Telangana High Court

M/S. Emcor Packaging Private Limited vs M/S. Bang Papers Private Limited on 19 June, 2025

     HON'BLE SRI JUSTICE LAXMI NARAYANA ALISHETTY

           CIVIL REVISION PETITION No.3149 of 2024

ORDER:

This Civil Revision Petition, under Article 227 of the

Constitution of India, is filed against the docket order dated

03.09.2024 in OS. No.209 of 2024 (old OS.No.37 of 2020), passed

by the IX Additional District Judge, Ranga Reddy District at LB

Nagar (hereinafter referred to as the 'District Court').

2. The revision petitioner is the defendant and the respondent

is the plaintiff in the suit before the District Court.

3. The brief facts of the case, shorn off unnecessary details,

required for disposal of the present Civil Revision Petition, are as

follows:

3.1 Initially, the respondent has filed a summary suit in

O.S.No.37 of 2020 on the file of the XII Additional District Judge,

Ranga Reddy District at Vikarabad, against the petitioner for

recovery of a sum of ₹50,64,490/- together with future interest

thereon. The respondent, claiming to be a dealer-cum-agent for LNA,J

supply of kraft paper manufactured by M/s. Kaygyon Paper

Mills Limited, contended that the petitioner, a manufacturer of

corrugated boards, had purchased kraft paper, which was

supplied under the respondent's instructions, to a tune of

₹1,92,73,723/-, out of which an amount of ₹50,64,490/- remained

unpaid as on 17.02.2020.

3.2 Upon service of summons, the petitioner failed to appear,

and accordingly, the trial court decreed the suit exparte by

judgment dated 28.12.2020. Thereafter, the petitioner filed I.A.

No. 22 of 2021 under Order IX Rule 13 and Order XXXVII Rule 4

CPC to set aside the ex parte decree and praying to grant leave to

defend the suit, and subsequently filed I.A.No.45 of 2021 seeking

to set aside the ex parte decree. The respondent herein/plaintiff

filed counters in both the interlocutory applications and in view

of the averments made in the counters, the petitioner/defendant

I.A.No.177 of 2021 under Order XXIII Rule 3 CPC to withdraw

I.A.No.45 of 2021 and I.A.No.180 of 2021 to withdraw I.A.No.22

of 2021 with liberty to file fresh applications. Both applications

were dismissed by the District Court on 23.11.2021, against which LNA,J

the petitioner preferred C.R.P.Nos.41 and 31 of 2022 respectively.

This Court initially granted stay on 04.03.2022 in the said CRPs.

However, on contest, the said Revisions were dismissed on

05.06.2023. Meanwhile, the petitioner filed C.R.P.No.1321 of 2022

challenging the judgment and decree dated 28.12.2020 passed in

O.S.No.37 of 2020 on the ground that the summary nature of the

suit did not comply with the mandatory provisions under Order

XXXVII CPC, thereby rendering the suit not maintainable and the

decree liable to be set aside.

3.4 Though the revision was initially dismissed by order dated

05.06.2023, on a review application in I.A.No.1 of 2023, this Court

allowed the same by order dated 12.01.2024. It was observed that

the trial court failed to render a finding on the maintainability of

the summary suit and whether procedural compliance under

Order XXXVII was followed, warranting a remand for fresh

adjudication. Consequently, the decree was set aside and the

matter was remanded to the trial court for a decision on the issue

of maintainability.

LNA,J

3.5 Pursuant thereto, the suit was restored to its original

number and, consequent upon the reorganization of Districts in

the state of Telangana, the said suit was transferred to the Court

of IX Additional District Judge, Ranga Reddy District at L.B.

Nagar and renumbered as O.S.No.209 of 2024. The District Court,

after hearing both the parties on the question of maintainability

and relying on the decisions cited by the respondent, by the

impugned order held that the suit based on invoices was

maintainable as a summary suit. Challenging the said order, the

defendant approached this Court by filing the present Civil

Revision Petition.

4. Heard Sri Shyam S.Agarwal, learned counsel for the

petitioners, and Sri S.Rajagopalan, learned for the respondents.

5. Learned counsel for the petitioner submitted that the

impugned order, wherein it is held that summary suit filed by

the plaintiff under Order XXXVII of the CPC is maintainable, is

legally unsustainable, arbitrary, and not based on a proper

appreciation of the facts and material on record. He further

submitted that the invoices in question, on their face, are issued LNA,J

by "M/s.Kaygyon Paper Mills Limited" and are addressed to the

petitioner. However, the respondent's name is not mentioned

anywhere on the invoices. In furtherance of this, it is contended

that no contractual relationship can be inferred between the

respondent and the petitioner. Therefore, the District Court erred

in treating the matter as one arising out of a valid commercial

transaction between the parties.

5.1. Further, the learned counsel for the petitioner has drawn

attention of this Court to Clause No.3 of the terms and conditions

mentioned at the bottom of the invoices, which expressly

provides that disputes shall be subject to the jurisdiction of

Courts in Kota. He contended that as per the said Clause, the

Courts at Kota have exclusive jurisdiction to adjudicate the

dispute between the parties. Therefore, the District Court lacked

jurisdiction to entertain the suit and erred in not giving a finding

to that effect. Learned counsel further submitted that there is no

nexus, either contractual or factual, between the respondent and

the petitioner. The pleadings and documents filed by the plaintiff

do not establish any privity of contract. Hence, the very LNA,J

institution of a summary suit by the plaintiff is without basis and

not maintainable under Order XXXVII CPC. Therefore, he finally

prayed to set aside the order of the District Court by holding that

the summary suit is not maintainable.

6. Per contra, the learned counsel for the respondent

submitted that the District Judge in the impugned order has

rightly held that the summary suit filed under Order XXXVII of

the CPC is maintainable and does not suffer from any legal

infirmity. It is contended that the invoices in question clearly

indicate the supply of goods made to the defendant through

M/s. Kaygyon Paper Mills Ltd. and the respondent is the dealer-

cum-agent of the said company; that the mention of the

respondent's name on the Certificate of dealership/agency issued

by M/s. Kaygyon Paper Mills Ltd. is determinative of the

contractual relationship, between the said company and the

respondent. The respondent submits that a commercial

transaction did, in fact, take place between the parties, which is

corroborated by the petitioner's acceptance of delivery and

subsequent conduct of payment of the amount.

LNA,J

7. Learned counsel for the respondent further submitted that

the petitioner's attempt to evade liability by questioning the

maintainability of the summary suit is merely a dilatory tactic.

He further submitted that the suit is based on written

instruments, namely the invoices and delivery challans, which

squarely fall within the ambit of Order XXXVII CPC, warranting

the invocation of summary procedure. As regards the aspect of

jurisdiction, he submitted that the Clause in the invoices referring

to exclusive jurisdiction of the Courts at Kota to adjudicate the

disputes, does not oust the jurisdiction of the present court. It is

well-settled that an ouster clause in a contract must be read in the

context of the intention of the parties and the cause of action. In

the present case, a substantial part of the cause of action has

arisen within the territorial jurisdiction of the District Court,

thereby rendering the suit maintainable before the District Court.

By making the above submissions, learned counsel contended

that impugned order of the District Court is well-reasoned and

supported by law and hence, it does not warrant interference by LNA,J

this Court and accordingly, the present Revision Petition is liable

to be dismissed.

CONSIDERATION:

8. From the aforesaid factual matrix of the case, the material

placed on record and the submissions made by learned counsel

for both the parties, the points that arise for consideration in this

Revision Petition are:

1. Whether the exclusive jurisdiction clause in the invoice stating "subject to KOTA jurisdiction only" is valid and it bars the civil Court having territorial jurisdiction from entertaining the suit?

2. Whether a summary suit filed under Order XXXVII of CPC on the basis of the Invoices maintainable?

3. Whether the plaintiff has locus standi to file the suit for recovery of money against the defendant?

POINT No.1: -

9. In the present case, it is pertinent to note that there exists

no formal agreement or contract between the parties expressly

conferring jurisdiction upon a particular court. The clause LNA,J

mentioning that the Courts at Kota have exclusive jurisdiction

appears only as a recital or standard printed term on the invoices

raised by M/s. Kaygyon Paper Mills Ltd.

10. To decide this point, it is apt to refer to the ratio laid

down by the Hon'ble Supreme Court in Hakam Singh v.

Gammon (India) Ltd., (1971) 1 SCC 286, wherein at para-4 it is

held as hereunder:

"4. ....It is not open to the parties by agreement to confer by their agreement jurisdiction on a Court which it does not possess under the Code. But where two courts or more have under the Code of Civil Procedure jurisdiction to try a suit or proceeding an agreement between the parties that the dispute between them shall be tried in one of such Courts is not contrary to public policy."

11. This principle has been reaffirmed and reinforced in

subsequent judicial pronouncements, that parties cannot, by

mutual agreement, confer jurisdiction upon a Court which

otherwise lacks it under the provisions of the Code of Civil

Procedure. In other words, the parties are only entitled to choose

between two or more Courts which have jurisdiction to try the

disputes between them and a clause in their mutual agreement LNA,J

conferring jurisdiction on a Court which does not possess the

same under the Code of Civil Procedure is not binding.

12. In the absence of such agreement, a unilateral

endorsement cannot oust the jurisdiction of the competent Court

otherwise conferred by law. Accordingly, the unilateral recital

regarding jurisdiction printed on the invoice cannot be held to be

binding the parties or override the statutory jurisdiction of the

Courts in the state of Telangana.

13. However, it is a settled principle of law that a unilateral

clause printed on a document such as an invoice, which has not

been mutually agreed upon or signed by both parties, cannot be

treated as a valid jurisdiction clause.

14. Furthermore, from the factual matrix of the case, it is

evident that M/s. Kaygyon Paper Mills Ltd. has its registered

office in Aurangabad, Maharashtra, and the registered offices of

both the parties to the present suit are situated within the State of

Telangana. No part of the cause of action is shown to have arisen

within the territorial limits of Kota. Therefore, even otherwise, LNA,J

the Courts in Kota would lack jurisdiction under the provisions

of the Civil Procedure Code.

15. Accordingly, the exclusive jurisdiction clause mentioned

unilaterally in the invoice is not legally sustainable, and cannot

override the territorial jurisdiction conferred by law.

Consequently, it is held that the Courts in Telangana, where the

registered offices of the parties to the suit are situated, have the

jurisdiction to try and entertain the present suit.

16. This point is accordingly answered in favour of the

plaintiff.

POINT No.2: -

17. With regard to this point, there are catena of decisions of

various High Courts, viz., the judgment of the Delhi High Court

in Flint Group India Private Limited v. Good Morning India

Media Private Limited 1, wherein it is held that a suit under

Order XXXVII of the CPC can be maintained on the basis of

invoices. This principle was subsequently reiterated by in Flick

2017 SCC OnLine Del 7894 LNA,J

Studios Pvt. Ltd. v. Gravity Entertainment Pvt. Ltd., {CM(M)

1185 of 2021}, wherein the Court upheld the maintainability of a

summary suit founded exclusively upon a series of invoices.

Further, various High Courts across the country have

consistently adopted a similar view, thereby fortifying the

judicial consensus on this aspect.

18. In view of the above judicial position, this Court is of the

considered opinion that the summary suit instituted by the

respondent under Order XXXVII CPC, based solely on the

invoices, is maintainable.

19. Accordingly, the finding of the District Judge on this

issue is sustained and does not warrant any interference by this

Court.

POINT No.3:

20. In order to answer this issue, it is relevant to note that the

plaintiff has filed a Certificate issued by M/s Kaygaon Paper

Mills Limited, wherein it is specifically stated as hereunder:-

LNA,J

"This is to certify that M/s Bang Papers Pvt Ltd is our authorised dealer-cum-agent for supply of our Kraft Paper and we on behalf of Bang Pvt Ltd have supplied Kraft Paper on different dates and invoices to M/s Emcor Packaging Pvt Ltd having its factory at Chevalla, Telangana.

All the payments due against the below invoices and delivery receipt for material supplied to M/s Emcor Packaging should be made to account of M/s Bang Papers Pvt Ltd only as they have already cleared payments against the below invoices to us."

21. The plaintiff also filed Ledger Account from 01.04.2016 to

31.03.2017, showing the particulars of the dates, the voucher Nos.

the Bill Nos. on which the amounts were debited at their end to

the credit of M/s Kaygaon Paper Mills Limited.

22. Upon perusal of the above Certificate issued by

M/s Kaygaon Paper Mills Limited and the Ledger Account,

which is placed on record, it is evident that M/s. Kaygyon Paper

Mills Ltd. has expressly authorized the respondent as its dealer-

cum-agent, and in furtherance thereof, the petitioner has to effect

all due payments directly into the account of the respondent. This

documentary evidence establishes that the respondent is not a

mere third party or stranger to the transaction, but is a duly LNA,J