Rajesh Coach Builders vs Shah Nagindas Machchram And Sons
2006 Latest Caselaw 926 Bom

JUDGMENT

Bhosale D.B., J.

1. By means of this writ petition under Article 227 of the Constitution of India the petitioners seek to challenge the judgment and order dated 15.3.1994 rendered by the 5th Joint Civil Judge, Senior Division, Kolhapur adjudicating upon the preliminary issue, holding that the Court at Kolhapur has jurisdiction to try and decide the suit.

2. The petitioner is the original defendant No. 1 whereas respondent No. 1 is the original plaintiff, hereinafter referred to as "the defendants" and "the plaintiffs" respectively. The suit was filed by the plaintiff for recovery of an amount of Rs. 22,22,931/-with interest at the rate of 21% per annum from the date of institution of the suit till its realisation. The defendants are engaged in body building of vehicles. For the purpose of the said business they were in need of cut size steel sheets and mild steel sheets (for short "the goods"). They placed the order for supply of the goods with the plaintiff. The defendants have their establishment at Jaipur whereas the plaintiffs have its establishment at Kolhapur. After the suit was instituted by the plaintiff, in the written statement, the defendants raised an issue of jurisdiction of the Court at Kolhapur stating that the cause of action has arisen at Jaipur and hence the Court at Kolhapur has no jurisdiction to entertain the suit. In view of the objection as to territorial jurisdiction the trial Court framed the said issue accordingly and tried it as preliminary issue. Both, the plaintiffs and the defendants, have examined one witness each, namely, Mr. D.N. Shah and Mr. V.M. Shah in support of their case as to territorial jurisdiction. The trial Court after considering the pleadings and the depositions of both the witnesses has recorded a categoric finding that the contract was made at Kolhapur and, therefore, the Court at Kolhapur has jurisdiction to try the suit. This finding of the trial Court is being challenged in the instant writ petition.

3. I heard learned Counsel for the parties and with their assistance have perused the pleadings, evidence as also other material placed before me. The submissions of Mr. Godbole, learned Counsel for the petitioner were two fold. Firstly, in the face of the facts of the instant case by no stretch of magination the cause of action, wholly or in part, could be said to have arisen at Kolhapur, and secondly, the suit being on breach of contract and that the breach was allegedly committed at Jaipur, the suit would lie at Jaipur. After taking me through the evidence of the witnesses, he further submitted that in the present case none of the acts which are liable to confer territorial jurisdiction on the Court at Kolhapur were committed at Kolhapur. My attention was invited to the evidence of V.M. Shah to contend that the partner of the defendant, Shri K.H. Shah accepted the offer made by the plaintiff by placing the order for supply of the goods at Mumbai. He further submitted that none of the subsequent acts such as delivery of the goods, signing of hundies, dishonour of hundies occurred at Kolhapur. All the acts which are responsible to confer territorial jurisdiction, as contended by Mr. Godbole, occurred outside the jurisdiction of Kolhapur Court and, therefore, Kolhapur Court has no jurisdiction to entertain the suit, In support of his contention he placed reliance upon the judgment of the Supreme Court in A.B.C. Laminart Pvt. Ltd. and Anr. v. A.P.Agencies, Salem and the judgment of this Court in CIDCO v. R.M. Mohite and Co. and Ors. .

4. On the other hand Ms. Shah, learned Counsel for the plaintiff at the outset submitted that from plain reading of the plaint and the evidence of both the witnesses it is clear that the contract was made at Kolhapur and, therefore, in view of the provisions of Section 20(c) of CPC, Kolhapur Court has jurisdiction to entertain the suit. In support of this contention she took me through the evidence of both the witnesses which in her submission clearly demonstrates that the offer and acceptance both occurred at Kolhapur. She submitted that even if it is assumed that other acts such as delivery of goods, place of payment, dishonour of hundies, did take place outside Kolhapur, that will not take away the jurisdiction of Kolhapur Court for trying the present suit. Lastly, she submitted that the facts of the case itself are clear and sufficient to confer jurisdiction on the Kolhapur Court, and trial Court has rightly answered the issue in favour of the plaintiff.

5. Section 20(c) of the Code of Civil Procedure, provide that every suit shall be instituted in the Court within local limits of whose jurisdiction the cause of action "wholly or in part" arises. It is well settled that a cause of action means every fact, which, if traversed, it would be necessary for the plaintiff to prove in order to support his right to a judgment of the Court. In other words, it is a bundle of facts which taken with the law applicable to them gives the plaintiff a right to relief against the defendant. It must include some act done by the defendant since in the absence of such an act no cause of action can possibly accrue. It is not limited to the actual infringement of the right sued on but includes all the material facts on which it is founded. It does not comprise evidence necessary to prove such facts, but every fact necessary for the plaintiff to prove to enable him to obtain a decree. Everything which if not proved would give the defendant a right to immediate judgment must be part of the cause of action. But it has no nexus whatsoever to the defence which may be set up by the defendant nor does it depend on the character of the relief prayed for by the plaintiff. This is settled by the Apex Court in A.B.C. Laminart Pvt. Ltd. (supra). Keeping the aforestated enunciation of law laid down by the Supreme Court I would now like to examine the facts of the case to find out whether the Court below has committed any error of law.

6. In the plaint, in paragraph 15, the plaintiffs have stated that why the Court at Kolhapur has jurisdiction to try the suit. Paragraph 15 in the plaint reads thus:

15. The cause of action arose at Kolhapur. The order of delivery of goods was placed by defendant No. 1 at Kolhapur. The payment of dues was to be made at Kolhapur. The hundies alongwith the bills were sent to the defendant No. 1 from Kolhapur. Hence, this Court has jurisdiction to try and decide this suit.

7. The plaintiffs have categorically stated in the plaint that the order for supply of the goods was placed by Vikas N. Shah, on behalf of the defendants, at Kolhapur and the plaintiffs agreed to supply the goods at Kolhapur. The hundies were signed by Vikas Shah at Kolhapur and they were discounted by the bank at Kolhapur and from Kolhapur they were forwarded to the bank at Jaipur for collection. In support of the averments in the plaint the partner of the plaintiffs firm, Mr. Dinkabhai N. Shah, stepped into witness box. He has stated in his deposition that the partner of the defendants one Mr. Vikas N. Shah had come to their office at Kolhapur and offered to purchase the goods and requested to supply 125 tons of the goods. In turn, the plaintiffs informed defendant No. 2 at Mumbai to supply the goods and accordingly, the goods were supplied to the defendants at Mumbai. He further stated that an amount was to be paid at Kolhapur immediately, and since the defendants had no cash they requested to draw hundies of Rs. 10,00,000/- and rest of the amount they asked him to pay in cash. Accordingly, the hundies were signed by Vikas N. Shah at Kolhapur. He has then stated that the bank at Kolhapur discounted those hundies and forwarded the same to Bank of Baroda, Jaipur branch for collection. In the cross examination he has denied the suggestion that Vikas N. Shah had not placed order at Kolhapur and that the defendant had not agreed to pay the amount at Kolhapur. Insofar as the statement made by this witness that the order for supply of the goods was placed by Vikas N. Shah at the office at Kolhapur and that the plaintiffs agreed to supply the goods at Kolhapur is concerned, that has gone unchallenged in the cross examination. The defendant's witness Vikas N. Shah in his examination in chief has stated that one K.H. Shah, partner of the defendants placed the order for supply of the goods at Mumbai. He could not support his statement by any other evidence. On the contrary, in the cross examination he has clearly stated, besides his words, he cannot examine other witness to prove that the oral order was placed at Mumbai. The partner of the defendants, K.H. Shah has chosen not to step into witness box in support of their case that the order was placed at Mumbai. This witness has admitted in the cross examination that the payment was to be made at Sangli Bank, Laxmipuri branch, Kolhapur as the hundies were drawn by the said branch. He has also stated that at the relevant time when the transaction took place he was residing at Kolhapur and continued to reside at Kolhapur till the written statement was filed in the suit. Besides, it is not disputed that the bills were signed by Vikas N. Shah and on the said bills it was clearly mentioned that "subject to Kolhapur jurisdiction".

8. It is thus clear that the offer and acceptance of the goods to complete the contract were made at Kolhapur. There may arise causes of action of various kinds. In a suit for recovery of the price of goods supplied, the cause of action would consists of making of the contract, and to its breach, so that the suit will be filed either at the place where the contract was made or at the place where it should have been performed and the breach occurred. The making of the contract is part of the cause of action. A suit on a contract, therefore, can be filed at the place where it is made. The determination of the place where the contract was made is part of the law of contract. Ordinarily, acceptance of an offer and its intimation result in a contract and hence a suit can be filed in a Court within whose jurisdiction acceptance was communicated. In the present case, it is clear from the overall facts and circumstances of the case that the offer and acceptance, both were at Kolhapur. Therefore, in my opinion, the cause of action in the present suit as contemplated by Section 20 of the Code of Civil Procedure did arise at Kolhapur and hence the Court at Kolhapur has jurisdiction to entertain the present suit and the trial Court has rightly answered the issue which does not warrant interference by this Court. I am fortified in the aforesaid view by the decision of the Supreme Court in A.B.C. Laminart Pvt. Ltd. (supra). In view of the peculiar facts and circumstances of the case the judgment of this Court in CIDCO (supra) is of no avail to the petitioner. The alternative submission of Mr. Godbole, in view of my findings on the first question, deserves no discussion or any finding thereon. The writ petition is, accordingly, dismissed. The trial Court shall proceed with hearing of the suit and decide the same as expeditiously as possible and preferably within a period of eight months from the date of receipt of this order. Rule stands discharged. No costs.