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2008 DIGILAW 901 (DEL)

Sunil Goel v. Oriental Insurance Co. Ltd.

2008-09-20

SHIV NARAYAN DHINGRA

body2008
JUDGMENT: JUSTICE SHIV NARAYAN DHINGRA 1. The petitioner is aggrieved by an order of learned Trial Court dated 29th July, 2005 whereby the Trial Court held that it had no jurisdiction to entertain the suit filed by the petitioner and therefore dismissed the suit on this ground. 2. The brief facts relevant for purpose of deciding this petition are that the petitioner/firm carried its business at Ambala, Haryana. The defendant is a company incorporated under Companies Act having divisional office at Ambala and head office at Delhi. The petitioner received an order from an importer and dispatched his goods to Nigeria through Ethiopian Airlines vide two consignments. The petitioner obtained a marine insurance policy in a sum of Rs.15,00,000/-from the divisional office of respondent at Ambala. The petitioner paid the requisite amount from time to time for the insurance policy. A major fire broke out at transit warehouse at Murtala Muhammed Airport, Lagos, Nigeria on 21/11/2002 resulting into loss of goods of the petitioner. Consignee of the goods, M/s. Charlec Ltd. filed its claim with M/s. Relugas (Nigeria) Ltd. the local agents of defendant and the said agent of defendant referred the matter to their London counterparts namely M/s. W.K. Webster and Company who rejected the claim of the plaintiff. The plaintiff then filed this suit at Delhi where the head office of defendant was situated. The defendant denied its liability and also denied the territorial jurisdiction of their Court at Delhi. 3. The Trial Court held that no cause of action arose in Delhi since the policy was obtained in Ambala and the divisional office of defendant company situated at Ambala, the suit could not be filed in Delhi. The Trial Court relied on Patel Roadways Ltd. Bombay vs. Prasad Trading Company (1991) 4 SSC 270. Both the parties in this case relied upon the same judgment to press their contrary view about the jurisdiction of Delhi Court. 4. Section 20 of CPC which governs the territorial jurisdiction of the Court reads as under : “20. The Trial Court relied on Patel Roadways Ltd. Bombay vs. Prasad Trading Company (1991) 4 SSC 270. Both the parties in this case relied upon the same judgment to press their contrary view about the jurisdiction of Delhi Court. 4. Section 20 of CPC which governs the territorial jurisdiction of the Court reads as under : “20. Other suits to be instituted where defendants reside or cause of action arises.- Subject to the limitations aforesaid, every suit shall be instituted in a Court within the local limits of whose jurisdiction- (a) the defendant, or each of the defendants where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain; or (b) any of the defendants, where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain, provided that in such case either the leave of the Court is given, or the defendants who do not reside, or carry on business, or personally work for gain, as aforesaid, acquiesce in such institution; or (c) the cause of action, wholly or in part, arises. [Explanation] “ A corporation shall be deemed to carry on business at its sole or principal office in [India] or, in respect of any cause of action arising at any place where it has also a subordinate office, at such place.” 5. Section 20 (a) provides that the suit can be filed where defendant at the time of commencing of the suit actually or voluntarily resides or carries on business, or personally works for gain. Section 20 has an explanation reproduced above which shows that in case of a corporation there is a deeming clause and it is presumed that a corporation shall deem to carry on business at the location of its principal office in India in respect of any cause of action arising at any place where it has a subordinate office. 6. Inview of this explanation if a suit against corporation was brought on ground of its carrying on business within the territorial limits of Court where its head office is situated, the suit would be maintainable even if no part of cause of action arises there. 6. Inview of this explanation if a suit against corporation was brought on ground of its carrying on business within the territorial limits of Court where its head office is situated, the suit would be maintainable even if no part of cause of action arises there. Thus, even if no part of cause of action has arisen in Delhi, the suit can be filed in Delhi where defendant corporation had its head office or principal office. 7. I consider that the Trial Court overlooked this explanation of Section 20 CPC. It was not necessary for the plaintiff to prove or to assert that cause of action had arisen in Delhi. I therefore allow this petition. The order of the Trial Court is set aside. The suit is remanded back to the Trial Court for decision on merits. Parties to appear before the Trial Court on 3rd November, 2008.