The central legal point established in the judgment is the determination of jurisdiction based on the place of performance of the contract, the obligations of the parties, and the application of statutory provisions and the English Common Law rule to India.

Yahya Ali, J.

1. The defendant firm, Galley and Co., auctioneers at Madras, who are the petitioners, here were sued by the respondent who carries on business at Rajahmundry. The suit was for the recovery of a sum. of Rs, 1,632-8-0 being damages claimed for alleged breach of the contract entered into between the plaintiff and the defendant firm that the latter would sell on behalf of the plaintiff a quantity of aluminium ingots and after deducting their commission pay the balance of the sale proceeds to the plaintiff. The goods were alleged to have been sold contrary to instructions resulting in loss to the plaintiff. The contract is contained in the correspondence that passed between the parties. In Ex. D-I, the plaintiff wrote to the defendant on 12th March, 1938, asking if the firm would agree to charge a commission of five per cent, on two tons of aluminium ingots which were being sent for sale. In reply the firm wrote on 13th March, 1938 (Ex. P-I) as follows:

Your letter of yesterdays date, received and noted that you have two tons aluminium ingots for auction sale for which we thank you. As desired by you we shall accent five per cent, commission on the sale proceeds and pay you the net sale value on the 3rd day after transaction, closes. Awaiting your consignment of aluminium ingots as early as possible.

2. The consignment was accordingly sent to Madras from Rajahmundry and was acknowledged by the defendant by his letter Ex. P-3 dated 25th March, 1938. Some attempts at sale appear to have been made but were withdrawn by the auctioneers for want of satisfactory bids. Ultimately the goods were sold on 7th September, 1940, but no intimation of the fact of the sale having taken place was sent to the plaintiff. On 9th October, 1941, the plaintiff wrote to the defendant Ex. D-3 directing that the lot should be sold only if it fetched a value of Rs. 40 per cwt. and if that price was not fetched, the goods should be returned to Rajahmundry. In reply to this communication the defendant firm wrote Ex. P-4 dated 10th October, 1941. The letter is in these terms:

We are in receipt of your letter dated 9th instant and in reply we have to state that your aluminium ingots were sold as long ago as 7th September, 194.0, for Rs. 120, the whole lot as per instructions contained in your letter dated 4th April, 1939, but by an oversight, the sale proceeds were not remitted to you.

We are taking the details of your account (i.e.,) rent accrued from the date of receipt, amount paid for clearing the stuff, withdrawal charges on several sales tried and we shall remit you the net sale proceeds next week.

3. On 14th October, 1941, the plaintiff caused a registered notice to be sent to the defendant through his lawyer and in reply thereto, the defendant wrote the letter Ex. P-5 dated 21 st October, 1941. The defendant sent with that letter a statement of account and a cheque for the balance of Rs, 68 shown at the foot of the account. The account itself is Ex. P-6.

4. The defendant raised several averments in his written statement one of which was that no part of the cause of action arose at Rajahmundry. and that consequently the Rajahmundry Court had no jurisdiction to entertain the suit. The learned District Munsiff tried the issue relating to jurisdiction as a preliminary issue and finding that the Court had no jurisdiction directed that the plaint be returned for presentation to the proper Court. Plaintiff appealed to the District Judge who differed from the view taken by the first Court and held that the Rajahmundry Court had jurisdiction to try the suit. This revision petition filed by the defendant arises out of that order of the District Judge.

5. Cause (c) of Section 20 of the Civil Procedure Code of 1908 provides that a suit shall be instituted in the Court within the local limits of whose jurisdiction the cause of action, wholly or in part, arises. In the Code of 1882, the corresponding provision was contained in Explanation III to the cor