AS THE CONTRACT ITSELF WAS NOT AMBIGUOUS.

I. Discovery Enterprises Gave Free Consent to The Terms of The Contracts

Section 2 of the Indian Contracts Act states that “All agreements are contracts if they are
made by the free consent of parties competent to contract, for a lawful consideration and
with a lawful object, and are not hereby expressly declared to be void.”23 

An end-user license agreement (EULA) is a legal agreement between a software company or

developer of software (known as licensor) and the end-user who uses the software (known as
licensee) and in compliance with the provisions of the Indian Contract Act, 1872. Section
10A of Information Technology Act, 200024, talks about validity of contract formed through
electronic means, recognizes a EULA, and considers it a valid contract.

The consent to the terms was given freely by Discovery Enterprises, and other essentials of a
valid contract as enumerated in Section 225 of the Indian Contract Act 1872 were fulfilled.

II. The Terms of The Contract Were Clear and Free from Ambiguity

The terms of the contract between Symphony Softwares and Discovery Enterprises were
clear and free from ambiguity.

19
Article 253 of the Indian Constitution, 1950
20
Article 3 of the Universal Declaration of Human Rights
21
Vienna Declaration
22
Convention on the Elimination of All Forms of Discrimination Against Women (CEDAW)
23
Section 2 of the Indian Contracts Act, 1872
24
Section 10A of Information Technology Act, 2000
25
Section 2 of the Indian Contract Act 1872
9
Lord Denning in Solle v Butcher26 observed that "once a contract has been made, that is to
say, once the parties, whatever their inmost states of mind, have to all outward appearances
agreed with sufficient certainty in the same terms.”

Clear terms like “updates, upgrades, supplements, add-on components (if any)”27
show the intention of the parties to exclude term like maintenance.

III. Preference Should Be Given to The Expressed Terms of The Contract.

It was observed in Homburg Houtimport BV v Agrosin Private Ltd28 that the terms that the
specific contracting parties have chosen to include should be given more weight than pre-
printed terms that were likely created to cover a wide range of situations that the specific
contracting parties had never considered.

As observed in China Cotton Exporters v Beharilal Ramcharan Cotton Mills Ltd29 that
Contracts must be interpreted in accordance with the primary and common meaning of the
language used by the parties, as well as the grammatical, common, or usual meaning of the
words used.

IV. There Exists No Necessity to Look Beyond the Clear Terms of The
Expressed Contract as There Is No Ambiguity

A bench comprising of Justices Rohintan F. Nariman and Sanjay Kishan Kaul in Nabha
Power Limited vs Punjab State Power Corporation Limited30 & another has held that:

A contract should be read in respect to its express terms; Implied terms should be
investigated only in cases of strict necessity and Commercial courts must be aware of the
contemporary technical legal drafting expertise and should not aim at implying terms into a
contract.

26
Solle v Butcher 1 KB 671
27
The First Year Intra-Batch Moot Court Competition, 2022 Proposition
28
Homburg Houtimport BV v Agrosin Private Ltd UKHL 12
29
China Cotton Exporters v Beharilal Ramcharan Cotton Mills Ltd AIR 1295
30
Nabha Power Limited vs Punjab State Power Corporation Limited Civil Appeal No.179 of
2017
10
Moreover, the Privy Council in an appeal 31 from Australia has held," that in the first instance
an implied term must be equitable. The other conditions are:

It must be reasonable and equitable. It must be necessary to give business efficacy to the
contract and no term can be implied if contract is effective without it. It must be so obvious
that 'it goes without saying' It must be capable for clear expression. It must not contradict any
express term of the contract.

In Shirlaw v Southern Foundries32 the 'officious bystander' test was formulated where on the
surface, what is left to be implied and need not be expressed is something that is so obvious
that it goes without saying; as a result, if a reasonable bystander were to suggest that their
agreement contain an express provision for it, the parties would exclaim, "Of course!"

Applying these principles in this case, there exists no strict necessity to imply terms in the
contract as the contract is still effective without it, and in no way dismantles the business
efficacy of the contract. The allegedly implied terms are not so obvious that they go without
saying.

Moreover, the email of correspondence clearly mention that Symphony Softwares usually
undertakes the task of maintenance for the software it develops for its clients at an apposite
annual charge. However, if it is not specified in the agreement, then Symphony Softwares
doesn’t undertake any maintenance.

It is necessary that there is latent ambiguity in the contract (Section 95 of the IEA 33), for the
courts to allow extrinsic evidence.

“We agree that when a contract has been reduced to writing we must look only to that
writing for ascertaining the terms of the agreement between the parties, but it does not
follow from this that it is only what is set out expressly and in so many words in the
document that can constitute a term of the contract between the parties.”34

31
BP Refinery (Westernport) Pty Ltd v Shire of Hastings 52 ALJR 20
32
Shirlaw v Southern Foundries AC 701
33
Section 95, Indian Evidence Act 1872
34
Khardah Company Ltd. v. Raymon and Co. (India) Private Ltd. AIR 1962 SC 1810
11
The Court's obligation is to interpret the words used, that really is, the expressed intentions,
not to delve deeply into the workings of the human mind to uncover the concealed intention.
35

VI. PRECONTRACTUAL NEGOTIATIONS SHOULD NOT BE RELIED UPON FOR EVIDENCE

I. Absence Of Consensus Ad Idem in the Precontractual Negotiations

During negotiations, there are agreements, disagreements, counteroffers, modifications made

between the parties, thus pre contractual negotiation and correspondence lack consensus
between the parties which forms an essential element of a contract. Thus, using terms of pre
contractual correspondence for interpreting the contract will be a wrong approach.

Regarding the case at hand, thus it can be said that the pre contractual correspondence should
not be relied upon for interpretation of the contract between Symphony Software and
Discovery Enterprise.

II. No Intention to Create Legal Relations in the Precontractual Negotiations

During pre-contractual correspondence, the parties do not intend to get bound by the terms
that are still in discussion between them. Since the parties lack the intention to create legal
relations based on their correspondence, the same should not be used in interpretation of the
final contract.

III. Inapplicability Of Precontractual Negotiations

Sec 94 of the Indian Evidence Act 187236 specifies that “When language used in a document
is plain in itself, and when it applies accurately to existing facts, evidence may not be given
to show that it was not meant to apply to such facts.”

In Ptc India Ltd. v. Tamil Nadu Electricity Board 37

it was propounded that pre-contractual
negotiations are not admissible in evidence for purposes of interpreting the contract.

To limit litigation, what a reasonable person with all the background information would have
understood, where the background information includes anything in the "matrix of fact" that
35
Bangalore Electricity Supply Company Limited (BESCOM) v. E.S. Solar Power Pvt. Ltd
36
Sec 94 of the Indian Evidence Act 1872
37
Ptc India Ltd. v. Tamil Nadu Electricity Board
12
 could impact the language's meaning but excludes earlier negotiations, where the context of a
word determines its meaning rather than its literal meaning based on the notion that humans
do not frequently make language errors38

In Joseph Darmanin v Carmel Micallef; Miryala Venkateswarlu & Co v Battula

Venkataperaiah and Venkateswarlu and Co 39
the Court observed that if the judges resort to
the evidence of prior negotiations, then they will be ultimately placing themselves in the
place of the parties who entered into the contract to grasp their intention.

In Trollope & Colls Ltd v N.W. Metropolitan Regional Hospital Board; Express Newspapers
v Silverstone Circuits40 it was stated that “A term will be implied merely because in all the
circumstances it would be reasonable to do so or because it would improve the contract or
make its carrying out more convenient": "the touchstone is always necessity and not merely
reasonableness"

VII. THE PRINCIPLE OF EXPRESSIO UNIUS EST EXCLUSIO ALTERIUS SHOULD BE

APPLIED FOR APT INTERPRETATION OF THE TERMS

“The  expression of one thing implies the exclusion of another thing.  A  maxim applied

in a  construction of contracts to the effect that the expression in a contract of one or mor
e things of a  class implies the exclusion of all not expressed.”41

Maintenance of a software and the fee mandated for it is an integral part of any software
purchase. The fact that the parties chose to not include it in the terms of the contract, that too
when it is a contract of significance in the nature of commercial transactions gives us
adequate reason to believe that the parties intended to not include it in the first place. The act
of excluding the term “maintenance” while explicitly stating terms like “updates, upgrades,
supplements, add-on components (if any) and other services in relation to the software”
prima facie seems to be a deliberate action furthering the assumption that the party did not
intend to include it in the contract.

38
Investors Compensation Scheme Ltd v West Bromwich Building Society [1997] UKHL 28
39
Joseph Darmanin v Carmel Micallef AIR 1946 PC 50; Miryala Venkateswarlu & Co v
Battula Venkataperaiah and Venkateswarlu and Co  AIR 1969 AP 88
40
Trollope & Colls Ltd v N.W. Metropolitan Regional Hospital Boards 2 AII ER 260
41
Ballentine's law dictionary
13
VIII. EVEN IF PRECONTRACTUAL CORRESPONDENCE WERE TO BE CONSIDERED, THEY
EXPLICITLY SPECIFY THAT MAINTENANCE WILL BE PROVIDED ON AN ANNUAL
FEE

In the current case, on being asked about the maintenance services by Discovery
Enterprises, Symphony Softwares explicitly specified that it usually undertakes the task of
maintenance for the software it develops for its clients at an apposite annual charge.
However, if it is not specified in the agreement, then Symphony Softwates does not
undertake any maintenance.

IX. EJUSDEM GENERIS FINDS NO APPLICABILITY IN THIS CASE

According to the Black’s Law Dictionary (8th edition, 2004.), “the principle of Ejusdem

Generis is where general words follow an enumeration of persons or things by particular
and specific words. Not only these general words are construed but also held as applying
only to persons or things of the same general kind as those specifically enumerated.”42

In this case as per the Annexure -D, terms like “updates, upgrades, supplements, add-on
components (if any) and other services in relation to the software” constitute a class of
procedures involved in the initial installation and the extra benefits/add ons of the contract.
Maintenance on the other hand, does not form a part of this class, therefore the principle of
Ejusdem Generis cannot be applied.

42
Black’s Law Dictionary (8th edition, 2004)
14
 PRAYER FOR RELIEF

Wherefore in light of the facts stated, issues raised, arguments advanced and authorities cited,
it is most humbly and respectfully prayed that this Hon’ble Supreme Court of Rarya may be
pleased to

I. Dismiss the Writ Petition TP No. 0909/2022.

II. Dismiss the Civil Petition TP No. 0909/2022.
III. Order the plaintiffs to pay for the complete costs of litigation incurred by the
defendant.

And pass any other order that it may deem fit in the ends of justice, equity, and good
conscience.

Date: 24 September 2022 Counsel No. 053R

Place: Rajubhinder (Counsel for the

Respondent)

15