Research › Browse › Judgment

Allahabad High Court · body

1995 DIGILAW 273 (ALL)

Overseas Corporation v. Bank of India

1995-02-24

S.N.AGGARWAL

body1995
JUDGMENT 1. Sudhir Narain, J. The question involved in the present revision is as to whether the suit filed by the plaintiff-opposite party No. 1 against the applicant is maintainable in the Civil Court, Mirzapur. 2. The facts in brief are that the plaintiff-opposite party No. 1 filed suit No. 46 of 1988 in the Court of Civil Judge, Mirzapur for recovery of Rs, 1, 16,260,65 jointly and severally against the defendants. The suit was filed against opposite parties 2 to 4 who were arrayed as defendants 1 to 3 and the applicant was arrayed as defendant No. 4 in the suit. The suit was tiled on the allegation that defendant No. 1 is proprietorship business concern. The defendant No. 2 is the sole proprietor of the first defendant. They are dealing with the manufacturing and exporting of woollen carpets. Defendant No. 3 is a transport company dealing with transportation of goods and defendant No. 4 (the applicant in revision) is the shipping and clearing agent dealing with shipping of goods. The defendants 1 and 2 were granted an advance by way of preshipment loan against the security of pledge of a Motor Transport Receipt (In short M. T. R.) dated 17-10-1984. The said M. T. R. was issued by defendant No. 3. On the request of the defendants the said M. T. R. was sent to defendant No. 4 for shipment of the goods covered under the said M. T. R. and confirmation of plaintiff's Hen over those goods. The defendants to perform their jobs as they failed to pay the amount due in respect of the said preshipment loan. Defendants 1 and 4 filed separate written statements. Defendant No. 4 denied that there was any contract between the plaintiff and defendant No, 4 and it never received M. T. R. alleged to have been sent by defendant No. 3 or the goods covered under the said M. T. R. It was denied that there was any cause of action against him to file the suit. The trial court framed various issues. Issue No. 5 was as to whether there was any agreement between defendant No. 4 and the plaintiff and issue No. 6 was whether the Court has territorial jurisdiction to decide the suit as against defendant No. 4. The trial court framed various issues. Issue No. 5 was as to whether there was any agreement between defendant No. 4 and the plaintiff and issue No. 6 was whether the Court has territorial jurisdiction to decide the suit as against defendant No. 4. On issue No. 5 the Court held that issue No. 5 could be decided after the evidence is adduced by the parties in the case. On issue No. 6 it held that the Civil Court at Mirzapur has territorial jurisdiction to decide the suit. The applicant-defendant No. 4 has filed revision against the decision of the learned Civil Judge, Mirzapur, on issue No. 6. The jurisdiction of a Civil Court to entertain a suit depends upon the allegations in the plaint and not upon what may ultimately be found true. Whether, after trial, the allegations are found to be unfounded, the suit will be dismissed not because the Court had no jurisdiction but because the allegations are incorrect. See Municipal Board, Faizabad v. Edward Medical Hall, Faizabad, AIR 1976 All. 439. According to the averments made in the plaint there are series of acts and transactions against the defendants on account of which they are jointly and severally liable to pay the amount of preshiment loan taken from the plaintiff. The suit, however, is maintain able in the Civil Court at Mirzapur against them provided the cause of action or part of a cause of action has arisen against thorn within the territorial jurisdiction of Civil Court, Mirzapur. 3. Learned counsel for the applicant urged that in the plaint there is no allegation that any part of cause of action arose against the applicant within the territorial jurisdiction of Civil Court at Mirzapur and in absence of such allegation the suit was not maintainable in the Civil Court, Mirzapur. He has placed reliance upon the decision H. D. Vashishta v. M/s. Glaxo Laboratories, AIR 1979 SC 134 , wherein it was held that in a suit for dismissal of an employee as illegal and contrary to the standing orders applicable to the Industry, the material facts necessary to constitute a cause of action about the illegality of dismissal has to be averred in the plaint and in absence of such material allegations the suit is liable to be dismissed. 4. 4. In the present case, the plaintiff-opposite party No. 1 stated that the defendants 1 and 2 were granted an advance by way of preshipment loan against the security of pledge of a Motor Transport Receipt. The said M. T. R. was issued by defendant No. 3 and further on the request of defendants 1 and 2 the said M. T. R. and confirmation of plaintiff's lien over those goods. The loan was granted against the pledge of M. T. R. payable 00 demand to the plaintiffs at Mirzapur together with interest thereon. The M. T. R. was pledged by the defendants 1 and 2 with the plaintiff which was issued by defendant No. 3, On the request of defendants 1 and 2 the said M. T. R. was sent to defendant No. 4 duly endorsed in their favour for taking delivery of the goods from defendant No. 3 at Calcutta and to confirm the plaintiff- bank's lien over those goods and thereafter taking necessary steps for shipment of the goods. The cause of action as against defendant No. 4 is that the defendant No, 4 received the M. T. R. It neither returned the original M. T. R. and invoice sent to it nor delivered the goods covered under the said M. T. R. It is admitted that defendants 1 and defendants 1 and 2 had taken the loan at Mirzapur. They executed the hypothecation deed and the deed of agreement at Mirzapur. The M. T. R. was also issued form Mirzapur which was pledged to the bank and the said M. T. R. was also seat to defendant No. 4 from Mirzapur. According to the allegation of the plaintiff-opposite party the amount was payable at Mirzapur. The M. T. R. and invoice were sent from Mirzapur to the applicant and in case they were received, it was under the duty to pay the amount or return the M. T. R. or ?oods at Mirzapur. 5. In Indian Bank v. L. Ramaswami, AIR 1977 Karnatak107, bank sued the defendants for recovery of the amount of loan against the defendants in the Civil Court at Bangalore, The document of loan was executed at Madras. Defendant No. 5 was a guarantor. 5. In Indian Bank v. L. Ramaswami, AIR 1977 Karnatak107, bank sued the defendants for recovery of the amount of loan against the defendants in the Civil Court at Bangalore, The document of loan was executed at Madras. Defendant No. 5 was a guarantor. He also executed guarantee deed at Madras, The Court held that the suit as against defendant No. 5 was also maintainable at Bangalore as the defendant No. 5 stood in the position of guarantor of the performance of their part by defendants 1 to 4 under the loan contract relating to repayment of the loan amount and as the amount was paid at Bangalore, the Civil Court had jurisdiction to entertain the suit as against guarantor also at Bangalore as there was joint liability against him. 6. In Union of India v. Ganpat Rai, AIR 1983 Cal 14 , it was held that where the Railway Receipt is endorsed in favour of a bank for valuable consideration there is a valid cause of action for the suit where the endorsement is made. The Court relied upon the decision in Morn Mercantile Bank v. Union of India, AIR 1965 SC 1954 . It was held that the advance of loan, the execution of Promissory Nots and the endorsement of the Railway Receipt together formed one transaction and their combined effect was that the Bank was in the control of the goods consigned under the said Railway Receipts. The Court, where the endorsement was made, was held to have jurisdiction to entertain the suit. As noted above, that the M. T. R. was pledged with the bank and it was sent to defendant No. 4 from Mirzapur and the amount was payable by defendant No. 4 at Mirzapur, the Court at Mirzapur will have the jurisdiction to try the suit. As noted above, that the M. T. R. was pledged with the bank and it was sent to defendant No. 4 from Mirzapur and the amount was payable by defendant No. 4 at Mirzapur, the Court at Mirzapur will have the jurisdiction to try the suit. Learned counsel for the applicant placed reliance upon the decision M/s. Vasant Gambhir Navgale, Metal Merchants v. M/s. Bhawanish Udyog Metal Marchants, AIR 1986 Punjab 319, wherein it was held that the mere agreeing by the defendant to take the delivery of goods on behalf of the plaintiff at his request and thereafter not sending back to it does not disclose any cause of action or any part of cause of action arose at the place where the plaintiff resides unless there is a privity of contract between the parties It is a matter of evidence which may be led by the parties during the trial to find out that there is an agreement between the applicant and the plaintiff-opposite party. The allegation of the plaintiff-opposite party is that the M. T. R. was sent to the defendant No. 4 and the goods covered under it for shipment was under the confirmation of the plaintiff. The amount was payable at Mirzapur. If, ultimately, it is found that the allegations are untrue, the Court may dismiss the suit but on the averments made in the plaint, the suit is cognizable at Mirzapur. 7. In view of the discussions made above, there is no merit in this revision. It is accordingly dismissed. Revision dismissed.