Parties to a contract can agree on a specific court for dispute resolution, and such an agreement is not contrary to public policy. The balance of convenience is not a relevant factor when a clear forum selection agreement exists.

( 1 ) THE respondent in this application as plaintiff has filed the above suit with leave under Clause 12 of the Letters Patent, inter alia, for a decree for Rs. 5,58,314. 00. The respondent's case is that under a contract made between the parties by its offer dated 9th March 1983 for supply of hessian bags and accepted by the petitioner by its letter of acceptance, dated 22nd March 1983, the respondent supplied hessian bags to the petitioner. According to the respondent, the letter of acceptance and the order were sent by the petitioner from its office at Mahanagar, Lucknow outside the aforesaid jurisdiction and the same were received by the respondent at his office at 68, Cotton Street, Calcutta, within the aforesaid jurisdiction. It is further stated by the respondent that the said hessian bags were inspected by the petitioner's representative at the respondent's office within the jurisdiction of this Hon'ble Court. The respondent duly delivered the entire contractual quantity of hessian bags to the petitioner at various places in the State of U. P. outside the jurisdiction of this Hon'ble Court and the petitioner paid 90% value of the said goods aggregating to Rs. 31,27,411/ -. The respondent has filed the above suit for recovery of the balance of the price of the said goods.

( 2 ) THE petitioner's case is that the goods supplied by the respondent were not of contract quality and specification and as a result whereof the petitioner has suffered loss and damage for a sum of Rs. 7,43,058. 35. The petitioner has also denied that it has office at Calcutta within the original side Jurisdiction of this Court or that goods were inspected at Calcutta within the said jurisdiction.

( 3 ) CLAUSE 4 of the letter of acceptance contains, inter alia, the following terms :- "any dispute arising out of this contract will be settled in a Court of law at Lucknow. "

( 4 ) THE petitioner has made the instant application, inter alia, for revocation of the leave under Clause 12 of the Letters Patent and the plaint filed in the suit be rejected as also permanent stay of the suit.

( 5 ) TWO points were urged at the hearing of this application. Firstly whether in view of Clause 4 of the agreement mentioned above the respondent should have filed a suit in a Court of law at Lucknow and the above suit should be stayed and leave under Clause 12 of the letters patent should be revoked; secondly whether the balance of convenience is in favour of the suit being tried at Calcutta or not.

( 6 ) THE law on the first point is well settled by various decisions of the Supreme Court and of this Hon'ble Court. It is well settled that parties by consent, cannot confer jurisdiction on a Court which it has not; but if two Courts have jurisdiction to decide a suit parties by their agreement prefer one Court against the other. Such an agreement is not unlawful and in case of such agreement parties should be held to the terms of such agreement.

( 7 ) IN the case of Hakam Singh v. Gammon (India) Ltd. , AIR 1971 SC 740 by clause 13 of the agreement it was expressly stipulated between the parties that the contract should be deemed to have been entered into by the parties concerned in the City of Bombay. Regarding the clauses the Supreme Court has observed that it is not open to the parties by agreement to confer jurisdiction on a Court which it does not possess under the Code; but, where two Courts, or more, have, under the Code of Civil Procedure, jurisdiction to try a suit or proceeding, an agreement between the parties that the dispute between them shall be tried in one of such Court is not contrary to public policy. Such an agreement does not contravene Section 28 of the Contract Act. The Supreme Court dismissed the appeal against the order of the High Court directing that the petition be returned for presentation to the proper Court.

( 8 ) IN the case of Continental Drug Company Limited v. Chemoids and Industries Limited, AIR 1955 Cal 161 an agre