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2014 Supreme(Sikk) 30
THE HIGH COURT OF SIKKIM : GANGTOK
S. P. WANGDI, J.
M/s. Pave Infrastructure Pvt. Ltd., 2nd Floor, Kapil Centre, Opposite ICICI Bank, Sevoke Road, Siliguri, West Bengal.
Shri Mahabir Agarwal, Director, M/s. Pave Infrastructure Pvt. Ltd., 2nd Mile, Kapil Centre, Opposite ICICI Bank, Sevoke Road, Siliguri, West Bengal - Petitioners
Versus
Union of India through the Secretary, Urban Development Department, Government of India, Nirman Bhawan, New Delhi.
National Buildings Construction Corporation Limited, NBCC Bhawan, Lodhi, Road, New Delhi.
The Senior General Manager, Head RBG-Tripura, National Buildings Construction Corporation Limited, Agartala.
The Additional General Manager (Engg.), National Buildings Construction Corporation Limited, C-13(4), Convoy Ground, Daragaon, Tadong, Gangtok, East Sikkim - Respondents
S.B. WP(C) No.34 of 2013
Decided On : 09-06-2014
For Petitioners:Mr. A. Moulik, Senior Advocate with Ms. K.D. Bhutia, Mr. Ranjit Prasad and Mr. Manish Kumar Jain, Advocates.
For Respondent No.1:Mr. Karma Thinlay Namgyal, Central Government Advocate with Mr. D.K. Siwakoti, Advocate.
For Respondents No.2 to 4:Mr. Zangpo Sherpa, Advocate with Mr. Dewen Sharma Luitel, Advocate.
The main legal point established is that the jurisdiction clause in the contract and the nature of the contract as a private law contract influenced the Court's decision in dismissing the Writ Petition.
Headnote:
Jurisdiction - Contract Dispute - Clause 16.1 of General Conditions of Contract - CPC Section 20 - Writ Petition - Private Law Contract - Jurisdiction of Courts in Delhi/New Delhi - Interpretation of Contract Terms - Exclusion of Jurisdiction Clause
Fact of the Case:
The Petitioner-Company sought a writ of mandamus to direct the Respondent to process a price variation bill and release payments with interest. The Respondents denied the claim, citing an erroneous interpretation of the contract terms and raised jurisdictional objections.
Finding of the Court:
The Court found that the jurisdiction clause in the contract conferred exclusive jurisdiction to the Courts in Delhi/New Delhi. It also held that disputes relating to the interpretation of contract terms cannot be adjudicated in a writ petition as the contract is in the realm of private law.
Issues: Jurisdiction of the Court to entertain the Writ Petition, Interpretation of Contract Terms, Applicability of Exclusion of Jurisdiction Clause
Ratio Decidendi: The Court held that Clause 16.1 of the General Conditions of Contract conferred exclusive jurisdiction to the Courts in Delhi/New Delhi. It also ruled that disputes relating to the interpretation of contract terms in a private law contract cannot be adjudicated in a writ petition.
Final Decision: The Writ Petition was dismissed on both accounts.
Wangdi, J.
1. The Petitioner No.1 is a Private Limited Company having its registered office at 2nd Floor, Kapil Centre, Opposite ICICI Bank, Sevoke Road, Siliguri, West Bengal and the Petitioner No.2 its Director. The Petitioner-Company had been awarded with a contract work for construction of Multi Level Car Parking with allied facilities at Mangan, North Sikkim, under a Contract Agreement dated 23-02-2010 in terms of which the work requiring completion in 24 months, was commenced on 25-01-2010.
2. Without going into the details, it is sufficient to note that the only grievance expressed by the Petitioner-Company in the Writ Petition is that the Respondents No.2 to 4 had refused to pay escalation costs occurring during and the extended period of the contract which, as per the Petitioner-Company, the Respondent No.2 was liable to pay under Clause 16.1 of the General Conditions of Contract.
3. Having been refused the payment, this Writ Petition has been preferred seeking for a writ of mandamus directing the Respondent No.4 to process the price variation bill submitted by the Petitioner-Company and to release payments to the Petitioner-Company with interest against the delay.
4. The Respondents No.2 to 4 in their counter-affidavit filed jointly, have denied the claim of the Petitioner-Company on the ground that those were being raised on an erroneous interpretation of the various terms and conditions of the Contract including the Letter of Intent (in short the “LoI”) which formed part of the Contract Agreement dated 23-02-2010.
5. Without going into the merits of the rival contentions on the interpretation of the various terms and conditions of the Contract Agreement as well as the General Conditions of Contract, it is pertinent to note that on behalf of the Respondents No.2 to 4, two preliminary objections had been raised which were seriously pressed at the hearing. Considering the fact that those pertain to the very jurisdiction of this Court to entertain the Writ Petition, it was deemed appropriate to take them up at the threshold. The preliminary objections are as follows:-
(i) That in view of Clause 16.1 of the General Conditions of Contract only the Courts in Delhi/New Delhi have the jurisdiction to deal with the matters arising out of the Contract to the exclusion of all other Courts; and
(ii) That disputes relating to the interpretation of the terms and conditions of Contract cannot be adjudicated in a Writ Petition as the Contract between the parties is a Contract in the realm of private law and not a statutory contract.
The objections are accordingly taken up and dealt with in seriatim in the manner as follows:-
6. That in view of Clause 16.1 of the General Conditions of Contract only the Courts in Delhi/New Delhi have the jurisdiction to deal with the matters arising out of the Contract to the exclusion of all other Courts.
(i) Mr. A. Moulik, Learned Senior Advocate, appearing on behalf of the Petitioners, would submit that the parties by their own will and volition had abandoned the stipulation prescribed in Clause 76.1 of the General Conditions of Contract by executing the agreement at Tripura instead of New Delhi. That the Contract work was executed by the Petitioner-Company at Mangan, North Sikkim, giving rise to accrual of cause of action for claiming the escalation in Sikkim. Mr. Moulik would further submit that by application of Section 20 of the Code of Civil Procedure, 1908 (in short the “CPC”), the cause of action for institution of the present proceedings would arise wholly or in part or where any of the Respondents actually and voluntarily carries on business as prescribed under Clauses (b) and (c) thereof respectively. It is urged that the parties could not confer jurisdiction on the Courts at Delhi/New Delhi by an agreement when no cause of action had arisen at all at that place. Reliance to this proposition has been placed upon M/s. Patel Roadways Limited, Bombay vs. M/s. Prasad Trading Company : AI
