The main legal point established in the judgment is the interpretation of territorial jurisdiction under Section 20 of the Code of Civil Procedure and the validity of exclusion clauses in contracts.

1. This appeal is filed under Section 96 of the Code of Civil Procedure against the judgment and decree dated 28.09.2005 and made in O.S.No.4866 of 1999 on the file of the Learned Additional District and Sessions Judge (FTC-IV), Chennai.

2. The suit was filed by the respondent/plaintiff against the appellant/defendant for the recovery of a sum of Rs.6,41,151/- with interest at 24% per annum on Rs.5,43,350/-from the date of plaint till the date of realization. The appellant/respondent had contested the suit on various grounds. However, the suit was decreed as prayed for. Challenging the judgment, the defendant has approached this Court by way of this appeal.

3. The fact which giving rise to this appeal may be summarised as under.

4. The plaintiff is carrying on business in manufacturing and installing Air-Conditioners and Cooling systems. The defendant is a company registered under the Indian Company's Act carrying on business at No.120, Ma.PO Si.Salai, Thiruttani. The defendant had approached the plaintiff at Madras for the supply of 28 Nos. 1-Ton and 12 Nos. 1.5 Tons window Air-Conditioners for his lodge at Tiruttani. The plaintiff had supplied the Air-Conditioners and partially installed them at the defendants premises and raised invoice for a total value of Rs.11,31,980/-. The defendant had effected payment of Rs.5,88,630/- through the Tamil Nadu Industrial Investment Corporation Ltd., and for the remaining balance he had issued two cheques drawn on Indian Overseas Bank, Tiruttani for Rs.2,96,370.40. When the cheques were presented for encashment they were bounced back. Despite repeated demands, the defendant had been giving evasive answers and did not come forward to pay the balance of Rs.5,43,350/-. Hence this suit.

5. The defendant has admitted that he had approached the plaintiff to supply window Air-Conditioners 40 in Nos. as per the specification detailed in the plaint. He would contend in his written statement that the plaintiff wanted to get all the amount payable to them as agreed upon. But the plaintiff's company had not taken care and caution in installation of the same.

6. The plaintiff was bound to perform the contract and keep the Air-Conditioners in working condition within the warranty period. Personal talks and representation through workers and phone messages about the defective conditions of the window Air-Conditioners ended in futile. The plaintiff never cared to look into the difficulties of the defendant with regard to defects at the time of installation followed by working conditions at later stage. Therefore this defendant is entitled for compensation. The plaintiff never sent an engineer to inspect the Air-Conditioners at any stage. The following are the particulars with regard to the supply of window Air-Conditioners.

Particulars Amount

1.5 Tones A/C (12 Nos.) Rs.3,00,000/-

12x25,000/-1 Tonne A/C (28

Nos.) 28x20,000/-Total Sale Rs.5,60,000/-

Price Rs.8,60,000/-

Rs.5,88,000/-

Paid by TIIC Rs.2,88,000/-

7. Now the plaintiff has claimed a sum of Rs.6,41,153/- in the plaint which is absolutely not correct.

Particulars Amount

Rs.1,75,000/-

7 Numbers 1.5 Tonnes Rs.2,60,000/-

A/C13 Numbers 1 Rs.4,35,000/-

Tonnes A/C Rs.65,000/-

Rs.5,00,000/-

8. The plaintiff has to replace the defective Air-Conditioners at their costs and entitled only for the amount valued at the time of installation on the date originally fixed, if not, the plaintiff is entitled to get back the defective machineries and to pay the balance amount with compensation.

9. In the additional written statement the defendant has contended that the entire cause of action for the suit arose out side the jurisdiction of the City Civil Court at Chennai. The defendants company carrying on the business at Tiruttani, Tiruvallur District and the Air-Conditioners have admittedly been supplied and installed by the plaintiff through their staff at the defendant's premises and therefore, no part of cause of action has arisen within the jurisdiction of t