1994 (0) MPLJ 626
P.P. Naolekar, J.
Raigarh Jute And Textile Mills ...
vs
New Haryana Transport Co.
Decided on : 14 October, 1992
JURISDICTION - CONTRACT - SECTION 28 OF THE CONTRACT ACT - AGREEMENT TO CONFER JURISDICTION ON A PARTICULAR COURT - VALIDITY - TORT - CONVERSION - RIGHT TO SUE.
Fact of the Case:
The plaintiff filed a suit in the Raigarh Court for recovery of the value of goods delivered to the defendant for transportation from Raigarh to Raipur. The defendant objected to the jurisdiction of the Raigarh Court, relying on a term in the consignment note stating that all disputes were subject to Calcutta jurisdiction only.
Finding of the Court:
The court held that the agreement to confer jurisdiction on the Calcutta Court was valid and enforceable, as it did not contravene Section 28 of the Contract Act or public policy. However, the court also held that the plaintiff could choose to bring an action in torts for conversion, which is independent of the cause of action for breach of contract, and in that case, the plaintiff would not be bound by the terms of the agreement.
Issues: 1. Whether the agreement to confer jurisdiction on the Calcutta Court was valid and enforceable. 2. Whether the plaintiff could bring an action in torts for conversion, independent of the cause of action for breach of contract.
Ratio Decidendi: 1. The court relied on the Supreme Court decision in Hakam Singh v. Gammon (India) Ltd., AIR 1971 SC 740, which held that parties can agree to confer jurisdiction on a particular court, provided that the court has jurisdiction under the Code of Civil Procedure. 2. The court also relied on the Supreme Court decision in Dhian Singh v. Union of India, AIR 1958 SC 274, which held that conversion is an act of wilful interference with another's chattel, without lawful justification, and that a person who holds possession of another's chattel and refuses to deliver it can be sued for conversion.
Final Decision: The court set aside the trial court's order returning the plaint for presentation to the Calcutta Court and directed the parties to appear in the Raigarh Court on a specified date for the trial to proceed on merits.
P.P. Naolekar, J.
1. The trial Court returned the plaint for presentation to the proper Court at Calcutta, exercising the powers under Order 7, Rule 10 of the Code of Civil Procedure and aggrieved by this order the plaintiff/appellant has filed the present appeal.
2. The suit, as it is filed, is for recovery of Rs. 39,040/- and the allegation is that on 25-12-1982 16 bales of gunny bags were given to the respondent/defendant for transportation in his truck from Raigarh to Raipur; the goods so consigned to the respondent were not delivered to the appellant/plaintiff in spite of notice and the goods are said to have been retained by the respondent/defendant and, therefore, the suit was filed for recovery of the value of the goods so assigned to the defendant/respondent.
3. The respondent filed its written statement, amongst other defences raised, an objection to the jurisdiction of the Court at Raigarh to try the suit was taken by the defendant on the ground that on the top of the consignment note (Exs. P-l and P-2) it is written : "All disputes subject to Calcutta jurisdiction only" and, therefore, it is Calcutta Court alone which can adjudicate and decide the dispute between the parties arising out of the contract entered into between the parties, i.e. the plaintiff and the defendant. It may be mentioned here that no objection to the jurisdiction of the Court was raised on account of the term No. 18 in Ex. P-2.
4. As per the pleadings of the parties, it is clear that the goods were assigned at Raigarh for transportation to Raipur, delivery was self and the plaintiff and the defendant have their principal place of business at Calcutta and branches at Raigarh. Thus, ordinarily the suit could have been filed at Raigarh, Raipur or at Calcutta. It is well-settled that the parties by mutual agreement can choose one out of several Courts having jurisdiction to try the dispute and such a contract is not contrary to public policy and does not contravene Section 28 of the Contract Act. In Hakam Singh v. Gammon (India) Ltd., AIR 1971 SC 740, it has been held by the Supreme Court that the parties cannot by agreement confer jurisdiction on Court not possessed by it under the Code of Civil Procedure. But the agreement that one of the Courts having such jurisdiction alone shall try dispute is not contrary to public policy and does not contravene Section 28 of the Contract Act. Therefore, if the parties have agreed, whereby out of the three Courts having jurisdiction to try the dispute between the parties to confer jurisdiction to Calcutta Court only, then such an agreement will not be violative of the Contract Act and will be enforceable.
5. The plaintiff can either bring a suit for breach of contract entered into between the parties, and in that eventuality it is the Court on which jurisdiction is conferred under the contract alone normally will have jurisdiction to adjudicate the matter, or to bring a suit in torts. The plaintiff has an authority to choose the cause of action either for breach of contract or under the torts. The plaintiff's choice is not controlled by the defendant. The plaintiff is free to choose a Court, having jurisdiction, to be the Court of competent jurisdiction to institute the suit. If the plaintiff brings an action in torts, which is independent of the cause of action for breach of contract, the plaintiff is not bound by the terms of the agreement. However, if the plaintiff chooses to bring a suit for breach of contract, then he is bound by the terms of the agreement. One of such term may be of selecting one of the Courts having jurisdiction to try the cause of action.
6. According to me, the plaintiff has based his case for value of the goods wrongfully detained by the defendant/respondent which is an act of conversion. An act of conversion may be committed -
1. When property is wrongfully taken.
2. When it is wrongfully parted with.
3. When it is wrongfully sold.
4. When it is wrongfully retained.
5. When it is wro
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