Judicial Analysis Court Copy Headnote Facts Arguments Court observation

1961 Supreme(SC) 303

SUPREME COURT OF INDIA
31st August, 1961
P.B. GAJENDRAGADKAR, K. SUBBA RAO AND M. HIDAYATULLAH JJ.
Andhra Bank Ltd., Appellant
Versus
R. Srinivasan and others, Respondents.
Civil Appeal No. 508 of 1958.
Advocates appeared
Mr. A. Ranganathan Chetty, Senior Advocate (M/s. C. V. Narsimhrao, A. V. Rangam and T. Satyanarayana, Advocates, with him, for Appellant; Mr. A. V. Viswanatha Sastri, Senior Advocate (Mr. S. Venkatakrishnan, Advocate, with him), for Respondents (Nos. 1 to 3); M/s. R. Ganapathy Iyer and T. K. Sundara Raman, Advocates, for Respondents (Nos. 5 to 9); M/s. R. Ganapathy Iyer and R. Thiagarajan, Advocates and Mr. G. Gopalakrishnan, Advocate of M/s. Gagrat and Co., for Respondents (Nos. 11 and 12). 233

Advocates:
A.RANGANADHAM CHETTY, A.V.RANGAM, A.V.VISHWANATHA SASTRI, C.V.NARASIMHA RAO, G.GOPALAKRISHNAN, R.Ganapathy Iyer, R.THIAGARAJAN, S.VENKATESHWARA RAO, T.K.SUNDARARAMAN, T.SATYANARAYANA

The rule of private international law, which states that personal actions must be filed in the courts of the country where the defendant resides, does not apply to a case where the suit as initially filed was competent and the court before which it was filed had jurisdiction to try it.

Headnote:
FOREIGN JUDGMENTS - ENFORCEMENT - COMPETENCE OF COURT - SUITS FILED IN HYDERABAD COURT AGAINST RESIDENTS - SUBSEQUENT DEATH OF ONE DEFENDANT AND IMPLEADING OF HIS LEGAL REPRESENTATIVES WHO WERE NON-RESIDENT FOREIGNERS - WHETHER HYDERABAD COURT CEASED TO HAVE JURISDICTION - RULE OF PRIVATE INTERNATIONAL LAW - APPLICABILITY.
Fact of the Case:

The appellant, Andhra Bank Limited, filed a suit in a Madras court to enforce two foreign judgments obtained against the respondents in Hyderabad. The suits were based on overdraft and pledge of sanitary-ware goods. Respondent 1 was the son of Raja Bahadur Krishnamachari (Raja Bahadur), who died in March 1943. Raja Bahadur had executed a letter of guarantee for the repayment of monies borrowed by Respondent 1. The appellant obtained decrees in both suits in October 1944, directing Respondent 1 to pay the whole amount claimed and respondents 2 to 12 (Raja Bahadur's legal representatives) to pay Rs. 20,000, the limit of the guarantee. The respondents resisted the suit, contending that the Hyderabad courts had no jurisdiction and that they had not been served with notice of suit. The trial court held that the Hyderabad court had jurisdiction and that the contesting respondents were bound by the decrees. The High Court reversed the trial court's decision, holding that the Hyderabad court was not competent to try the suits.
Finding of the Court:

The Supreme Court held that the Hyderabad court had jurisdiction to try the suits when they were filed and that the jurisdiction continued even after the death of Raja Bahadur and the impleading of his legal representatives, who were non-resident foreigners. The court found that the rule of private international law, which states that personal actions must be filed in the courts of the country where the defendant resides, did not apply in this case because the suits were competent when they were initially filed and the subsequent addition of non-resident foreign legal representatives did not invalidate the continuance of the suits.
Issues: 1. Whether the Hyderabad court had jurisdiction to try the suits when they were filed? 2. Whether the jurisdiction of the Hyderabad court ceased after the death of Raja Bahadur and the impleading of his legal representatives, who were non-resident foreigners? 3. Whether the rule of private international law, which states that personal actions must be filed in the courts of the country where the defendant resides, applied in this case?
Ratio Decidendi: 1. The rule of private international law, which states that personal actions must be filed in the courts of the country where the defendant resides, applies only to the commencement or initiation of the suit. 2. Once a suit is properly instituted, the jurisdiction of the court continues even if one of the defendants dies and his legal representatives, who are non-resident foreigners, are brought on the record. 3. The legal representatives of a deceased defendant can only defend the suit on grounds that the deceased defendant could have taken.
Final Decision: The Supreme Court allowed the appeal, reversed the decrees passed by the High Court, and restored the decree of the trial court with costs throughout.

Judgment

GAJENDRAGADKAR, J. : This appeal has been brought to this Court with a certificate issued by the Madras High Court under Art.133 (1) (a) of the Constitution and it arises out of a suit (O. S. No. 83 of 1945) filed by the appellant the Andhra Bank Limited against the twelve respondents. This suit was based on two foreign judgments, Exs. P-1 and P-3, which had been obtained by the appellant against the said respondents in Hyderabad. Respondent 1 is the son of Raja Bahadur Krishnamachari (hereafter called Raja Bahadur) who died in March, 1943. Respondent 1 and his father were residents of Hyderabad. Raja Bahadur was practising as an advocate in Hyderabad and subsequently he was appointed the Advocate-General. In September, 1935, Respondent 1 was indebted to the appellant in the sum of Rs. 14,876-3-7 in respect of an overdraft account. In May, l938, he became indebted to the appellant in the sum of Rs. 8,217-ll-6 in respect of his borrowings on a pledge of sanitary-ware goods. Raja Bahadur had executed a letter of guarantee (Ex. P.18) in January, 1932 whereby he guaranteed the repayment of monies borrowed by Respondent 1 up to the limit of Rs. 20,000. As the amounts due from Respondent 1 remained unpaid the appellant had to institute two suits in the Hyderabad High Court for their recovery. These suits were numbered 47 and 53 of Fazli 1353. After they were filed in the said High Court they were transferred to the City Civil Court and renumbered as Suits Nos. 62 and 61 of Fazli l353. Whilst the suits were pending Raja Bahadur who had been impleaded to the suits along with respondent 1 died. Thereupon the appellant joined the present respondents 2 to 12 in those two suits as legal representatives of Raja Bahadur on the ground that they were in possession of different pieces of his properties under a settlement deed of 1940 and a registered will executed by him on August 28, 1942 (Ex, P. 17). In both the suits the appellant obtained decrees with costs on October 5, l944. The said decrees directed respondent 1 to pay the whole of the amount claimed by the appellant against him and respondents 2 to 12 to pay Rs. 20,000 which was the limit of guarantee executed by Raja Bahadur. All the respondents were directed to pay interest at 3 per cent. on the amount due against them. Whilst the suits were pending the goods pledged in Suit No. 62 were auctioned and the sale proceeds realised which amounted to Rs. 4,232-1-7 were given credit for whilst the Court passed the decrees in the said suits. According to the appellant an amount of Rs. 27,923-6-5 was still due on the said decrees and so in the present suit the appellant claimed from respondent 1 the whole of the said amount and from respondents 2 to 12 Rs. 20,000 with interest and costs.

2. Respondent 2 is the son of Raja Bahadur and respondents 6 to 9 are his minor sons. Respondents 3, 4 and 5 are the sons of respondent 1. Respondent l0 is the daughter of Raja Bahadur while respondents 11 and 12 are his grand-daughters through his two daughters. Respondent 2 for himself and as guardian of his minor sons resisted the appellant s claim and contended that the Hyderabad Courts had no jurisdiction over them and therefore the decrees passed by the City Civil Court was without jurisdiction. They also alleged that they had not been served with notice of suit and had not submitted to the jurisdiction of the City Civil Court. Respondent 1 did not resist the suit but his sons did. They alleged that they were not the legal representatives of Raja Bahadur and had been improperly added as parties to the Hyderabad suit. They joined respondents 2 and 6 to 9 in their contention that the Hyderabad Court was not a Court of competent jurisdiction and they pleaded that the foreign judgments had not been based on the merits of the case. Respondents 10 to 12 filed similar pleas.

3. On these pleading the learned trial Judge framed five principal issues. He held that the City Civil Court of Hyderabad had juris

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