Aegis Logistics Ltd vs Shreeji Liquid Storage Terminal ...
2021 Latest Caselaw 1718 Bom

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              IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                  ORDINARY ORIGINAL CIVIL JURISDICTION
                       IN ITS COMMERCIAL DIVISION

             LEAVE PETITION (LODG.) NO. 1229 OF 2021
                  (For Clause XII of Letters Patent)
                                 IN
         COMMERCIAL SUMMARY SUIT (LODG.) NO. 333 OF 2020

Aegis Logistics Ltd.                          .. Applicant
                                              (Orig. Plaintiff)
In the matter between :
Aegis Logistics Ltd.                          .. Petitioner
      Vs.
Shreeji Liquid Storage Terminal
Pvt. Ltd.                                     .... Respondent/
                                              (Orig. Defendant)
                                ****
Mr.G.S. Godbole i/b Mr. Ketan Joshi for applicant.

                         CORAM : N.J. JAMADAR, J.

DATE : 27th JANUARY 2021 P.C.

1. This petition is filed seeking leave under Clause XII of the

Letters Patent to institute the suit as a part of cause of action has

allegedly arisen within the territorial limits of the jurisdiction of this

Court.

2. The material averments in the plaint indicate that the dispute

between the parties arose over sharing of the costs of a "common

corridor" for laying pipelines from their respective terminals to Y-

junction at Kandla Port Trust, where the plaintiff has been allotted

Shraddha Talekar PS 2/6 leave petition (Lodg.)-1229-2021 comssl-333-2020.doc

Plot Nos. 3, 4, 5 and 6 and the defendant has been allotted Plot

No.7. The plaintiff and the defendant are developing infrastructure for

storage terminals on their respective plots. At the instance of the Port

Trust, the plaintiff and the defendant entered into an agreement to

construct a "common corridor" for laying pipelines. A Memorandum

of understanding, dated 4th February 2017 ('MOU'), came to be

executed between the plaintiff and defendant incorporating the terms

of the agreement and a clause which professed to vest jurisdiction

over any dispute which might arise as regards the interpretation and

enforcement of the MOU in the Courts of Mumbai.

3. The plaintiff claims that under the terms of the MOU and

subsequent modification thereto, the plaintiff appointed the contractors

and the work was executed. Initially, on 11 th March 2017, the plaintiff

raised a debit note for a sum of Rs.1,79,35,711/-. The defendant paid

an amount of Rs.1,05,00,000/- towards the said debit note.

Subsequently, on 7th May 2018, the plaintiff raised another debit note

of Rs.2,26,78,237/-, inclusive of the amount which remained unpaid

under the first debit note. The defendant contested the liability by

raising untenable issues. There was exchange of correspondence and

legal notices. Hence, the plaintiff was constrained to institute the

summary suit as the MOU, dated 4 th February 2017 and the later

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addendum thereto, constitute a written contract.

4. The plaintiff has sought leave under Clause XII on the ground

that the said MOU confers exclusive jurisdiction on the Courts in

Mumbai and, additionally, part of cause of action has arisen within

the territorial limits of the jurisdiction of this Court as the debit note

was issued from the Mumbai office of the plaintiff and the part

payment was received from the defendant in the account of the

plaintiff maintained with Bank of Baroda, Mumbai Branch. Thus, this

Court has jurisdiction to entertain, try and dispose of the present

summary suit.

5. Heard Mr. Girish Godbole, the learned counsel for the plaintiff.

It was urged that though the work was executed in respect of the

premises not situated within the local limits of the jurisdiction of this

Court, and the MOU was also executed at Gandhidham, Gujrat, this

Court would be within its rights to entertain the suit as a part of

cause of action has arisen within the limits of this Court.

6. The learned counsel advanced a two-pronged submission. One,

the registered office of the plaintiff is in Mumbai. Two, the debit

notes were issued from Mumbai and there was exchange of

correspondence also emanating from the Mumbai office of the

plaintiff. The learned counsel for the plaintiff further urged that clause

Shraddha Talekar PS 4/6 leave petition (Lodg.)-1229-2021 comssl-333-2020.doc

'h' of MOU which confers exclusive jurisdiction on the courts in

Mumbai is required to be construed in the light of the aforesaid facts,

which indicate that a part of the cause of action has definitely arisen

in Mumbai.

7. Clause 'h' of MOU reads as under :

"(h) The contents interpretation and enforcement of this MOU shall be governed by the Indian Laws and Courts in Mumbai shall have the jurisdiction over any action arising out of this MOU."

8. I find it rather difficult to accede to the submissions on behalf

of the plaintiff. Firstly, the fact that the parties have conferred

exclusive jurisdiction on the courts in Mumbai, in the aforesaid clause

'h' of the MOU, is of no significance. It is trite that the parties

cannot confer jurisdiction in a court which lacks inherent jurisdiction,

even by consent. Unless the plaintiff succeeds in demonstrating that a

part of the cause of action has arisen within the jurisdiction of this

court, the aforesaid clause cannot be pressed into service to empower

this court to entertain this suit.

9. The second submission premised on the fact that the corporate

office of the plaintiff is situated in Mumbai is also not of much

significance. The mere fact that the office of the plaintiff is situated at

a particular place does not by itself confer jurisdiction on the courts

Shraddha Talekar PS 5/6 leave petition (Lodg.)-1229-2021 comssl-333-2020.doc

which exercise territorial jurisdiction over that place. The position is

no longer res integra. Reference in this context can be made to the

judgment of the Supreme Court in the case of National Textile

Corporation Ltd. & Ors. Vs. M/s. Haribox Swalram and Ors. 1.

10. This leaves the aspect of the debit note having been issued from

the registered office of the plaintiff. In my considered opinion, the

said fact also cannot be said to form a part of the cause of action.

Indisputably, the work has been executed at Kandla Port Trust. The

MOU, which constitutes the edifice of the claim of the plaintiff, has

also been executed at Gandhdham. Undoubtedly, the cause of action

constitutes a bundle of facts. However, every fact in relation to the

dispute does not ipso facto leads to the conclusion that the said fact

gives rise to a cause of action. Facts which have no bearing on the lis

or the dispute involved in the case, do not give rise to a cause of

action so as to confer territorial jurisdiction on the court concerned.

11. In the case at hand, the issuance of the debit note, receipt of

part payment, or for that matter, the exchange of correspondence

from the office of the plaintiff, does not constitute an integral part of

the cause of action. Resultantly, this Court does not seem to have

jurisdiction to entertain, try and dispose of the suit.

1     AIR 2004 SC 1998

Shraddha Talekar PS
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12. Hence, the leave to institute the suit under clause XII of the

Letters Patent is refused.

The Leave Petition stands rejected.

The plaint be returned to the plaintiff for presentation Digitally signed by Shraddha Shraddha K. Talekar before the proper Court, in accordance with Rule 283 of the K.

Date:

Talekar 2021.01.28 18:31:16 +0530 Bombay High Court (Original Side) Rules.

[ N.J. JAMADAR, J. ]

Shraddha Talekar PS