ORDER :- The defendant in O.S.100/87 (Arb), a suit instituted by the respondent herein is the revision petitioner. 2. The suit is based on a tripartite agreement entered into on the 27th day of August, 1980 between the plaintiff, the defendant and M/s. Puzzolana Machinery Fabricators for modifying 'a cement plant of the defendant of 100TPD Capacity already fabricated, supplied and erected by M/s. Puzzolana Machinery Fabricators' as per Regional Research Laboratory's Technology. The reliefs prayed for in the suit are: "(a) appoint a sole arbitrator and refer points of differences stated above to the arbitration and pass award in terms thereof. (b) grant such other reliefs as the Hon'ble Court deems fit and proper and convenient…………" 3. The defendant inter alia raised a preliminary issue namely, 'whether this court (the court of the Additional Sub-Judge, Parur) has territorial jurisdiction to try this suit?' The court below considering the various aspects of the issue has, by the order under challenge, held that it has 'territorial jurisdiction to try the suit'. Accordingly the issue was found in favour of the plaintiff. In order to decide the point covered by the issue it is necessary to understand the scope of certain clauses contended in the agreement. The clauses relevant in the context are Art.1.6 and Art.5.4. They read:- "1.6. Effective date of contract means the date on which this agreement is signed by any of the three parties after signature by the other two and acceptance by Engineer of payment by owner of the advance vide Para (1) of Art.5.1, hereof. The date on which Engineer advises the other two of such acceptance shall be the effective date of contract. 5.4. Advance payment shall be made in the form of Demand Draft drawn in the name of FACT Engineering and Design Organisation and payable at the State Bank of India, Cochin ......." The term, 'Engineer' denotes the FEDO, having headquarters at Eloor, 'Owner' denotes the defendant having headquarters at Rajkot and the 'contractors' denotes the partnership concern, the Puzzolana Machinery fabricators having its place of business at Bombay. 4. It is clear from Art.1.6 that until the date on which 'Engineer' advises the other two of the acceptance of the payment by 'owner' of the advance, it cannot be said that the contract has been made.
4. It is clear from Art.1.6 that until the date on which 'Engineer' advises the other two of the acceptance of the payment by 'owner' of the advance, it cannot be said that the contract has been made. Only on such acceptance being acknowledged by the other parties to the agreement, it could be said that a concluded contract has come into being. 5. From the facts stated above it is clear that the contract based on which the suit is instituted is entered into between parties at a distance. Such contracts can invariably be made only by correspondence. In a contract by correspondence, the acceptance must be communicated in some perceptible form. The perceptible form, however, shall be in the manner suggested or indicated in the correspondence between the parties. In the absence of any correspondence, the perceptible form may be by speech or other acts. Whatever that be, the answer to the question as to where (the place where a contract is made can as well be the place where a suit based on the said contract be brought) and when a concluded contract has been made between parties at a distance, depends upon the facts of each case. Facts in this regard therefore should be pleaded by the plaintiff. Such facts must necessarily be substantiated by evidence afforded by the correspondence between the parties if the contract is one made by correspondence and in all other cases the facts must) be established by the usual evidence because the above question can be decided only on the, verification of the pleadings supported by adequate evidence. 6. It is in this background the preliminary issue requires to be considered. The enquiry therefore should be geared to the pleadings as also the documents in support of the pleadings produced by the plaintiff. The only pleading regarding the cause of action is the one contained in paragraph 14 of the plaint. It reads:- "The cause of action for this suit has arisen at Udyogamandal within the jurisdiction of this Court from 27-8-1980 when the agreement was executed and from various other dates since then including suit notice dated 22-7-1986." Whether or not the contract was made at Udyogamandal could be decided only on a close scrutiny of the pleadings substantiated by the evidence.
The plaint does not contain even the requisite pleadings without which, to my mind, it is rather impossible to decide the question where exactly the contract in question was made. The pleadings now available do not supply any material in this regard. I cannot therefore agree with the argument of the learned counsel for the respondent plaintiff that para 14 of the plaint indicates the place where the agreement is made. 7. However, it is clear from Art. 5.4 of the Contract which deals with the advance payment, that the court in Cochin get the jurisdiction to entertain the suit. It should in this connection be remembered that payment of money under a contract is a part of the performance of the contract and as such will furnish a cause of action. This is a well established principle. In view of the fact that the parties have agreed to have the Advance payment made in the form of Demand Draft in the name of the plaintiff and payable at the State Bank of India, Cochin, the Cochin Court gets jurisdiction to entertain the suit. 8. In the light of the discussion above the order under challenge is liable to be set aside. I accordingly set aside the same and declare that, going by the materials available on record, the court at Cochin is the Court which gets the jurisdiction to entertain the suit. The court blow therefore is directed to pass appropriate orders under Order 7, Rule 10, C.P.C., returning the plaint to be presented in the appropriate Court at Cochin. C. R. P. is allowed in the manner indicated above. Petition allowed.