Gujarat High Court
Gujarat State Warehousing ... vs Divine Developers on 24 December, 2021
Bench: A. P. Thaker
C/SCA/9705/2019 CAV JUDGMENT DATED: 24/12/2021
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 9705 of 2019
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE N.V.ANJARIA
and
HONOURABLE DR. JUSTICE A. P. THAKER
==========================================================
1 Whether Reporters of Local Papers may be allowed
to see the judgment ? Yes
2 To be referred to the Reporter or not ? Yes
3 Whether their Lordships wish to see the fair copy
of the judgment ? No
4 Whether this case involves a substantial question
of law as to the interpretation of the Constitution No
of India or any order made thereunder ?
==========================================================
GUJARAT STATE WAREHOUSING CORPORATION
Versus
DIVINE DEVELOPERS
==========================================================
Appearance:
MR PJ KANABAR(1416) for the Petitioner(s) No. 1
MR DHAVAL C DAVE, SR. ADVOCATE WITH MR UDIT VYAS WITH MR
JIGAR M PATEL(3841) for the Respondent(s) No. 1
NOTICE SERVED(4) for the Respondent(s) No. 2,3
==========================================================
CORAM:HONOURABLE MR. JUSTICE N.V.ANJARIA
and
HONOURABLE DR. JUSTICE A. P. THAKER
Date : 24/12/2021
CAV JUDGMENT
(PER : HONOURABLE MR. JUSTICE N.V.ANJARIA)
Heard learned advocate Mr.P.J. Kanabar for
the petitioner and learned Senior advocate Mr.Dhaval
Dave with by learned advocate Mr.Udit Vyas for the
respondents.
2. In the present Special Civil Application
C/SCA/9705/2019 CAV JUDGMENT DATED: 24/12/2021
filed by the petitioner-original defendant, what is
called in question is order dated 04th May, 2019 below
Exh.26 in Commercial Special Civil Suit NO.132 of
2016 passed by learned Judge, Commercial Court,
Rajkot. Thereby application of the petitioner-
defendant seeking rejection of the plaint under Order
VII Rule 11(d) of the Code of Civil Procedure, 1908
came to be dismissed.
3. Respondents herein instituted Special Civil
Suit No.132 of 2016 against the petitioner-defendant
for recovery of damages to the tune of
Rs.06,84,19,350/-. It was pleaded in the plaint that
plaintiff No.1 was a registered partnership firm
whereas plaintiff Nos.2 and 3 were the partners. The
plaintiffs owned four godowns at Village Dharampur,
Taluka Ranavav, Probandar, details of which in terms
of their size and measurement were stated in
paragraph No.3 of the plaint. It was averred that
since 23rd December, 2013 defendant had taken on rent
the said four godowns for the purpose of storing
groundnut on monthly rent of Rs.03.50 ps. per sq.
ft., and that a written agreement was also executed
between the parties. The possession of the godowns
was handed over to the defendant on 23rd December,
2013. On 09th January, 2015, possession of godown
Nos.2, 3 and 4 was given back to the plaintiffs as
defendant did not require the same. Godown No.1
admeasuring 52070 sq. ft. remained in possession of
the defendant, the monthly rent of which at Rs.03.50
ps. per sq. ft amounted to Rs.01,82,245/-.
C/SCA/9705/2019 CAV JUDGMENT DATED: 24/12/2021
3.1 It was further averred that on 29 th
February, 2014 at around 01.40 in the midnight, when
the goods were being loaded in the godown, fire took
place. As a result of the fire, quantity of groundnut
lying therein was reduced to ashes. It was pleaded
that fire broke out because of negligence on part of
the defendant. The seeds of groundnut happens to be
inflammable, it was pleaded. It took as many as four
months before the fire could be extinguished. The
godown had heavy angles, yet it got completely
damaged and its entire structure stood destroyed in
the fire. The incident of fire was reported in the
police station of the nearby area at Udyognagar and
inquiry was undertaken by the police. Also the F.S.L.
report was called for and together with the
photographs of the site the Panchnama of the place
was prepared.
3.2 It was the case that under the terms of rent
agreement, the defendant was required to keep the
godown in good condition and was under obligation to
handover to the plaintiffs in the same condition.
Though the seeds of groundnut being loaded in the
godown were inflammable, defendant failed to ensure
taking of the safety measures, it was pleaded. The
fire extinguishing equipments were not kept, and the
defendant did not supervise by not keeping adequate
staff, averred the plaintiff.
3.3 It was pleaded that the plaintiffs were
receiving rent as per the rent agreement from the
defendant. Due to destruction of the godown, they
C/SCA/9705/2019 CAV JUDGMENT DATED: 24/12/2021
have suffered every month the rental income which was
Rs.01,82,245/- per month. It was stated that as per
the assessment of the Valuer, the expenditure towards
reconstruction of the godown would come to
Rs.06,28,42,000/-. It was stated that had the fire
been not broken out, the plaintiffs could have earned
the rent income but due to defendant's negligence and
carelessness, the godown was destroyed in fire
depriving plaintiffs the said recurring income. The
plaintiffs accordingly claimed Rs.06,84,19,350/-
towards damages inclusive of reconstruction cost of
Rs.06,28,42,000/- and Rs.54,67,350/- being the rental
loss from 22nd February, 2014 to 22nd August, 2016, in
addition claimed other expenses.
3.4 The cause of action to institute the suit
was mentioned in paragraph No.17 of the plaint
averring that it arose since the incident of fire
broke out on 22nd February, 2014 on account of
negligence of the defendant and despite notice dated
01st March, 2016, defendant failed to pay the damages.
About the jurisdiction of the Court, it was stated in
paragraph No.19 that since the godown was situated
within the territorial jurisdiction of the Court, the
Court had the jurisdiction to try the suit.
3.5 The defendant filed written statement, and
also filed application (Exh.26) under Order VII Rule
11(d), CPC. It was contended that Act of letting the
godown by the plaintiffs to the defendant would not
make the dispute 'commercial dispute' and the suit
before the Commercial Court could not have been
C/SCA/9705/2019 CAV JUDGMENT DATED: 24/12/2021
instituted. The other ground urged for rejecting the
plaint under Order VII Rule 11(d), CPC was that the
plaint was liable to be rejected for want of
jurisdiction.
3.6 With regard to jurisdiction aspect it was
contended that since in the agreement Mark 4/2, the
clause was incorporated whereby both the parties had
agreed that the jurisdiction to try the dispute
arising out of contract shall be Ahmedabad only, the
suit could have been instituted only in the court at
Ahmedabad. It was further submitted that the
petitioner-Corporation has its principal office
located in Ahmedabad. Therefore also, in terms of
Section 20 of the Code of Civil Procedure, the cause
of action could be said to have been arisen in
Ahmedabad for instituting the suit in Ahmedabad
jurisdiction. It was, therefore, contended that in
view of the above agreement, the jurisdiction of the
Court at Porbandar will not attract.
4. Learned advocate for the petitioner
reiterated the submission that the dispute would not
fall within the meaning of Section 2(c) of the
Commercial Courts Act, 2015 which defines the
commercial dispute. He next referred to Mark 4/2
which was the document of rent agreement and
submitted with reference to condition No.11 thereof
that thereunder it is provided that in respect of any
dispute under the said contract, the jurisdiction
shall be Ahmedabad only, therefore the suit could not
have been instituted at Porbandar and the same was
C/SCA/9705/2019 CAV JUDGMENT DATED: 24/12/2021
barred. He relied on the decision of the Supreme
Court in case of Patel Roadways Limited, Bombay v.
Prasad Trading Company [(1991) 4 SCC 270], to submit
that where the two courts have jurisdiction, a party
can choose either of them.
4.1 On the other hand, learned senior advocate
for the respondent highlighted the aspect that the
godown was situated in the Porbandar district.
Therefore, jurisdiction was only with competent court
within the territory of that district. He also
supported the finding of the Commercial Court that
the dispute fell within the definition of commercial
dispute under the Commercial Courts Act, 2015.
5. The submission that the instant dispute
between the parties for which suit is instituted, is
not a commercial dispute may be dealt with at the
outset. Statutory definition of 'commercial dispute'
is found in Section 2(1)(c) of the Commercial Courts
Act, 2015. The relevant part is extracted.
"2(1)(c) "commercial dispute' means a dispute
arising out of-
(i) ordinary transactions of merchants,
bankers, financiers and traders such as
those relating to mercantile documents,
including enforcement and interpretation
of such documents;
(ii) to (vi) ... ... ...
(vii) agreements relating to immovable
property used exclusively in trade or
commerce;
(viii) to (xxii) ... ... ...
Explanation.-A commercial dispute shall
C/SCA/9705/2019 CAV JUDGMENT DATED: 24/12/2021
not cease to be a commercial dispute merely
because-
(a) it also involves action for recovery
of immovable property or for realisation
of monies out of immovable property given
as security or involves any other relief
pertaining to immovable property;
(b) one of the contracting parties is the
State or any of its agencies or
instrumentalities, or a private body
carrying out public functions;
(d) ... ... ...
(e) ... ... ...
(f) ... ... ...
(g) ... ... ... ...
(h) ... ... ...
(i) ... ... ...
(2) The words and expressions used and not
defined in this Act but defined in the Code of
Civil Procedure, 1908 (5 of 1908) and the
Indian Evidence Act, 1872 (1 of 1872), shall
have the same meanings respectively assigned
to them in that Code and the Act."
5.1 Thus, one of the limbs of the commercial
dispute under the above definition is an agreement
relating to immovable property used exclusively in
trade or commerce. The explanation provides that a
commercial dispute would otherwise not cease to be
commercial dispute merely because action involves
recovery of immovable property or realisation of
money out of immovable property or involve any other
relief pertaining to immovable property.
5.2 Dispute arising out of agreement whereby
godown was leased on rent for the purpose of storage
of goods could well be said to be falling within the
clause of agreements relating to immovable property
used exclusively in trade or commerce. The godown has
no other use. It is a property used exclusively in
C/SCA/9705/2019 CAV JUDGMENT DATED: 24/12/2021
trade and commerce. When the godown owned by the
plaintiffs was rented by the defendant on a fixed
rent, and the suit claim and relief sought for
pertained to damages arising out of such subject
transaction, the dispute arising therefrom becomes a
'commercial dispute' within the meaning of the
Section 2(1)(c) of the Act.
5.3 The reasoning and finding supplied by the
court below on this score is eminently proper. The
court below has rightly held,
"20 If the definition of commercial dispute is
perused, it is clear that not just the dispute
specifically mentioned under sub-clause (c) of
Section 2(1), but any dispute arising out of such
eventuality would also constitute to be commercial
dispute. This plain from the language of the said
sub-clause (c), which defines commercial dispute
as "dispute arising out of" the eventualities
mentioned therein. Thus, if a dispute "arises out"
of the agreement relating to immovable property,
use exclusively in trade or commerce, it would
deemed to be a commercial dispute. The same would
be the plain construction of the language used in
the Commercial Courts Act. It is clear that only
because of the parties having entered into
agreement for rent that the defendant become
entitled to store groundnut in the said godown.
Thus, though such wrong is a tort, however it
arises out of the use of the godown by the
defendant under the agreement between plaintiff
and defendant. Therefore, the dispute is deemed to
be a commercial dispute."
5.4 In Ambalal Sarabhai Enterprises Limited v.
K.S. Infraspace LLP [(2020) 15 SCC 585], the Supreme
Court had an occasion to consider the definition of
'commercial dispute', in particular with reference to
clause (vii) itself. It was held that for a dispute
to be a commercial dispute under section 2(1)(c)
(vii), the agreement between the parties must refer
C/SCA/9705/2019 CAV JUDGMENT DATED: 24/12/2021
to immovable property 'used' or 'being used'
exclusively in trade or commerce. It was stated, the
word "used" occurring in the section, denotes
"actually used" and it cannot be either "ready for
use" or "likely to be used". The thrust was provided
that the immovable property the subject matter of
agreement between the parties must be in exclusive
use in presentee in trade or commerce. The
commercial use contemplated in future or capability
of being used in trade or commerce, would not attract
the jurisdiction of the Commercial Court.
5.5 In the present case, the immovable
properties subject matter of agreement were the
godowns, which were exclusively used for storing
purpose, could be indeed said to be used in trade or
commerce and further that they were being actually
used. Therefore, the dispute between the parties
fell within the provisions of section 2(i)(c)(vii) of
the Act to become commercial dispute.
6. Adverting to the second contention about the
jurisdiction, what was sought to be contended with
reference to Patel Roadways Limited (supra) that
since the defendant company had its principal office
at Ahmedabad, the suit ought to have been filed in
the court within the Ahmedabad jurisdiction. In the
present case, the godown was rented were admittedly
located in the territorial limits of Porbandar. The
aspect of jurisdiction and the question as to which
would be the court of competent jurisdiction where
the suit could be instituted will have to be examined
C/SCA/9705/2019 CAV JUDGMENT DATED: 24/12/2021
and addressed in light of relevant provisions in that
regard contained in the Code of Civil Procedure,
1908.
6.1 The principles governing the place of suing
are set out in group of Sections 15 to 20 of the Code
of Civil Procedure. While Section 15 says that every
suit shall be instituted in the Court of lowest grade
competent to try, Section 16 refers to the suits to
be instituted where the subject matter situate.
6.2 Section 16 reads as under.
"16. Suits to be instituted where subject-matter
situate. - Subject to the pecuniary or other
limitations prescribed by any law, suits-
(a) for the recovery of immovable property with
or without rent or profits,
(b) for the partition of immovable property,
(c) for foreclosure, sale or redemption in the
case of a mortgage of or charge upon
immovable property,
(d) for the determination of any other right to
or interest in immovable property,
(e) for compensation for wrong to immovable
property,
(f) for the recovery of movable property
actually under distraint or attachment,
shall be instituted in the Court within the local
limits of whose jurisdiction the property is
situate:
Provided that a suit to obtain relief
respecting, or compensation for wrong to,
immovable property held by or on behalf of the
defendant, may where the relief sought can be
entirely obtained through his personal obedience
be instituted either in the Court within the local
limits of whose jurisdiction the property is
situate, or in the Court within the local limits
of whose jurisdiction the defendant actually and
C/SCA/9705/2019 CAV JUDGMENT DATED: 24/12/2021
voluntarily resides, or carries on business, or
personally works for gain."
6.2.1 The subject matter of the suit is
categorised in Section 16 above to provide further
that in relation to such subject matter a suit shall
have to be instituted where the property is situated.
The suit for recovery of immovable property, for
partition of immovable property, for foreclosure or
redemption or for determination of any other right to
or interest in immovable property are required to be
instituted in the Court within whose jurisdiction the
subject matter is situate. What is relevant for the
present controversy is the suits categories in sub-
clause (e), that is for compensation for wrong to
immovable property. In General Clauses Act, 1897,
the words "immovable property" is defined as
inclusive of land and benefits to arise out of land
as well as the inclusion of things attached to the
earth or permanently fastened anything attached to
the earth. The suit in this regard has to be
instituted within local limits of whose jurisdiction
the property is situate.
6.3 In Messrs Moolji Jaitha and Co. v the
Khandesh Spinning and Weaving Mills Co. Ltd. [AIR
(37) 1950 Federal Court 83], Five Judges' Bench
underlined the principles underlying Section 16, CPC,
thus.
"It has been further pointed out that the Courts of
any country are considered to have jurisdiction
over any matter with regard to which they can give
effective judgment and are considered not to have
jurisdiction over any matter with regard to which
C/SCA/9705/2019 CAV JUDGMENT DATED: 24/12/2021
they cannot give an effective judgment. The same
principle finds statutory recognition in S. 16,
Civil P.C. The rule was first adopted in this
country in the regulations framed under the Bengal
Code of 1793 and in the several regulations in
Madras and Bombay which have been mentioned in the
judgment of Fawcett J. in Hatimbhai's case [51 Bom.
516 : A.I.R. (14) 1927 Bom. 278 F.B.]. This was
then incorporated in the Civil Procedure Code of
1859 and the later Codes and in the Letters Patents
of the various High Courts. The rule that actions
regarding land or immovable property are to be
determined not only by lex situs but also in forum
situs does not concern itself with the nature of
the particular relief that may be claimed in the
particular circumstances of each case. It only
concerns itself with the nature of each case. It
only concerns itself with the nature of the
property which is involved in controversy between
the parties and regarding which the Court has to
adjudicate the conflicting claims of the parties
and grant relief operating on the property."
(Para 83)
6.4 Section 17 is about the suits for immovable
property situated within the jurisdiction of
different Courts. It says that where a suit is for
the purpose of obtaining relief in respect of
compensation for wrong to immovable property situated
within the jurisdiction of different Courts, the suit
may be instituted in any Court within the local
limits of whose jurisdiction any part is situated.
Section 18 deals with the place of institution of
suit where local limits of jurisdiction is uncertain.
Section 19 provides that suits for compensation for
wrong to persons or movables are to be instituted at
the option of the plaintiff either in the place of
wrong done or where the defendant resides.
6.5 In Harshad Chiman Lal Modi (supra), the
Supreme Court stated in no uncertain terms that
Section 20 of the Code covers only those cases not
C/SCA/9705/2019 CAV JUDGMENT DATED: 24/12/2021
falling within the limitation of Sections 14 to 19.
"Plain reading of Section 20 of the Code leaves no
room of doubt that it is a residuary provision and
covers those cases not falling within the
limitations of Sections 15 to 19. The opening
words of the section "Subject to the limitations
aforesaid" are significant and make it abundantly
clear that the section takes within its sweep all
personal actions. A suit falling under Section 20
thus may be instituted in a court within whose
jurisdiction the defendant resides, or carries on
business, or personally works for gain or cause of
action wholly or partly arises." (Para 19)
6.6 Section 20 deals with other suits to be
instituted where the defendant resides or cause of
action arises. Section 20 reads as under.
"20. Other suits to be instituted where defendants
reside or cause of action arises.--Subject to the
limitations aforesaid, every suit shall be
instituted in a Court within the local limits of
whose jurisdiction--
(a) the defendant, or each of the defendants where
there are more than one, at the time of the
commencement of the suit, actually and
voluntarily resides, or carries on business,
or personally works for gain; or
(b) any of the defendants, where there are more
than one, at the time of the commencement of
the suit, actually and voluntarily resides,
or carries on business, or personally works
for gain, provided that in such case either
the leave of the Court is given, or the
defendants who do not reside, or carry on
business, or personally works for gain, as
aforesaid, acquiesce in such institution; or
(c) The cause of action, wholly or in part,
arises.
* * * * *
Explanation.--A corporation shall be deemed to
carry on business at its sole or principal office
in India or, in respect of any cause of action
arising at any place where it has also a
subordinate office, at such place."
6.7 The noted author Mulla in his Code of Civil
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Procedure, 1995 Edition, Vol.1, mentioned that
Section 20 is a general section embracing all
personal actions. At common law, it is stated, the
actions are either personal or real. The personal
actions are also called transitory because they may
occur anywhere, such as actions for tort to persons
or to movable property or suits on contracts. It was
then stated that, "real actions are actions against
res or property and are called local because they
must be brought in the form rei sitoe, that is, the
place where the immovable property is situate. The
action may also be a mixed question being partly real
and partly personal. Torts to immovable property such
as trespass and nuisance are mixed actions and are
referred to in Section 16(e)".
6.8 Section 20 begins with the words "subject to
the limitations aforesaid". These opening words make
it very clear that Section 20 operates where
limitations of Sections 15 to 19 do not operate. In
other words, Section 20 is a residuary section. It
enacts the rule as to the forum in all cases which do
not fall within the confines of Sections 15 to 19 of
the Code.
7. In Harshad Chiman Lal Modi v. D.L.F.,
Universal Ltd. [AIR 2005 SC 4446], the Supreme
Court, having noticed the scheme of the aforesaid
provisions in the Code of Civil Procedure regarding
place of suing, stated thus.
"Section 16 thus recognizes a well established
principle that actions against res or property
C/SCA/9705/2019 CAV JUDGMENT DATED: 24/12/2021
should be brought in the forum where such res is
situate. A court within whose territorial
jurisdiction the property is not situate has no
power to deal with and decide the rights or
interests in such property. In other words, a
court has no jurisdiction over a dispute in which
it cannot give an effective judgment. Proviso to
Section 16, no doubt, states that though the court
cannot, in case of immovable property situate
beyond jurisdiction, grant a relief in rem still
it can entertain a suit where relief sought can be
obtained through the personal obedience of the
defendant. The proviso is based on well known
maxim "equity acts in personam, recognized by
Chancery Courts in England. Equity Courts had
jurisdiction to entertain certain suits respecting
immovable properties situated abroad through
personal obedience of the defendant. The principle
on which the maxim was based was that courts could
grant relief in suits respecting immovable
property situate abroad by enforcing their
judgments by process in personam, i.e. by arrest
of defendant or by attachment of his property."
(Para 14)
7.1 In Harshad Chiman Lal Modi (supra), the
reliefs sought for by the plaintiff was for specific
performance of the agreement respecting immovable
property by directing defendant No.1 to execute sale
deed in favour of the plaintiff and to deliver
possession to him. The submission of the appellant
before the Supreme Court was similar to one as sought
to be canvassed by learned advocate for the
petitioner that the Court at Delhi alone had the
jurisdiction. The Supreme Court stated that such
submission has no force. Such a provision, it was
opined, would apply to those cases where two or more
courts have jurisdiction to entertain the suit and
parties have agreed to submit to jurisdiction of one
court.
7.2 As regards the Proviso to Section 16, the
Supreme Court stated in Harshad Chiman Lal Modi
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(supra) that the Proviso is an exception to the main
part of the Section. About the application of the
Proviso, the principle was reiterated that the
Proviso cannot be interpreted or construed to enlarge
the scope of the principal provision. The Supreme
Court held that Proviso would apply "only when the
suit falls within one of the categories specified in
the main part of the section and the relief sought
would be entirely obtained by personal obedience of
the defendant". In respect of the prayers in the
suit, applying provision of Section 16 with such
reasoning, it was held that the suit was covered by
clause (d) of Section 16 of the Code and that the
Proviso has no application.
8. In Hadibandhu Mallik v. Chandra Sekhar
Behera [AIR 1973 Orissa 141], the opposite party-
plaintiff had instituted the suit in the in the court
of Munsif, Banki for recovery of certain amount which
was borrowed by the petitioner from the plaintiff on
the basis of usufructuary mortgage in respect of
certain properties admittedly situated within the
Munsiffi of Khandapara. The court noted that the
nature of usufructuary mortgage was such that there
was no personal liability to pay implied in it and
none of the covenants in the mortgage could be so
construed. The remedy of the mortgagee in such cases
was only against the mortgaged property. The High
Court held in the context of Section 16, CPC, that
when a mortgagee is deprived of the whole or part of
his security by or in consequence of the wrongful act
of the mortgagor, his suit for mortgage money is in
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the nature of suit for wrong done to immovable
property. It was held, therefore, that the suit must
be filed in the court within the local limits of
whose jurisdiction the property is situate.
8.1 In Anil Kumar Handa v. Smt. Suman Bala [AIR
1980 Delhi 103], the plaintiff had filed suit for
declaration that he was absolute owner of all the
properties, immovable and movable, mentioned in the
schedule to the plaint. The immovable properties were
situated at Sahranpur whereas the immovable in the
nature of investment in the banks were at Delhi. The
plaintiff claimed jurisdiction with regard to
immovable properties on the basis that defendant held
out threats to him at Delhi and that she resides and
works for gain at Delhi. The question was can the
Court return the plaint as regards relief relating to
immovable properties. By relying on the provisions of
Section 16 of the Act it was observed that if a court
has no jurisdiction to entertain the suit with
respect to all the reliefs claimed, the plaint is
liable to be returned to the plaintiff for
presentation of the court in which the suit should
have been originally instituted under Order VII Rule
10, CPC. The court rejected the prayer in respect of
immovable properties which were situated at
Sahranpur, which was the proper court of territorial
jurisdiction where suit could have been instituted in
respect of immovable properties in view of provisions
of Section 16 of the Act.
8.2 Following relevant observations were made.
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"Under this section a suit for the determination of
any right to immovable property under cl. (d) is to
be instituted in the Court within the local limits
of whose jurisdiction the property is situate. The
plaintiff claims absolute ownership regarding the
property in question, and absolute right under the
Will dated 28th Dec. , 1977 of Kewal Kishan Handa,
husband of the defendant. The question is: what are
the rights of the plaintiff in the three plots in
question? This question relates to determination of
rights in immovable property, Admittedly the three
plots are not situated within the jurisdiction of
this Court and therefore this Court has no
jurisdiction under S. 16, Civil P. C. to determine
whether the plaintiff is the absolute owner of the
plots. The moveable properties consist of deposits
in banks. The defendant admittedly resides at
Delhi. Therefore this Court under S. 20, Civil P.
C. has jurisdiction to determine the right of the
plaintiff with respect to moveable properties in
suit. Some of the bank accounts are within the
jurisdiction of this Court at Delhi. The other
accounts are with the banks at Saharanpur. It is,
therefore, held that this Court has jurisdiction to
determine the plaintiffs right with respect to
moveable properties only." (Para 3)
9. The principles set out in relation to the
operation and applicability of Section 16, CPC and
the statements of law observed therein answers the
controversy in the present case. Section 16 of the
CPC which speaks the principle that action against
property shall have to be brought in the forum where
the property is situated, has an overriding effect
over what is provided in Section 20. The Court other
than Porbandar will not have territorial jurisdiction
to deal with the subject matter since the property-
the godown is situated within the limits of Porbandar
district.
9.1 Even at the cost of reiteration, it is to be
recollected that the suit fell under clause (e) of
Section 16 which was for compensation for wrong to
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immovable property. Any other court than the
Porbandar court shall not have the jurisdiction to
try the suit. The legal principles highlighted above
as applied to the facts do not make out a case where
two courts can be said to have jurisdiction, since
what governs is Section 16, CPC alone. In view of the
position of law as above, the reliance placed on
behalf of the petitioner on the decision of the
Supreme Court in Patel Roadways, Bombay (supra) was
not well conceived. Even in the said decision, the
dictum of law has been stated that the agreement
cannot confer jurisdiction on a place where it does
not lie otherwise.
9.2 The submission that the parties have agreed
in the agreement Mark 4/2 that the Courts in
Ahmedabad shall alone have jurisdiction, has no room
to sustain. The reasons are two folds. Firstly, as
discussed above, Section 16, CPC would have a riding
effect. The subject matter suit falls under clause
(e) of Section 16, required to be instituted where
the suit property is situated, which is within
Porbandar. Secondly, the contention that since the
principal office of the petitioner is situated at
Ahmedabad, Ahmedabad Courts shall have jurisdiction
is also of no merit. When the provisions of Section
16, CPC, are juxtaposed with Section 20, there is no
gainsaying that Section 16 shall prevail over Section
20 and the jurisdiction for the suit against res
shall have necessary the reference of the place where
such res or property is situated.
C/SCA/9705/2019 CAV JUDGMENT DATED: 24/12/2021
10. For the discussion supplied and the reasons
recorded, the impugned order of the Commercial Court
holding that the Court at Porbandar shall have
jurisdiction is eminently proper and legal. When the
Commercial Court has rejected the application of the
defendant under Order VII Rule 11(d), CPC, refusing
to reject the plaint, it does not book any error.
11. The Special Civil Application stands
meritless. It is dismissed. Interim orders are
vacated. Notice is discharged.
(N.V.ANJARIA, J)
(DR. A. P. THAKER, J)
ANUP
