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2019 Supreme(Cal) 329
IN THE HIGH COURT OF JUDICATURE AT CALCUTTA
SOUMEN SEN, RAVI KRISHAN KAPUR, JJ.
Srei Capital Markets Ltd. - Appellant
Versus
Gridco Ltd. - Respondent
A.P.D. No. 241 of 2017 with C.S. No. 76 of 2007
Decided On : 13-09-2019
For the Appellant :S.N. Mitra, Sr. Advocate, Anuj Singh, S. Ghosh, Advocates.
For the Respondent:Debdut Mukherjee, Advocate.
Headnote:
JURISDICTION - Recovery of Money - 12 - The court discussed the jurisdiction of the court to entertain the suit for recovery of money. The court concluded that the cause of action, formation of the contract, execution, and performance of the contract had all taken place outside the jurisdiction of the court. The court also emphasized that the debtor must seek the creditor, and in this case, the money was payable at the registered office of the plaintiff and not at any other place. The court held that the plaintiff failed to prove that any discussion took place within the jurisdiction of the court, and therefore, the court lacked jurisdiction to receive, try, and adjudicate the claim of the plaintiff.
Fact of the Case:
The plaintiff filed a suit for recovery of money on account of fees allegedly remaining unpaid for service rendered. The defendant failed to make the payment, and the plaintiff sought leave under Clause 12 of the Letters Patent, stating that the cause of action had arisen both outside and within the jurisdiction of the court.
Finding of the Court:
The court found that the formation of the contract, execution, and performance of the contract had all taken place outside the jurisdiction of the court. The court concluded that the plaintiff failed to prove that any discussion took place within the jurisdiction of the court, and therefore, the court lacked jurisdiction to receive, try, and adjudicate the claim of the plaintiff.
Issues: The main issue was whether the court had jurisdiction to entertain the suit for recovery of money. The court also addressed the issue of whether the debtor must seek the creditor and the place of payment specified in the contract.
Ratio Decidendi: The court's decision was based on the principle that the cause of action, formation of the contract, execution, and performance of the contract had all taken place outside the jurisdiction of the court. The court emphasized that the debtor must seek the creditor, and in this case, the money was payable at the registered office of the plaintiff and not at any other place.
Final Decision: The court set aside the decision on the issue of whether the plaintiff was entitled to the relief sought, and directed the department to return the original plaint to the plaintiff's advocate-on-record to enable the plaintiff to present it before the appropriate commercial court having jurisdiction over the Topsia office of the plaintiff. The court also allowed the plaintiff to benefit from section 14(2) of the Limitation Act 1963 if the suit was filed within a specified period before the appropriate commercial court.
JUDGMENT :
SOUMEN SEN, J.
1. The appeal is directed against the judgment and decree dated 8th September, 2016 in a suit for recovery of money on account of fees allegedly remaining unpaid for service rendered.
2. The learned Single Judge on the basis of the pleadings has framed five issues which are as follows:
"1. Whether this Hon'ble Court has any jurisdiction to entertain the present suit or the suit is otherwise maintainable, as framed or at all?
2. Was the syndication fees as payable to the plaintiff dependent upon the amount actually received by the defendant, as alleged in the written statement and particularly in paragraph 12 thereof?
3. Did the plaintiff not perform its obligations under the contract between the parties, as alleged in paragraph 15 of the written statement?
4. Did not the financier make disbursement of any portion of the second tranche of the said sum of Rs.300 crores in spite of the request of the defendant and was the plaintiff fully aware of the same, as alleged in the paragraph 19 of the written statement?
5. What relief, if any, is the plaintiff entitled to?"
3. The learned Single Judge has decided the issue no.2 first and thereafter issue no.1. We have invited the parties to first address us on issue no.1 since if it is decided in favour of the plaintiff/appellant, there would be no necessity to decide issue no.2. The learned Single Judge decided issue no. 2 against the appellant.
4. Unnecessary facts not relating to the issue no.1 are not required to be stated and accordingly we state only the facts that are necessary to decide the said issue.
5. The defendant floated a tender for selecting its merchant banker for the purpose of syndication of loan facilities to be availed of by the defendant. The plaintiff/appellant participated in the tender and was appointed as merchant banker being the second lowest tenderer for mobilisation of a term loan to the tune of Rs. 300 crores. The defendant by a letter dated 2nd June, 2003 communicated its acceptance of the tender from its office at Bhubaneswar to the office of the plaintiff at 86C Topsia Road (South), Vishwakarma, Kolkata -700 046, outside the jurisdiction of the Court. The mode of payment was through Escrow mechanism. The plaintiff in acknowledgement of the letter dated 2nd June, 2003 confirmed its acceptance to undertake the mandate offered by the defendant by a letter dated 5th June, 2003 issued from its registered office at Viswakarma 86C Topsia (South), Kolkata. In the said communication, the plaintiff called for certain clarification and/or information. The defendant was requested to forward a line of confirmation in all the matters mentioned in the said letter. The defendant from its office at Bhubaneshwar by a letter dated 19th June, 2003, addressed to the defendant at its registered office at Topsia, provided certain information in relation to the said contract. However, the said arrangement was cancelled by letter dated 2nd August, 2003 by GRIDCO followed by letter of the dated 2nd August, 2003 addressed to the plaintiff at its registered office at Topsia regarding mandate for term loan syndication for an amount of Rs.600 crores. The defendant requested the plaintiff that if the plaintiff was agreeable to the terms, they must communicate their acceptance. The said terms and conditions were accepted by the plaintiff at its registered office at Topsia. Thereafter on 3rd November, 2003 the defendant requested the plaintiff to take necessary steps for raising of funds and rating of the issue as per the mandate letter. This was followed by a letter dated 10th November, 2003 and few other communications from HUDCO regarding financial assistance of term loan of Rs.600 crores to plaintiff and defendant at their respective registered office. On 3rd February, 2004 a joint meeting was held between the plaintiff, defendant and the representative of the HUDCO at the office of HUDCO at Bhubaneshwar. The extension of mandate for term loan syndication was issued b
