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1972 Supreme(Gau) 65
GAUHATI HIGH COURT
M. C. PATHAK, J.
Burmah Oil Co.(India Trading) Ltd -Appellant
Versus
Kunchanpore Tea Co.Ltd.and another -Respondent
M. A. (F) 21 of 1968
Decided On : 07-08-1972
P.C. Choudhary and S.K. Sen, J.P. Bhattacharjee and P.C. Deka
The territorial jurisdiction of a court to try a suit is determined by the place where the cause of action arises.
Headnote:
JURISDICTION - TERRITORIAL - CAUSE OF ACTION - SECTION 20 OF THE CIVIL PROCEDURE CODE - PAYMENT OF PRICE OF GOODS SOLD - PLACE OF PAYMENT NOT STIPULATED - SUIT FOR RECOVERY OF PRICE - COURT HAVING JURISDICTION.
Fact of the Case:
Plaintiff, a limited liability company incorporated in Scotland, filed a suit for recovery of money from Defendant, a tea company carrying on business in Cachar, Assam. Plaintiff claimed that Defendant had purchased petroleum products on credit terms and had not made payment despite repeated demands. Defendant contended that the Court lacked territorial jurisdiction as the agreement was made in Calcutta, supplies were made in Cachar, and payment was made in Calcutta.
Finding of the Court:
The Court held that the Court at Dibrugarh lacked territorial jurisdiction to try the suit. The Court found that the agreement was made in Calcutta, the goods were delivered in Cachar, and the payment was to be made in Calcutta. The Court also found that there was no reliable evidence to prove that there was a stipulation between the parties that the price of the goods sold in Cachar district would have to be paid at Digboi or Dibrugarh.
Issues: 1. Whether the Court at Dibrugarh had territorial jurisdiction to try the suit. 2. Whether there was a stipulation between the parties that the price of the goods sold in Cachar district would have to be paid at Digboi or Dibrugarh.
Ratio Decidendi: The Court held that the Court at Dibrugarh lacked territorial jurisdiction to try the suit because the cause of action did not arise wholly or in part at Digboi or Dibrugarh. The Court found that the agreement was made in Calcutta, the goods were delivered in Cachar, and the payment was to be made in Calcutta. The Court also found that there was no reliable evidence to prove that there was a stipulation between the parties that the price of the goods sold in Cachar district would have to be paid at Digboi or Dibrugarh.
Final Decision: The Court dismissed the appeal and upheld the trial court's order returning the plaint to the Plaintiff for presentation in the proper Court.
This appeal is from the judgment and order passed by the learned Assistant District Judge. Lakhimpur District, Dibrugarh on 30-3-1968, by which he has ordered the plaint to be returned to the Plaintiff for presentation in proper Court, as provided under Order VII Rule 10 of the Civil Procedure Code.
2. The Plaintiff Appellant has filed Money Suit No. 8 of 1966 for recovery of a sum of Rs. 13,055.78 p. for goods supplied including interest and costs from the Defendant No. 1.
3. Defendant No. 1 Kunchanpore Tea Estate, is the Principal Defendant. Assam Oil Company has been impleaded as Pro forma Defendant in the case.
4. The Plaintiffs case briefly is that it is a limited liability Company incoporated in Scotland and has been carrying on business among other places at Digboi as Distributor for the Assam Oil Company Ltd. in the district of Lakhimpur. The Plaintiff Company had been the sole marketing Agents and Distributors for the Assam Oil Company Ltd. for all their products and the Plaintiff is responsible to account to Assam Oil Company Limited for sale proceeds of all their products marketed by the Plaintiff and for that reason the Plaintiff has impleaded the Assam Oil Company Limited as Pro forma Defendant.
5. The Defendant Company carries on business as Tea Planter at Kunchanpore Tea Estate situated in the district of Cachar in Assam and the Defendant had credit facilities with the Plaintiff for purchasing petroleum products of Assam Oil Company marketed by the Plaintiff on condition of making payment to the Plaintiff at Digboi within 30 days from the date of the bills. The Defendant Company on credit terms purchased from the Plaintiffs Badarpurghat Depot situated in the district of Cachar various petroleum products and after deducting all the part payments made from time to time an outstanding balance of Rs. 11,888.28 p. is still due from the Defendant to the Plaintiff. The Plaintiff claims an amount of Rs. 1,167.50 p. as interest on the said arrear. Thus the total amount claimed in the suit by the Plaintiff is Rs. 13,055.78 p. Notwithstanding repeated demands after submission of regular monthly statements of accounts accepted by it, the Defendant neglected to pay the said outstanding dues. Hence the Plaintiff has filed the suit for realisation of the said amount.
6. The Defendant Tea Company filed a written statement wherein it is stated, inter alia, that the Court has no territorial jurisdiction to try the suit as the Defendant carries on business at Kunchanpore Tea Estate in the district of Cachar, Assam, and its head office is situated in Calcutta. Moreover the agreement between the parties took place in Calcutta, the supplies thereunder were made at Badarpur in the district of Cachar and payment thereof was made in Calcutta. The Defendant also has specifically denied the alleged condition of making payment at Digboi and it has averred that the allegation made in the plaint that payment was to be made at Digboi in the district of Lakhimpur is false. The Defendant has also averred that the Plaintiff has got no right to sue, that the claim is barred by limitation, and that the amount claimed in the plaint is not due.
7. On the pleadings of the parties the following issues have been framed by the trial Court.
1. Is the suit maintainable in law in the present form?
2. Has the plaintiff any right to sue?
3. Did the cause of action arise on the dates as alleged?
4. Is any part of the claim barred by limitation?
5. Has the Court jurisdiction to try this suit?
6. Is the interest charged excessive?
7. What amount, if any, is due to the plaintiff from the defendant No. 1?
8. To what relief is the plaintiff entitled?
8. The learned trial Court took up issue No. 5 as the first issue for decision as it involves jurisdiction of the Court. On this issue the plaintiff examined one witness and the defendant also examined one witness.
9. The plaintiff has filed certain statements of account and bills which have been marked as Exts. 1 to 34 and
