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2004 DIGILAW 234 (CAL)

RAMLALL KANHAIYALALL v. MYSORE SUGAR COMPANY LIMITED BANGALORE

2004-03-29

ASOK KUMAR GANGULY, SOUMITRA SEN

body2004
SEN, J. ( 1 ) THIS appeal is directed against a judgment and order dated 2. 2. 2001 whereby an application made by the defendant, the respondent in this appeal, inter alia for revocation of leave granted under Clause 12 of the Letters Patent was allowed. ( 2 ) THE appellant has filed a suit after obtaining leave under Clause 12 of Letters Patent for the following reliefs: (c) Receiver, (d) Injunctionl, (e) Costs, (f) Further and/or other reliefs. ( 3 ) THE contention of the respondent is that no part of the cause of action has arisen within the ordinary original civil jurisdiction of this Court. ( 4 ) IN order to appreciate the rival contentions of the parties some relevant facts which are required to be enumerated are as follows: on/or about July, 1977 the appellant filed the said suit. ( 5 ) BETWEEN January and June, 1978 the respondent took out two applications inter alia for extension of time to file written statement and also for a direction upon the appellant to give better particulars of certain averments contained in the plaint as well as for inspection of certain documents. ( 6 ) BETWEEN March, 1986 and April, 1998 the suit continued to appear before the appropriate Court from time to time when the appellant examined its witness in Chief. Notices were directed to be given to the respondent to enable it to contest the suit. Even for several days when the matter appeared in the list, no one appeared on behalf of the respondent. Then on 30th of april, 1998 the suit was taken up for hearing at the second call of the cause list and was decreed on merits in the absence of the respondent. ( 7 ) ON about 30th of May, 1998 the respondent made an application for recalling of the decree. The said application was dismissed by the learned judged by an order dated 28th of July, 1998. ( 8 ) AGAINST the said order of dismissal of the application for recalling of the decree, the respondent preferred an appeal. The Hon'ble Division Bench by an order dated 3rd of March, 1999 was pleased to allow the appeal upon payment of cost assessed at Rs. 7. 000/ -. Before the Hon'ble Appeal Court the parties agreed that the suit should be heard and disposed of as expeditiously as possible. The Hon'ble Division Bench by an order dated 3rd of March, 1999 was pleased to allow the appeal upon payment of cost assessed at Rs. 7. 000/ -. Before the Hon'ble Appeal Court the parties agreed that the suit should be heard and disposed of as expeditiously as possible. ( 9 ) ON/or about 18th of June, 1999 the respondent took out an application for recalling of the order dated 28th of July, 1977 whereby leave under Clause 12 of the Letters Patent was granted to file the suit. However, no steps were taken by the respondents to have the said application heard and/or for obtaining any order for stay of hearing of the suit. ( 10 ) BETWEEN 29th of June, 1999 and 16th of September, 1999 the appellant concluded the examination in Chief of its witness. ( 11 ) ON 27th of September, 1999 the respondent took out an application and forwarded the same to the Advocate on record of the appellant inter alia praying for an order for examination of its two witnesses on commission. The appellant had filed an affidavit-in-opposition to the said application. ( 12 ) BETWEEN 24th and 25th of November, 1999 the respondent concluded the cross-examination of the witness of the appellant. ( 13 ) AT the time when the application of the respondent for examining its witness on commission was pending, the learned Judge took up the application filed by the respondent for revocation of leave under Clause 12 and passed the impugned judgment on 2nd of February, 2001. ( 14 ) FROM the above it is clear that the suit was instituted in the year 1977. When the suit subsequently appeared for hearing, several opportunities were afforded to the defendant to contest the suit, but such opportunities were not availed of by the defendant. As a result, the suit was decreed on merits. The Appeal Court allowed the application for recalling of the decree upon payment of costs. Before the Appellate Court the parties agreed that the suit would be heard and disposed of as expeditiously as possible. As a result, the suit was decreed on merits. The Appeal Court allowed the application for recalling of the decree upon payment of costs. Before the Appellate Court the parties agreed that the suit would be heard and disposed of as expeditiously as possible. ( 15 ) FROM the sequence of events it appears that the application filed by the defendant for examination of two of its witnesses in commission was pending at the time when the learned Judge took up the application for revocation of leave granted under Clause 12 of the Letters Patent and was pleased to allow the same. ( 16 ) THE appellant had urged that the application for revocation of leave granted under Clause 12 of the Letters Patent was filed at an extremely belated stage and in this case, after almost 22 years from the date of institution of the suit. It was contended before us that from the facts of the instant case it would be clear that the defendant had participated in the proceedings and could not have challenged the territorial jurisdiction of this Court after having submitted to its jurisdiction for so long. ( 17 ) IT was further submitted that from a plain reading of the plaint it would appear that a part of cause of action did arise within the territorial jurisdiction of this Hon'ble Court. As such this Court was right in granting leave under Clause 12 of the Letters Patent. ( 18 ) FROM the impugned judgment it appears that the learned Judge had accepted the contention of the respondent that in the written statement the defendant had challenged the territorial jurisdiction of this Court and therefore it cannot be said that the defendant has submitted to the jurisdiction of this Court. The learned Judge had also accepted the submission that there was no pleading in the plaint as to where the agreement between the parties was entered into. It was held that remittance of advance from Calcutta was within the jurisdiction of the Court but the same was received by the defendant outside the jurisdiction of the Court would not constitute a cause of action for the instant suit as that would not conclusively prove that any payment of price was actually made or agreed to be made within the jurisdiction of this Court. From a reading of the plaint the learned Judge came to a conclusion that delivery of goods and payment of price was agreed to be made outside the ordinary original civil jurisdiction of this Court. ( 19 ) THE learned Judge had also accepted the contention of the respondent that in absence of any contract to the contrary, under Section 36 of the Sale of Goods Act, goods sold are to be delivered at the place at which they are at the time of sale and goods agreed to be sold, are to be delivered at a place at which they are at the time of the agreement to sell. It is well settled that :- (1) Cause of action are the bundle of facts required to be proved by the plaintiff, if traversed, for getting the relief prayed for and, (2) In order to decide a point of demurrer regarding jurisdiction the averments in the plaint are to be treated as correct. ( 20 ) IT appears that there is some amount of misconception in the mind of the respondent regarding the cause of action of the suit. Though the appellant had made a money claim, but the suit is not for a decree for money for price of goods sold and delivered, but for refund of the advance paid to the defendant consequent upon repudiation of contract. ( 21 ) THEREFORE, one of the main cause of actions which the appellant will have to prove in the suit is the fact of payment of advance which payment has been admittedly made in Calcutta within the jurisdiction of this Hon'ble court. ( 22 ) IN we plaint the appellant have described the modus operandi between the parties regarding payment for the price of goods to be despatched by the respondent. It has been stated that the respondent upon despatch of goods would draw hundies on the appellant at Calcutta for the value of the goods after adjusting Rs. 307- per bag out of the money advanced by the plaintiff. ( 23 ) IT has also been stated that in terms of the agreement arrived at between the parties the respondent was required to deliver/despatch 6,200 bags of sugar out of which 1,890 bags were delivered. ( 24 ) OUT of the total sum of Rs. 307- per bag out of the money advanced by the plaintiff. ( 23 ) IT has also been stated that in terms of the agreement arrived at between the parties the respondent was required to deliver/despatch 6,200 bags of sugar out of which 1,890 bags were delivered. ( 24 ) OUT of the total sum of Rs. 1,86,000/- paid towards advance which was the entire price of 6,200 bags of sugar, the appellant gave due adjustment of a sum of Rs. 56,700/- being the price of 1,890 bags actually received. ( 25 ) UNDER these circumstances, the appellant claimed decree for the balance sum of Rs. 1,29,300/- held by the defendant towards advance of the entire goods since the respondent failed to deliver the remaining 4,300 bags of sugar. ( 26 ) FROM the plaint we find the necessary pleadings for grant of leave under Clause 12 of the Letters Patent have been made. ( 27 ) SINCE the suit is for a drcree of refund of the amount held by the defendant, the proof of remittance of money from Calcutta would be a relevant fact and is definitely a part of cause of action which has arisen within the jurisdiction of this Hon'bie Court. ( 28 ) IN order to arrive at a definite conclusion that leave under Clause 12 granted by this Hon'ble Court should be revoked, the Court will have to come to the conclusion that no part of the cause of action has arisen within the territorial jurisdiction of this Hon'ble Court. The learned Judge has held that in the plaint there is no averment as to where the delivery of the goods is to be made or where the payment was made or agreed to be made. Accordingly the learned Judge has been pleased to hold that in absence of such pleading provisions of Section 36 of the Sale of Goods Act, 1930 would apply and it would, therefore, imply that the goods were to be delivered at the place at which they were at the time of sale. Accordingly the learned Judge has been pleased to hold that in absence of such pleading provisions of Section 36 of the Sale of Goods Act, 1930 would apply and it would, therefore, imply that the goods were to be delivered at the place at which they were at the time of sale. ( 29 ) HOWEVER, from the agreement which has been pleaded both in the plaint as well as the written statement it appears that the respondent was under an obligation to issue indent for wagons for despatch and delivery of the goods and in case of non-availability of wagons the respondent was to remove the goods and to keep the same in a duty paid godown till allotment of wagons by the Railway and despatch the same to the appellant. ( 30 ) THE intention of the parties to a contract can be either explicit or can be inferred from various terms and conditions of the contract. ( 31 ) THE expression 'issuing indent for wagons and to despatch the same' appearing in the contract clearly indicates that the parties intended that the goods are to be sent by Railway wagons to the appellant at Calcutta. The appellant is situated at Calcutta, the respondent is situated at Bangalore. Therefore, the only place where the respondent could have despatched the goods was to Calcutta, as no other place is mentioned anywhere as to where the goods were to be despatched. ( 32 ) THE appellant had also made a clear averment in its plaint that pursuant to the despatch instruction given to the respondent from Calcutta within the territorial jurisdiction of this Hon'ble Court, the respondent delivered to the appellant 1890 bags of the goods. This averment has to be taken as correct for the purpose of deciding whether it gives rise to a part of cause of action within the territorial jurisdiction of this Hon'ble Court. Since the despatch instructions were given from Calcutta the only conclusion which has to be drawn at this stage is that the part of the goods were actually delivered to the appellant at Calcutta. Having regard to the aforesaid, we are of the opinion that the reliance placed by the learned Judge to Section 36 of Sale of Goods act is not correct. Having regard to the aforesaid, we are of the opinion that the reliance placed by the learned Judge to Section 36 of Sale of Goods act is not correct. ( 33 ) FROM the conduct of the respondent it is also apparent that apart from contending in the written statement that this Court does not have any territorial jurisdiction and the leave granted under Clause 12 of the Letters patent should be revoked, the respondent during a long period of time did not express any intention that it was not willing to have the suit tried by this hon'ble Court. On the contrary, not only several applications for extension of time to file written statement were made, prayer for giving better particulars and inspection of documents were also made before this Hon'ble Court which directions are normally given by the Court in aid of hearing of the main suit. The respondent had also made an application for examination of its witness in commission. In the written statement the respondent had also claimed a set off. All these clearly indicate that the respondent did not really intend to challenge the jurisdiction of this Hon'ble Court. There is no lack of territorial jurisdiction of this Hon'ble Court inasmuch as a part of cause of action has arisen within the territorial limits of this Hon'ble Court. The conduct of the respondent is of a material significance, inasmuch as after having conducted itself in a particular manner, it is not open to the respondent to take out an application after 22 years for challenging the jurisdiction of this Hon'ble Court. ( 34 ) THE case reported in 1994 (4) SCC 711 (O/7 and Natural Gas commission v. Utpal Kumar Basu and Ors.) was relied upon by the respondent to demonstrate before us that no part of cause of action has arisen within the jurisdiction of this Hon'ble Court. The facts of the case of ONGC (supra)is different from the instant case. After going through the averments made in the writ petition the Hon'ble Supreme Court had come to the conclusion that no part of cause of action arose within the territorial jurisdiction of the Calcutta high Court. The cause of action of the writ petitioner in the said case of ongc (supra) was based on newspaper advertisement issued in Calcutta and submission of tender from Calcutta and representations demanding justice was sent from Calcutta. The cause of action of the writ petitioner in the said case of ongc (supra) was based on newspaper advertisement issued in Calcutta and submission of tender from Calcutta and representations demanding justice was sent from Calcutta. These facts as held by Hon'ble Supreme court did not constitute a cause of action within the territorial jurisdiction of the Calcutta High Court. In the instant case, from the averments contained in the plaint it is clear that the advance payments were made from Calcutta, despatch instructions were sent from Calcutta, part of the goods were despatched, though the place at which it was despatched was not mentioned, the only inference that can be drawn is that the only place at which the said goods could have been delivered was Calcutta and no other place. Obviously the respondent situated at Bangalore would not despatch it to any other place other than where the appellant carried on business which was admittedly in Calcutta and within the jurisdiction of this Hon'ble Court. ( 35 ) ANOTHER case reported in 1996 (3) SCR 405 (South East Asia shipping Co. Ltd. v. M/s. Nav Bharat Enterprises Pvt. Ltd. and Ors.) was relied upon by the respondent in support of its contention that no part of cause of action has arisen within the jurisdiction of this Hon'ble Court. Having regard to the facts and circumstances of the case reported in 1996 (3) SCR (supra) the Hon'ble Supreme Court was pleased to hold that execution of a bank guarantee at Delhi and transmitting the same to Bombay would not constitute any cause of action at Delhi. In the said case, it was an admitted position that the contract was executed in Bombay and the performance and obligation of liabilities under the contract was to be done in Bombay. The execution of the bank guarantee did not form a part of the cause of action for the suit which was a separate agreement from the main contract. However, in the instant case in order to substantiate its case as made out in the plaint that the appellant was entitled to refund of the amount lying with the defendant after repudiation of the contract, the appellant will have to prove the averments made in the plaint that despatch instructions were given from Calcutta within the jurisdiction of this Hon'ble Court which averments will have to be taken as correct. A part of cause of action has definitely arisen within the territorial jurisdiction of this Hon'ble Court, inasmuch as the appellant will ultimately have to prove that in spite of such instructions being given the goods were not delivered by the respondent. ( 36 ) SEVERAL other cases were annexed to the written notes of arguments but were not placed by the respondent before us, for the same proposition that no cause of action arose within the jurisdiction of this Hon'ble Court. Having regard to the facts of the case noted above we are of the opinion that none of the cases annexed to the written notes on arguments are of any assistance to the respondent and we do not wish to deal with each of the cases separately. ( 37 ) A great deal of reliance has been placed on behalf of the respondent on Section 36 of the Sale of Goods Act in support of its contention that when there is no express agreement, goods sold are to be delivered at the place at which they are at the time of the sale and the goods agreed to be sold are to be delivered at the place at which they are at the time of the agreement to sell. However, Section 36 itself clearly mentions that whether it is for the buyer to take possession of the goods or for the seller to send them to the buyer is a question depending in each case of the contract express or Implied between the parties. Therefore, even in the absence of any express terms the intention of the parties can be inferred from various terms and conditions of the agreement. We have already held that from various terms of the contract pleaded in the plaint it can be very reasonably inferred that goods were actually required to be despatched to the appellant at Calcutta. ( 38 ) THE appellant in support of its contention has relied upon various decisions. They are discussed as under. We have already held that from various terms of the contract pleaded in the plaint it can be very reasonably inferred that goods were actually required to be despatched to the appellant at Calcutta. ( 38 ) THE appellant in support of its contention has relied upon various decisions. They are discussed as under. ( 39 ) THE case reported in AIR 1985 Cal 74 (Sreenivasa Pulverising industries v. Jai Glass and Chemical Pvt. Ltd.) has been cited on behalf of the appellant in support of the contention that the cause of action for a suit on breach of such a contract for sale of goods would arise not only where the goods were to be delivered but also where the price would be payable on such delivery. ( 40 ) ANOTHER case reported in 1978 Cal 211 (Union of India v. Kuppuswamy Naicker) was cited on behalf of the appellant to demonstrate that a letter sent by the plaintiff from Calcutta for appointing the defendant as an agent at Madras, accepted and sent back to Calcutta was considered to be a part of cause of action which has arisen within the jurisdiction of this hon'ble Court. The learned Judges of the Hon'ble Division Bench observed that in the facts and circumstances of the said case the contention that the contract was made in Calcutta couldn't be prima facie be brushed aside. ( 41 ) THE next case cited was reported in AIR 1949 Mad 145 (Battepati v. Calcutta Glass and Silicate Works ). It was relied for the proposition that having regard to the facts and circumstances of the instant case the right to payment arises simultaneously with the delivery of goods. Therefore, after the payment of price had been made the relationship between the parties ceased to be that of a vendor and purchaser and become converted into that of a creditor and debtor. Therefore, after the payment of price had been made the relationship between the parties ceased to be that of a vendor and purchaser and become converted into that of a creditor and debtor. ( 42 ) ANOTHER case reported in AIR 1964 Cal 418 (State of Punjab v. A. K. Raha) was cited before us on behalf of the appellant in support of its contention that taking the respondent's case to be correct, as place of payment in the instant case is not specified, then the general rule that the debtor must seek the creditor should apply and since the creditor in the instant case being the appellant is situated at Calcutta, the debtor being the respondent must make payment of the amount held by it to the appellant at calcutta. Therefore, a part of cause of action has definitely arisen within the jurisdiction of this Hon'ble Court. ( 43 ) THE proposition of law as it appears from the decisions referred above, in our opinion support the case of the appellant and is applicable in the facts and circumstances of the instant case. ( 44 ) EVEN otherwise in accordance with the Section 32 of the Sale of goods Act unless it is otherwise agreed, the delivery of the goods and payment of the price are concurrent conditions, that is to say, the seller shall be ready and willing to give possession of the goods to the buyer in exchange for the price, and the buyer should be ready to pay the price in exchange for possession of the goods. Therefore, if the said proposition is applied to the instant case and delivery of the goods and the payment of price are to be treated as concurrent conditions the respondent was to give possession of the goods to the appellant from where the appellant has made the payment. Payment was admittedly made from Calcutta within the jurisdiction of this Hon'ble Court. ( 45 ) THE next case reported in AIR 1953 SC 472 (/. T. Commr. Payment was admittedly made from Calcutta within the jurisdiction of this Hon'ble Court. ( 45 ) THE next case reported in AIR 1953 SC 472 (/. T. Commr. v. Jeewanlal Ltd.) has been cited in support of the proposition that the respondent who had applied for revocation of leave granted under Clause 12 to file the instant suit had not only acquiesced in the steps taken by the appellant to carry forward the progress of the suit incurring considerable expenses but also made use of the existence of the suit to obtain advantage and therefore should not be allowed to challenge the jurisdiction of this Court. In the instant case, apart from taking a point in the written statement that this Court had no jurisdiction and the leave granted under Clause 12 of the Letters Patent should be revoked, the respondent had done nothing which should have been done at the earliest possible opportunity, by asking for all proceedings to be stayed until the question of jurisdiction was finally settled. The respondent allowed every step to be taken in the suit itself by applying for better particular and inspection of documents and for examination of its witness on commission. All these prayers are granted in aid of hearing of the main suit. Before the Appellate Court also the respondent did not contend that the trial court which had initially passed a decree in favour of the appellant had no jurisdiction to pass the said decree. On the contrary before the Appellate court the parties agreed that the suit be heard and disposed of as expeditiously as possible. ( 46 ) THE application for revocation of leave which was heard and disposed of by the learned Judge was admittedly taken out after 22 years. For the aforesaid reason we are of the opinion that the conduct of the respondent is such as to preclude it from contending that this Hon'ble Court has no jurisdiction to try and entertain the suit on the ground that no part of the cause of action has arisen within the territorial jurisdiction of this Hon'ble court. ( 47 ) FOR the reasons aforesaid, the appeal is allowed and the impugned judgment and order passed by the learned trial Judge is set aside. ( 47 ) FOR the reasons aforesaid, the appeal is allowed and the impugned judgment and order passed by the learned trial Judge is set aside. Since the suit is pending for a very long time the parties are given liberty to mention the matter before the Appropriate Court to have the suit disposed of expeditiously. No order as to costs.