G.D. Mehta vs Ashok Honda & Another
2008 Latest Caselaw 1678 Del

    *IN THE HIGH COURT OF DELHI AT NEW DELHI

+                CS(OS) No.492/2004

%                          Date of decision : 18.09.2008

G.D. Mehta                                      ....... Plaintiff
                       Through: Ms. Mala Goel, Advocate

                              Versus

Ashok Honda & Another.                         ....... Defendants
                       Through: Mr. A.K. Mishra, Advocate for
                       defendant No.1
                       Mr. Atul Y. Chitale, Advocate for defendant
                       No.2

CORAM :-
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW

1.    Whether reporters of Local papers may Yes
      be allowed to see the judgment?

2.    To be referred to the reporter or not?    Not Necessary

3.    Whether the judgment should be reported Not Necessary
      in the Digest?


RAJIV SAHAI ENDLAW, J.

1. The issue no.6 of the issues framed on 24.3.2008 is as under:

"Whether this court has no territorial jurisdiction to entertain the suit ? OPD"

and was ordered to be treated as preliminary issue. The counsels

for the plaintiff, defendant no.1 & defendant no.2 have been

heard.

2. The plaintiff has instituted a suit for recovery of money on

the basis of an agreement dated 18.1.2003 modified/amended vide

letters dated 18.1.2003 & 24.1.2003 between the plaintiff and the

defendant No.1 for distribution of a movie produced by the

defendant no.1, by the plaintiff as distributor. It is the case of the

plaintiff that as per the said agreement, upon the plaintiff being

unable to recover within six months from the date of the release of

the movie, the advance amount of Rupees twenty five lacs paid to

the defendant no.1 as producer, the defendant no.1 had agreed to

refund the said sum of Rupees twenty five lacs to the plaintiff and

had undertaken not to telecast the movie on satellite

channel/Doordarshan before paying the plaintiff the unrecouped

amount of Rupees twenty five lacs paid by the plaintiff to the

defendant no.1. It is the case of the plaintiff that the plaintiff has

become entitled to recover the entire sum of Rupees twenty five

lacs with interest from the defendant no.1. The plaintiff further

alleges that the defendant no.1 without paying the said monies to

the plaintiff had permitted the defendant no.2 to telecast the

movie. The plaintiff claims to have learnt of the same from the

public notice inserted by the Defendant No.2 in a trade magazine.

The plaintiff claims that without refund of the sum of Rupees

twenty five lacs with interest to the plaintiff, the defendant no.1

itself or through the defendant no.2 is not entitled to telecast the

movie. The plaintiff claims that the defendant no.2 has stepped

into the shoes of the defendant no.1 and is liable to pay the

amount to the plaintiff and is bound by the agreement of the

defendant no.1 with the plaintiff.

3. The suit as originally filed, besides against the defendants

no.1 & 2 aforesaid was also instituted against "MAX Satellite

Channel, Division of M/s. Set India Pvt. Ltd.", impleaded as the

defendant no.3. The plaint described the defendant no.3 as a

premium satellite channel, which is a division of the defendant

no.2.

4. The plaintiff in the plaint invoked the territorial jurisdiction

of this court stating "that this Hon'ble Court has territorial

jurisdiction to entertain and try this matter as the Agreement was

executed for Delhi, the distribution rights were acquired for Delhi

etc., the movie has been announced to be shown on the satellite

channel in Delhi, the money payable to the plaintiff was to be paid

at Delhi, and the defendant no.3 which is a division of defendant

no.2 has an office at Delhi and thus works for gain within the

jurisdiction of this Hon'ble Court."

5. It is worth mentioning that the plaintiff alongwith the plaint

had filed an application for interim relief and vide exparte order

dated 14.5.2004, it was ordered that in case the defendant no.3

proceeds to telecast the movie, payment for telecasting the film

shall not be made to any of the other defendants till next date.

The order sheet does not disclose the aforesaid exparte order to

have been continued confirmed or modified or vacated thereafter.

The plaintiff however alongwith IA.No.4003/2003 filed a letter

dated 21.5.2004 of the defendant no.2 to the plaintiff informing

the plaintiff that the defendant no.2 had paid the entire

consideration for the movie to the person from whom the

defendant no.2 had acquired rights therein.

6. The defendant no.2 in its affidavit dated 26.8.2004 filed

before the court stated that there was no entity as described as

the defendant no.3 in the plaint. It was further stated in the

affidavit that MAX is the name of the television channel which is

broadcast in various countries including in India and is owned by a

broadcaster based in Singapore. It was further stated that the

defendant no.2 was in no way connected with broadcast of the

television channel MAX or any other television channel and the

defendant no.2 was in the business of acquiring telecast rights for

various audio visual programmes such as feature films, events etc.

It is also worth mentioning that the defendant no.3 was ordered to

be proceeded exparte on 27.3.2006. However, subsequently vide

order dated 24.5.2007, the name of the defendant no.3 was

ordered to be struck off from the array of the defendants. This

fact has been mentioned because the plaintiff has in the plaint

given the addresses of the defendants no.1 & 2 of Mumbai only

and though the address given of defendant no.3 was also of

Mumbai, but a Delhi address of defendant no.3 was also given and

in para 3 of the plaint also, it was emphasized that the defendant

no.3 had an office in New Delhi.

7. Both the defendants no.1 & 2 in their respective written

statements took the plea that the agreement between the plaintiff

and the defendant no.1 on the basis whereof the suit was filed, in

clause-23 thereof provided as under :

"It is agreed between the parties hereto that any dispute and or differences under this agreement shall be referred to the respective association of the Producer and the Distributor for Arbitration or otherwise in the appropriate courts in Mumbai shall have the jurisdiction to entertain and try any

suit or matter in dispute between us relating to this agreement."

8. It was pleaded that the plaintiff having agreed to the

jurisdiction of the court at Mumbai, the suit filed in this court

ought to be dismissed. It was further pleaded that the agreement

between the plaintiff and the defendant no.1 had been executed in

Mumbai and the public notice in the trade magazine had been

issued by the defendant no.2 and has been published in Mumbai

and the telecast of the film had been done from Singapore and

thus no part of cause of action arose within the territorial

jurisdiction of this court. It was further pleaded that the offices of

the defendants no.1 & 2 were in Mumbai. It was denied that the

money was payable to the plaintiff at Delhi or that the defendant

no.3 was a division of the defendant no.2.

9. The plaintiff in its replication to both the written statements,

did not deny that the agreements were executed at Mumbai. It

was however pleaded that the Public notice was for all India

including Delhi and it was averred that the movie was beamed in

Delhi and thus, the cause of action had accrued at Delhi. It was

thus denied that no part of cause of action had arisen at Delhi.

However, the agreement for jurisdiction of courts at Mumbai was

not disputed.

10. The preliminary issue as to territorial jurisdiction has to be

decided in the aforesaid state of pleadings and documents.

11. The counsel for the plaintiff has not disputed the agreement

between the plaintiff and the defendant no.1 providing for the

jurisdiction of the courts in Mumbai for entertaining or trying any

suit or dispute between the plaintiff and defendant no.1 relating to

the agreement. It was put to the counsels for the defendants

whether, in the absence the words like "alone", "only",

"exclusive" in the jurisdiction clause, the requirement of ouster of

jurisdiction of any other court could be inferred. The counsels for

the defendants have in this regard relied upon Hanil Era Textiles

Ltd. Vs. Puromatic Filters (P) Ltd., (2004)4 Supreme Court

Cases 671, where the Apex Court relying upon the earlier

judgment in A.B.C. Laminart Pvt. Ltd. Vs. A.P. Agencies,

(1989)2 SCC 163 and Angile Insulations Vs. Davy Ashmore

India Ltd., (1995) 4 SCC 153, held that it is necessary to

construe the ousting expression or clause properly. The courts are

to see whether there is ouster of jurisdiction of other courts.

Where the clause is clear, unambiguous, specific accepted notions

of contract would bind the parties and unless absence of ad-idem

can be shown, the other courts should avoid exercising

jurisdiction. It was further held that even without the words like

"alone", "only" or "exclusive" in the ouster clause, the principle

that expression of one is the exclusion of another may be applied.

It was further held that when certain jurisdiction is specified in a

contract, an intention to exclude all others from this operation may

be inferred.

12. In the present case, there is no dispute that the courts at

Mumbai have jurisdiction (the plaintiff admits the agreement to

have been executed there). The agreement is between the

producer of a movie and a distributor of a movie who are regularly

engaged in similar transactions. The plaintiff even though

resident of Delhi, went to Mumbai to execute the agreement and

also agreed to make the payments to the defendant no.1 by

cheque/demand draft on a bank in Mumbai (per clause 13 of the

agreement) and also as aforesaid consciously agreed not only to

the arbitration of association of producer and distributor, but also

to the jurisdiction of courts at Mumbai to entertain and try any

suit or matter in between himself and the defendant no.1. The

defendant no.1 admittedly was at Mumbai only and there is no

averment that the defendant no.1 has any office or presence at

Delhi. The dispute subject matter of suit squarely relates to the

agreements between the plaintiff and defendant No.1. the reliefs

claimed of recovery of money and of restraining defendants from

telecasting the movie are based on the rights of plaintiff under the

agreement. The agreement in the present case is not a standard

form of contract and no inequality in the bargaining position has

been alleged. The plaintiff and the defendant no.1 being

professionals in a specific trade and being men of commerce,

having consciously agreed to provide for the jurisdiction of the

courts at Mumbai and the defendant no.1 also having taken care

to insist for payment by a cheque/demand draft on a bank at

Mumbai, in my view, there is a clear unambiguous and specific

contract by which the parties ought to be held to be bound and I

find that the parties had agreed to exclude the jurisdiction of all

other courts except Mumbai and had clearly shown intention to

confine the jurisdiction of the courts to Mumbai to the exclusion of

all other courts, even if the courts at Delhi have jurisdiction, as

claimed by the plaintiff.

13. As noted above, the suit as framed was sought to be brought

within the territorial jurisdiction of this court for the reason of the

defendant no.3, which was stated to be a division of the defendant

no.2, having an office at Delhi. However, with the deletion of the

defendant no.3 as aforesaid and which order has attained finality,

the said basis for invoking the territorial jurisdiction of this court

has also disappeared.

14. The plaintiff himself has as aforesaid pleaded that the

defendant no.2 is an assignee of the defendant no.1 and has

stepped into the shoes of the defendant no.1 and is bound by the

agreement of the defendant no.1 and the plaintiff. The plaintiff

has sought to recover monies from the defendant no.2 also on the

said premise. If that is to be so, even if the plaintiff was entitled

to invoke the territorial jurisdiction of this court against the

defendant no.2 for the reasons alleged, the principles aforesaid

would apply and the plaintiff having agreed to the jurisdiction of

the court at Mumbai, would not be entitled to invoke the

jurisdiction of this court against the defendant no.2 also, even if

entitled to.

15. I, therefore, hold that this court has no territorial jurisdiction

to entertain the suit and decide the issue no.6 in favour of the

defendants and against the plaintiff.

16. The outcome of the decision of the issue no.6 is that the

plaint is liable to be returned to the plaintiff u/o.7 rule 10 of CPC

for presentation in the court of appropriate jurisdiction, if so

deemed fit by the plaintiff. The plaint is accordingly ordered to be

returned to the plaintiff.

RAJIV SAHAI ENDLAW (JUDGE) September 18, 2008 k