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2020 DIGILAW 1183 (MP)

HEMANG RESOURCES LTD. v. BANK OF INDIA

2020-11-03

S.C.SHARMA, SHAILENDRA SHUKLA

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ORDER S. C. SHARMA, J. – The appellant before this Court, a Company registered under the provisions of the Companies Act, 1956, has filed this present miscellaneous appeal under section 13 (1-A) of the Commercial Court Act, 2015 r/w Order XLIII of the Code of Civil Procedure, 1908 being aggrieved by the order dated 8-8-2020 passed by the VII Additional District Judge in Case No. RCS-A 1280/2017. 2. The facts, as stated in the appeal, reveal that the appellant is a Company registered under the provisions of the Companies Act, 1956 and respondent No. 3 is again a Company registered under the provisions of the Companies Act, 1956. The appellant/Company entered into an agreement with respondent No. 3/Company for dispatch of washed coal from the washery of respondent No. 3 to the stockyard as well as for coal handling, siding, transportation and loading of washed coal into railway wagons. The appellant/Company has stated in the memo of appeal that the agreement was reduced in the form of work order dated 29-9-2015 and the same is also on record as Annexure-A/1. 3. It has been further stated by the appellant/Company that pursuant to the work order dated 29-9-2015, the appellant/Company has furnished a bank guarantee to the tune of Rs. 5,00,00,000/- in favour of respondent No. 3/Company issued by Bank of India, Indore Branch dated 7-10-2015. It has been stated that no work was carried out by respondent No. 3/Company, however, the bank guarantee was extended from time to time and finally, keeping in view the fact that the work order was not financial viable, the work order was cancelled on 7-11-2017. 4. The appellant/Company has further stated that respondent No. 3/Company, through its Banker i.e., State Bank of India, requested for encashment of the bank guarantee and the State Bank of India, Nagpur Branch has informed the Bank of India, Vijay Nagar Branch, Indore that they are going to encash the bank guarantee. 5. The appellant/Company has further stated that as the bank guarantee was being encashed, a civil suit was immediately preferred in the matter and the Commercial Court vide order dated 12-12-2017 granted interim protection against the encashment bank guarantee. 5. The appellant/Company has further stated that as the bank guarantee was being encashed, a civil suit was immediately preferred in the matter and the Commercial Court vide order dated 12-12-2017 granted interim protection against the encashment bank guarantee. It has been stated that an interim order was extended from time to time and respondent No. 3/Company, who was not a party to the civil suit, preferred a miscellaneous petition under Article 227 of the Constitution of India challenging the injunction order dated 12-12-2017 and the petition was dismissed with a liberty to respondent No. 3 to prefer appropriate application for impleadment before the Commercial Court. During the pendency of the civil suit, the bank guarantee was renewed from time to time. 6. It has further been stated that preliminary objection was raised in respect of maintainability of the civil suit (on the issue of jurisdiction) and by an order dated 8-8-2020, the Commercial Court has held that territorial jurisdiction to hear the case lies at Nagpur and not at Indore. The plaint has been returned under Order 7, Rule 10 of the Code of Civil Procedure to be presented before the Court having competent jurisdiction at Nagpur. 7. Shri Purushaindra Kaurav, learned senior counsel along with Shri Abhinav Malhotra, learned counsel for the appellant has vehemently argued before this Court that the impugned order dated 8-8-2020 suffers from palpable legal perversity and liable to be set aside. It has been argued that the dispute was arising out of the work order and the work order itself was cancelled by the parties. It has also been argued that the Commercial Court has failed to appreciate the judgments of various High Courts and Supreme Court in the cases of Suresh Arjundas Bakhtiani vs. Union of India, reported in 1990 M.P.L.J. 1243, Hindustan Paper Corporation Limited vs. Keneilhouse Angami, reported in (1990) 68 CompCas (Cal), Befesa Agua and others vs. IVRCL Infrastructure and Projects Limited, reported in (2014) 1 BC 547 (Mad.), Lumino Industries Limited vs. Fedders Liyod Corporation Limited and another dated 17-8-2015 (Calcutta High Court), NCC Limited vs. ABB India Limited and others, reported in 2018 (3) AKR 612, M. R. Engineers and Contractors Private Limited vs. Som Datt Builders Ltd., reported in (2009) 7 SCC 696 and National Insurance Company Limited vs. Boghara Polyfab Private Limited, reported in (2009) 1 SCC 267 . 8. 8. Reliance has also been placed upon judgments delivered in the case of Sukanya Holdings Private Limited vs. Jayesh H. Pandya and another, reported in (2003) 5 SCC 51, Indowind Energy Limited vs. Wescare (I) Limited, reported in (2010) 5 SCC 306 and Sunil Hi-Tech Engineers Limited vs. NIC Construction (India) Private Limited, reported in 2017(3) M.P.L.J. 122 . A prayer has been made to quash the order dated 8-8-2020 and to decide the civil suit on merit. 9. By submitting a written synopsis also in addition to the written arguments, it has been stated that the dispute resolution clause perish with the mutual termination of the work order and in the present case, as the work order was cancelled, the question of taking into account the terms and conditions of work order does not arise. Reliance has also been placed upon a judgment delivered in the case of Union of India vs. Kishorilal Gupta and others, reported in AIR 1959 SC 162. 10. It has also been argued that no arbitration and jurisdiction agreement is existing between the parties, as the work order was cancelled subsequently and the bank agreement is an independent contract as held by the Hon’ble Supreme Court in the case of Standard Chartered Bank vs. Heavy Engineering Limited, reported in 2019 SCC OnLine SC 1638. Reliance has also been placed upon a judgment delivered in the case of Gannon Dunkerley and Company Limited vs. Indore Smart City Development Limited, W. P. No. 24484/2018 dated 11-10-2018. 11. It has been vehemently argued that the relief prayed for, can certainly be granted at Indore as the bank guarantee was prepared at Indore by Bank of India. There is an application filed by the appellant for taking application for additional and subsequent facts/documents on record and it has been brought to the notice of this Court that against the interim order granted in the matter by this Court, a SLP was preferred and Hon’ble Supreme Court has directed this Court to decide the appeal finally on 3-11-2020. 12. Reply has been filed by respondent No. 3 as well as by the State Bank of India. The respondents, in the reply, have stated that an agreement was certainly executed between the parties on 29-9-2015 and Clause – 10 and 11 of the agreement relates to arbitration clause and jurisdictional clause. 13. 12. Reply has been filed by respondent No. 3 as well as by the State Bank of India. The respondents, in the reply, have stated that an agreement was certainly executed between the parties on 29-9-2015 and Clause – 10 and 11 of the agreement relates to arbitration clause and jurisdictional clause. 13. It has been argued by Shri Pushyamitra Bhargav that the parties have accepted the jurisdiction to be at Nagpur. It has been stated that the appellant/Company is having its having its registered office in Chennai (Tamil Nadu), the respondent No. 3/Company is having its registered office in Nagpur (Maharashtra) and the bank guarantee has been prepared in favour of State Bank of India at Nagpur, and therefore, keeping in view Clause – 9 and 10 of the agreement executed between the parties, the question interference by this Court in respect of the order passed by the Court below does not arise. It has been stated that the appellant/Company has played a mischief by not impleading respondent No. 3 as a defendant in the civil suit, which was filed in the year 2017 and in all fairness, the respondent No. 3 should have been impleaded as the respondent No. 3 was a necessary party. It has been stated that the bank guarantee was arising out of an agreement executed between the appellant and respondent No. 3, and therefore, in all fairness, the respondent No. 3 should have been impleaded as a defendant. It has been further stated that on account of intervention of this Court, the respondent No. 3 was impleaded as a defendant and in those circumstances, an application was preferred for vacating the interim relief and the issue of jurisdiction was also raised. 14. It has been further stated that on account of intervention of this Court, the respondent No. 3 was impleaded as a defendant and in those circumstances, an application was preferred for vacating the interim relief and the issue of jurisdiction was also raised. 14. Learned counsel for respondent No. 3 has placed reliance upon several judgments delivered in the cases of Swastik Gases Private Limited vs. Indian Oil Corporation, reported in (2013) 9 SCC 32 , B. E. Simoese vs. Chhattisgarh Investment Limited, reported in (2015) 12 SCC 32, State of W. B. vs. Associated Contractors, reported in (2015) 1 SCC 225, AVM Sales Corporation vs. Anuradha Chemicals, reported in (2012) 2 SCC 315 , Rajasthan State Electricity Board vs. Universal Petrol Chemicals Limited, reported in (2009) 3 SCC 107 , Angile Insultations vs. Davy Ashmore India Limited, reported in (1995) 4 SCC 153 , Archana vs. Tupperware India Private Limited, reported in 2014(4) M.P.L.J 476 , Reliance Securities Limited vs. Ajit Kumar, reported in 2013 SCC Online MP 10541, Branch Manager, Magma Leasing and Finance Limited and another vs. Potluri Madhavilata and another, reported in (2009) 10 SCC 103 , Iron and Steel Company Limited vs. Tiwari Road Lines, reported in (2007) 5 SCC 703 , National Agriculture Coop Marketing Federation India Limited vs. Gains Trading Limited, reported in (2007) 5 SCC 692 , South East Asia Shipping Company Limited vs. Nav Bharat Enterprises Private Limited, reported in (1996) 3 SCC 443 . He has placed heavy reliance upon the judgment delivered in the case of South Asia Shipping Company Limited (supra) and his contention is that the question of interference by this Court, in the peculiar facts and circumstances of the case, does not arise. 15. Heard learned counsel for the parties at length and perused the record. The matter is being disposed of at motion hearing stage itself with the consent of the parties through video conferencing. 16. The undisputed facts of the case make it very clear that an agreement, as admitted by the present appellant, was executed between the appellant and respondent No. 3. Clause 10 and 11 of the agreement read as under : – “10. 16. The undisputed facts of the case make it very clear that an agreement, as admitted by the present appellant, was executed between the appellant and respondent No. 3. Clause 10 and 11 of the agreement read as under : – “10. Arbitration: In case of any dispute arising due to difference of opinion in interpretation of any clause or terms and conditions or meaning of the work or language the decision of the arbitrator appointed with mutual consent shall e treated as final and binding on both the parties. 11. Jurisdiction: In case of any legal matters, the jurisdiction would be Nagpur, Maharashtra.” 17. Pursuant to the agreement executed between the parties, a bank guarantee was also furnished and relevant extracts of the bank guarantee reads as under : – “We, Bank of India, do hereby undertake to pay the amounts due and payable under the guarantee without any demur, merely on a demand from the SBIIFP, Bharat Nagar, Nagpur stating that the amount claimed is due by way of loss or damage caused to or would be caused to or suffered by the Company by reason to any breach by the said Contractor of any of the terms or conditions contained in the said Agreement or by reason of the Contractor’s failure to perform the said Agreement. Any such demand made on the Bank shall be conclusive as regards the amount due and payable by the Bank under this guarantee. However, our liability under this guarantee shall be restricted to an amount not exceeding Rs. 50000000.00 (Rupee Five Crores only). We, Bank of India, further agree that the guarantee herein contained shall remain in full force and effect during the period that would be taken for the performance of the said agreement and that it shall continue to the enforceable till all the dues to the Company under or by virtue of the said Agreement have been fully paid and its claim satisfied or discharged or till the Assistant General Manager of SBI-IFB certifies that the terms and conditions of the said Letter of Award/Agreement have been fully and properly carried out by the said contractor and accordingly discharges the guarantee. Unless a demand or claim under this guarantee is made on us in writing on or before 29 March, 2017, we shall be discharged from all liability under this guarantee thereafter. Unless a demand or claim under this guarantee is made on us in writing on or before 29 March, 2017, we shall be discharged from all liability under this guarantee thereafter. We, Bank of India, further agree with the SBI-IFB that the Company shall have the fullest liberty without our consent and without affecting in any manner our obligations hereunder to vary any of the terms and conditions of the said Agreement or to extend time or performance by the said Contractor from time to time or to postpone for any time or from time to time any of powers exercisable by the company and/or corporation against the said contractor and to forbear or enforce any of the terms and conditions relating to the said agreement as a result of change in terms and conditions in the Agreement between the corporation and the Company and we shall not be relieved from our liability by reason of any such variation, or extension, being granted to the said contractor or for any forbearance, act or omission on the part of the Corporation and/or company or any indulgence by the Corporation and/or Company to the said Contractor or by any such matter of thing whatsoever which under the law relating to sureties would, but for this provisions, have effect of so relieving us. We, Bank of India lastly undertake not to revoke this guarantee during its currency except with the previous consent of the company in writing. Notwithstanding any contained herein before our liability under guarantee is restricted to Rs. 50000000.00 (Rupees Five Crores only) and our guarantee shall remain in force until 29 March, 2017. Unless a demand or claim in writing is made on us on or before 29 March, 2018 all your rights under the guarantee shall be forfeited and we shall be relieved and discharged from all liability there under irrespective of whether or not the original Guarantee is returned to us.” 18. The appellant/Company has contended that the agreement was cancelled on 7-11-2017 (Annexure-A/4). The appellant/Company has contended that the agreement was cancelled on 7-11-2017 (Annexure-A/4). The appellant did file a civil suit in the year 2017, when the bank guarantee was being encashed by the State Bank of India and did not implead the respondent No. 3, the beneficiary Company of the bank guarantee, in the civil suit and in those circumstances, a miscellaneous petition was filed i.e., M. P. No. 1882/2020, Indo Unique Flame Limited vs. Hemang Resources Limited and others and this Court on 19-6-2020 has passed the following orders : – “The petitioner before this Court has filed this present petition under Articles 226 and 227 of the Constitution of India being aggrieved by the order dated 12-12-2007 passed in Civil Suit No. RCA 128/2017. The petitioner’s contention is that respondent No. 1 has filed a civil suit before the District Judge, Indore for declaration and grant of injunction in the year 2017 and the trial Court has passed an interim order on 12-12-2017. Against the interim order passed in the year 2017, the present petition has been filed in the year 2020. Learned counsel for respondent No. 1 has argued before this Court such a petition under Article 226 of the Constitution of India is not maintainable, it is only maintainable under Article 227 of the Constitution of India. He has also stated that an order of 2017 vintage is being challenged by filing a writ petition and the remedy available to the petitioner is to file application under Order 1, Rule 10 of the Code of Civil Procedure, 1908 for impleadment and in case, the same is allowed, he is certainly having a remedy to file appropriate application for vacating the interim order passed by the trial Court. This Court has carefully gone through the writ petition as well as the order passed by the trial Court. Undisputedly, the petitioner before this Court is not a party to the civil suit. The petitioner does have a remedy to file appropriate application under Order 1, Rule 10 of the Code of Civil Procedure, 1908 and the petitioner does also have a remedy to file an application under Order 39, Rule 4 of the Code of Civil Procedure, 1908, and therefore, as there is a remedy available to the petitioner under the Code of Civil Procedure, such a petition, by a stranger to the suit, deserves to be dismissed. Not only this, the petitioner is having a remedy of appeal also against the injunction order under the Code of Civil Procedure, 1908 after he is added as a party to the suit. This Court, in light of the aforesaid, is of the considered opinion that the present petition deserves to be dismissed with a liberty to the petitioner to prefer appropriate application for impleadment and other applications in the matter before the trial Court. It is needless to mention that if the appropriate applications under the Code of Civil Procedure are preferred before the trial Court, the trial Court shall pass appropriate order in accordance with law at an early date, preferably within a period of seven days from the date of receipt of certified copy of this order in accordance with law. With the aforesaid, the present Writ Petition stands dismissed.” 19. The trial Court has framed two preliminary issues in the matter (a) “is this suit not maintainable owing to the fact that the agreement dated 29-9-2015 between the parties embodies arbitration clause; (b) “does this Court, situated at Indore, has jurisdiction to hear the case. 20. The trial Court, while passing the impugned order, has held that the Court at Indore is not having jurisdiction keeping in view the specific clause as contained under the agreement and the suit has been returned as per provisions of Order VII, Rule X of the Code of Civil Procedure, 1908 for being presented in the Court having competent jurisdiction i.e., at Nagpur. 21. Learned senior counsel for the appellant has placed reliance upon a judgment delivered in the case of Union of India vs. Kishorilal Gupta (supra) and his contention is that keeping in view the aforesaid judgment, the arbitration clause mentioned in the original contract perished with the original contract, as the contract was extinguished by a substituted agreement. In the present case, there is no substituted agreement, the dispute is arising out of initial agreement, which provides the jurisdiction at Nagpur, and therefore, judgment relied upon by learned counsel is of no help to the appellant. 22. In the present case, there is no substituted agreement, the dispute is arising out of initial agreement, which provides the jurisdiction at Nagpur, and therefore, judgment relied upon by learned counsel is of no help to the appellant. 22. Learned senior counsel for the appellant has also placed reliance upon judgments delivered in the cases of Damodar Valley Corporation vs. K. K. Kar, reported in (1974) 1 SCC 141 , National Insurance Company Limited vs. Boghara Polyfab Private Limited, reported in (2009) 1 SCC 267 , Young Achievers vs. IMS Learning Resources Private Limited, reported in (2013) 10 SCC 535 and his contention is that in the case of Young Achiever (supra), the Hon’ble Supreme Court in paragraphs – 7 and 8 has held as under : – “7. This Court in Kishorilal Gupta’s case (supra) examined the question whether an arbitration clause can be invoked in the case of a dispute under a superseded contract. The principle laid down is that if the contract is superseded by another, the arbitration clause, being a component part of the earlier contract, falls with it. But where the dispute is whether such contract is void ab intio, the arbitration clause cannot operate on those disputes, for its operative force depends upon the existence of the contract and its validity. The various other observations were made by this Court in the above-mentioned judgment in respect of “settlement of disputes arising under the original contract, including the dispute as to the breach of the contract and its consequences”. Principle laid down by the House of Lords in Heyman vs. Darwins Limited, 1942(1) All. E.R. 337 was also relied on by this Court for its conclusion. The Collective bargaining principle laid down by the US Supreme Court in Nolde Bros. case (supra) would not apply to the facts of the present case. 8. We may indicate that so far as the present case is concerned, parties have entered into a fresh contract contained in the Exit paper which does not even indicate any disputes arising under the original contract or about the settlement thereof, it is nothing but a pure and simple novation of the original contract by mutual consent. Above being the factual and legal position, we find no error in the view taken by the High Court. Above being the factual and legal position, we find no error in the view taken by the High Court. The appeal, therefore, lacks merit and stands dismissed, with no order as to costs.” In the considered opinion of this Court, in the aforesaid case also, the contract was superseded by another contract, whereas in the present case, there is only one agreement out of which dispute has arisen between the parties, and therefore, the question of interference by this Court in respect of jurisdictional issue does not arise. 23. Learned senior counsel for the appellant has vehemently argued before this Court that the arbitration clause or exclusive jurisdiction clauses cannot be foisted or forced upon those parties, who have not signed or agreed to such clauses. 24. In the present case, the present appellant, for the reasons best known to the appellant, did not implead the respondent No. 3 while filing the civil suit, though the respondent No. 3 was beneficiary of the bank guarantee. A mischief was played by filing a civil suit only against the bank and in obtaining an injunction order. It was only after intervention of this Court, the respondent No. 3 was impleaded by the appellant as defendant in the year 2020. The respondent No. 3 is certainly a necessary party, and therefore, as the appellant and respondent No. 3 have signed the agreement out of which the dispute is arising and there is an exclusive jurisdiction clause, the judgments relied upon by the appellant is of no help to the appellant. 25. The bank guarantee agreement is an independent contract and there is no doubt about it. The same has been held in the case of Standard Chartered Bank (supra), however, in the present case, the issue relates to jurisdiction in respect of a dispute arising out of an agreement entered into by the parties, which contains territorial jurisdiction clause categorically specifying that in case of any legal matter, the territorial jurisdiction of the Court would be at Nagpur (Maharashtra), and therefore, the judgment relied upon by learned counsel does not help the appellant in any manner. 26. In the case of Branch Manager, Magma Leasing and Finance Limited and others (supra), the Hon’ble Supreme Court in paragraph-15 has held as under : – “15. 26. In the case of Branch Manager, Magma Leasing and Finance Limited and others (supra), the Hon’ble Supreme Court in paragraph-15 has held as under : – “15. In the instant case, clause 22 of the hire purchase agreement that provides for arbitration has been couched in widest possible terms as can well be imagined. It embraces all disputes, differences, claims and questions between the parties arising out of the said agreement or in any way relating thereto. The hire purchase agreement having been admittedly entered into between the parties and the disputes and differences have since arisen between them, we hold, as it must be, that the arbitration clause 22 survives for the purpose of their resolution although the contract has come to an end on account of its termination.” In the aforesaid case, there was a contractual dispute resolution clause and the contract was terminated. The Hon’ble Supreme Court has held that arbitration clause neither perishes nor become inoperative in such a case. It survives for the purpose of resolution of dispute to the extent specified in the clause concerned. Keeping in view the aforesaid judgment, even if it is proved that the contract has been terminated, the jurisdiction clause and the arbitration clause will not perish, and therefore, as the jurisdiction is exclusively at Nagpur, this Court does not find any reason to interfere with the order passed by the Commercial Court. 27. In the case of South East Asia Shipping Company Limited (supra), the Hon’ble Supreme Court in paragraphs-3 and 4 has held as under : – “3. It is settle law that cause of action consists of bundle of facts which give cause to enforce the legal injury for redress in a Court of law. The cause of action means, therefore, every fact, which if transferred, it would be necessary for the plaintiff to prove in order to support his right to a judgment of the Court. In other words, it is a bundle of facts, which taken with the law applicable to them, gives the plaintiff a right to claim relief against the defendant. It must include some act done by the defendant since in the absence of such an act no cause of action would possibly accrue or would arise. In other words, it is a bundle of facts, which taken with the law applicable to them, gives the plaintiff a right to claim relief against the defendant. It must include some act done by the defendant since in the absence of such an act no cause of action would possibly accrue or would arise. In view of the admitted position that contract was executed in Bombay, i.e., within the jurisdiction of the High Court of Bombay, performance of the contract was also to be done within the jurisdiction of the Bombay High Court; merely because bank guarantee has executed at Delhi and transmitted for performance in Bombay, it does not constitute a cause of action to give rise to the respondent to lay the suit on the original side of the Delhi High Court. The contention that the Division Bench was right in its finding and that since the bank guarantee was executed and liability was enforced from the bank at Delhi, the Court got jurisdiction, cannot be sustained. 4. We, therefore, hold that the learned single Judge was right in his conclusion that no part of the cause of action had arisen within the jurisdiction on the original side of the High Court of Delhi and direct to return the plaint for presentation to the proper Court.” In the aforesaid case also, a contract was executed at Bombay, performance of contract was required to be transmitted to Bombay, suit was filed before Delhi High Court for perpetual injunction against the appellant therein for enforcing the bank guarantee and in those circumstances, the Hon’ble Supreme Court has held that mere execution of bank guarantee at Delhi would not give rise to cause of action at Delhi. It was also held that no cause of action has arisen within the jurisdiction of Delhi High Court and the suit was held to be not maintainable. 28. In the present case also, the agreement was executed at Nagpur, the appellant/Company is having its registered office at Chennai, the respondent No. 3/Company is having its registered office at Nagpur, the work was to be executed at Karnataka, there is exclusive clause relating to jurisdiction i.e., at Nagpur and merely because the bank guarantee was prepared at Indore, it will not give rise to cause of action at Indore. 29. 29. In the case of Iron Steel Company Limited (supra), the Hon’ble Supreme Court in paragraph-15 has held as under : – “15. Learned counsel for the appellant has also submitted that City Civil Court, Hyderabad had no jurisdiction to entertain the application moved by the respondent as no part of cause of action had accrued there. In this connection, he has referred to clause (b) of sub-section (12) of section 11 and clause (e) of sub-section (1) of section 2 of the Act which will govern the question of jurisdiction as to Chief Justice of which High Court has to be approached for moving an application under section 11 of the Act. Learned counsel has submitted that the tenders were floated at Kolkata, the respondent submitted the tender at Kolkata, the agreement was executed at Kolkata and, therefore, the Court at Hyderabad had no jurisdiction to entertain the application. Learned counsel has also submitted that the view taken by the High Court that as the bank guarantee was furnished at Hyderabad and was encashed at Hyderabad, the Court at Hyderabad has jurisdiction is erroneous in law inasmuch as the agreement did not contain any clause regarding the place from where the bank guarantee had to be furnished. Learned counsel has submitted that there was only a requirement for furnishing the bank guarantee and that it could be furnished from anywhere in India and since in the present case the bank guarantee was furnished by the respondent from a bank at Hyderabad it was encashed there and, therefore, the said fact was wholly irrelevant for deciding the plea of jurisdiction. He has also relied upon a decision of this Court in South East Asia Shipping Co. Ltd. vs. Nav Bharat Enterprises Pvt. Ltd., (1996) 3 SCC 443 , in support of his contention that the submission of the bank guarantee from Hyderabad or the encashment thereof does not constitute even a part of cause of action to confer jurisdiction on the Court at Hyderabad. Ltd. vs. Nav Bharat Enterprises Pvt. Ltd., (1996) 3 SCC 443 , in support of his contention that the submission of the bank guarantee from Hyderabad or the encashment thereof does not constitute even a part of cause of action to confer jurisdiction on the Court at Hyderabad. Though we find substance in the contention raised by the learned counsel for the appellant but in view of our finding recorded on the main point, we do not consider it necessary to express any final opinion on the second contention.” In the aforesaid case also, the bank guarantee was furnished at Hyderabad and was encashed at Hyderabad, even though the Court has held that submission of the bank guarantee from Hyderabad or encashment thereof, does not constitute even a part of cause of action to confer jurisdiction on the Court of Hyderabad. 30. In the case of National Agriculture Coop Marketing Federation Limited (supra), the Hon’ble Supreme Court in paragraph-6 has held as under : – “6. The respondent contends that the contract was abrogated by mutual agreement; and when the contract came to an end, the arbitration agreement which forms part of the contract, also came to an end. Such a contention has never been accepted in law. An arbitration clause is a collateral term in the contract, which relates to resolution disputes, and not performance. Even if the performance of the contract comes to an end on account of repudiation, frustration or breach of contract, the arbitration agreement would survive for the purpose of resolution of disputes arising under or in connection with the contract. [Vide : Heymen vs. Darwins Ltd., 1942 (1) All ER 337, Union of India vs. Kishori Lal Gupta and Bros., AIR 1959 SC 1362 and Naihati Jute Mills Ltd. vs. Khyaliram Jagannath, AIR 1968 SC 522 ]. This position is now statutorily recognized. Sub-section (1) of section 16 of the Act makes it clear that while considering any objection with respect to the existence or validity of the arbitration agreement, an arbitration clause which forms part of the contract, has to be treated as an agreement independent of the other terms of the contract; and a decision that the contract is null and void shall not entail ipso jure the invalidity of the arbitration clause. The first contention is, therefore, liable to be rejected.” 31. The first contention is, therefore, liable to be rejected.” 31. In light of the aforesaid, the dispute between the parties is arising out of the initial agreement and even if the contract comes to an end, as argued by learned senior counsel for the appellant, the jurisdictional clause does not vanish, and therefore, the Commercial Court was justified in passing the impugned order. 32. The appellant/plaintiff has filed a civil suit along with an application for grant of injunction without making respondent No. 3 as a party, as already stated earlier, the territorial jurisdiction, as per the terms and conditions of the agreement executed between the parties dated 29-9-2015, lies at Nagpur, the Commercial Court was certainly justified in returning the plaint to present the same before the Court having jurisdiction in the matter. 33. In light of the aforesaid, this Court does not find any reason to interfere with the order passed by the Commercial Court. Resultantly, the present Miscellaneous Appeal stands dismissed. Certified copy, as per rules.