Madras High Court
M/S.Bharat Engineering Construction ... vs M/S.Kirloskar Brothers Limited on 5 September, 2024
Author: M.Sundar
Bench: M.Sundar
O.S.A. (CAD) No.104 of 2021
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 05.09.2024
CORAM
THE HONOURABLE MR.JUSTICE M.SUNDAR
and
THE HONOURABLE MR.JUSTICE N.SENTHILKUMAR
O.S.A. (CAD) No.104 of 2021
M/s.Bharat Engineering Construction Company
(P) Ltd., rep. By Mr.A.G.M.Salman, Director,
Jhaver Plaza, 6th Floor,
Nungambakkam High Road, Chennai – 34. .. Appellant
Vs
M/s.Kirloskar Brothers Limited
Having Registered Office at Udyog Bhavan,
Tilak Road, Pune – 411 002.
And Corporate Office at
Yamuna 98 (3-7), Plot No.3,
Baner, Pune – 411 045.
And Regional Office at
Raj Paris Trimeni Towers,
2nd Floor, No.147, G.N.Chetty Road,
T.Nagar, Chennai – 17. .. Respondent
Original Side Appeal filed under Section 13 of The
Commercial Courts Act, 2015 read with Order XLIII Rule 1 of Code
of Civil Procedure to set aside the order in A.No.8552 of 2019 in
C.S. No.567 of 2019 dated 11.08.2021 and restore the suit to the
file of this Court.
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Page 1 of 15
O.S.A. (CAD) No.104 of 2021
For Appellant : Mr.G.Surya Narayanan
For Respondent : Mr.Shivakumar
of M/s.Shivakumar and Suresh
JUDGMENT
(Judgment of the Court was delivered by M.Sundar, J.)
In the captioned 'Original Side Appeal' (hereinafter 'OSA' for
the sake of brevity), sole appellant is 'Bharat Engineering
Construction Company (P) Ltd.,' (hereinafter 'BECCPL' for the sake
convenience and clarity) and the lone respondent is 'Kirloskar
Brothers Limited' (hereinafter 'KBL' for the sake of brevity). To be
noted, before the Hon'ble Commercial Division, BECCPL was sole
plaintiff and KBL was lone defendant.
2. Captioned OSA has been presented in this CAD on
09.09.2021 assailing an order dated 11.08.2021 wherein and
whereby Commercial Division has in effect held that BECCPL
should have filed the main suit viz., C.S.No.567 of 2019 only in
jurisdictional Court in Pune, State of Maharashtra. This '11.08.2021
order of the Hon'ble Commercial Division' which is under challenge
in the captioned OSA shall hereinafter be referred to as 'impugned
order' for the sake of convenience and clarity.
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3. In the hearing today, Mr.G.Surya Narayanan, learned
counsel for appellant (BECCPL) and Mr.Shivakumar of
M/s.Sihvakumar and Suresh (Law Firm) for lone respondent (KBL)
are before us i.e., before this CAD. Both the learned counsel
submit in unison in one voice that the main appeal i.e., main OSA
can be taken up and disposed of as both learned counsel are on
the same page as regards the position that the main suit i.e.,
plaint ought to be presented in a Pune Court. In this regard alone,
consensus has been arrived at between the parties but we make it
clear that all other questions are left open and all the rights and
contentions of both sides viz., BECCPL and KBL are preserved for
the purpose of being canvassed in a Pune Court pursuant to this
order.
4. In the light of the consensus, considering the nature of the
matter, short facts shorn of granular particulars will suffice.
Factual matrix in a nut shell is that BECCPL presented a plaint
drawn up in the month of July of 2019 claiming a sum of a little
over Rs.5.08 crores against KBL; that this claim was predicated on
a contract for construction of Sea Water Pump House and
Electrochlorination of IGCAR Bhavini Project at Kalpakkam; that
this Court, owing to the nature of legal drill at hand, deems it
appropriate to not to dilate any further on the lis; that on the
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plaint drawn in July of 2019 being presented, the suit was
instituted and on institution of suit, the plaint manifested itself as
C.S. (Comm. Div.) No.567 of 2019; that suit summons was served
on KBL; that on service of suit commons, KBL took out an
application in A.No.8552 of 2019; that the burden of the song in
this application i.e., burden of the song qua KBL is that the suit
ought to have been presented only in a Pune Court by BECCPL as
the contract specifically says that the parties have agreed to go to
Pune Court, the cause of action has arisen in Pune and that the suit
will lie only with the Pune Court; that however the prayer in this
application i.e., A. No.8552 of 2019 was 'rejection of plaint' rather
than 'return of plaint'; that there will be some discussion/allusion
infra in this regard as the order progresses; that this application
i.e., A.No.8552 of 2019 was taken up by the Hon'ble Commercial
Division (after completion of pleadings) and the Hon'ble
Commercial Division in and by the impugned order (order dated
11.08.2021) held that BECCPL ought to have presented the plaint
only in a jurisdictional Court in Pune inter-alia as the cause of
action has arisen only in Pune (no cause of action has arisen within
the territorial jurisdiction of Madras, according to the impugned
order); that the parties have agreed to submit the lis, if any, in the
Pune Court; that as already alluded to supra, both the counsel are
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on the same page as regards the obtaining position that the plaint
has to be presented in Pune Court but the problem presents itself
in a different manner as Hon'ble Commercial Division has rejected
the plaint; that this Court now proceeds to consider the impugned
order and make an order disposing of the captioned OSA.
5. Paragraph 33 i.e., the concluding paragraph of the
impugned order is of immense significance/relevance and the same
reads as follows:
'33. In this case, neither the cause of action nor place
of defendant's business falls within the jurisdiction of this
Court. In the Letters of Intent, parties have specifically
accepted the jurisdiction of Pune Court where the defendant
carrying on business. Therefore, this Court holds that the
Application is liable to the reject under Order 7 Rule 11(a)
of C.P.C., for want of jurisdiction and cause of action.
Hence, the Application is allowed. Suit is rejected for want
of jurisdiction.'
6. Adverting to the aforementioned paragraph, both counsel
submitted that it is a clear case of return of plaint and not rejection
of plaint. On return of plaint, the same is vide Order VII Rule 10 of
'The Code of Civil Procedure, 1908 (5 of 1908)' [hereinafter 'CPC'
for the sake of convenience and clarity] unlike rejection of plaint
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which is vide Order VII Rule 11 of CPC, however, Order XLIX Rule
3 sub-rule (1) of CPC makes it clear inter-alia that Rule 10 of
Order VII will not apply to Chartered High Courts in exercise of
ordinary or extra ordinary original civil jurisdiction. The case on
hand is clearly a case of exercise of ordinary original civil
jurisdiction. There can hardly be any disputation that Madras High
Court is a Chartered High Court. This means that Rule 10 of Order
VII (return of plaint) will not apply to Madras High Court which is a
Chartered High Court. In this regard, reliance can be placed on a
case law i.e., R.P.C'Connor case [R.P.C'Connor Vs. P.G.Sampath
Kumar] decided on 29.09.1952 by Justice Rajamannar as Chief
Justice of this Court (as Hon'ble Judge then was) and reported in
1952 SCC OnLine Madras 250. In the light of Padma Sundara
Rao principle [Padma Sundara Rao Vs. State of Tamil Nadu
reported in (2002) 3 SCC 533] and more particularly paragraph 9
thereat, we deem it appropriate to set out the facts in
R.P.C'Connor case very shortly before we rely on R.P.C'Connor
principle. In R.P.C'Connor case, a suit for recovery of money (a
princely sum Rs.6,720/- in 1952) on the foot of a promissory note
was presented in this Court and this suit was resisted by the
defendant inter-alia on the ground that the Original Side of the
Madras High Court does not have jurisdiction as the entire
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transaction has taken place in Bangalore, the promissory note was
executed in Bangalore and all endorsements were made in
Banglaore. When the matter was listed before Hon'ble Justice
Panchapakesa Ayyar, Hon'ble Judge referred the matter to Hon'ble
Chief Justice for constitution of a Full Bench to decide this very
issue i.e., exclusion of Rule 10 of Order VII by Order XLIX Rule 3
sub-rule (1) of CPC. Then Hon'ble Chief Justice presiding over a
Division Bench along with Hon'ble Justice Venkatarama Ayyar took
the view that it is not necessary to constitute a Full Bench as there
is no conflict or dichotomy in decisions and decided the matter as a
Division Bench. In deciding the matter as a Division Bench in
R.P.C'Connor, it was held that in the light of inherent powers of the
Court which is saved vide Section 151 of CPC, there will be no
impediment in the Original Side of this Court returning a plaint
(dehors Order XLIX Rule 3 sub-rule (1) of CPC which excludes
application of Rule 10 of Order VII to proceedings on the Original
Side i.e., of this Court) and returning a plaint, if it is found that
the Original Side of this Court does not have territorial jurisdiction
to entertain the matter. This is articulated in paragraphs 12 and 13
of R.P.C'Connor and the same reads as follows:
'12. Assuming that it is necessary to preserve carefully the
proceedings taken in a Court of Record, we see no reason why the
suitor should lose the benefit of the Court-fee stamps which he
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had affixed to the plaint filed by him in a wrong Court. A
memorandum of appeal filed in this Court can certainly be
returned if it is found that this Court has no jurisdiction to
entertain the appeal. Such a memorandum is never retained on
the file of this Court in spite of the fact that this Court is a Court
of Record. Logically there should not be any difference between a
Memorandum of Appeal filed on the Appellate Side of this Court
and a plaint filed on the Original Side of this Court. Apparently
the practice on the Original Side of the Bombay High Court had
changed since the days of In re Bai Amrit(1) because we find in
Sewaran Gokaldos v. Bajrangdat Hardwar(2) Macleod, J. sitting on
the Original Side directing a plaint to be returned to the plaintiffs
for presentation in the proper Court after holding that the High
Court had no jurisdiction.
13. After giving my full consideration to the matter I am of
opinion that it is open to this Court to direct the plaint to be
returned to the plaintiff for presentation to the proper Court
when this Court finds that it has no jurisdiction to entertain it.'
7. Be that as it may, notwithstanding R.P.C'Connor principle,
we are convinced that Clause 12 of Letters Patent would hold the
field as regards jurisdiction. In Clause 12 of Letters Patent, the
lead case law is Captain Tractors vs. Ashok Leyland (Ashok
Leyland case) reported in 2018 SCC OnLine Madras 13669 :
2018 (8) MLJ 564. This Division Bench has held that Ashok
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Leyland rendered by Hon'ble Single Judge is good law. However,
in the case on hand, BECCPL did not choose to seek leave under
Clause 12 of Letters Patent and if leave had been obtained, it is
quite possible that KBL might have resorted to revocation of leave
under Clause 12 rather than coming up with A.No.8552 of 2019. In
the case on hand, obviously KBL cannot seek revocation of 'leave
to sue' which was neither sought nor given but a party cannot be
without remedy merely because plaintiff comes to Court without
seeking 'leave to sue' and the Registry numbers the suit and in
such cases R.P.C'Connor comes to the reference of such
defendants. Therefore, either way, there is no impediment in the
Original Side of this Court returning a plaint for presentation in the
proper Court with jurisdiction if the Original Side finds that no part
of cause of action has arisen within the territorial jurisdiction of
that Court and if the Original Side does not have jurisdiction to try
the suit for any other reason i.e., Special Statutes such as IPR
statute which make a departure from Section 20 CPC or contractual
covenant/s as in the case on hand.
8. Be that as it may, in this regard, while on this discussion,
we deem it appropriate to write that there is a subtle but a certain
and nice distinction in language between Section 120 CPC and
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Order XLIX Rule 3 sub-rule (1). Vide Section 120 CPC, the
application of three provisions of law viz., Sections 16, 17 and 20
have been excluded for exercise qua original jurisdiction by the
High Court. Section 120 CPC reads as follows:
'Section 120. Provisions not applicable to High
Court in original civil jurisdiction:
(1) The following provisions shall not apply to the
High Court in the exercise of its original civil jurisdiction,
namely, sections 16, 17 and 20.'
9. Order XLIX Rule 3 sub-rule (1) CPC excludes the
application of inter-alia Rule 10 of Order VII and some other
provisions to exercise of ordinary or extra ordinary original civil
jurisdiction of the High Court. In Section 120 CPC, the expression
used is 'High Court' whereas in Order XLIX Rule 3 CPC, the
expression used is 'Chartered High Court'. This means that Section
120 CPC would apply to five out of 25 High Courts of the country
viz., the three Chartered High Courts - Madras, Bombay and
Calcutta besides Delhi and Himachal Pradesh which have Original
Side by statutory powers in contra distinction Order XLIX Rule 2
will apply only to three out of 25 High Courts viz., the three
Chartered High Courts viz., Madras, Bombay and Calcutta. The
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reason is not far to seek and we may say that it is even obvious as
these three Chartered High Courts have Letters Patent unlike the
two other High Courts which have Original Side but do not have
Letters Patent.
10. Reverting to the legal drill on hand, paragraph 33 of the
impugned order makes it clear that no part of cause of action has
arisen within the jurisdiction of the Original Side of this Court.
Obviously, the reference is to territorial jurisdiction and both
learned counsel do not have any disagreement on that. Thereafter,
Hon'ble Commercial Division, after holding that the parties have
specifically accepted/restricted to the jurisdiction of the Pune Court
has proceeded to reject the plaint by holding that there is no cause
of action. We have no hesitation in making it clear that when a
Court says that it does not have territorial jurisdiction and directs
return of plaint, no other application including a rejection of plaint
can be looked into. The reason is, one will run into the other. A
Court cannot in one breath say that it does not have territorial
jurisdiction, direct return of the plaint for presentation in
jurisdictional/proper Court and also consider the matter on merits
including rejection of plaint (though rejection of plaint application
would not be considering the lis on merits) as that would turn
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more on the plaint averments. Ergo, we have no hesitation in
holding that aforereferred paragraph 33 of the impugned order to
the extent that it talks about rejection of plaint deserves to be set
aside. However, the other limb of paragraph 33 which directs
return of plaint for presentation in appropriate Court viz., Pune
Court is sustained by applying R.P.C'Connor principle and Ashok
Leyland principle in the light of Clause 12 of Letters Patent.
11. In the light of the narrative, discussion and dispositive
reasoning set out infra, we hold that the plaint in C.S. No.567 of
2019 is returned for presentation in appropriate Court by BECCPL.
12. For the sake of enhanced clarity and specificity, we write
our order as an operative paragraph by way of points which are as
follows:
12.1 Captioned OSA is partly allowed and partly
sustained i.e., allowed as regards rejection of plaint and
sustained with regard to return of plaint;
12.2 It is now open to BECCPL to present the July
of 2019 plaint (plaint which manifested itself as C.S.
No.567 of 2019 on institution of suit) in an appropriate
Court in Pune;
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12.3 If BECCPL presents the plaint in the
appropriate Court in Pune, we are sure that the
jurisdictional Court will examine the plaint on its own
merits and in accordance with law untrammeled by any
observations made by this Court in this order which is
for the limited purpose of facilitating return of plaint for
presentation in proper Court;
12.4 If the plaint is presented in a proper Court in
Pune all questions are left open qua both sides. All
rights and contentions including rights and contentions
raised before Hon'ble Commercial Division thus far and
in the captioned OSA are preserved;
12.5 The further sequitur of above means, it is
still open to KBL to file in Pune Court a rejection of
plaint application on any available ground if so advised
and if so desired. If any application of above nature is
filed, the same shall be considered on its own merits
and in accordance with law.
12.6 Registry is directed to return all original
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documents to the counsel on record for the plaintiff
under due acknowledgment but preserve the case file
as this is a Chartered High Court i.e., Court of Record.
There shall be no order as to costs.
(M.S.J.) (N.S.J.)
05.09.2024
Index:Yes/No
Neutral Citation: Yes/No
mmi
To
1.The Sub Assistant Registrar,
Original Side, High Court,
Madras.
2.The Section Officer,
Original Side (Records),
High Court, Madras.
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M.SUNDAR, J.,
and
N.SENTHILKUMAR, J.,
mmi
05.09.2024
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