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2015 DIGILAW 148 (CAL)

Sahaj-E-Village v. Oracle India Private Limited

2015-02-20

ASHIM KUMAR BANERJEE, SAMAPTI CHATTERJEE

body2015
Judgment :- Ashim Kumar Banerjee, J. The appellant-plaintiff entered into a contract with the defendant No.1 for sale of software and/or portal at a price of Rupees One Crore Ninety Three Lakhs Twelve Thousand and Thirty Two. They initially paid Fifty Lakhs and declined to pay the balance raising a dispute as to the functioning of the portal. Further transactions were had between the parties as would appear from the plaint. The plaintiff would claim, being induced by the defendant, they issued work order for development of the portal and its maintenance as well as Online Database and Solution Support Centre services for an agreed amount of Rupees Five Crores Seventy Four Lakhs Ninety Two Thousand Two Hundred Sixty Five and Paise Eight. The appellant-plaintiff would contend, despite receipt of the past consideration that would amount to Rupees Sixty Five Lakhs Five Thousand Five hundred Seventy Seven, the defendant failed to extend the services. Portals were also not in operation. As a result, they suffered huge loss that they assessed at Rupees One Hundred Fourteen Crores Sixteen Lakhs Eighty Thousand Nine Hundred Thirty Three and Paise Forty Eight. The relevant prayers of the plaint are quoted below: “(a) A decree for a sum of Rs.114,16,80,933.48/- against the defendants jointly and/or severally as pleaded in paragraph 23 hereof; (b) Alternatively, an order for enquiry into the damages suffered by the plaintiff and a decree for such sum as may be found payable upon such enquiry;” They also obtained leave under Clause 12 of the Letters Patent on the basis of the averment that a part of the cause of action arose within and a part thereof outside, of this Court. Upon receipt of notice, the defendant No. 1 filed an application for dismissal of the suit and/or return of plaint as no part of the cause of action arose within the jurisdiction. The defendant No. 2 filed an application for dismissal of the suit as against them, on the ground, the plaint did not disclose any cause of action against them. The defendant No. 2 filed an application for dismissal of the suit as against them, on the ground, the plaint did not disclose any cause of action against them. Learned Judge held, the plaint did disclose cause of action as against the defendant No. 2 and as such dismissed the application of the defendant No. 2, however, allowed the application of the defendant No. 1 holding, this Court had no territorial jurisdiction to entertain the suit as no part of the cause of action arose within the jurisdiction of this Court and directed the suit to be heard by Delhi Courts. Being aggrieved, the plaintiff filed this appeal. The defendant No. 2, however, accepted the decision and did not make any grievance. CONTENTION Mr. S.N. Mookherjee, learned Senior Counsel would submit, the learned Judge erred in appreciating the case of the plaintiffs. According to him, the plaintiff sued the defendant no. 1 enforcing their contractual right for the breach that the said defendant had committed in not adhering to the terms of the contract. He also sued the defendant no. 1 along with the defendant No. 2 for the damage that they had suffered. Hence, the cause should be treated as a cause on tort. He would also have cause of action as against the defendant No. 2 enforcing the guarantee that the said defendant extended to the plaintiffs in case of failure on the part of the defendant No. 1. He would submit, to find out whether the plaint would disclose any part of the cause of action within jurisdiction, the averments made in the plaint should be taken as sacrosanct. Paragraph 8 would relate to mutual discussions that the parties had at Calcutta whereas paragraph 15 would refer to the payments made at Calcutta that would extend the territorial jurisdiction. In the alternative, he would submit, even if it was not so, the very fact that the action on tort would lie against defendant Nos. 1 and 2 jointly and severally, would extend the jurisdiction. Once the learned Judge held, the plaint did disclose cause of action as against the defendant no. 2, the suit would be maintainable in this Court. He would rely upon Order 1 Rule 3 of the Code of Civil Procedure to submit, since the cause of action as against the defendant Nos. 1 and 2 are inseparable the suit could not be transferred. 2, the suit would be maintainable in this Court. He would rely upon Order 1 Rule 3 of the Code of Civil Procedure to submit, since the cause of action as against the defendant Nos. 1 and 2 are inseparable the suit could not be transferred. He would rely upon the decision of this Court in the case of The Bengal and North-Western Railway Company Limited Vs. Sadaram Bhairodan and another reported in Calcutta Weekly Notes Volume- XXVII Page- 82. He would rely upon a passage appearing at page 84 where the division Bench of this Court observed: “The fact that the Court has jurisdiction against the Steamer Company does not give jurisdiction against the Railway Company. The fallacy of the argument, it appears to me, lies in the use of the words “the Court has jurisdiction over the suit,” – such jurisdiction the Court has over the suit as regards the Steamer Company. This does not give jurisdiction over the Railway Company, and in my opinion Or. 1, r. 3 has no bearing on the case. That rule of the Order is a provision which relates to a joinder of parties: and, it assumes the existence of a suit in a proper forum, the Court having jurisdiction to try the suit. If the Court has such jurisdiction, then Or. 1, r. 3 may come into play.” The logic behind the above observation would lie in the theory, if it is held otherwise, plaintiff would have to file two suits that would make the case impossible as observed by the Division Bench in the later part of the judgment. Citing the said authority, Mr. Mookherjee, learned Senior Counsel would submit, once the learned Judge dismissed the application of the defendant no. 2, the plaintiff would have cause of action as against defendant no. 2. The cause of action being inseparable herein, would rather protect the suit against the defendant no. 1 as well, even if it is otherwise held. He would pray for setting aside of the judgment and order that allowed the application for return of plaint by allowing the appeal. Per contra, Mr. Ranjan Bachawat, learned Senior Counsel would submit, paragraph 8 and 15 did not disclose any cause of action at all. Every fact leading to the controversy, may not constitute a cause of action unless such fact would conspicuously relate to the right to sue. Per contra, Mr. Ranjan Bachawat, learned Senior Counsel would submit, paragraph 8 and 15 did not disclose any cause of action at all. Every fact leading to the controversy, may not constitute a cause of action unless such fact would conspicuously relate to the right to sue. As and by way of alternative, he would refer to the forum selection clause in the agreement that would debar filing of the suit in Calcutta. He would submit, the suit was vexatious and had been filed only to stop him from initiating any proceeding for realization of their dues that the appellants had withheld for a long time. To support his contention, he would rely upon two Division Bench decisions, one of this Court and the other of Kerala, in the case of Sri Rajendra Mills Limited Vs. Messrs H.V.M. Hazi Hasan Dada and another reported in All India Reporter 1970 Calcutta Volume- 57 page- 342 and V. Sreedharan Vs. T.T. Nanu and another reported in All India Reporter 1987 Kerala Page-249. Relying on the Calcutta decision, Mr. Bachawat would contend, where two Courts would have concurrent jurisdiction, it would be open to the parties to agree to choose one to the exclusion of the other. Citing the Kerala High Court decision, Mr. Ranjan Bachawat would contend, once the Court would find no part of the cause of action arose within the jurisdiction, the Court would have to return the plaint, that the learned Judge did in the present case. He would pray for dismissal of the appeal. Cause of action is bundle of facts that the plaintiff would allege in the plaint. Taking the bundle of facts on its face value, if the Court, in which the suit is filed, on a plain reading of the plaint, comes to conclusion it would have territorial and pecuniary jurisdiction to entertain the same, it would receive the suit and try the same. Otherwise, it would be returned to the plaintiff for being filed in the appropriate Court. The learned Judge adopted the like mode. The learned Judge found existence of cause of action as against the defendant No. 2. We do not make any comment in absence of any appeal filed by any of the parties on that score. Otherwise, it would be returned to the plaintiff for being filed in the appropriate Court. The learned Judge adopted the like mode. The learned Judge found existence of cause of action as against the defendant No. 2. We do not make any comment in absence of any appeal filed by any of the parties on that score. We are only concerned whether the learned Judge was right in returning the plaint after finding no part of the cause of action arising within the territorial jurisdiction. Paragraphs 8 and 15 were being relied upon by the plaintiff. Paragraph 8 would say, there was preliminary discussion between the parties. In the later part of the plaint, the plaintiff averred, they entered into contract. Once the parties entered into contract and the plaintiff sued the parties for the breach of contract or any damage suffered due to such breach, the earlier negotiation, although might have some relevance, would not constitute cause of action. Cause of action is a right to sue that the plaintiff would derive from the facts immediate before the discord. “The facts” as referred to in the preceding sentence would not, however, include all facts being available for appropriate investigation as to the cause of action. Mr. Mookherjee would not dispute the proposition of law. He would bank upon Order 1 Rule 3 and the decision in the case of The Bengal and North-Western Railway Company limited (supra). He would contend, inseparable cause of action would prevent the Court from returning the plaint. According to him, learned Judge never said, the cause of action as against the defendant No. 2 did not occur within the jurisdiction. Between the two defendants, in case cause of action in respect of one would arise within that would itself make the suit against the other defendant maintainable before this Court, that was the logic so explained by the Division Bench in the case of The Bengal and North-Western Railway company limited (supra). However, application of such logic would depend upon a further investigation as to whether the cause of action was inseparable. There is one more issue relevant. The plaintiffs themselves approached this Court on the strength of averments made in paragraphs 8 and 15. The plaintiffs would also seek leave under Clause 12 as according to them, part of the cause of action arose outside. There is one more issue relevant. The plaintiffs themselves approached this Court on the strength of averments made in paragraphs 8 and 15. The plaintiffs would also seek leave under Clause 12 as according to them, part of the cause of action arose outside. On such admission, if we look to the contract, we cannot overlook the forum selection clause that would preclude this Court to entertain the suit. In this regard, we would rely upon the Apex Court decision in the case of V. Sreedharan (supra), as well as the Division Bench decision of this Court in the case of Sri Rajendra Mills Limited (supra), learned Judge held so correctly. From the judgment and order of the learned Single Judge, we find, His Lordship found the agreement to have been entered into between the plaintiffs on the one hand and the defendant No. 1 on the other hand. Defendant No. 2 was not a party to the same. The relevant clause would bind the parties to the exclusive jurisdiction of the Courts in New Delhi in any dispute resolution. The learned Judge relied on the Apex Court decision in the case of A.B.C. Laminart Private Limited Vs. A.P. agencies reported in 1989 Supreme Court Cases Volume-II page-163. The learned Judge observed, the parties, keeping their eyes wide open, agreed to the avenue of resolution of dispute that would preclude this Court to be outside the scope of entertaining the suit, even if, it is ultimately found, part of the cause of action arose within the jurisdiction of this Court. We do not find any scope to interfere. The appeal fails and is hereby dismissed. There would be no order as to costs.