Manoharlal Jiwanlal Chopra v. Rao Raja Hiralalji S. Kalyanmalji Sarogi
1953-08-20
SAMVATSAR
body1953
DigiLaw.ai
ORDER : A partnership was formed between the plaintiff and the defendant for working Coal mines and manufacturing cement on 14-1-1944. This partnership was by mutual consent dissolved on 22-8-1945. The plaintiff brought the present suit against the defendant for a sum of Rs.190519/0/6 as on a settled account in the Court of the District Judge at Indore, which is registered as suit No.1 of 1949. After the written statement was filed and issues framed, the defendant applied to the lower Court to stay this suit alleging that he has instituted a suit against the plaintiff in the Court of the Subordinate Judge Asansol on 18-8-1948, being suit No.39 of 1948 of the Court, and the matter directly and substantially in issue in the present suit was directly and substantially in issue in the suit previously instituted by him. The Additional District Judge Indore heard the parties and dismissed the application. The present revision application filed by the defendant is directed against the said order. 2. The Additional District Judge Indore has dismissed the defendant's application mainly on the ground that S.10, Civil P.C., was subject to a contract if any, between the parties regarding the forum by which the dispute should be decided. Mr. Pande who appeared for the petitioner raised two points before me: (1) That there was no special contract between the parties regarding the forum which should decide the dispute between the parties relating to the subject matter of the suit, and, (2) even if it be held that there was a valid and binding contract, it could not control the provisions contained in S.10 of the C.P. Code. The learned counsel criticised adversely the view ex-pressed by the High Court of Bombay in - 'Tilall-ram Choudhary v. Kodumal', AIR 1928 Bom 175 (A) and in support of his contention relied upon a decision of the High Court of Calcutta reported in - 'Bhagatsingh Bugga v. Dewas Jagbir Sawhney', AIR 1941 Cal 670 (B). 3.
The learned counsel criticised adversely the view ex-pressed by the High Court of Bombay in - 'Tilall-ram Choudhary v. Kodumal', AIR 1928 Bom 175 (A) and in support of his contention relied upon a decision of the High Court of Calcutta reported in - 'Bhagatsingh Bugga v. Dewas Jagbir Sawhney', AIR 1941 Cal 670 (B). 3. As regards point No.1 the learned counsel for the petitioner invited my attention to Cl.16 of the partnership deed dated 14-1-1944 and proviso No.2 in the deed of dissolution and submitted that Cl.16 of the partnership deed provides for the exclusive jurisdiction of the Indore Court in case there was arbitration between the parties and the proceedings had to be taken by either party in connection therewith and this clause did not therefore apply in case either party filed a suit. He urged that the provision for exclusive jurisdiction in the deed of dissolution was unenforcible as it was hit by S.28, Contract Act. The material provision is the term in the deed of dissolution. Both the parties have admitted this deed and have based their respective claims on the terms contained therein. The relevant portion is reproduced below: "The parties have agreed that as the parties entered into the partnership agreement at Indore (Holkar State) all disputes and differences whether regarding money or as to the relationship or as to other rights and liabilities of the parties hereto, in respect of the partnership hereby dissolved or in respect of questions arising by and under this document shall be decided amicably or in Court at Indore and nowhere else." 4. Mr. Pande raised two objections to the enforcibility of this part of the agreement. According to him (1) the clause is intended to have application so long as Holkar State was in existence as reference to Indore Courts meant reference to the Courts constituted under the Holkar State laws, (2) secondly, the clause which stated that all disputes and differences shall be decided by the Court, at Indore and nowhere else is void as it sought to oust the jurisdiction of the Courts anywhere else. 5. The first contention can be disposed off easily as a plain reading of the aforesaid portion lends no support to the argument of the learned counsel. The second contention however needs to be examined.
5. The first contention can be disposed off easily as a plain reading of the aforesaid portion lends no support to the argument of the learned counsel. The second contention however needs to be examined. S.28 of the Contract Act prohibits any agreement between the parties which divests the courts of their inherent jurisdiction and debars the parties from going to a court of law. There is no such attempt in the present case and the agreement expressly provides that all disputes and differences will be decided by the Indore Courts. It is therefore not a case where the approach to the Court of law is absolutely prohibited. The relevant clause only provides that suits relating to disputes arising between the parties should be instituted in one only out of two or more courts having jurisdiction to entertain them. A Full Bench of the Lahore High Court has recently considered the matter in the case of - Musaji Lukmanji v. Durga Dass', AIR 1946 Lah 57 (C). The agreement in the Lahore case was similar to the case before me. Mahajan J., who wrote the principal judgment with which other judges agreed, upheld the validity of the agreement and observed that: "The doctrine of conferring jurisdiction on or depriving Courts of jurisdiction by consent applies to cases of inherent jurisdiction over the subject-matter of the suit." The learned Judge further stated: "It may be observed that there is nothing against public policy in an agreement arrived at between the parties that when several courts have territorial jurisdiction to hear a case they may limit their choice to one of those courts. So long as the case is heard by a competent court who has jurisdiction to hear it, there is nothing in public policy which dictates that, because other courts can also hear the same because they cannot hear it in view of the agreement, that is a matter against public policy." 6. I am, therefore, of the opinion that there is no substance in the point raised and the clause providing for determination of disputes by an Indore Court and no other Court, is binding on the parties. 7. Next Mr. Pande dealt with the language of S.10, Civil P.C., and contended that it lent no support to the view enunciated by the Division Bench of the Bombay High Court in 'AIR 1928 Bom 175 (A)'.
7. Next Mr. Pande dealt with the language of S.10, Civil P.C., and contended that it lent no support to the view enunciated by the Division Bench of the Bombay High Court in 'AIR 1928 Bom 175 (A)'. He submitted that the Bombay view could only be supported if we read into the section something which is not there and relied upon a decision of the Calcutta High Court reported in 'AIR 1941 Cal 670 (B)'. 8. The Advocate General who opposed the revision application on behalf of the plaintiff referred to a passage from the latest edition of Civil Procedure Code by Mulla where at page 35 the learned author has endorsed the Bombay view. He also referred to a decision of the Allahabad High Court reported in - 'Firm Bichchha Ram Baburam v. Firm Baldeo Sahai Surajmal', AIR 1940 All 241 (D). In the Bombay case 'AIR 1928 Bom 175 (A)', the trial Court had refused to stay the subsequently instituted suit and had granted an injunction against the defendant restraining him from proceeding with his previously instituted suit. The Division Bench of the Bombay High Court upheld the order for injunction. As regards the application of S.10, C.P. Code they have held that there is nothing in the section which prevented the Court from enforcing contractual rights of the nature as between the parties. Observations indicating a contrary principle are however to be found in the Calcutta case reported in 'AIR 1941 Cal 670 (B)', where the learned Judge has said that the existence of an agreement between the parties that they would litigate only in a particular court would not affect the argument that the Court has no option but to obey the mandatory provisions of S.10, C.P. Code. All the same the learned Judge dismissed the application of the defendant for staying the subsequently filed suit and restrained the defendant from proceeding with the suit previously instituted by him. 9. The trend of decisions is thus against staying of the subsequently instituted suit on the ground that previous suit was flagrantly in breach of the contract and was an abuse of the process of law. 10. Under the circumstances I do not think that is fit case for interference in the revisional jurisdiction. I dismiss the revision application with costs. Application dismissed.