The main legal point established in the judgment is that the rejection of a plaint is a serious matter and cannot be ordered cursorily without satisfying the requirements of the provision. The court emphasized that the plaint must disclose a cause of action and that the court should not consider the defenses raised by the defendant at the stage of considering the application under Order VII Rule 11.

Headnote:
Order VII rule 11 - Jurisdiction of Indian Courts over Foreign Company - Section 21 and Section 151 of Code of Civil Procedure - 1990 (3) SCC 481, (1998) 5 SCC 310, (1963) 2 SCR 577, (1999) 3 SCC 267, AIR 1997 Allahabad 323, air 1954 Bombay 491 - The court discussed the jurisdiction of Indian courts over a foreign company and the rejection of plaint under Order VII rule 11 of the Code of Civil Procedure. The court referred to various cases to establish that the presence of a foreign defendant who contests jurisdiction does not confer jurisdiction on the court. It also emphasized that the rejection of a plaint is a serious matter and cannot be ordered cursorily without satisfying the requirements of the provision. The court highlighted that the plaint must disclose a cause of action and that the court should not consider the defenses raised by the defendant at the stage of considering the application under Order VII Rule 11. The court ultimately dismissed the application for rejection of the plaint, concluding that the plaint disclosed a cause of action against the foreign company.
Fact of the Case:

The defendant, a foreign company, sought rejection of the plaint on the grounds of lack of jurisdiction of Indian courts due to its non-residence and absence of business in India. The plaintiff, a beneficiary of a letter of credit, claimed compensation for losses suffered due to breaches of the terms of the letter of credit by the defendants.
Finding of the Court:

The court found that the plaint disclosed a cause of action against the foreign company and rejected the application for rejection of the plaint. The court also allowed the plaintiff's application for amendment of the plaint to seek recovery only against specific defendants.
Issues: Jurisdiction of Indian courts over a foreign company, rejection of plaint under Order VII rule 11, and amendment of the plaint.
Ratio Decidendi: The court emphasized that the rejection of a plaint is a serious matter and cannot be ordered cursorily without satisfying the requirements of the provision. It highlighted that the plaint must disclose a cause of action and that the court should not consider the defenses raised by the defendant at the stage of considering the application under Order VII Rule 11. The court also noted that pretrial amendments are allowed more liberally than those sought after the commencement of trial or after its conclusion.
Final Decision: The court dismissed the application for rejection of the plaint, concluding that the plaint disclosed a cause of action against the foreign company. The court also allowed the plaintiff's application for amendment of the plaint to seek recovery only against specific defendants.

ANIL KUMAR, J.

( 1 ) THIS order shall dispose of defendant No. 4 s application under Order VII rule 11 (D) read with Section 21 and Section 151 of Code of Civil Procedure for rejection of plaint and plaintiff?s application for amendment of the plaint under Order VI rule 17 read with Section 151 of Code of Civil Procedure. IA No. 9339/2001 by this application, the defendant No. 4 has sought rejection of plaint on the ground that the defendant is a foreign company and does not have any office in India and it does not carry on any business in India nor resides in india and in the circumstances Indian Courts do not have jurisdiction to entertain any proceeding against the defendant No. 4/applicant. The defendant no. 4/applicant has also sought rejection of the plaint on the ground that it is well settled that the presence of a foreign defendant who appears under protest to contest jurisdiction does not confer jurisdiction on the court and because the defendant is contesting the jurisdiction of the Court under protest, no jurisdiction is conferred and since there is no jurisdiction against the defendant no. 4/applicant plaint is liable to be rejected against him.

( 2 ) THE applicant/defendant no. 4 asserted that it neither resides within the jurisdiction or voluntarily appeared or has contracted with the plaintiff, therefore, the Courts in India do not have any jurisdiction to try the case against the defendant no. 4. The reliance was placed by the applicant/defendant no. 4 on 1990 (3) SCC 481, British India Steam Navigation Co. Ltd. Vs. Shanmughavilas Cashew Industries and others; (1998) 5 SCC 310; World Tanker carrier Corporation Vs. S. N. P. Shipping Services Pvt. Ltd. and Others and (1963) 2 SCR 577, Raj Rajender Sardar Moloji Nar Singh Rao Shitole Vs. Shankar Saran and Others to contend that since the defendant no. 4 is a foreign company not having its registered office in India, the Courts in India does not have jurisdiction against such an entity. The applicant has also relied on D. Ramachandran Vs. R. V. Janakiraman and Others, (1999) 3 SCC 267 to contend that the plaint is liable to be rejected as it does not discloses any cause of action against the defendant no. 4/applicant, a foreign company. The applicant has also relied on AIR 1997 Allahabad 323, ITC Limited Vs. Rakesh Bihari Srivastava and air 1954 Bombay 491, Baroda Oil Cakes Traders Vs. Parshottam Narayan Das Bagulia and Another to contend that the plaint in the facts and circumstances of the case is liable to be rejected under Order VII rule 11 of the Code of Civil procedure.

( 3 ) THE applicant has also sought rejection of plaint on the ground that the contract No. CPA/12/7/98 was not between defendant No. 4 and Kannu Exports and in case of any dispute the matter had to be referred to the arbitration of GAFTA in London and on this ground also it is claimed that the Court does not have jurisdiction and the plaint is liable to be rejected.

( 4 ) THE application for rejection of plaint is contested by the plaintiff contending inter alia that defendant No. 4/applicant and the defendant Nos. 1 and 2 are jointly and separately liable to compensate the plaintiff for the losses suffered on account of default committed by defendants on account of illegal and malafide breaches of the terms of Letter of Credit. Refuting the allegation that the Court does not have jurisdiction, it was asserted that cause of action wholly/partially arose within the jurisdiction of this Hon?ble Court and denied the allegation of defendant No. 4 that it does not reside or carries on business within India. Regarding the allegation of there being no contract, it has been averred that the suit has been filed on account of violation of the terms of LC no. 98/404200/mc and not on the basis of any contract. The existence and presence of any contract No. CPA/12/7/98 was not admitted by the plaintiff and was denied.

( 5 ) THE claim of the plaintiff is that he was beneficiary of the letter of credit and