The New India Assurance Co. Ltd. vs Economic Transport Organization ...
2011 Latest Caselaw 756 Del

*             IN THE HIGH COURT OF DELHI AT NEW DELHI

+                                  RFA No.240/2001


%                                                     8th February, 2011

THE NEW INDIA ASSURANCE CO. LTD.                                 ...... Appellant
                          Through:      Mr. Ramesh Kumar, Adv.



                          VERSUS


ECONOMIC TRANSPORT ORGANIZATION & ANR.                  ...... Respondents
                  Through:  None

CORAM:
HON'BLE MR. JUSTICE VALMIKI J.MEHTA

    1.   Whether the Reporters of local papers may be
         allowed to see the judgment?

    2.   To be referred to the Reporter or not?

    3.   Whether the judgment should be reported in the Digest?


VALMIKI J. MEHTA, J (ORAL)

1.            The challenge by means of this Regular First Appeal under

Section 96 of the Code of Civil Procedure, 1908 is to the impugned order

dated 2.2.2001 whereby the suit has been dismissed because the Court

lacked territorial jurisdiction.     Of course, when a Court has no territorial

jurisdiction, the suit should not be dismissed and in fact the plaint has to be

returned for presentation to the Court having jurisdiction as per Order 7 Rule




RFA No.240/2001                                                       Page 1 of 4
 10 of the CPC. In fact this eventuality has to follow because there is no merit

in the appeal for the reasons given hereinafter.


2.          The facts of the case are that the respondent no. 2 took the

benefit of the services of respondent no.1 transportation company for its

machine known as one Compact Sheet Line Extruder Model CS-50 from Nasik

in Maharashtra to Sahibabad in UP. The consignment when it reached the

premises of the respondent no. 2 at Sahibabad it was noticed that the same

was damaged and since the consignment was insured with the appellant

insurance company, the appellant company settled the claim of the

respondent no. 2 and consequently obtained an assignment deed-cum-

subrogation bond on the basis of which the subject suit came to be filed.


3.          Admittedly, the appellant/plaintiff only steps into the shoes of the

respondent no.2 whose machine was damaged during the contract of

transportation.   The contract of the respondent no.2 with the respondent

no.1 was not at Delhi but was at Nasik. The performance of the contract was

also not at Delhi because the machine was not taken by the respondent no.

1 at Delhi for transportation and the same was taken at Nasik and the

machine was delivered not in Delhi but in Sahibabad, UP. Quite clearly the

Courts in Delhi had no territorial jurisdiction. The Trial Court has rightly held

that merely because there was an inquiry and complaint office of the

respondent no. 1 at New Delhi with whom correspondence was entered into

would not mean that the whole cause of action arises in Delhi.          Learned

RFA No.240/2001                                                   Page 2 of 4
 counsel for the appellant contended that the Central Administrative Office of

the respondent no.1 was at Delhi and therefore Courts at Delhi have

territorial jurisdiction. I am unable to agree because this issue is no longer

res integra and has been pronounced upon by the Supreme Court in its

decisions reported as Patel Roadways vs. Prasad Trading Company,

1991 (4) SSC 270 and New Moga Transport Company vs. United India

Insurance Co. Ltd & Ors. 2004 (4) SCC 677. It has been held in these

judgments by the Supreme Court that unless and until whole or part of the

cause of action arises within the jurisdiction of the principal office, a suit

cannot be filed against a Corporation in the Courts situated at its principal

office and the suit has necessarily to be filed in the Court within whose

jurisdiction the branch office is situated and where the whole or part of the

cause of action arises within the jurisdiction of the branch office. Since no

part of cause of action arose at Delhi, merely there was an office of the

respondent no.1 at Delhi will not give the courts have territorial jurisdiction.


4.           In view of the above there is no illegality or perversity in the

impugned judgment and the appeal is therefore dismissed. However, once it

is found that the Courts at Delhi do not have territorial jurisdiction the plaint

will have to be retuned for presentation to the appropriate Court having

territorial jurisdiction. In this case, the territorial jurisdiction will be either at

Nasik or at Sahibabad or at any place in which whole or part of the cause of

action arises. Accordingly, the impugned judgment and decree is sustained


RFA No.240/2001                                                        Page 3 of 4
 except that instead of dismissing the suit, the appellant/plaintiff is directed

to appear before the District and Sessions Judge on 28th March, 2011 and on

which date or any other subsequent convenient date the District and

Sessions Judge will return the plaint to the appellant/plaintiff for presenting

the same to the Court which has the territorial jurisdiction.


5.          With the aforesaid observations, the appeal is disposed of and

the appellant is directed to appear before the District and Sessions Judge on

14th March, 2011 and on which date the District and Sessions Judge will

return the plaint to the appellant or on any other subsequent date as may be

found convenient. The appeal is accordingly disposed of. Trial Court Record

be sent back.




FEBRUARY 8, 2011                                 VALMIKI J. MEHTA, J.

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