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1986 Supreme(Ori) 120
High Court Of Orissa
S. C. MOHAPATRA
AJANTA ENTERPRISERS - Appellant
Versus
HOECHST PHARMACEUTICAL LTD. - Respondent
Misc. Appeal 332 Of 1985
Decided On : 09/01/1986
B.K.BEHAR, J.P.CHOUDHURY, P.K.PATRA, S.K.DAS GUPTA, Sujata Das
An agreement between parties restricting the jurisdiction of a court may not be oppressive or harsh in all circumstances, and the court has the discretion to consider the facts and circumstances of each case and may relieve a party from the bargain if the agreement is found to be oppressive or harsh.
Headnote:
JURISDICTION - CONTRACTUAL CLAUSE - OUSTER OF JURISDICTION - OPPRESSIVE AND HARSH - RETURN OF PLAINT - SECTION 20(C), 21, O. 7 R. 10, 10-A, C. P. C. - INTERPRETATION - COURT'S DISCRETION - FACTUAL CIRCUMSTANCES.
Fact of the Case:
Plaintiff, a proprietor of a business concern in Cuttack, entered into an agreement with Defendant No. 1, a public limited company, to be appointed as a stockist and distributor of some of the latter's products. After the termination of the contract, the plaintiff filed a suit against the company and its officers for prohibitory and mandatory injunctions and for recovery of Rs. 2,19,538/- with 17% interest per annum. The defendant claimed that the Cuttack Court lacked jurisdiction due to a clause in the agreement specifying that disputes arising from the agreement would be litigated in Courts having jurisdiction in greater Bombay.
Finding of the Court:
The Court found that the agreement did not completely oust the jurisdiction of the Cuttack Court, as the language of the clause did not expressly restrict jurisdiction to the Courts in greater Bombay. The Court also considered the conduct of the defendants in not raising the issue of jurisdiction promptly and in taking adjournments and participating in the proceedings, which indicated a waiver of their right to object to the jurisdiction of the Cuttack Court.
Issues: 1. Whether the agreement between the parties ousted the jurisdiction of the Cuttack Court. 2. Whether the agreement was oppressive or harsh in the given circumstances. 3. Whether the defendants' conduct amounted to a waiver of their right to object to the jurisdiction of the Cuttack Court.
Ratio Decidendi: 1. The Court held that the agreement did not completely oust the jurisdiction of the Cuttack Court, as the language of the clause did not expressly restrict jurisdiction to the Courts in greater Bombay. 2. The Court found that the agreement was not oppressive or harsh in the given circumstances, considering factors such as the amount of the claim, the location of the witnesses, and the defendants' conduct in not raising the issue of jurisdiction promptly. 3. The Court held that the defendants' conduct in not raising the issue of jurisdiction promptly and in taking adjournments and participating in the proceedings indicated a waiver of their right to object to the jurisdiction of the Cuttack Court.
Final Decision: The Court allowed the appeal and set aside the order of the trial court directing the return of the plaint. The Court directed the parties to appear before the trial court on a specified date for the fixation of the date of hearing of the suit.
S. C. MOHAPATRA, J.
( 1 ) THIS is an appeal under O. 43, R. 1 (a), Civil Procedure Code, where direction for return of the plaint is assailed.
( 2 ) PLAINTIFF-APPELLANT is proprietor of a business concern at Cuttack. He entered into an agreement with defendant No. 1, a public limited company having its head office at Bombay, for being appointed as stockist and, distributor of some of the products of the latter. On account of termination of the contract after some period of its continuance, plaintiff filed a suit against the defendant No. 1-Company and its officers for prohibitory and mandatory injunctions and for recovery of Rs. 2,19,538/- with 17% interest per annum. In view of Cl. 7 of the agreement, the defendant No. 1 claimed that the Cuttack Court where the suit has been filed has no jurisdiction to try the suit. Clause 7 of the agreement reads as follows :-"all disputes arising out of this agreement shall, failing arbitration, be litigated in Courts having jurisdiction in greater Bombay. "trial Court having decided the question of jurisdiction as a preliminary issue in favour of the defendants and having directed return of the plaint, this appeal has been filed.
( 3 ) A perusal of the plaint indicates that the plaintiff disclosed the clause in the agreement in the plaint itself and claimed that notwithstanding the same the Court at Cuttack would have jurisdiction. The plaint was admitted and the defendants appeared on being summoned. They took adjournments for about eight months to file their written statement where they took the plea of want of jurisdiction. The parties were heard under O. 10, R. 1, C. P. C. and Issues were settled in which Issue No. 4 was relating to jurisdiction. After giving opportunity to the parties to furnish list of witnesses and to summon them, the suit was posted for hearing to 26-2-1981. On the said date the defendants filed a petition for deciding the question of jurisdiction as a preliminary issue. On that petition, the matter was posted to 26-3-1981 for hearing. Defendants took time on that date and on the next date. The matter was posted to 11-5-1981. On the prayer of both the parties, it was posted to 7-7-1981 on which date at the request of the lawyers of both parties it was posted to 23-7-1981 for hearing. Defendants did not move the petition on 23-7-1981 which was rejected and the suit was posted to 17-8-1981 for hearing. Plaintiff filed requisites for summoning witnesses. On 17-8-1981 defendants filed an application for adjournment to get opportunity to adduce evidence. The suit was posted to 9-9-1981 on which date the second petition for preliminary hearing of the Issue relating to jurisdiction was filed. After the hearing was deferred for about four years, it was at last heard and the impugned order was passed on 20th Aug. , 1985. Thus, about six years after presentation of the plaint the plaint is being directed to be returned.
( 4 ) IN the trial Court, the learned counsel for the plaintiff contended that Cl. 7 in the agreement is oppressive inasmuch as it would be very expensive for the plaintiff to proceed with the litigation at Bombay and it would be inconvenient to procure the attendance of the witnesses who are available at Cuttack and Bhubaneswar, and in case the hearing is taken up by the Cuttack Court it would be convenient to call for most of the documents available at Cuttack or Bhubaneswar and prove the same causing no inconvenience to defendants if the suit is tried at Cuttack as the Company has an office at Cuttack. The defendants on the other hand relied upon Cl. 7 claiming jurisdiction of the Courts in respect of greater Bombay to entertain the suit. While the plaintiff relied upon the decisions reported in (1976) 42 Cut LT 696, (Arja Venkata Ratnam v. Calendar Printing House of Sivakasi); AIR 1975 Guj 72, (Snehalkumar Sarabhai v. Economic Transport Organisation) and AIR 1978 Delhi 183 (FB), (Shri Ram Rattan Bhartia v. Food Corpn. of India), the defendants relied
