Agarwal Chemicals Traders v. Gwal ior Rayon Silk Manufacturing (Weaving) Company Limited
2012-04-20
S.K.SETH
body2012
DigiLaw.ai
Judgment 1. Defendant Nos. 1 and 2 are in appeal against the judgment and decree passed by the District Judge, Ujjain, in Civil Suit No. 9-B of 1985 on 31-10-1996. By the impugned judgment suit was decreed. 2. Plaintiff (now respondent No. 1) is a company having its registered office at Nagda in Ujjain District. Appellant No. 1 (defendant No. 1 in the suit) is a partnership firm and appellant No. 2 is the Managing Partner thereof. Other respondents are the sleeping partners and were impleaded as pro-forma defendants in the suit. 3. Plaintiff brought a suit for recovery of Rs. 1,31,000/- for the price of goods supplied to appellants. It was alleged that as per the agreement, respondent No. 1 sold the goods to appellants. After delivery of goods, and despite repeated demands, appellants failed to pay the price of the goods, therefore suit as aforesaid was filed at Ujjain. Appellants contested the suit denying their liability to pay any amount and raised an objection to the maintainability of suit at Ujjain for lack of territorial jurisdiction. As according to them Civil Court at Nagpur in Maharashtra alone had the jurisdiction to try the suit. 4. Based on pleadings, Trial Court framed issues, including the issue regarding the jurisdiction of the Court at Ujjain to try the suit and allowed the parties to adduce their evidence. Trial Judge, on due appreciation of evidence found that plaintiff supplied the goods ex-factory Nagda. The price of goods was payable ex-factory Nagda. The goods were delivered to transporter ex-plant at the responsibility, risk and costs of appellants. Cheqties were issued by the appellant payable at Nagda, which upon presentation/were dishonoured. There are series of letters addressed to respondent company, by or On behalf of appellants not only to supply the goods, but also acknowledging the outstanding sale-price of material already supplied with a assurance to pay off existing debts at an early date. Thus taking into account relevant factors, learned Trial Judge held that notwithstanding the fact that the contract might have concluded at Nagpur but part of the cause of action accrued within the territorial jurisdiction of Civil Court at Nagda. 5. Learned Counsel for the appellant submitted that offer was made at Nagpur, therefore, Court at Nagpur alone had the jurisdiction to try the suit. We are not impressed with the submission.
5. Learned Counsel for the appellant submitted that offer was made at Nagpur, therefore, Court at Nagpur alone had the jurisdiction to try the suit. We are not impressed with the submission. The real question for determination is whether the goods were actually delivered at Nagda, as a direct result of a sale or purchase? There is ample evidence on record for an affirmative answer to the question. It is well settled law that where goods are delivered to a carrier for transmission to a buyer, the carrier is presumed to be buyer's agent not only to take delivery, but to assent to the appropriation to the contract of goods so delivered. The property in goods passed on to the buyer and he was responsible for the price of the goods supplied at Nagda. The material on record clearly shows that the parties intended Nagda as the situs of sale where property passed on to the buyer in pursuance of the contract. Section 20 (c) of the Civil Procedure Code carves out an exception to general rule that all personal action, must be instituted in a Court within whose jurisdiction defendant actually resides or carry on business; or (b) any of the defendants (where there are more than one) actually resides and either the leave of the Court has been taken or the other defendants acquiesce; or (c) the cause of action or a part of it arises. The expression 'cause of action' has acquired judicially settled meaning. In a wider sense, it means whole of the material facts, which would be necessary for the plaintiff to allege and prove in order to succeed. The jurisdiction of the Court in matter of a contract will depend on the situsr of the contract and the cause of action arising through connecting factors. In the matter of a contract there may arise causes of action of various kinds. In a suit for damages for breach of contract the cause of action consists of the making of the contract, and of its breach, so that the suit may be filed either at the place where the contract was made or at the place were it should have been performed and the breach occurred. The making of the contract is part of the cause of action. A suit on a contract, therefore, can be filed at the place, where it was made.
The making of the contract is part of the cause of action. A suit on a contract, therefore, can be filed at the place, where it was made. The determination of the place where the contract was made is part of the law of contract. But making of an offer on a particular place does not form cause of action in a suit for damages for breach of contract. Ordinarily, acceptance of an offer and its intimation result in a contract and hence a suit can be filed in a Court within whose jurisdiction the acceptance was communicated. The performance of a contract is part of cause of action and a suit in respect of the breach can always be filed at the place where the contract should have been performed or its performance completed. If the contract is to be performed at the place where it is made, the suit on the contract is to be filed there and nowhere else. In suits for recovery of price of goods, the cause of action arises at the place where the contract of agency was made or the place where payment is to be made. Part of cause of action arises where money is expressly or impliedly payable under a contract. 6. In the case in hand, facts and circumstances unmistakably point that part of the cause of action arose within the territorial jurisdiction of Ujjain Civil Court, therefore, there is nothing wrong with the institution of suit at Ujjain or trial thereof by the learned District Judge at Ujjain. We find no force in the submissions of the learned Counsel that the impugned judgment and decree is bad in law for want of territorial jurisdiction. No other contention was urged before us. Thus, in view of the foregoing discussion, this appeal fails and is hereby dismissed with costs throughout. Counsel's fee Rs. 5,000/- if certified.