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SUPREME COURT OF INDIA
R.F. NARIMAN, NAVIN SINHA, INDIRA BANERJEE, JJ.
M/s. Exl Careers And Another – Appellant
Versus
Frankfinn Aviation Services Private Limited – Respondent
Civil Appeal No. 2904 of 2020 (Arising out of SLP (Civil) No. 16893 of 2018)
Decided On : 05-08-2020
Civil Procedure Code, 1908 – 1908 – Order VII Rule 10 and 10A – Return of plaint – Recovery suit – In a dispute between parties where two or more courts may have jurisdiction, it is always open for them by agreement to confer exclusive jurisdiction by consent on one of two courts – Agreement between parties clearly indicated that it was only court at Delhi which shall have exclusive jurisdiction with regard to any dispute concerning franchise agreement and no other court would have jurisdiction over the same – In that view of matter, presentation of plaint at Gurgaon was certainly not before a court having jurisdiction in the matter – Suit has to proceed afresh before proper court – In cases dealing with transfer of proceedings from a Court having jurisdiction to another Court, discretion vested in Court by Sections 24(2) and 25(3) either to retry proceedings or proceed from the point at which such proceeding was transferred or withdrawn, is in marked contrast to scheme under Order VII Rule 10 read with Rule 10-A where no such discretion is given and proceeding has to commence de novo – However, in exercise of discretionary jurisdiction under Article 136 of Constitution and in order to do complete and substantial justice between the parties under Article 142 of Constitution in peculiar facts and circumstances of case nonetheless, Court decline to set aside impugned order of High Court. (Paras 13, 15, 21 and 27)
Facts of the case:
Present appeal has been placed before Court on a reference by a two Judge Bench opining a perceived conflict between two Division Bench decisions in Joginder Tuli vs. S.L. Bhatia, (1997) 1 SCC 502 and Oil and Natural Gas Corporation Ltd. vs. Modern Construction & Co., (2014) 1 SCC 648. The question of law required to answer is that if a plaint is returned under Order VII Rule 10 and 10A of the Code of Civil Procedure 1908 for presentation in the court in which it should have been instituted, whether the suit shall proceed de novo or will it continue from the stage where it was pending before the court at the time of returning of the plaint. The order of reference also leaves it open for consideration if the conduct of the appellant disentitles it to any relief notwithstanding the decision on the issue of law.
Findings of Court:
In cases dealing with transfer of proceedings from a Court having jurisdiction to another Court, discretion vested in the Court by Sections 24(2) and 25(3) either to retry the proceedings or proceed from the point at which such proceeding was transferred or withdrawn, is in marked contrast to the scheme under Order VII Rule 10 read with Rule 10-A where no such discretion is given and the proceeding has to commence de novo.
Result : Appeal disposed of.
JUDGMENT :
NAVIN SINHA, J.
1. Leave granted.
2. The present appeal has been placed before us on a reference by a two Judge Bench opining a perceived conflict between two Division Bench decisions in Joginder Tuli vs. S.L. Bhatia, (1997) 1 SCC 502 and Oil and Natural Gas Corporation Ltd. vs. Modern Construction and Co., (2014) 1 SCC 648. The question of law we are required to answer is that if a plaint is returned under Order VII Rule 10 and 10A of the Code of Civil Procedure 1908, (hereinafter called as "the Code") for presentation in the court in which it should have been instituted, whether the suit shall proceed de novo or will it continue from the stage where it was pending before the court at the time of returning of the plaint. The order of reference also leaves it open for consideration if the conduct of the appellant disentitles it to any relief notwithstanding the decision on the issue of law.
3. The respondent filed a suit for recovery against the appellant arising out of a franchise agreement dated 24.03.2004, before the Civil Judge (Sr. Division) at Gurgaon. In view of the exclusion clause in the agreement, the plaint was returned holding that the court at Gurgaon lacked territorial jurisdiction and that the court at Delhi alone had jurisdiction in the matter. The High Court by the impugned order dated 13.03.2018 has held that the suit at Delhi shall proceed from the stage at which it was pending at Gurgaon before return of the plaint and not de novo. Aggrieved, the appellant preferred the present appeal. Further proceedings were stayed on 13.07.2018 culminating in the order of reference.
4. Shri Manoj Swarup, learned senior counsel appearing on behalf of the appellant, submitted that there is no conflict between the decisions in Joginder Tuli (supra) and Modern Construction (supra) requiring consideration by a larger Bench. The latter lays down the correct law that the suit will have to proceed de novo at Delhi and cannot be continued from the earlier stage at Gurgaon. Joginder Tuli (supra) cannot have any precedential value not being based on consideration of the law, but having been passed more in the facts of that case.
5. Shri Swarup submitted that the High Court erred in not appreciating that it was not exercising transfer jurisdiction under Section 24 of the Code. The plaint could be returned at any stage of the suit under Order VII Rule 10 and 10A. The fact that the pleadings and evidence may have concluded before the Gurgaon court was inconsequential. The suit was filed on 06.01.2011. The appellant had preferred the objection under Order VII Rule 10 promptly on 26.08.2011. Order XVIII Rule 15 also could not be invoked in view of the nature of jurisdiction conferred under Rule 10 for return of the plaint. Rule 10A is only a sequitur with regard to the procedure to be followed for the same. It cannot be interpreted as providing for continuation of the suit. The High Court in the first revisional order dated 05.09.2017 had rejected the objection with regard to the advanced stage at which the suit was at Gurgaon. The mere use of the words 'return the file' are irrelevant and cannot be construed as enlarging the scope of jurisdiction under Order VII Rule 10. The order attained finality as no appeal was preferred against the same. Significantly under Order VII Rule 10A fresh summons had to issue upon presentation of the plaint before the court of competent jurisdiction. Shri Swarup in this context referred to Order IV Rule 1 with regard to the institution of the suit by presentation of a plaint and issuance of summons under Order V Rule 1 to contend that under Rule 10A when summons are issued by the new court where the plaint is presented the proceedings go back to the inception of the suit by institution.
6. In support of his submission that the suit has necessarily to proceed de novo on return of the plaint, he relied upon Ramdutt Ramkissen Dass vs. E.D. Sassoon & Co., AIR 1929 PC 103; Amar Chand Inani vs. The Union o
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