Sambhu Prasad Agarwal v. I. C. D. S. Ltd. — 1994 DIGILAW 92 (CAL)

JUDGMENT Ruma Pal, J.: This is an application by the defendants Nos. 2 and 3 for taking the plaint in the suit off the file after revocation of leave under clause 12 of the Letter Patent : The ground on which revocation leave under clause 12 has been sought is that no part of the cause of action has arisen within the jurisdiction of this Court. 2. This principles for deciding an application for revocation of leave under clause 12 and for taking the plaint off the file under Order 7, Rule 11 are well established. First the Court is required to construe the plaint as it stands on the assumption that the allegations contained in the plaint are correct. 3. Second the jurisdiction of this Court under clause 12 of the Letter's Patent extends to matters in which each of the defendants is within the jurisdiction of this Court and where they are not so situate, if part of the cause of action arises within the jurisdiction of the Court. 4. It is not in dispute that the defendant No. 1 has its registered office at Manipal in the State of Karnataka. The only other defendants in the action viz., defendants Nos. 2 and 3, according to the plaint reside at Manipal in the State of Karnataka. 5. As none of the defendants, according to the plaint either carryon business or reside within the jurisdiction of this Court, the question is whether any part of the cause of action has arisen within the jurisdiction of this Court. The defendants No.2 and 3 have argued that, even if the Court has jurisdiction, on the principle of balance of convenience, this Court should return the plaint to be represented before the Karnataka High Court within the jurisdiction of which the company was registered and the defendants were carrying on business. 6. The question whether the facts pleaded as attracting the jurisdiction of this Court form part of the cause of action in the suit will have to determine in the context of the averments in the plaint and the reliefs claimed. 7. In the plaint the plaintiff claims to be a registered share-holder and owner of 550 shares in the defendant. The question whether the facts pleaded as attracting the jurisdiction of this Court form part of the cause of action in the suit will have to determine in the context of the averments in the plaint and the reliefs claimed. 7. In the plaint the plaintiff claims to be a registered share-holder and owner of 550 shares in the defendant. The defendants 2 and 3 are the directors of the defendant No.1 has stated that by a notice dated 26.8.1993 the Annual General Meeting of the company was to be held at Karnataka. The defendant No.2 had requested the plaintiff to give proxy in his favour. Two share-holders of the company had, after the issuance of the notice date 26.8.1993 proposed themselves for election to the office of the Director of the Company. The proposals were not taken up and only business relating to certain items were transacted at the Annual General Meeting held on 30.9.93. The defendant No. 2 as the Chairman of the company adjourned the Annual General Meeting to 7th October, 1993 to consider the balance items in the Agenda. The proposals, according to the plaintiff, were required to be served on each share-holder of the company or advertised under s. 257 of the Act. The company advertised the proposals in two newspapers on 22.9.93 and 24.9.93. It was shorter than the period specified under s. 257 of the Act. The defendant had requested for proxies wrongfully. It is stated that the proxies so collected by the defendant No.2 were equally illegal and invalid and could not be acted upon. The proxies received by the defendant No. 1 were illegal as they were not signed by both the joint share-holders of the Company. The further grievance is that there was Public Issue by the defendant company in July, 1991. The defendants Nos. 2 and 2 had applied for and obtained a large number of equity shares. The allotment of shares were illegal and invalid and therefore the allottees could not exercise voting rights either in person or proxy at the adjourned Annual General Meeting. The allotment of shares was also illegal. In the plaint it has been stated that many share-holders from whom the second defendant had collected proxies had stated that the proxies were given by them on the representation that the defendants Nos. The allotment of shares was also illegal. In the plaint it has been stated that many share-holders from whom the second defendant had collected proxies had stated that the proxies were given by them on the representation that the defendants Nos. 2 & 3 would use the proxies only for ensuring the re-election of the defendant No.3. In fact the defendant No. 2 had informed his colleagues on the Board that he would use the proxies for defeating the re-election of the retiring Director of the company. Such use was not in terms of the representation made to the share-holders and was illegal. It is stated in the plaint that the defendant No. 2 should not be allowed to preside over the adjourned Annual General Meeting on 7th October 1993 as he would be biased. The plaintiff has finally stated that the defendants Nos. 2 and 3 were acting in collusion with each other to manipulate the majority of the Board of Directors in their favour and to divert Crores of rupees of the company for their own private use. The Directors who were not members of the Pai family had been approached by the defendant No. 2 to resign to enable the defendants Nos. 2 and 3 to appoint their nominees to the Board. It was therefore necessary that the defendants Nos. 2 and 3 should not be appointed as Directors. The defendant No. 2 had abused his duties as Trustee. The share-holders should take proper steps for attendance at the adjourned Annual General Meeting to voice their feeling and vote on resolutions according to their own desire. Since the share-holders had been cheated and they feel that fraud had been done to them required sufficient time for attending the Annual General Meeting. The defendants Nos. 2 and 3 had perpetrated fraud on the company. 8. It was in this background that the plaintiff has stated that the following acts constituting part of cause of action in the suit arose within this Courts jurisdiction:- (i) The receipt at the plaintiff's place of business within the jurisdiction of this Court of a notice dated 26th August 1993 convening the Annual General Meeting of the defendant No. 1 at Manipal. (Paragraph 3 of the plaint). (Paragraph 3 of the plaint). (ii) The receipt of a communication dated 7th September 1993 from the defendant No. 2 requesting the plaintiff to give a proxy in favour of the defendant No. 2 in respect of the plaintiff's shares in the company. (Paragraph 4 of the plaint). (iii) The failure of the company to publish in terms of provisions of s. 257 of the Companies Act, 1956. (Paragraph 8 of the plaint). (iv) Perpetration of fraudulent acts mentioned in sub-paragraphs of paragraph 18 of the plaint. The sub-paragraphs which are 3 in number refer to (a) default in complying with s. 257 of the Companies Act, (b) the non-publication of the proposals in accordance with s. 257 of the Act and (c) the adjournment of the Annual General Meeting of the defendant No. 1 by the respondent No.2. (Paragraph 18 of the plaint). (v) The defendants' denial of the plaintiff's legal character and right to property within the jurisdiction of this Court. (Paragraph 20 of the plaint). (vi) Breach by the defendants of their obligation to the share-holders of the defendant No. 1. (Paragraph 21 of the plaint). (vii) Invasion or threat to invade the plaintiff's right and enjoyment of property. (Paragraph 22 of the plaint). The plaintiff has claimed the following reliefs in the Suit :–– "(a) Declaration that the adjournment of the 22nd Annual General Meeting of the Company convened to be held on September 30, 1993 and adjourned to October 7, 1993 is illegal, null and void; (b) Perpetual in junction restraining the defendants and each of them from convening, conducting or holding the 22nd Annual General Meeting of the Company held on September 30, 1993 and adjourned on 7th October, 1993 on 7th October, 1993 as on any other date; (c) Perpetual injunction restraining the defendants and each one of them from acting as Chairman or Director of the Company; (d) Declaration that the proxies procured by the defendant Nos. 2 & 3 are illegal, null and void; (e) Perpetual injunction restraining the defendants and each one of them from acting upon or giving any effect to the proxies procured by the defendant Nos. 2 & 3 are illegal, null and void; (e) Perpetual injunction restraining the defendants and each one of them from acting upon or giving any effect to the proxies procured by the defendant Nos. 2 and 3; (f) Mandatory injunction directing the defendants to give fresh notice of the adjourned Annual General Meeting of the company on such terms and conditions as their Hon'ble Court may deem fit and proper; (g) Decree for delivery up of proxies procured by the defendant Nos. 2 and 3 so that the same be cancelled and adjudged void; (h) Perpetual injunction restraining the defendants and each one of them from giving effect as holding themselves out as Directors of the company and/or interfering or intermeddling with the management and affairs of the company in any manner whatsoever; (i) Receiver; (j) Interlocutory injunction; (k) Costs; and (l) Further or other reliefs." 9. At the outset, it may be noted that there was some dispute regarding the representation of the defendant company. Two groups of Advocates claimed to represent the interest of the company. Needless to say, one of the group appearing for the company has supported the plaintiff and the other group, the defendants 2 and 3. 10. The plaintiff has opposed the application and said that no case for revocation of leave under clause 12 on the ground of balance of convenience has been raised in the petition and that as such this Court should not entertain any argument on this score. On the question of jurisdiction of this Court the plaintiff has claimed that the facts on the basis of which the leave under clause 12 had been obtained formed part of the bundle of facts necessary to be proved by the plaintiff for obtaining reliefs of the suit. It is contended that the basis of the plaintiff's case is that at the last Annual General Meeting the agenda for election or re-election of directors could not be validly considered. It is stated that the notice of the Annual General Meeting was a relevant fact and would have to be proved before the plaintiff could obtain relief in the suit. The non-compliance with s. 257 namely the non-receipt of the individual notice under s. 257 would also have to be proved. It is stated that the notice of the Annual General Meeting was a relevant fact and would have to be proved before the plaintiff could obtain relief in the suit. The non-compliance with s. 257 namely the non-receipt of the individual notice under s. 257 would also have to be proved. It is said that the plaintiff's further case that the defendant No. 2 had misrepresented the use of the proxies to the members of the company was made to the plaintiff within the jurisdiction of this Court. It is said that it is immaterial that the plaintiff was not misled by the representation because the suit was a representative suit under Order 1, Rule 8. According to the plaintiff, these facts formed part of the cause of action. Reliance has been placed on the decisions reported in Madanlal Jalan vs. Madanlal and others, AIR 1949 Cal 495 and Bimal Singh Kothari and Anr. vs. Muir Mills Co. Ltd. and Ors, AIR 1952 Cal 645 . 11. The plaintiff has also argued that the lack of territorial jurisdiction was not a case of inherent lack of jurisdiction and that an objection to Court's territorial jurisdiction could be waived. It is stated that in fact, the defendants No. 2 and 3 had waived their objection to the jurisdiction of this Court. It is submitted that the defendants Nos. 2 and 3 have taken benefit of the proceedings of this Court and had applied for and obtained an order from this Court. It is further submitted that by relying on the order passed by this Court, the defendants Nos. 2 and 3 had persuaded the munsiff at Mangalore in O.S. No. 1057 of 1993 to pass certain orders. It is stated by the plaintiff that even though the defendant had contended in an application that this Court had no jurisdiction, it had in that very application asked for interim orders and an interim order was in fact, passed in favour of the defendants. It is therefore stated by the plaintiff that the defendants Nos. 2 and 3 were estopped by their conduct from contending this Court did not have the jurisdiction to entertain the suit. 12. It is therefore stated by the plaintiff that the defendants Nos. 2 and 3 were estopped by their conduct from contending this Court did not have the jurisdiction to entertain the suit. 12. The cause of action in a suit has been stated as being "every fact which is material to be proved to entitle the plaintiff to succeed––every fact which the defendant would have a right to traverse." [See: Cooke vs. Gill, (1873) 8 C.P. 107 at page 116]. This definition has been para-phrased and applied in various decisions and has been approved by S. R. Das-J. (as his Lordship then was) in the case of Madanlal Jalan vs. Madanlal & Ors. (supra). 13. Keeping this definition in view, cannot be said that any part of the cause of action of the plaintiff in the suit has arisen within the jurisdiction of this Court either on the basis of the averments in the plaint or the reliefs claimed. 14. It is true that in case of Bimal Singh vs. Mills and Co. Ltd., AIR 1952 Cal 645 the Court held that the receipt of a notice under s. 173 formed part of the cause of action. The difference between that case and the one before me is that the plaintiffs had challenged the notice itself as being inadequate and a 'tricky' notice which did not fully or frankly disclose all material facts in keeping with s. 173 (2). Indeed the non-disclosure of material fact was the ground or the basis on which the main relief was claimed in the suit viz., declaration that a Special Resolution was void. The plaintiff's have nowhere said in this case that any misrepresentations was made to him in Calcutta. 15. The plaint has not challenged the adequacy or validity of the notice dated 26th August 1993. The grievance is directed towards the adjournment of the meeting to consider part of the agenda referred to in the notice on the adjourned date. In such circumstances it cannot be said that the receipt of the notice was part of the cause of action without proof of which the plaintiff will not succeed in the suit. Similarly the communication dated 7th September, 1993 would not form part of the cause of action. The communication was a request by the defendant No.2 for grant of proxy to him. Similarly the communication dated 7th September, 1993 would not form part of the cause of action. The communication was a request by the defendant No.2 for grant of proxy to him. The mere receipt of the request for proxies does not form part of cause of action. If the request had been acted upon by the plaintiff then the cause of action would have arisen here. It is not the plaintiff's case that the plaintiff in fact gave any proxy to the defendant No. 2 on the basis of the communication. 16. The effect of the decision in Bimal Singh vs. Muir Mill (supra) has been explained in a subsequent case viz., that the receipt of notice would constitute part of an action only when the notice itself was challenged and where the misrepresentation is contained in the notice itself. Otherwise mere knowledge of a fact did not form part of the cause of action. (See: Jyoti Bhusan vs. Baster Tea Co. Ltd., AIR 1981 Cal 195). 17. The next fact alleged to be part of the cause of action is the violation of s. 257 of the Companies Act. Section 257 of the Companies Act provides as follows:- "(1A) The company shall inform its members of the candidature of a person for the office of director or the intention of a member to propose such person as a candidate for that office, by serving individual notices on the members not less than seven days before the meeting. Provided that it shall not be necessary the company to serve individual notices upon the members as aforesaid if the company advertises such candidature or intention not less than seven days before the meeting in at least two newspapers circulating in the place where the registered office of the company is located, of which one is published in the English language and the other in the regional language of that place." 18. In this case the company had advertised the proposals in two local newspapers i.e. news paper having circulation at Manipal in Karnataka. Whether such advertisement was correct or incorrect or in violation of s. 257 is not a cause of action which can be said to have arisen within the jurisdiction of this Court. 19. The allegation of perpetration of fraudulent acts in sub-paragraphs of paragraphs 18 relate to matters which have taken place outside the jurisdiction of this Court. Whether such advertisement was correct or incorrect or in violation of s. 257 is not a cause of action which can be said to have arisen within the jurisdiction of this Court. 19. The allegation of perpetration of fraudulent acts in sub-paragraphs of paragraphs 18 relate to matters which have taken place outside the jurisdiction of this Court. 20. It is not stated how the plaintiff has been denied any legal character or right to property within the jurisdiction of this Court. The right to vote is to be exercised by the plaintiff at Manipal at the registered office of the defendant No.1. The denial or invasion of the plaintiff's rights qua share-holder must therefore, if at all, have taken place at the adjourned meeting in Karnataka, outside the jurisdiction of this Court. 21. As far as the cause of action is to be determined with reference to the reliefs claimed, all the prayers relate to matters outside the jurisdiction of this Court. 22. For all these aforesaid I am of the view this Court does not have the jurisdiction to try this suit as no part of the cause of action has arisen within its jurisdiction. 23. The next question is whether the defendants Nos. 2 and 3 can be said to have waived their rights to object to the jurisdiction. It is not disputed by the defendants Nos. 2 and 3 that an objection to jurisdiction can be waived but it is said they have not. The plaintiff has relied upon various orders obtained by the defendant being orders dated 7.10.93, 5.1.94 and 6.1.94 to contend that the defendants have participated in the proceedings and had obtained orders for their benefit in a manner which would amount to waiver or at least which estopped the defendants from questioning the jurisdiction of this Court. 24. The principle of weaver of jurisdiction is derived from the language of s. 21 of the Code of Civil Procedure which provides that the Appellate Court will not take cognizance of a plea of lack of jurisdiction unless the plea was taken at the Trial Court as early as possible and, in any event, before the settlement of issues and unless there has been a consequent failure of justice. Therefore in order to established that the defendant has waived any objection as to the jurisdiction of this Court the plaintiff must show that the defendant had not taken the objection at the earliest possible opportunity. As to what would constitute the earliest possible opportunity has been judicially laid down in the decisions relied upon by the plaintiff. 25. The earliest decision cited on this point by the plaintiff is Lhoneux & Co. vs. Hong Kong and Shanghai Banking Corporation, 33 Chancery Division 446. The Court found that the defendant, in fact, carried on business within the jurisdiction. The Court went on to say if it had any doubt in the matter it would say that the application for security for costs made by the defendant amounted to waiver of any objection that might be taken as to the service of the writ. The last observation would amount to an obitere. Even if it were not, an application for security for costs is a step in the suit in that it is an application for payment of costs incurred on likely to be incurred by the defendant in contesting the suit. If an application is made for security of cost, it is only an evidence of intention on the part of the defendant to contest the suit in that Court. 26. The second case cited on this aspect is that decision in Chittaranjan Mukherjee vs. Barhoo Mahato, AIR 1953 SC 472 . In that case the defendant had entered appearance and had applied for and obtained an extension of time to file his written statement which he actually filed. Pending the hearing of the suit a consent order was also passed appointing the solicitors of the parties to hold a sum of monies due to the firm constituted by the plaintiff and the defendant. The plaintiff's application for injunction and receiver was heard and dismissed without any objection as to the jurisdiction. Even when the application for stay was made no attempt was made to have the proceedings in the suit stayed. On the other the defendant had applied for discovery and inspection. On the application of the defendant for revocation of leave under Clause 12. The Supreme Court found that part of the cause of action had arisen within the jurisdiction of the Court. On the other the defendant had applied for discovery and inspection. On the application of the defendant for revocation of leave under Clause 12. The Supreme Court found that part of the cause of action had arisen within the jurisdiction of the Court. The only question was whether the Court should direct revocation of leave under Clause 12 on the ground of balance of convenience. 27. It is to be noted that the issue was not one of waiver decided with regard to the lack of jurisdiction but with reference to the convenience of the parties. The Supreme Court held that when the parties had made use of the existence of the suit to obtain interlocutory reliefs and where proceedings in the suit had been allowed to reach a stage where it would result in injustice if the Court were to hold that the forum conveniences or other and not Calcutta and leave under Clause 12 could not be revoked. 28. The third case cited is Hiralal Patni vs. Shri Kalinath : AIR 1962 SC 199 . In that case the objection to jurisdiction was taken at a stage when the suit had been decreed and was in the process of being executed. The defendant had consented to the subject matter of controversy in the suit being resolved by arbitration through Court. The Court appointed an arbitrator acting on the consent order. The arbitrator passed an award and a decree was passed on the award. 29. The last case cited on the issue is the decision in Bahrein Petroleum vs. P. J. Pappu, AIR 1966 SC 634 . The defendant had filed an application under s. 34 of the Arbitration Act 1940 to stay the suit. The application was dismissed. The defendant then filed a written statement disputing the territorial jurisdiction of the Court. The matter was tried as a preliminary issue. The Trial Court held in favour of the defendant. The appeal was dismissed but on revision the High Court held that the objection as to jurisdiction had been waived by the defendant. The Court followed Hiralal Patni's case (supra) and held that the defendant could waive an objection as to territorial jurisdiction but negatived the finding of the High Court that the defendant had waived the objection. The appeal was dismissed but on revision the High Court held that the objection as to jurisdiction had been waived by the defendant. The Court followed Hiralal Patni's case (supra) and held that the defendant could waive an objection as to territorial jurisdiction but negatived the finding of the High Court that the defendant had waived the objection. The Supreme Court stated:- "If the defendant allows the trial Court to proceed to judgment without raising the objection as to the place of suing and takes the chance of a verdict in his favour, he clearly vaives the objection, and will not be subsequently permitted to raise it. It is even possible to say that long and continued participation by the defendant in the proceedings without any protest may, in an appropriate case amount to a waiver of the objection." 30. The Supreme Court held that the application for stay of suit under s. 34 was not a recognition that the Court had jurisdiction to try the suit nor was the appeal under s. 39 of the Arbitration Act an act of waiver. The Court also clarified that where a suit had not been tried there could be no question of failure of justice, and that the condition "unless there has been a consequent failure of justice" implied that at the time of objection is taken in the appeal or revision the suit had already been tried on the merits. 31. The principle which seems to evolve from a consideration of all the decisions cited is that the objection as to jurisdiction would be waived if a defendant allows the suit to proceed to trial or where there has been a long and continued participation in the proceedings or where the defendant has taken steps in the suit. 32. In this state of the law, the facts of this case may be considered. 33. This suit was filed on 6th October, 1993. The plaintiff filed an application for interlocutory relief. An ex parte interim order was passed on 6th October, 1993 allowing the adjourned Annual General Meeting to be held on 7th October, 1993 but directing that no effect should be given to any resolution relating to the removal and appointment of Directors and Chairman of the defendant No. 1 till further orders. On 7th October, 1993 an attempt was made by the defendants Nos. On 7th October, 1993 an attempt was made by the defendants Nos. 2 and 3 to obtain a modification of the Order dated 6th October, 1993. A modification was obtained to the effect that none of the directors of the company (who were continuing in an office by reason of the order dated 6th October, 1993) would withdraw any money above Rs. 5,000/- till 12th October, 1993 without the leave of Court. 34. The defendants Nos. 2 and 3 affirmed an affidavit in opposition to the application of the plaintiff's interim relief on 1st December 1993. In that affidavit the defendants Nos. 2 and 3 have stated that this Court had no jurisdiction to entertain the suit. The allegations in the interlocutory petition have been dealt with without prejudice to that contention and without waiving the same. 35. The Board of Directors who were continuing by virtue of the order dated 6th October, 1993 issued a notice on 30th December, 1993 that a meeting would be held on 5th January, 1994 to consider 11 items including the Chairman's (defendant No.2) statement to the Press that he would be launching a finance company etc. and his letter dated 1st December, 1993 to the share-holders : to consider the reconstitution of the working committee of Directors and to consider the various cases filed in different courts against the Company consequent to holding of the Annual General Meeting and its adjournment. These items were items 2, 4 and 5 in the Agenda of the meeting scheduled to be held on 5th January, 1994. The defendants Nos. 2 and 3 again approached this Court for an order of injunction restraining the Board of Directors from giving any effect to the resolutions to be passed on 5th January, 1994. As it was submitted on behalf of the plaintiff that no meeting was in fact going to be held on 5th January, 1994 no interim order was passed. 36. The defendants Nos. 2 and 3 then filed an application before this Court on 6th January, 1994 for an injunction restraining the defendant No. 1 and its Board of Directors from considering or transacting items 2, 4 and 5 of the notice dated 30.12.93 at the Board Meeting convened to be held on 6.1.94. An ad-interim order was passed by this Court on 6th January 1994 as prayed by the defendants Nos. 2 and 3. An ad-interim order was passed by this Court on 6th January 1994 as prayed by the defendants Nos. 2 and 3. The plaintiff preferred an Appeal from the Order dated 6.1.94. An order was passed by the Appellate Court staying the operation of the Order dated 6.1.94 insofar as it restrained the consideration of items 2, 4 and 5 of the Notice dated 30th December, 1993 but directed that if any resolution was passed in respect of items 2, 4 and 5, the same would not be given effect to. 37. In my view by obtaining Order dated 7th October, 1993 or 6th January, 1994 the defendant Nos. 2 and 3 could not be said to have submitted to this Court's jurisdiction. To obtain a modification of an interim order passed ex parte would not amount, in my view, to conduct sufficient to constitute waiver of an objection as to the jurisdiction of this Court. As far as the order dated 6.1.94 is concerned the complaint is that it is the order of this Court which had restrained the elected Board of Directors at the adjourned meeting from assuming charge. Therefore the Board of Directors who were continuing by virtue of the Order dated 6th October, 1993 were taking advantage of the same to render infructuous the plea of the defendant Nos. 2 and 3 before this Court that this Court had no jurisdiction to have issued the interim order dated 6th October, 1993 in the first place. The application filed on 6.1.1994 is in substance an application for modification of the Order dated 6th October, 1993. Besides the application on which the defendants Nos. 2 and 3 had prayed for and obtained the order dated 6.1.94 contains the following paragraph:- "Your petitioner states and contends that this Hon'ble Court has no territorial jurisdiction to entertain and try the suit or pass any order therein and the suit and the interlocutory application are liable to be dismissed on this ground alone." 38. No steps have been taken in the suit, nor has there been continued or long participation in the suit by the defendants 2 and 3 in the suit, nor is the suit ripe for hearing. On the contrary the objection to jurisdiction was taken early, expressly and has consistently been maintained. No steps have been taken in the suit, nor has there been continued or long participation in the suit by the defendants 2 and 3 in the suit, nor is the suit ripe for hearing. On the contrary the objection to jurisdiction was taken early, expressly and has consistently been maintained. There can be no question of implied waiver of the objection by the defendants 2 and 3 in the circumstances of the case. 39. It was faintly sought to be argued by the plaintiff that the defendant No. 1 did not object to the jurisdiction of this Court. As already noted, the representation of the defendant No. 1 is disputed. Besides whether the defendant No. 1 has any objection or not is not material to the question whether this Court has the jurisdiction to try the suit or whether the defendants 2 and 3 have waived their objection to the jurisdiction of this Court by their conduct. 40. On the question of balance of convenience it is submitted by the plaintiff that the defendant Nos. 2 and 3 have not in so many words said that the balance of convenience was in favour of the suit being tried at Karnataka. However, facts relevant to having the suit tried in Karnataka rather than at Calcutta have been pleaded by the defendants 2 and 3. It is noteworthy that the defendants 2 and 3, in their application have said that the suit had been instituted with ulterior motive with a mala fide intention and was vexatious, harassing and liable to be dismissed in limine. 41. Besides, the plaintiff itself in the affidavit in opposition has put the question of balance of convenience in issue (vide paragraph 3(xi) of the affidavit of the plaintiff). 42. In any event, in my opinion, the balance of convenience is required to be determined on the allegations in the plaint. The Court must be satisfied having regard to the submissions made in the plant that it would be inconvenient if the matter were determined in this Court. 43. It is well established that the question of jurisdiction must be decided on the allegations in the pleadings (See Ruit Sachdev vs. Amita Zindal, AIR 1982 Cal 333 ). This in my view, would include questions of balance of convenience. The decision of a Learned Single Judge in Sanjoy Trading Co. 43. It is well established that the question of jurisdiction must be decided on the allegations in the pleadings (See Ruit Sachdev vs. Amita Zindal, AIR 1982 Cal 333 ). This in my view, would include questions of balance of convenience. The decision of a Learned Single Judge in Sanjoy Trading Co. vs. M/s. Dal Chemical N. V. and Anr., AIR 1978 Cal 397 that a mere allegation of balance of convenience by the defendant would not be sufficient for the Court to revoke leave under clause 12 of the letters patent would seem to suggest that the important thing is not the allegation but the satisfaction of the Court that the balance of convenience was overwhelmingly in favour of the suit being tried in another Court. The Learned Judge held that the Court has to consider and satisfy itself from the materials before it that if the suit is allowed to proceed in this Court, it would amount to gross injustice to the petitioners for revocation of leave under Clause 12. 44. Chakraborty J. in an unreported Bench decision in Ridh Karan Kabra vs. A. Karmally and Sons and Anr. (dated 19.11.1948: Appeals Nos. 83 and 84 of 1948 : referred to in AIR 1952 Cal 82 , 84). "The Court has to take the field of enquiry to be that envisaged by the whole plaint and it has to take into account the whole mass of evidence which will have to be given by the plff. to prove his case and by the defts. to meet it. The Court may also take into consideration the inconvenience likely to be caused to the parties by having to attend personally throughout the trial, as also the expense, and any other local or special condition in the one forum or the other. If on taking into consideration all these facts, it appeared that that part of the evidence which could be more conveniently given in another Court was so much larger and the inconvenience of compelling the deft. in bringing that evidence to this Court was so much greater that it would be oppressive in the extreme to compel him to do so, then a balance of convenience would be established in favour of the deft. in bringing that evidence to this Court was so much greater that it would be oppressive in the extreme to compel him to do so, then a balance of convenience would be established in favour of the deft. "What is to be considered." said Chakravarti, J. "is not the importance of the matter to be proved but the volume of the evidence, and convenience or inconvenience of producing it. The most vital and fundamental part of a case may well depend upon evidence of a limited volume and yet evidence bearing upon the remaining parts of the case which are only consequential or inconsequential, may be voluminous and troublesome to bring forward"." 45. Sinha J., (as His Lordship then was) in the case of Parasram Harmandrai vs. Chitandas and Ors., AIR 1952 Cal 82 stated: "In deciding the question of 'balance of convenience', statements of general nature contained in affidavits affirmed for that purpose, with out particulars are useless. The Court must consider the facts and cannot proceed to act on vague allegations, devoid of particulars. In deciding applications for revocation of leave, it is always useful to consider as to which Court as the 'Natural fourm' for an action." 46. In the case of Bimal Singh vs. Muir Mills Co. (supra) the suit was filed for declaration that a special resolution of the defendant No. 1 was void. The defendant No. 1 was alleged to carryon business through its managing agents and sole selling agents in Calcutta within the jurisdiction of this Court. The Plaintiffs and defendants 1, 2 and 6 all resided and carried on business within the jurisdiction of this Court. It was in this context, the Court negatived a plea of balance of convenience. 47. In my view, on the basis of the statement contained in the plaint it is abundantly clear having regard to the facts pleaded that the balance of convenience is overwhelmingly in favour of the suit being tried in Karnataka. One of the principal allegations made in the plaint relates to reception of invalid proxies by the defendant No.1. Admittedly the Company's total shares are 71 lakhs of which 2100 proxies cover the aggregate of more than 26 lacs shares (vide para 11 of the plaint). It would certainly be necessary for the proxies to be produced before this Court. One of the principal allegations made in the plaint relates to reception of invalid proxies by the defendant No.1. Admittedly the Company's total shares are 71 lakhs of which 2100 proxies cover the aggregate of more than 26 lacs shares (vide para 11 of the plaint). It would certainly be necessary for the proxies to be produced before this Court. The plaintiff has also challenged the issue of 21 lacs shares in 1991. The allegation is that the defendants Nos. 2 and 3 had applied for shares in the names of companies and firms belonging to or controlled by them. The allegation also is that persons who were said to have renounced their shares were not alive and forgery had been committed. The allotment of 4,85,780 shares has been challenged on this basis for which the records of the company including the share register, the application for shares would have to be produced and considered. The plaintiff has also made allegations regarding mis-utilisation of the funds of the company by the defendant No.2. For this the books of account of the company would have to be adduced in evidence. Therefore, in order to arrive at a decision the Court would have to consider the entire records of the company which have to be procured from Karnataka and produced before the Calcutta High Court. 48. The volume of evidence brought from Karnataka will be considerable if the action is tried here. As far all the plaintiff is concerned, he is the holder of 550 shares in the defendant No. 1 which is a company having 71 lakh shares. The evidence in support of the plaintiff's case in respect of the alleged part of the cause of action in Calcutta would be trifling in nature compared to the massive evidence pertaining to matters in the plaint which are in Karnataka. On the same date as this suit was filed there other suits were filed before three Munsiffs at Bangalore in the State of Karnataka. On 7th October, 1993 another suit was filed before the Munsiff Court at Udipi also in Karnataka. The subject matter of all these suits has been stated to be similar to the subject matter of the suit before this Court. 49. On 7th October, 1993 another suit was filed before the Munsiff Court at Udipi also in Karnataka. The subject matter of all these suits has been stated to be similar to the subject matter of the suit before this Court. 49. Therefore even assuming the Court has jurisdiction, having regard to the material before me, I am of the considered opinion that the natural forum to try this suit is Karnataka and that apart from any other reason the leave under clause 12 should be revoked on this ground. 50. It was then contended by one of the counsel claiming to appear for the defendant No. 1 that this Court had no jurisdiction to direct the plaint to be returned to the Advocate on Record for the plaintiff for representation before the appropriate Court. It is argued that Order 7 Rule 10 of the Code of Civil Procedure by which a Court could direct return of a plaint did not apply to the High Court because of Order 49 Rule 3. However this court has consistently allowed applications for revocation of leave under Clause 12 by revoking the leave and directing the return of the plaint to the plaintiff's Advocate for presentation before the Appropriate Court (See. T.B.K.S. Maharaj vs. Mayapur Shree Chaitanya Mahaprabhu Math : AIR 1983 Cal 420 , para 19 (DB); East Indian Plastics (India) Ltd. vs. State of West Bengal and Anr., AIR 1986 Cal 422 , para 11, 39). 51. The same issue came up before the Division Bench of the Madras High Court in R.P.O. Connor vs. P. G. Sampath Kumar, AIR 1953 Mad 897 where the Division Bench held that although Order 7 Rule 10 of the Code of Civil Procedure did not apply to the Chartered High Courts by virtue of the Order 49 Rule 3, the Chartered High Courts had power under s. 151 to make an order directing the return of the plaint if it was necessary for the ends of justice or to prevent abuse of process of Court. In my view, it would be more appropriate and in the interest of justice to direct return of the plaint to the advocate for the plaintiff for representation. In my view, it would be more appropriate and in the interest of justice to direct return of the plaint to the advocate for the plaintiff for representation. If the suit is merely dismissed or leave is revoked under Clause 12 by this Court on the ground of jurisdiction or on the ground of balance of convenience, the plaintiff would have to pay court fees again in filing a fresh suit on the same cause of action. Furthermore, as the Division Bench of the Madras High Court has held that a practice which has been in vogue in this Court for a long time should be followed. 52. For the reasons stated there will be an order in terms of prayers (a) and (bb) of the notice of motion. The plaint is directed to be returned to the Advocate on Record for the plaintiff for representation before the appropriate Court. 53. As far as the interim orders are concerned when they were passed, were passed validly as leave under clause 12 of the Letters Patent was still subsisting. The revocation of such leave now does not operate retrospectively. But that is not to say that the interim orders will continue indefinitely. Therefore and without going into the merits the interim orders will continue for four weeks. Any further extension or modification of the interim orders must be obtained from the Court before which the suit may be represented. 54. There will however, be no order as to costs. 55. Operation of order as prayed for is stated for 2 weeks. 56. Let xerox copy of this judgment duly signed by the Assistant Registrar of this Court, be given to the both parties upon their undertaking to apply for the certified copy of the judgment and on payment of usual charges. 57. All parties are to act on a signed copy of the operative portion of this judgment on the usual undertaking. Application allowed.