Back
1979 Supreme(Kar) 182
Karnataka High Court
REPUBLIC MEDICO SURGICAL - Appellant
Versus
UNION OF INDIA - Respondent
Decided On : 08-13-79
M.F.A. : 174 of 1978
B.RAMACHANDRA RAO, C.V.SUBBA RAO
The cause of action arises at the place where the contract was made or where the breach was committed, not merely where the offer was made.
Headnote:
Jurisdiction - Cause of Action - Section 20 C. P. C. - [Bhuvaneshwar Silt Equipages Case] - [Section 20 C. P. C.] - The court discussed the interpretation of Section 20 C. P. C. and the concept of cause of action in determining territorial jurisdiction. The key legal provision highlighted was the Supreme Court's ruling in Bhagwandas v. Giri Dharlal and Co. (AIR 1966 SC 543) emphasizing that the making of an offer at a place, which has been accepted elsewhere, does not form part of the cause of action in a suit for damages for breach of contract. The court's decision was influenced by the understanding that the cause of action arises at the place where the contract was made or where the breach was committed, and not merely where the offer was made.
Fact of the Case:
The plaintiff sued for recovery of balance of the price towards silt equipages supplied to the 2nd defendant in Bhuvaneshwar. The defendant raised the contention that the Court in Bangalore had no territorial jurisdiction to entertain the suit.
Finding of the Court:
The Court found that no part of the cause of action took place in Bangalore, and therefore, the Court in Bangalore had no jurisdiction to entertain the suit.
Issues: The main issue was whether any part of the cause of action arose within the territorial limits of Bangalore Civil Court.
Ratio Decidendi: The contract is completed when an offer made is accepted, and the cause of action arises at the place where the contract was made or where the breach was committed. The court relied on the interpretation of Section 20 C. P. C. and the Supreme Court's ruling in Bhagwandas v. Giri Dharlal and Co. to determine the cause of action.
Final Decision: The appeal was dismissed, and the plaintiff was given 3 months to take back the plaint and present it before the proper Court.
( 2 ) THE learned Civil Judge appreciating the evidence both oral and documentary adduced before him, came to the conclusion that no part of the causie of action took place in Bangalore and as such, the Court in bangalore has no jurisdiction to entertain the suit and accordingly he orderejd the return of the plaint for presentation before competent court. Aggrieved by the said order, the plaintiff has come up in appeal before this Court.
( 3 ) SECTION 20 C. P. C. no doubt states. "other suits to be instituted where defendants reside or cause of action arises. Subject to the limitations afosesaid, every suit shall be instituted in a Court within the limits of whose jurisdiction- (a) (b) (c) The cause of action, wholly or in part, ariases. "
( 4 ) IT is the case of the plaintiff-company that the tender was offered for supply of silt equipages to the Executive Engineer, Southern guaging division in Bangalore, but that it was addrefssied to the 2nd defendant. Ultimately his tender was accepted and he supplied the silt eguipagqs for which, according to the plantiff, 2nd defendant was due the balance of price totalling to Rs. 32897. 86 paise. Accordingly, the plaintiff sued the defendatnts in the court of the Principal Civil Judge, Bangalore City in o. S. No. 150 of 1972. The defendants on entering appearance pleaded that the Court of the Principal Civil Judge had no territorial jurisdiction to entertain and try the suit, fqr according to them no part of the cause of action arose within the limits of the Court of the Principal Civil Judge, bangalore.
( 5 ) THE learned Counsel appeairing for the appellants submitted that the learned Civil Judge was not justified in holding that no part of the cause of action took place within the territorial jurisdiction of the Principal civi] Judge, Bangalore City. According to him the offer was made in bangalore and as such, the iearned Civil Judge ought to have held that part of the cause of action arose within the limits of Bangalore City. Hence he prayed that the appeal be allowed.
( 6 ) AS against that, the learned Counsel appearing for the respondents- deleodants submitted that a mere offer cannot be considered asi part of the cause of action and as such the Court in Bangalore City has no jurisdiction to entertain and try the suit.
( 7 ) THE soie point, therefore, that arises for my consideration in this appeal is whether it can be stated that any pant of the cause of action arose within the territorial limits of Bangaiore Civil Court.
( 8 ) THE contract is completed when an offer made is accepted. It is the acceptance that gives rise to the cause of action and not merely an offer. Hence, even though an offer is made from Bangalore, it cannot be said that a Part of the cause of action arises in Bangalore. In a suit the cause cf action will consist of making of the contract and its breach at the place where it is to be performed. Therefore, a suit for breach of contract can, at the option, of the plaintiff be brought either at the place where the contract was made, or at the place where the breach was committed. It can also be said that the place where money is to be paid or goods are to be supplied are also the places where parts of the cause of action arise; but certainly not the place where offer is made.
( 9 ) THE Supreme Court of India in the case of Bhagwandas v. Giri Dharlal and. Co. , AIR 1966 SC 543. has laid down thus:"mak
