The controversial New York case in which two former Chief Justices of India took conflicting positions on the capability of Indian courts has taken a U turn. Reversing a decision of the New York Supreme Court, the Appellate Division last month granted the plea of ICICI Bank that its letter of credit dispute with a Japanese company could well be tried in Indian courts. As first reported in The Indian Express, the New York Supreme Court had decided in August 2003 to take up the case relying on an opinion given by Justice B N Kirpal, on behalf of the Japanese company, that Indian courts would take up to 20 years to dispose of such suits. But, in its 17-page judgment delivered on May 18, the Appellate Division preferred to go by the view given by Justice A M Ahmadi, on behalf of ICICI Bank, that ‘‘it is the non-commercial cases that clog the Indian court calendars’’ after reforms in the judicial system. The Appellate Division also set store by the fact that there was no ‘‘factual connection’’ between New York and the dispute even if ICICI Bank was subject to its jurisdiction on account of its shares being traded on the New York Stock Exchange. Judge Joseph Sullivan of the Appellate Division ruled that the dispute had ‘‘no substantial nexus to New York’’ and therefore it was not worthwhile for any US court to bear ‘‘the burden of having to interpret Indian banking law.’’ The Appellate Division also said that the New York Supreme Court had ‘‘failed to defer to India’s interest in resolving its own affairs.’’ Quoting the expert testimony of Justice Ahmadi, the Appellate Division said: ‘‘Indian courts are keenly interested in governing the affairs of (India’s) financial institutions to insure uniformity and consistency in the processing of financial transaction and in the interpretation of Indian banking statutes and laws.’’ Though it said nothing on Justice Ahmadi’s optimistic assertion that commercial cases could be wrapped up in India in just a year, the Appellate Division took due note of the reforms made in recent years in the Civil Procedure Code. Justice Kirpal, when contacted by The Indian Express, said: ‘‘My opinion was limited to the delays in Indian courts. Whether that is a relevant factor for deciding the question of alternative forum is for New York courts to decide.’’ Incidentally, this is the second time a New York court has overlooked Justice Kirpal’s grim picture of delays in Indian courts. He had given an affidavit in that case for the same Japanese company, Shin-Etsu, while Justice Y V Chandrachud, another former Chief Justice of India, testified for State Bank of India. The court had dismissed Shin-Etsu’s action saying, ‘‘the conflicting evidence concerning the availability of an alternative forum has not convinced this court that the action should remain here, in a forum having no connection whatsoever with the action.’’
